FROM PAPER TO ELECTRONICS

ELECTRONIC COMMERCE FOR

BUYERS AND SELLERS

A Strategic Plan for

Electronic Federal

Purchasing and Payment

President’s Management Council’s Electronic Processes Initiatives Committee

Washington, D.C.

March 1998
Electronic Commerce for Buyers and Sellers Page ii

FROM PAPER TO ELECTRONICS

Electronic Commerce

for

Buyers and Sellers

A Strategic Plan for

Electronic Federal

Purchasing and Payment

Report of the

Electronic Processes Initiatives Committee of the

President’s Management Council

March 1998

http://policyworks.gov/epic
Electronic Commerce for Buyers and Sellers Page iii

The Vice President

The White House

Washington, DC 20500

Dear Mr. Vice President:

As members of the President’s Management Council’s Electronic Processes Initiatives Committee

(EPIC), we are pleased to present to you the report: Electronic Commerce for Buyers and Sellers, A

Strategic Plan for Electronic Federal Purchasing and Payment. This report was submitted to the

Congress in response to a requirement in Section 850 of the fiscal year 1998 Department of Defense

Authorization Act. This report describes our vision that, by the year 2001, all Federal agencies will

support their programs by making available customer-friendly electronic purchasing tools integrated

with end-to-end commercial processing of payment, accounting and performance reporting

information.

This vision is intended to capitalize on the common interests of buyers, sellers, and technology

providers by rapidly pursuing the largest market segments of transactions. From this base of

operations, work will proceed to expand the list of integrated buying and paying functions. In

preparing this report, we consulted and received excellent input from the Federal Procurement

Council, the CFO Council, and the CIO Council.

We echo your call for a government that works better and costs less and believe that a clearly

defined plan for electronic commerce can create a solid and modern procurement and finance

infrastructure to replace the multitude of systems and processes that exist today. We look forward

to working with you across agencies and functional areas to find common solutions that accomplish

the goals set forth in this report.

Sincerely,

G. Edward DeSeve David J. Barram

Deputy Director for Management (Acting) Administrator

Office of Management and Budget General Services Administration

John D. Hawke, Jr. William J. Lynn

Under Secretary for Domestic Finance Under Secretary of Defense (Comptroller)

Department of the Treasury Department of Defense

cc: President’s Management Council
Electronic Commerce for Buyers and Sellers Page iv

Contents

EXECUTIVE SUMMARY................................................................................... .........iii

SCOPE AND VISION .......................................................................................... ..........1

Track One: Foster Partnerships............................................................................................ 2

Track Two: Integrate End-to-End ........................................................................................ 3

Track Three: Reengineer Operations Functionally................................................................ 4

TRANSACTION MARKET ................................................................................ ..........5

STAKEHOLDERS ............................................................................................... ..........7

Buyers................................................................................................................................. 7

Sellers................................................................................................................................. 8

Service Providers................................................................................................................. 8

Reviewing Authorities ......................................................................................................... 9

State and Local Governments............................................................................................. 10

DRIVING FORCES ............................................................................................. ........11

Need to Improve Performance in Balanced Budget World................................................... 11

Buyer and Seller Demand for Easier and Better Service ...................................................... 11

Congressional Interest in Performance and Accountability .................................................. 11

Outdated Legacy Systems and Processes ............................................................................ 12

Availability of New Technology......................................................................................... 12

Commercial Use of Electronic Commerce .......................................................................... 12

POLICY PRINCIPLES........................................................................................ ........13

Make the Buying and Paying Process Easier and More Efficient.......................................... 13

Facilitate Best Value Buying and Paying ............................................................................ 13

Take Advantage of Proven Commercial Applications.......................................................... 14

Outsource Transaction Processing ...................................................................................... 15

Assign Financial Liability Based on Ability to Manage and Mitigate Risk ........................... 15

Monitor Investments for Returns........................................................................................ 16

Manage the Change Process............................................................................................... 16

BUILDING BLOCKS........................................................................................... ........17

Electronic Catalogs............................................................................................................ 18

Payment Utilities ............................................................................................................... 20

Buyer and Seller ID and Authentication.............................................................................. 23

Contract Formation and Administration.............................................................................. 26

Automated Contract Writing Systems................................................................................. 29

Finance System Interfaces.................................................................................................. 29

Change Management ......................................................................................................... 32

MIGRATION PATH............................................................................................ ........35

GLOSSARY.......................................................................................................... ......A-1

LIST OF ABBREVIATIONS............................................................................... ......B-1

CONTRIBUTORS................................................................................................ ......C-1
Electronic Commerce for Buyers and Sellers Page v
Electronic Commerce for Buyers and Sellers Page vi

EXECUTIVE SUMMARY

The 22 million United States Government

purchase transactions each year present a market

opportunity within a new wave of technology

enabled trade, broadly defined as “Electronic

Commerce” (EC). Our vision is that, by the year

2001, all Federal agencies will support their

programs by making available customer-friendly

electronic purchasing tools integrated with end-toend commercial electronic processing of payment, accounting and performance reporting information. In an

electronic environment, selling to the government will be simpler. Sellers of products and services will

enjoy easier access to market opportunities. Sellers will not have to disrupt existing and developing

commercial relationships for purchasing and payment support services. Within the government, buyers

should find buying simpler, faster and easier.

Turning the potential of EC into reality requires that sellers, service providers, and government buyers

see a strong business case for making investments in

EC development, operations and continuous

improvement. The Federal market can be viewed in

segments organized by such attributes as size of

purchase, frequency of purchase and buying technique

employed. Viewing market segments this way can

help both the government and private sector assess the

business case and rank order investments in EC for

each market segment.

This strategy -- based on building a business case for both buyers and sellers -- presumes program

managers will rely upon cost effective commercial ordering and payment transaction processing services for

high-volume activity. Government-unique EC systems will be developed only as a last resort for low

transaction volume activity, where industry has not

invested in platforms to provide commercial services.

