Unlock the Potential of Commercial Innovation in the Public Sector: Part 2 – Building a Public-Private Partnership
In part 1 of this series, we asked three former senior officials from the intelligence community about their thoughts on how government agencies can unlock the potential of commercial innovation. We focused on the challenges of adopting commercial technology in the public sector, as well as the benefits as we spoke with:
- Jack Gumtow, a member of the Babel Street Board of Advisors and former CIO of the Defense Intelligence Agency;
- Farid Moussa, senior strategist with Babel Street and former executive at the NSA; and
- Pat Butler, the Executive Vice President of Product at Babel Street, and a former CIA targeting officer.
In part 2, we look at our experts’ opinions on what each side needs from the other to forge a successful relationship. They agreed that the biggest factor is trust and a sense of shared mission. But what are the tangible actions each side can take to make that a reality? Here are their answers.
Pat is a strong proponent of clear communication, even in potentially sensitive areas. Given that in many cases what was once classified technology is now publicly available, it’s likely that commercial vendors already have a good understanding of previously sensitive sources and methods. So, while it remains true that the government needs to be careful in these regards, it serves no purpose for the government to be overly circumspect and it can harm the outcome if the commercial vendor isn’t ever given the bigger picture. Pat recommends that government project leaders be as specific as they can or find analogous use cases that can help fill the gaps.
Another frustration to building trust that Pat has experienced is the practice of having all communications going through a prime contractor. While there are certainly some good reasons for this, it also has the effect of filtering the agency’s responses through the lens of the prime contractor. And if the prime doesn’t have a strong understanding of the subcontractor’s technology, a lot could get lost in transmission — like a high-stakes game of telephone. To counter this, Pat recommends including subcontractors in conversations as much as possible to eliminate guesswork and the costly revisions that come from misunderstandings.
On the flip side, Jack said that commercial providers could do more to help government acquisition professionals understand the value of the procurement as they strive to comply with federal acquisition regulations (FAR and DFAR). In particular, the vendor community can help the government see the long-term and strategic benefit of the product over its life cycle in terms of total cost of ownership.
This speaks to the shift in ownership model from capital expenses to operating expenses. The private sector has undergone this transition as well – the cloud has transformed computing resources into services. Especially when it comes to technology, the government is accustomed to owning and depreciating physical items like servers and software licenses. The consumption model is different and procurement professionals must pivot to adjust.
Vendors can help government officials see the benefit of “as a service” offerings by doing the math and demonstrating the value over time. And value certainly includes the cost avoidance of not having to invest in the servers, environmental control, physical security, and maintenance that goes into developing and running an application in-house. Show the numbers and ease these calculations for procurement agents.
Our experts provided a few other pointers for both sides as they strive to make commercial procurement easier:
- Investigate alternative contract vehicles: Farid mentioned Other Transaction Agreements/Authority (OTAs) as a more flexible way for the government to engage with commercial vendors for research, development, and prototyping projects outside of the strict limitations of the FAR.
- Test applications on the low side with analogous data: Pat recommended this approach for validating that software will work as expected for the particular use case without having to involve classified data. This saves both the time and expense of having to set up a high side environment for testing.
- Put yourself in the shoes of the other party: Jack recommended that government agencies build their understanding of commercial operations through a type of exchange program, where government pays the salaries of some of its employees to work in the private sector for a short time. This kind of program helps promote a better appreciation of the issues faced by both sides.
- Generalize one situation to another: Oftentimes, different parts of an agency will have very similar problems and can benefit from a broader procurement. By bringing other departments in on a solution, volume goes up and per user price goes down.
The biggest takeaway from our experts when it comes to engendering trust between the public and private sectors was to assume noble intent. Government and commercial organizations are ultimately sharing a mission as they work toward solving a problem. Both entities benefit from adopting that perspective and recognizing that no one has all the answers. Trust is built by working together as partners in an equal relationship.