The new initiative announced by the White House to encourage the establishment of Acquisition Innovation “Labs” in Federal Agencies is a great step towards facilitating a culture that facilitates ingenuity and innovation. One aspect of the initiative urges Departments and Agencies to appoint Acquisition Innovation Advocates as a means to foster greater innovation, to stand up Innovation “Labs“, — really just a commitment to experiment with better ways to solve mission challenges through procurement, but I’m going to stick with Lab for the rest of this post — and to participate in an established council. If you find yourself named as your agency’s Acquisition Innovation Advocate or otherwise leading an Acquisition Innovation Lab, I offer a sample roadmap that has an excellent track record in innovation efforts, especially those with the sense to run like a start-up.
If you want to move your Agency’s Lab forward from “good idea” to “real impact”, you need to overcome inertia: on Day 90, you need to have at least 3 pilots launched. This means you need to have something of value to offer to willing customers with active requirements and procurement problems to solve. Which means you need a thorough understanding of the requirements in the pipeline, the missions of the owner of each requirement, what they are trying to accomplish with each requirement, and the specific procurement challenges most impactful to each. And you have to do all of this in the context of your agency mission and strategy.
This probably sounds like a lot. You might be anxious. An important way to minimize stress will be to minimize the spin/churn cycle. If you change an experiment while you’re running it, it’s impossible to assess the result.
Start in a green field. The FAR isn’t a labyrinth; it’s a giant prairie with some critical fences and some occasional giant rocks. OFPP and the federal CIO told you to focus on technology procurements. I wouldn’t limit your opportunity for innovation to just IT. Focusing on IT and digital is good – these have gotten a lot of attention in recent years – but looking at services more broadly is the biggest opportunity: 2/3 of the federal government’s $437 billion in contracts during Fiscal Year 2015 were for services – and IT/Communications products weren’t even half of the 1/3 that was product/supplies spend (FPDS-NG). Look at the entire procurement journey – from requirement concept to contract closeout – and be open to trade-offs. Look at the three major groups of participants – the customer, the procurement shop, and the prospective vendor.
First, lay a strong foundation by setting out to make your innovations a win-win-win for each of the three types of participants – your customer, the procurement office, and the vendors who will offer solutions. Try to do this in your first two weeks. Be clear about what your agency wants from this effort. Is it the cheapest, fastest solutions? Or more about the quality of the service or product (utility & warranty)? How does the customer experience factor into acquisitions (both from the government program manager and the vendor perspectives)? This will drive what you measure and how. Calling in support from an artificial intelligence system that lives in the cloudcan’t help you here.
Take this opportunity to spend a few days re-learning your agency as a buyer. What does your agency really buy? What does the requirement pipeline look like? Based on this discovery and learning, identify major areas of opportunity. If these are still IT, great. Run with it.
Second, recruit early adopters as customers for your Lab. To do this you need to craft your value proposition – why these customers should take a chance on the Lab: be explicit, be objective, and be honest. Aim to do this by the end of Month 2. If you want to end up with three strong pilots, you need to start with 20-30 prospects. An email announcing the experiment is one way to raise awareness. You should also consider a road show among the customers who already have requirements in the acquisition forecast. Use these early adopter prospects to build a pipeline of upcoming customer requirements for the Lab. From this pipeline, you will draw your 3 pilot procurements. There may be some back-and-forth with customers as you recruit them to participate.
To narrow the list, you first establish criteria for what constitutes a good pilot candidate – measured against the utility, warranty, and experience objectives you laid out in the first two weeks. Next, you and your team do a first round of scoping these potential pilots. What mission outcomes is the customer trying to accomplish or enable with this procurement? What’s the customer particular procurement problem, how might you solve it, what would it take, what are the obstacles, etc.? Force-rank these potential pilots, and then take a couple of weeks to refine the scope of the best half with the customer. Repeat this down-select process toward the end of month two. As part of selecting your first three pilots, be sure that you can measure what you need to measure for each in a timely and accurate manner. You can reduce angst by keeping this part simple; just focus on how each furthers your acquisition innovation outcomes.
Third, select the top three pilots, execute, and “land the plane”. By Day 90, launch your pilots. Measure your results. Listen to your customers, the acquisition professionals involved in each pilot, and the vendors who offering solutions (and those who aren’t). Read between the lines. Measure impact and perceptions on both sides of the acquisition equation (government and industry). The people involved will make or break any innovation.
As you think about the pilots, understand what behavior you incentivized or disincentivized? Are procurements appealing only to well-funded, established companies that can afford to take the risk? Does the approach encourage competition? What are the costs to bid on work relative to the award? What is the impact to the market? “If my agency continues this behavior…”
This roadmap should get you started on building and measuring your experiments with better ways to solve your agency’s mission challenges using procurement. Next you need to feed what you learn back into more experiments and start scaling what works.
I love thinking about this stuff, and I’d love to hear what you have to say.