Seven policy principles -- based on stakeholder

needs and driving forces in the environment -- will

guide EC investment. These principles will be used to

promote investment in EC projects that support

commercial service, market-based EC development policies. In the transition to EC, Federal agencies

should: (1) make the buying and paying process easier and more efficient; (2) facilitate best value buying

and paying; (3) take advantage of proven commercial applications; (4) outsource transaction processing;

(5) assign financial liability based on ability to manage risk; (6) monitor investments for return; and (7)

manage the change process.

The Electronic Processes Initiatives Committee (EPIC) of the President’s Management Council (PMC)

will provide leadership across organizational boundaries so that coordinated Federal EC work activities can

proceed along three related tracks: (1) fostering partnerships within the Federal Government, with states and

with the private sector during 1998; (2) reengineering and integrating buying for high-volume purchases with

All agencies will support programs by

making available customer-friendly

electronic purchasing tools integrated with

end-to-end commercial electronic

processing of payment, accounting and

performance information by 2001.

The combination of next-generation

purchase cards and electronic catalogs

provides immediate opportunity for

migration to large-scale EC for up to 85%

of Federal purchases.

EC can greatly enhance the government’s

ability to simplify key functions of the

acquisition cycle for many different types of

buys in different dollar ranges.
Electronic Commerce for Buyers and Sellers Page 7

end-to end ordering and payment processing through the use of purchase cards tied to payment utilities

and electronic catalogs by 2000; and (3) reeingineering additional buying and paying functions by 2001.

This vision is intended to capitalize on the common interests of buyers, sellers, information technology

providers and financial service providers by rapidly pursuing the largest segment of transactions. From

this base of operations, work will proceed to expand the list of buying and related paying functions that

can be performed by electronic means.

 A number of building blocks will be required in order to achieve the EC goals and objectives in

this plan. The premise behind the building blocks is that the foundation of large-scale EC will be

commercial services. The building blocks include: expanding use of electronic catalogs, payment utility

services, services to authenticate buyers and sellers on the Internet, use of commercial software for

contract formation and administration, contract writing systems, Federal systems interfaces, and a

coordinated change management process. As efforts progress, the change management process will

include consideration to proposing additional legislation that would further facilitate the effective use of

EC. A general time table and list of responsibilities is presented in the migration path from current

operations to our future vision (see page 35).

Federal and Private Sector Partnerships

EC FOR BUYERS AND SELLERS

Building Blocks

Federal

System

Interfaces

Contract

Formation/

Administration

Payment

Utilities

ID and

Authentication

End-to-End

Processing

Buying and

Paying Functions

Additional Prototype(s)

Additional Prototype(s)

Additional Prototype(s)

Additional Prototype(s)

Commerical Prototypes for High

Volume End-to-End Transaction

Processing and Decision-Support

Agency Prototypes to Enhance

Buying and Paying Processing

and Decision Functions

Integrated

Electronic

Commerce

Change

Management

Electronic

Catalogs

Contract

Writing

Systems
Electronic Commerce for Buyers and Sellers Page 8

1. SCOPE AND VISION

For much of the last decade, the United States Government and its trading partners have been

simplifying their business practices. Reengineering efforts have focused on streamlining many of the

steps involved in conducting competitions and processing transactions to support buying and paying

activities, e.g., notifying, ordering, receiving, and reconciling. The advent of Internet communications,

dramatic increases in the capability of commercial software, and the increasing availability of commercial

transaction processing services have raised expectations for a new wave of technology-enabled trade,

broadly defined as “Electronic Commerce” (EC). Few now doubt the potential of EC-related technology

to improve government buying and paying on a large scale.

Today, some aspects of the buying and paying process can be completed in cyberspace, using the

Internet. Over the next several years, the government should obtain the capacity to buy and pay for its

goods and services electronically by taking advantage of the growing Internet and other technologies

whenever a business case is made. Our vision is that, by the year 2001, all Federal agencies will

support their programs by making available customer friendly electronic purchasing tools

integrated with end-to-end commercial electronic processing of payment, accounting and

performance reporting information.

The 22 million government purchases from the private sector each year (worth over $200 billion) is

a sufficiently large business opportunity to attract the interest of sellers of products and services as well as

technology and financial service providers. Another 10 million in transfers among Federal entities each

year (worth $450 billion) adds to the market. To turn the potential of EC into reality requires that sellers,

service providers, and government buyers see a strong business case for making investments into EC

development, operations and continuous improvement.

In an electronic environment, sellers of products and services should have easier access to specific

market opportunities. They should find selling to the government simpler, without the need to interrupt

existing and developing commercial relationships for purchasing and payment support services. Within

the government, buyers (i.e., contracting officers

and end users with buying authority) should find

buying simpler, faster and easier. EC systems

should help buyers improve their assessment of

market capabilities, increase their access to

competition, better evaluate sellers, and more

effectively administer contracts.

The Federal market can be viewed in segments organized by such attributes as size and frequency

of purchase and buying technique employed. Looking at its market in these segments can help

government assess the business case and rank order its EC investments. The pace of electronic commerce

expansion then can be more finely tuned to the strength of the business case for each market segment.

This strategy -- based on building a business case for both buyers and sellers -- presumes that program

managers will rely upon cost-effective commercial ordering and payment transaction processing services

for high-volume activity. Government-unique EC systems will be developed only as a last resort for lowvolume activity, where industry has not invested in platforms to provide commercial services. Where

government systems are required, commercial “off-the-shelf” software will be used wherever government

processes can be accommodated by existing software.

EC Strategy Framework

Federal activity will proceed along three

related tracks: fostering partnerships;

integrating high volume services; and

reengineering key buying and paying

functions.
Electronic Commerce for Buyers and Sellers Page 9

TRACK STRATEGIC POSITIONS BUILDING BLOCKS

Foster Partnerships in

1998

 · Foster Government EC

Partnerships

 · Foster Commercial EC

Partnerships

 · Change Management

Integrate High-Volume

Services End-to-End by

2000

 · Enhance Purchase Card Use

 · Develop and Expand

Streamlined Catalog

Ordering

 · Electronic Catalogs

 · Payment Utilities

 · Buyer/Seller Authentication

 · Federal System Interfaces

Reengineer Buying and

Paying Functions by

2001

 · Reengineer Key Functions

of the Buying and Paying

Process

 · Electronic Catalogs

 · Contract Formation and

Administration

 · Contract Writing Systems

 · Federal System Interfaces

Federal activity will proceed along three related tracks: (1) fostering partnerships; (2)

reengineering and integrating buying with end-to-end ordering and payment processing for high volume

buying techniques; and (3) reengineering additional buying and paying functions. This vision is intended

to capitalize on the common interests of buyers, sellers, technology providers, and financial service

providers by rapidly pursuing the largest segment of transactions. Simply put, the idea is to build a

consistent structure for applications processing (both within the government and with industry), that

leverages the Federal Government’s economies of scale to take advantage of existing and emerging

technologies.

