Services and IT

The acquisition of services and information technology (IT), which now comprise over 50 percent of Department of Defense (DoD) acquisition spending, continues to be a major challenge. At the core, these acquisitions require flexible budgetary and acquisition practices, which conflicts with DoD’s rigid acquisition process designed for hardware systems, and require accurate requirements definition – a difficult task.


In recent years, the landscape for services and IT has seen lots of change. The use of indefinite delivery, indefinite quantity (IDIQ) multiple award contracts (MACs) has increased sharply both with DoD and government-wide to purchase services and IT. Further, the Office of Federal Procurement Policy (OFPP) through category management, and DoD through the its newly-issued DoD Instruction 5000.74 have undertaken initiatives to manage government’s spend in these areas. These, combined with a more aggressive push to meet small business prime contracting goals that rely heavily on services and IT contract dollars, will impact reform efforts in these areas through the incentives they create.


Future reforms to improve these acquisitions will have to strike a delicate balance. In response to industry concerns and high administrative costs, government agencies have attempted to consolidate the number of contract vehicles and utilize interagency vehicles, which have uncertain consequences for small business program outcomes. Furthermore, Congressional reform efforts must strike a proper balance between meaningful insight into government’s spending on services and IT, and oversight measures that may undermine the flexibility needed, especially for IT acquisitions. Also, in its attempts to push the Department to adapt private sector best practices for IT and services acquisitions and access new suppliers, Congress should not designate winners and losers based on nonperformance factors, and remove unnecessary burdens that serve as barriers to innovation for all suppliers.