DOE Contracting:

Improved Program Management Could Help Achieve Small Business Goal

GAO-06-501: Published: Apr 7, 2006. Publicly Released: Apr 7, 2006.

Additional Materials:

Contact:

Eugene E. Aloise
(202) 512-6870
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Federal policy requires that small businesses receive the maximum practicable opportunity for providing goods and services to federal agencies through prime contracts--direct contracts between the government and a contractor. The Department of Energy (DOE) buys more than $20 billion in goods and services annually. GAO was asked to (1) discuss DOE's key efforts to increase small business prime contracting opportunities and (2) identify the management challenges DOE faces in improving its small business prime contracting performance. In addition to these objectives GAO is providing information on the management of small business programs by other federal agencies that either share certain characteristics with DOE's largest program offices or that have components that share certain characteristics with these offices.

Key DOE efforts to increase small business prime contracting have included identifying more contracting opportunities for small businesses, expanding small business development and outreach activities, and increasing program management and oversight. The department has had some success in redirecting to small businesses portions of contracts to manage large DOE facilities, as well as in securing additional small business prime contracting opportunities from the department's other contracts. As a result, the total dollars awarded annually as prime contracts to small businesses have increased, and the share of procurement dollars awarded to small business in 2005 was DOE's second highest ever. Despite these gains, however, DOE was unable to meet its small business prime contracting goal in 4 of the past 5 years. DOE faces two key management challenges to improving its small business program. Addressing these challenges will bring DOE's small business program more in line with the practices associated with high-performing organizations and with principles contained in the Government Performance and Results Act. Specifically, DOE has not defined the concrete steps necessary to enable it to achieve its prime contracting goal and does not collect sufficient information to effectively assess its small business program efforts, identify problems, and implement changes that could further increase small business prime contracting. Other federal agencies with missions or agency components with missions similar to DOE periodically comprehensively evaluate their programs to determine effectiveness, identify problems and make changes intended to improve performance. GAO obtained information from the following three agencies: the National Aeronautics and Space Administration, the Department of the Army (U.S. Army Corps of Engineers), and the Department of Health and Human Services (Centers for Disease Control and Prevention).

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: According to DOE officials, small business program objectives that collectively identify the steps or approach DOE will take to reach its annual prime contracting goal were to be articulated in its Annual Small Business Strategic Plan, scheduled for publication Oct. 1, 2006. The strategic plan was received by GAO on Nov. 29, 2006. The plan does not directly respond to our recommendations. However, according to discussions with DOE officials on July 18, 2007, they consider this recommendation closed.

    Recommendation: To improve DOE's management of its small business prime contracting program and to help ensure that small businesses receive the maximum practicable opportunity for DOE prime contracts, the Secretary of Energy should direct the Office of Small and Disadvantaged Business Utilization, the Office of Procurement and Assistance Management, and the NNSA Office of Acquisition and Supply Management to jointly establish a systematic, organized, and disciplined approach to achieving the department's small business goal. Such an approach should define small business program objectives that collectively identify the steps or approach DOE intends to take to reach its annual prime contracting goal. These objectives should focus on the specific results the department intends to achieve, should clearly contribute directly to DOE's prime contracting performance, and should be measurable so that progress can be determined.

    Agency Affected: Department of Energy

  2. Status: Closed - Not Implemented

    Comments: According to DOE's Office of Economic Impact and Diversity, the department collects small business award data and produces quarterly status reports for each program element on their small business achievements compared to their goals. This represents no change in behavior from that prior to our audit. The Small Business Annual Report was released at the end of 2006 and was to identify more specific performance measures for the small business program. That report does not identify performance measures at all. DOE considers this recommendation closed.

    Recommendation: To improve DOE's management of its small business prime contracting program and to help ensure that small businesses receive the maximum practicable opportunity for DOE prime contracts, the Secretary of Energy should direct the Office of Small and Disadvantaged Business Utilization, the Office of Procurement and Assistance Management, and the NNSA Office of Acquisition and Supply Management to jointly establish a systematic, organized, and disciplined approach to achieving the department's small business goal. Such an approach should identify, collect, and analyze performance information that will allow the department to determine whether the small business program activities it carries out are achieving the desired results.

    Agency Affected: Department of Energy

  3. Status: Closed - Implemented

    Comments: In response to our recommendation, DOE's Office of Small and Disadvantaged Business Utilization (OSDBU) in 2007 contracted with a private consulting firm to conduct a survey of the department's small business program managers. The objectives were to (1) evaluate the extent of managers' knowledge of the small business program, (2) identify areas of improvement, and (3) determine the effectiveness of the DOE small business program. The response rate was 97 percent. We received a copy of the final report detailing the findings and identifying future small business program improvements. (DOE, ANALYSIS OF DOE SMALL BUSINESS, PROGRAM SURVEY, Washington, DC: Dec. 20, 2007.) According to DOE officials, information from this evaluation has strengthened the department's small business strategic planning efforts, and has allowed them to target programmatic changes toward areas needing improvement. Thus, key requirements of our recommendation were implemented. The recommendation is implemented and closed.

    Recommendation: To improve DOE's management of its small business prime contracting program and to help ensure that small businesses receive the maximum practicable opportunity for DOE prime contracts, the Secretary of Energy should direct the Office of Small and Disadvantaged Business Utilization, the Office of Procurement and Assistance Management, and the NNSA Office of Acquisition and Supply Management to jointly establish a systematic, organized, and disciplined approach to achieving the department's small business goal. Such an approach should periodically conduct a comprehensive evaluation of the department's and program offices' small business programs to determine if changes are needed and use these assessments to guide improvement efforts.

    Agency Affected: Department of Energy

 

Explore the full database of GAO's Open Recommendations »

Dec 11, 2014

Nov 20, 2014

Nov 19, 2014

Nov 7, 2014

Oct 14, 2014

Sep 22, 2014

Sep 16, 2014

Jul 28, 2014

Looking for more? Browse all our products here