From this base of operations, work will proceed to expand the list of buying and paying functions

that can be performed through electronic means. Within each track, there are strategic positions toward

which the Federal Government will move over the next three years by completing concrete building

blocks.

Track 1: FOSTER PARTNERSHIPS

Strategic Positions

 A. Foster Government EC Partnerships -- Organize Federal Activity Across Organizational

Boundaries to Reengineer Business Processes for EC in 1998.

 B. Foster Commercial EC Partnerships -- Promote the Development of Integrated, End-to-End,

Commercial Transaction Processing Service Capability in 1998.

To launch this strategy, buyers need to collaborate on their business case development activity and

keep abreast of commercial EC service offerings. Sellers need easy access to government market

opportunities and the ability to transact more effectively and inexpensively. Information

technology providers and financial service processors need to understand the parameters of their

investment risk in EC systems and time their EC systems development activity appropriately.
Electronic Commerce for Buyers and Sellers Page 10

To foster Federal EC partnerships, the PMC -- comprised of cabinet agency chief operating officers

-- provides a forum for coordinating EC development activity across the Federal acquisition,

finance and information technology communities.

To foster Federal EC partnerships with States, starting immediately, Federal Chief Financial

Officers (CFOs), Chief Information Officers (CIOs), and Senior Procurement Executives involved

in Federal EC projects will work with their State counterparts to identify and capitalize on areas of

common interest.

To foster commercial EC partnerships, senior Federal staff will participate actively in public forums

with the broad range of private sector associations involved in EC services, in order to build and

maintain open communications on EC development topics.

Track 2: REENGINEER AND INTEGRATE HIGH-VOLUME SERVICES END-TO END

Strategic Positions

 A. Enhance Purchase Card Use -- Enable Buyers in All Agencies to use Purchase Cards for 90%

of Internet and other High-Volume, Low-Dollar Purchasing with Transparent End-to-End Back

Room Processing by the Year 2000.

 B. Develop and Expand Streamlined Catalog Ordering -- Provide EC tools in All Agencies so that

(a) Buyers have Easy, Internet Access to Catalogs with Transparent End-to-End Back-Room

Processing and (b) Indefinite-Delivery, Indefinite Quantity (IDIQ) Contracts are Available Online to All who Qualify to Order by the Year 2000.

Micro-purchases and orders under $25,000 from IDIQ contracts or schedules could account for up

to 85 percent of the total number of Federal transactions. These market segments, micro-purchases

and orders under $25,000 from IDIQ contracts or schedules, appear poised for rapid EC roll-out.

Purchase cards can be used for micro-purchases, i.e., those transactions under $2,500, which

account for more than 60 percent of the Federal Government’s annual purchase transaction volume.

Buyers can use their accounts, in many cases tied to a purchase card, for electronic catalog

shopping on virtual malls to obtain best value for micro-purchases as well as higher cost goods and

services at pre-negotiated prices and conditions. The business case to industry for these

technologies may include transactions from other markets, e.g., travel, other-than-Federal

customers, training, etc.

Beginning in 1998, all agencies will be able to choose from among several card issuers and aquirers

offering purchase, travel, fleet and related services supporting, integrated electronic commerce, e.g.,

intra-governmental transfers, multi-application smart cards and electronic catalogs. These card

issuers are part of consortia -- or payment utilities -- that can provide end-to-end, ordering and

payment transaction processing.

The structure and array of EC support service choices provided through payment utilities allows

agencies to migrate to EC based on the readiness of their legacy systems and their current

organizational capacity to manage change. Central buying agencies and other agencies which host

electronic malls, agencies with large transaction volumes, and small agencies will be encouraged to

move most aggressively toward integrated commercial EC services using advanced technology.
Electronic Commerce for Buyers and Sellers Page 11

Track 3: REENGINEER ADDITIONAL BUYING AND PAYING FUNCTIONS

Strategic Position

 Reengineer Key Functions of the Buying and Paying Process (e.g., strengthen market research

capabilities and facilitate more effective negotiations) by 2001.

EC can greatly enhance the government’s ability to simplify key functions of the acquisition cycle

for many different types of buys in different dollar ranges, even where "end-to-end" use of commercial

EC services is not yet possible or is otherwise impractical. For example, EC can be used to improve

market research; provide notice of contract opportunities; exchange data with vendors; and collect, use

and exchange data across functional offices within the government. Additional challenges remain

to implement end-to-end EC applications for new contracts over the micro-purchase

threshold.

The government’s current approach is to watch how the market is developing in these areas and adopt

best practices as they emerge. Beginning in fiscal year 1998 (FY 1998), the President’s

Management Council has begun to coordinate, on an interagency basis, reengineering efforts and EC

applications development for these functions of the buying and paying process. This will promote the

quicker development, for lower volume EC transactions, of applications that are modular in nature,

interoperable and replaceable without substantial investment loss.

Subsequent sections of this plan present the transaction market, the needs of stakeholders and

driving forces in the environment that will facilitate movement toward the strategic positions identified in

this document. The plan also identifies policy principles and building blocks of activities that need to be

accomplished to address these needs and driving forces in order to reach the strategic positions. The

principles should serve as investment decision-making criteria to help ensure that new EC-related projects

are pointed toward the strategic positions. Finally, a migration path lays out a general time table of event

milestones for the building block activities.
Electronic Commerce for Buyers and Sellers Page 12

2. TRANSACTION MARKET

EC technologies can connect the government’s market

of procurement transactions with its market of related

finance transactions. To make a business case for these EC

technologies, the government must present its market in

segments to potential investors. Some market segments will

present a business case for end-to-end transaction processing

using EC. Others will attract investment into EC projects

that provide returns only for some parts of the buying and

paying process. The chart “Transaction Market and

Electronic Commerce Applications” illustrates how EC

applications can bring these market segments together.

