State Department: Provision of Residential Furniture Inconsistent With Best Practices

GAO reviewed the State Department's procurement of residential furniture for its overseas employees.

GAO noted that: (1) GAO's preliminary work indicates that State may be missing an opportunity to develop a more cost effective and efficient approach to purchasing furniture for its overseas employees; (2) the current process is inefficient because of its long cycle times, several handoffs, and substantial inventories; (3) State's Logistics Reengineering Project (LRP) team reported similar problems with the procurement of other goods and services for use overseas; (4) although the team is conducting a pilot test on the feasibility of purchasing goods and services locally as part of its efforts to reengineer its procurement processes, State has no specific plans to include the process for purchasing furniture in the test; (5) in fact, State plans to enter into another contract with similar terms restricting the posts from purchasing goods locally; (6) adoption of a local purchase option, where feasible, could streamline the process, substantially decrease the time it takes to receive an order, increase customer satisfaction, and reduce costs; (7) during its review, GAO benchmarked State's process for purchasing furniture to practices used by six private sector companies and the World Bank; (8) none of these organizations purchased residential furniture in their home country for use overseas and none maintained warehouses at each location to store furniture; (9) instead they shipped the employees' personal household effects or purchased furniture locally or regionally; (10) in addition, representatives of the LRP team consider residential furniture to be a good candidate for local purchase at some posts; and (11) also, some post officials expressed interest in having the option of purchasing furniture locally.