Market of Procurement Transactions

Buying techniques form a basis for defining Federal buying and paying market segments.

Procurement transactions typically are conducted using one of four buying techniques, generally defined

by the size and frequency of the purchase, competition strategy and legal requirements. [1] For items

that cost under $2,500, purchases can be made from local sources offering a reasonably priced product or

service. [2] For individual purchases between $2,500 and $25,000, buyers must contact at least three

sources (i.e., obtain three quotes). [3] For high volume buys, rather than make individual purchases on

the open market, buyers may establish a single- or multiple-award indefinite-delivery, indefinite quantity

(IDIQ) contract (or a blanket purchase agreement (BPA) under a contract awarded by the General

Services Administration) to leverage buying power. Orders then may be made under these contracts

through simplified techniques that vary based on the size of the purchase and legal considerations. [4] For

individual purchases above $25,000, buyers must issue widespread notices of solicitation.

The nature of the purchase will shape further the buying technique. For purchases of products

under IDIQ contracts, a buyer may need only the seller’s electronic description and price/delivery terms

before placing an order. For services, though, buyers may need to develop (often with input from sellers)

statements of work before they can reach agreement with sellers on the contracted task and performance

requirements. For example, some pricing arrangements, e.g., fixed price or cost reimbursable, may be

easier than others to accommodate using EC.

Understanding differences in buying techniques is

critical to determining how EC can improve the

efficiency and effectiveness of the buying and paying

processes associated with those techniques. These

differences also can help technology and financial

service providers to determine what applications of

EC will likely hold the most promise within high

volume market segments.

Procurement Market of Transactions

Size of

Procurement

Millions of

Actions %

Billions of

Dollars %

Under $2,500 13.2 60 5.3 3

$2,500 to $25,000

$2_5,00

8.3 38 16.6 9

Over $25,000

$25,000$100,000_

0.4 2 178.6 89

TOTAL 22.0 100 200.5 100

Note: Numbers may not add due to rounding

Source: FPDS data for Fiscal Year 1996

Orders from IDIQ Contracts Orders under $2,500 may be placed with any

contract holder offering products and services at

reasonable prices. For orders above $2,500 on

multiple-award IDIQ contracts, buyers generally

must conduct commercial-style competitions that

give contract holders a fair opportunity to be

considered for each order. For orders above

$25,000 on schedule contracts, buyers should

consider three or more schedule contractors,

depending on the size of the order.
Electronic Commerce for Buyers and Sellers Page 7

Different mixes of technology can be brought to bear to each market segment. At this time, five

clusters of EC applications appear to hold promise. As the chart below illustrates, purchase cards can be

used by [A] end users and [B] contracting officers for face-to-face and computer-to-computer spot

purchases and orders. In FY 1997, purchase cards were used for over 10 million transactions, worth

about $5 billion. This represents 55 percent of all micropurchases.

Two sets of EC applications hold promise for contracting officer and end-user orders under existing

contracts. [C] For contracts involving a wide range of buyers, electronic catalogs established on the

Internet can connect multiple sets of buyers and sellers for purchases under multiple contracts. [D] For

contracts involving a narrower set of buyers, contract-specific electronic links may be established using

dial-up, Internet or other communications links. Such a system could be active (e.g., directing

notification to sellers) or passive (e.g., allowing buyers to browse). [E] Open market purchases above

$25,000 will be supported by a variety of interoperable contract office systems and network systems as

appropriate.

Market of Financial Transactions

For the financial processing market, the vast majority of payments will settle through the

Automated Clearing House, either directly, through a financial network clearing arrangement, or

through emerging and developing EC clearing mechanisms. Very large payments and many international

payments will settle through other means.

For the market of procurement and related financial transactions, the growth of these clusters of EC

applications will depend upon the business case to agencies and industry for investment in their

implementation. Over time, new applications are expected to supplement and replace those represented

above. Business will continue to be conducted using paper methods for a portion of each segment of the

market, i.e., where paper means are more convenient or cost effective.

Micropurchase

$2,500 to

$25,000

More than

$25,000

(1) Spot

Purchase

(2) Three

Quotes

(3) Orders

Under IDIQ

Contracts

(4) Open

Market

Buys

Size

Buying

Technique

* for Paying

Web Browser,

E-mail,

EDI, etc.

Web Browser,

E-mail,

EDI, etc.

Browser, etc.

plus Catalog

Backbone

Browser, Server,

E-Mail,

EDI, etc.

End User

Purchase Card

for Buying

Contract Office

Purchase Card

End User or

Contract Office

Purchase Card

Varies by

Contract

Varies By

Network

to Buying

Opportunities

Internet Site/

Address

Card

Association

Internet Site/

Address

Card

Association

Varies by

Catalog

Varies by

IDIQ

Varies by

Contract

Varies by

Contract

CBDNet,

Internet

or VAN

Varies by

Network

Financial

Processing

Rules

Commercial

Card Rules

Commercial

Card Rules

Catalog Rules

(plus financial

network rules )

Contract

Provisions

Proprietary

System Rules

Settlement*

ACH

Card

Settlement

Frequency

of Purchase

Intranet,

Internet or

EDI Server

*For each technique, non-electronic

transactions are not represented here.

Typical Mechanism

for Buyer Access

to

Payment

Typical Mechanism

for Seller Access

Often

or Rare

Rar e

Rare

Often

Often

*For each settlement technique,

there may be additional clearing

mechanisms not represented

Procurement Market Electronic Commerce Applications Finance Market

Often

A

B

C
Electronic Commerce for Buyers and Sellers Page 8

3. STAKEHOLDERS

Agencies do not engage in commerce -- buying and paying -- alone. Partnerships among buyers,

sellers, service providers, and reviewing authorities are needed to make the transition from paper to

electronics. State and local governments -- faced with the same opportunities and challenges -- also

should be included in discussions on this transition. The needs of each stakeholder must be identified

and addressed in order to make a compelling business case to incent investment.

Buyers

Despite shrinking agency budgets and decreasing workforces, taxpayers demand improved

performance from our procurement workforce. To meet this demand, buyers of the products and services

needed to support agency missions continually must streamline processes, reduce burden, and improve

productivity.

• Program Offices ultimately are responsible for the projects that carry out agency missions. They

are the end users of the products and services acquired by contracting offices. Program offices

increasingly are being authorized to make purchases up to $2,500 (“micro-purchases”) directly

from sellers using purchase cards, oftentimes under contracts with pre-established business

arrangements and prices. This trend enables program offices to satisfy their needs more

expeditiously and allows contracting office personnel to focus their attention on more complex,

higher dollar procurements, where their expertise adds the greatest value to the buying process. For

this reason, agencies need continued management commitment to a strong purchase card program

and program offices need mechanisms for easily accessing information about the goods and

services that might suit their needs. For other purchases (especially higher dollar purchases),

program offices need to collaborate with contracting and legal offices in defining requirements,

evaluating offers, and assessing contractor performance. This integrated team approach helps to

ensure use of effective acquisition strategies, effective use of competition and financial incentives,

and the best possible match between agency needs and marketplace capabilities.

• Contracting Offices enter into and administer contracts for the goods and services needed to support

the missions of executive agencies. To secure best value for the taxpayer, contracting offices must

conduct effective market research, encourage and take advantage of marketplace competition, and

negotiate effectively with sellers. They also must properly administer contracts and conduct

contractor performance assessments to ensure that contractors meet contract requirements.

Contracting offices find that use of performance information to support future source selections is

desirable, as it motivates contractors to excel in their performance.

• Contracting offices in mixed ownership or quasi-governmental corporations typically are afforded

greater flexibility in their buying practices than that granted to contracting offices in most

executive agencies. This notwithstanding, contracting offices in mixed ownership or quasigovernmental corporations still face the prospect of having to “do more with less” and remain

accountable to the taxpayer for good performance. As a result, they too need processes that can

help them reduce costs, get goods deals, and increase their productivity.

Sellers
Electronic Commerce for Buyers and Sellers Page 9

Sellers -- small and large, selling domestically and from abroad -- want easy, effective, and

inexpensive ways to find customers and market their products. The same holds true for the more than

300,000 sellers currently doing business with the Federal Government. Lower transaction costs mean

greater returns on investments.

• Business Concerns, as a group, hold a significant amount of resources to invest in technological

solutions that improve their competitive position in the marketplace. To conduct business as

efficiently and effectively as possible, businesses must know the marketplace in which they operate

and the way in which their trading partners do business. This knowledge enables them to gear

investments towards solutions that will help them maintain a competitive edge. For the relatively

small number of large established government contractors that account for a significant percentage

of all the government’s procurement dollars, streamlined processes and decreased

administrative burden will reduce their overhead costs and, accordingly, save the government

money.

• Small businesses concerns are entities that are independently owned and operated, not dominant in

the field of operation in which they are bidding, and qualified as small businesses under criteria and

size standards prescribed by the Small Business Administration. Small businesses are a key player

in Federal procurement, receiving more than 20 percent of the total value of all prime contract

awards each fiscal year. To remain integral players in government contracting and key contributors

to the economy, small businesses must strive to stay competitive as technologies and business

practices evolve. They need easy and inexpensive ways of learning about contracting

opportunities, a low cost, user-friendly operating environment, and access to training and technical

assistance to reengineer their business strategies and processes to accommodate change.

• Statutorily required sources are organizations that the government, in accordance with statutory

requirements, must use to fulfill needs for certain products or services. In order for required

sources (which include the Federal Prison Industries (UNICOR) and the Javits-Wagner-O’Day

program (JWOD) for nonprofit agencies employing people who are blind or severely disabled) to

be viable players over time, they must be able to continue offering quality supplies and services at

reasonable prices. As a result, they must take advantage of technological advances to enhance

marketing, minimize transaction costs and maximize efficiency.

• Businesses operating in foreign countries covered by international trade agreements, whether

foreign or U.S.-owned, compete without restriction and on the same basis as firms located in the

United States. Sellers competing from abroad need to be able to learn quickly about contracting

opportunities and communicate efficiently using internationally recognized standards that enable

easy electronic interchange of information.

Service Providers

Four sets of entities add value to the EC processing chain: finance offices, financial service

providers, information technology offices and information technology providers. Each has an important

role to play in the end-to-end buying and paying process.

 · Finance (CFO) Offices typically are responsible for providing front-end funds control as

well as accounting for and reporting on buying and paying activity. Together with support

and program offices, finance offices ensure that there are proper management controls in

place throughout the processing environment. Finance offices need convenient tools to

make the right payments, on-time, in the right amount. Finally, they need easy, accurate
Electronic Commerce for Buyers and Sellers Page 10

and reliable means to collect the requisite data for accounting and reporting and to structure

and transmit this information. Finance office needs can be met through a combination of

commercial and in-house systems and services.

 · Financial Service Providers offer commercial transaction processing services, many of

which can be used for Federal transactions. Financial service providers must be able to

make a business case for investing in and adjusting their commercial systems to

accommodate Federal transactions.

 · Information Technolgy (CIO) Offices typically provide assistance in the acquisition and

management of information systems, develop and maintain agency information

architectures, and promote the effective design of information resource management

processes. CIO offices need software and services that couple with and operate

effectively in concert with existing agency systems, provide adequate security over

government operations, and support sound capital planning and investment practices.

 · Information Technology (IT) Providers offer information processing services and/or

software to support Federal operations. (Financial service providers also may be IT

providers.) Like financial service providers, IT providers need a business case to support

software and/or system development. The strength of this business case will rely heavily

on how similar Federal transactions are to commercial transactions.

Reviewing Authorities

Reviewing authorities are individuals and organizations that oversee Federal EC operations

and respond or pass judgment. Reviewing authorities can be divided into four groups that

illustrate a variety of ways in which review may occur: Taxpayers, the Congress, Regulators and

Auditors.

 · Taxpayers contribute the capital for Federal operations. As a matter of public trust, the

Federal Government is responsible to taxpayers for efficient and effective operations. EC

presents a vast opportunity; taxpayers should be able to see their government realizing the

potential inherent in EC through wise, sound management investments and practices that

yield solid returns over time.

 · The Congress authorizes and appropriates funding for, and provides oversight over, Federal

programs. The Congress also is responsible for the laws that underpin the regulatory

framework in which EC operates. In these roles, the Congress has an interest in good

government, social policy, and equitable treatment of the public. To perform these duties

for electronic commerce, the Congress needs reliable information about investment choices

and information on the results of operations insofar as they effect compliance, efficiency,

effectiveness and equity.

 · Regulators are responsible for administering laws and regulations in a variety of areas,

including procurement policy, financial management and information technology

management. In each area, regulators conduct planning and set standards, issue guidance,

offer technical assistance, review results of operations, and work to modernize policy and

operations. Regulators need to effectively manage risk, assess the result of operations, and

understand changes in the marketplace.
Electronic Commerce for Buyers and Sellers Page 11

 · Auditors assure independent accountability to public officials, legislators and the public.

Auditors validate whether funds are handled properly and in compliance with law and

regulation, and determine the extent to which programs and services are achieving the

purposes for which they were authorized and funded in an efficient manner. Auditors need

a clear understanding of applicable requirements and objectives against which to audit as

well as good working relationships with program managers that quickly and accurately

identify, assess and correct deficiencies.

State and Local Governments

Buying and paying offices in state and local governments perform functions similar to

those of their federal counterparts and face many similar constraints and challenges. Like the

Federal Government, states and localities are striving to obtain the capacity to buy and pay for

their goods and services by taking advantage of the growing Internet and other technologies

whenever business cases are made. They have both an interest and a desire to support

development of uniform operating environments for their market segments that are similar to

those in the Federal marketplace, especially with respect to transaction processing for payments.

In short, states and local governments are looking for active Federal coordination to ensure EC

services are compatible and to time EC implementation so as to better leverage EC investments.
Electronic Commerce for Buyers and Sellers Page 12

4. DRIVING FORCES

Driving forces are environmental factors that affect an organization’s ability to conduct operations.

While an organization’s response to a driving force may be “business as usual,” generally a more forceful

reaction is needed to achieve benefits or avoid adverse consequences. The first four driving forces cited

below represent stakeholder constraints on the domain of available options. The last two represent

opportunities that are difficult to ignore.

Need to Improve Performance in a Balanced Budget World

The President, the Congress and the American people share the goal of balancing the budget in the

immediate future. Even as these fiscal realities hit home in agencies, there are rising expectations for

service. Citizens now hold their government to the high standards they have come to expect from world

class leaders in the private sector. The government has responded in some areas. For example, calls to

the Social Security Administration (SSA) are answered more quickly. Hundreds of thousands of tax

forms and instructions are downloaded over the Internet from the Internal Revenue Service (IRS) each

year. Recipients of Food Stamps can access benefits electronically with an Electronic Benefits Transfer

(EBT) card in the grocery check-out line -- eliminating paper coupons.

For Federal acquisition functions, doing more with less means ensuring offerors have better, easier

access to Federal buying opportunities. It means using commercially-proven best practices, like ensuring

employees have ready access to pre-negotiated, lower, priced contracts. It means eliminating manual

reconciliation between procurement and finance documents. Without simplifying processes, incremental

gains from moving to EC will not bridge the gap between available resources and public expectations.

Buyer and Seller Demand for Easier Access and Better Service

Buyers and sellers want convenient ways to conduct business that help sellers communicate about

their products and services and help buyers make informed choices. For example, with the advent of

electronic catalogs a few years ago, many buyers shifted their shopping patterns because they found

electronic catalogs to be convenient and to carry vast, robust information. This behavior change is

indicative of the magnitude of demand for service and the speed in which large portions of the market will

move to superior ways of doing business. Conversely, some government initiatives have seen slow

growth because sellers have been reluctant to adopt government-only purchasing mechanisms.

With such strong demand, there exists a risk that buyers will choose convenience at the expense of

richer market data. While such an anomaly would be short-lived, the consequences of uninformed buying

could be substantial. The Internet can provide for short development times and broad exchange of

detailed information, somewhat mitigating this risk.

Congressional Interest in Performance and Accountability
Electronic Commerce for Buyers and Sellers Page 13

Over the past four years, legislation such as the Government Performance and Results Act (GPRA),

the Government Management Reform Act (GMRA), and the Federal Acquisition Streamlining Act

(FASA) all have called for increased performance reporting. These reports, such as government-wide

audited financial statements, required by the GMRA, in turn will increase public interest in accountability

and performance. Accurate entry of low level transaction data into systems can allow for automated

account reconciliation and is the key to opening the door that provides timely financial and performance

reporting. Also, this richer transaction data can be stored in repositories and aggregated for decisionsupport analysis. The Congress has recognized that EC can generate the fine-grained, rich

transaction data needed for these purposes. As such, Congressional mandates are spurring significant EC

activity in some areas. Notable is the Debt Collection Improvement Act which requires all Federal

payments, except tax refunds, to be made electronically by January 1999 and for all payments to be

matched against a comprehensive list of debtors for offset purposes. Agencies are on the fast track, and,

since the law was enacted, the percent of vendor payments made by EFT has increased by more than 20

percent. These mandates will have subsidiary effects as well, contributing to the business case in related

areas.

Outdated Legacy Systems and Processes

Many current government processes were established thirty to sixty years ago as agencies went

through rapid growth periods. These processes typically are labor-intensive and involve recording and

reconciling information on paper. Today, some processes have changed significantly, but most still rely

heavily on paper. For example, most travel authorizations and vouchers still are filed and reconciled on

paper. Purchase orders and petty cash disbursements remain common. The difference between sixty

years ago and today is often that data from paper documents is hand-keyed into a computer rather than

hand-written in a ledger.

Availability of New Technology

New technology continues to reduce the cost of communications and increases the convenience of

accessing, analyzing and disseminating information. Most important is the Internet and Intranets, that

collapse the traditional trade-off between the cost of communications and the detail of information, the

customization of information, and the pace of feedback. The result is a radical reduction in

communications costs. These networks quickly have had, and will continue to have, a dramatic impact on

the information that surrounds business activity. Because change now happens on Internet-time, that is,

at a fraction of calendar time, a modular approach to systems is a must. Whole-cloth systems will be

obsolete long before completion.

A second key impact of the Internet results from its public architecture -- the same architecture that

supports cheaper communications. Widespread use of public networks for public communications has

created a demand for trusted communications, so that more sensitive business also can capitalize on the

reduced costs of communication. Commerce and transactional exchanges soon will see the same radical

changes heretofore seen for simple communications. Some experts estimate that Internet commerce will

grow from a $8 billion industry in 1997 to a $330 billion industry by 2002.

Commercial Use of EC

Industry is capitalizing on technology opportunities and is organizing the market into segments that

can be addressed by different EC products and services. A large growth area is EC applications for

business -- a market segment that typically require more information about transactions than do

consumers. This is coming at the same time that many traditional consumer EC products are reaching

market maturity. For example, the corporate market for purchase cards--in both number of transactions
Electronic Commerce for Buyers and Sellers Page 14

and dollar volume -- is growing much more quickly than the consumer market for credit cards. As a

result, solutions for lower volume exchange of invoice and remittance information now are on the

horizon.

The government, as a business customer, will benefit from these market forces. At the same time,

government investment should be targeted and monitored to ensure that the promise of new technologies

is realized in a timely manner. Using commercial products and services can reduce the risk of such

investment -- both in up-front design and development and in maintaining state-of-the-art systems.

Federal agencies can reap savings to the extent that government transactions mirror commercial

transactions.

5. POLICY PRINCIPLES

The principles listed below are intended to promote investments in EC projects that support

commercial, market-based EC development policies. Simply put, these policy principles describe policy

criteria for making and managing investments. The first two policy principles describe criteria for what

to do. The next three principles describe how to do it. The last two policy principles are criteria for

managing investments. Investments in end-to-end processing should support the first five policy

principles. Investments targeted at specific buying and paying functions also will benefit the end-to-end

procurement and finance process continuum. While these investments generally will not support all

policy principles, they should be consistent with achievement of policy objectives.

Use EC to make the buying and payment processes easier and more efficient for both buyers and

sellers

Agencies should use EC to reduce effort, time, and expense required for the government

to buy from sellers and for sellers to sell to the government.

Advances in information technology offer a solution for agencies that must do more with less,

helping agencies meet taxpayer demands in a balanced-budget environment. In addition, the government

has a strong interest in decreasing the cost of sellers’ participation in government procurement, e.g., in the

source selection process. Agencies can and should use EC to help: (1) streamline and, where possible,

eliminate transaction steps; (2) reduce unnecessary paperwork and its attendant administrative cost

and delay; (3) facilitate access to resource materials; (4) improve buyer visibility of products and services

under contract; (5) permit sellers to gain quick access through a single, government-wide point of entry to

information on government contracting opportunities to be procured on the open market above $25,000;

(6) avoid redundant reporting of business information; (7) enable sellers to receive timely and accurate

payment and remittance information; and (8) ensure that buying and paying rules can be understood and

applied in a consistent manner to transactions conducted electronically. Whenever possible, Federal EC

applications should not disrupt existing and developing commercial relationships for purchasing and

payment support services.

Use EC to facilitate best value buying and paying

Agencies should use EC to improve key aspects of the buying and paying process that

contribute to the government’s ability to make good deals on behalf of taxpayers.
Electronic Commerce for Buyers and Sellers Page 15

Recent statutory, regulatory, and policy changes brought about by acquisition reform are improving

agencies’ ability to get more value from what they buy. The government can get better deals from quality

contractors when it uses new technology to overcome inefficient paper-based processes.

• EC can be used to help buyers research the marketplace for sources of supplies and services. As

agencies turn more to the commercial market to meet mission needs, knowledge and understanding

of the industries and sectors that make up the global commercial market becomes more important.

EC can improve the ability to search product and service information. To start, EC applications

should enhance buyer awareness of products and services already available under contract at their

own and other agencies. The competitive pressure among sellers across agencies for orders under

existing contracts likely will increase as buyers are able to more easily make informed comparisons.

To the extent practicable, systems should be open and interoperable. Closed or proprietary systems

make buyer access difficult, reducing the utility of the information they contain.

• EC can assist the government in accessing the competitive pressures of the marketplace. Easier

access will stimulate greater seller interest and participation by increasing the visibility of and

reducing the cost of learning about buying opportunities. For open market buys above $25,000, for

example, EC applications must foster convenient and universal user access through a single

government-wide point of entry. Multiple points of entry discourage sellers from learning about

and responding to buying opportunities.

• EC can support easy and efficient information exchange during contract negotiations. Recent

acquisition reform efforts have recognized that more robust information exchange will help the

government better identify the best value match between agency needs and items available in the

marketplace. EC should be used to make these exchanges easier and more efficient.

• EC can help to make the payment process more efficient and accurate. Reducing the numbers of

late payments, erroneous payments or payments with erroneous documentation can help attract high

quality sellers to government solicitations. Simply automating old financial processes is not

enough. Financial intermediaries can ensure that the agreed-upon price is paid. They also can help

the Federal Government pay only the sales taxes that are due, not those charged. Proposals for

investment in financial EC should make the payments process noticeably more accurate and

reliable.

Take advantage of proven commercial applications of electronic commerce

Whenever possible and cost effective, agencies should rely on commercial products, services

and practices.

In comparison to government-developed products, commercial items benefit from market-driven

economies and innovation, that is, in terms of cost, quality, etc., and entail less risk of schedule overruns

and performance shortfalls. The private sector has made and continues to make a significant investment

of resources into information technology. The government should leverage the investment already made

in the ever-growing commercial infrastructure and share the costs of maintenance and upgrades.

Tools such as performance-based service contracting (PBSC) can help agencies intelligently

purchase EC services. Rather than telling sellers how to do the work, the government outlines its needs in

measurable, mission-related, results-oriented performance terms and allows the contractor to be

innovative and determine the best, most cost-effective way to do the job. With PBSC, agencies pay for

results, not effort or process. In general, purchasing commercially-defined services, with commercial

transaction processing rules, is preferable to purchasing services that merely support unique, expensive

business methods.
Electronic Commerce for Buyers and Sellers Page 16

 When agencies design systems in-house, there is a real danger that the resulting system

specifications will by overly prescriptive and the system will perform core functions poorly. For

example, poor specifications may include a requirement that systems write upwards of twenty specific

reports -- defined at the data element level. A better approach is to ask for the ability to provide standard

commercial reports, such as account history, and the ability to define new reports.

In addition, the government must apply nationally and internationally recognized standards that

broaden interoperability and ease the electronic interchange of information. Proprietary protocols should

be avoided, as they fail to permit multiple sources from providing viable competition on multiple

platforms. Further, proprietary systems limit interoperability and discourage full-scale private sector

participation. 

 Strategies for EC should take advantage of the latest cost-effective technologies. This will help

avoid static, one-size-fits-all, or overreaching applications with their attendant cost overruns. The

Administration is drafting legislation that will encourage agencies and the private sector to implement

innovative electronic payment technology by allowing for early payment in cases where EC promotes

good cash management and sound business practices.

Outsource transaction processing

Common commercial services should be competed in identifying the best value source.

Agency in-house processing capacity should be designed and developed only when there

is a clear, demonstrated business case.

There is substantial opportunity to move to commercial transaction processing for invoicing,

authorization, payment, and remittance processing. Commercial transaction processing services are

becoming ever more sophisticated in offering a wide variety of capabilities. Not only have these services

been market-tested, but also they typically cost less than doing the processing in-house. For example, the

purchase card capitalizes upon decades of experience in credit card processing and economies of scale

from hundreds of millions of cardholders.

Too often, contractors build one-of-a-kind transaction processing systems to meet government-only

specifications. Likewise, contractors often build government-only systems to meet government-only

ways of doing business. This makes little sense when the same (or nearly the same) service is performed

in better and cheaper ways in the private sector. Whenever possible, Federal agencies should change their

processes to interact easily with commercial processing structures and take advantage of readily available

transaction processing services.

Assign financial liability for losses commensurate with ability to manage and mitigate related risks

Federal programs should limit procurement and payments risk exposure by accepting

liability only for risk they can control, managing risk by balancing security costs and

expected losses, and managing trading partners’ risk expectations.

EC, like all commerce, poses a risk of adverse consequences that typically lead to financial losses.

Managing that risk -- and preventing losses -- reduces the cost of doing business. At the same time,

managing risk costs money, thus creating a disincentive for risk management -- especially when others

will bear the losses. When developing EC systems or choosing among competing EC commercial

services, choices must be made as to how risk will be managed. Risk can be managed by ensuring that
Electronic Commerce for Buyers and Sellers Page 17

parties understand those losses for which they will be liable, developing security and risk-control

measures, and limiting participation in the system based on the ability and willingness to bear risk.

Systems and rules that assign financial liability for particular losses based on participants’ ability to

prevent those losses promotes stability and long-term working relationships.

For the government’s trading partners, a framework of risk management creates a clear

understanding of potential losses. Trading partners then can decide whether to participate based on their

desire to bear that relatively well-known risk. The Federal Government intends to accept commercial

processing rules where appropriate. Given differences in the commercial and government environments,

the Federal Government may need to amend commercial rules at the margin. Where the Federal

Government can mitigate risk, the security and risk-control measures used should balance costs of

implementation with expected losses prevented by the measure. For example, such decisions as how

extensively to encrypt transactions through a catalog system should reflect the number, size, and type of

losses that might result from a breach.
Electronic Commerce for Buyers and Sellers Page 17

Different business arrangements may be necessary to address different market segments. For

example, a well-documented dispute resolution process (and a method of maintaining that system) would

be appropriate for transaction systems involving a wide range of different businesses. On the other hand,

the cost of maintaining corporate capability of this sort might not be worthwhile for a system involved

only in very large in-progress payments with major vendors easily capable of directly controlling their

risk exposure.

Monitor investment for returns

Agencies should devise performance metrics to determine return on investment.

 Recent legislation aimed at performance has increased the pressure on agencies to demonstrate

results. The government cannot afford to incur the costs of inefficient and impractical EC applications.

EC investments must be supported by a business case. Achievement of benefits should be measured by

establishing realistic outcome-oriented goals, defined in objectively measurable terms to help agencies

determine return on investment. A “one-size fits-all” measurement system is not likely to reveal

information that is useful for agencies to assess their achievements. With good measures, there is an

understanding of the scope of transactions to which a given application is intended to apply so that actual

impact can be measured against expectations.

Progress can be measured by gathering data on the possible universe of procurement and financial

transactions that can be improved by using EC methods. A first step is to describe the current segments

of the Federal market (based on the types of products or services, size and frequency of purchase, buying

technique and legal considerations), the current processing methods used, and the current application of

EC methods. These data should reveal those segments where increased use of EC methods would

improve the efficiency of an agency’s operation and result in measurable savings. Once the universe of

transactions has been identified, a time period should be established to measure improvements. When

determining how to measure the benefits of EC, agencies should take into account how other government

and commercial concerns measure similar activity, which will allow for benchmarking against the

performance of others.

Where performance can be measured across organizations, it should be reported to managers in

those organizations. This reporting will enable managers to see how they are performing relative to their

“peers.” Peer performance reporting established the context managers need to evaluate the success, or

lack thereof, of implementation in their agency. Such reporting also creates peer pressure to improve

results.

Manage the change process

In order to reap the long term benefits of EC, the government must gain the ongoing

acceptance of the users of its reengineered buying and paying processes -- both outside

and within government

The successful transition from paper to EC-based buying and paying processes ultimately will

hinge on how well the government makes its business case to garner buyer and seller investment and

participation. To foster seller interest, the government must be able effectively to identify those market

segments where using EC would provide both sufficient activity and benefit to make investment and

participation worthwhile. To foster buyer interest, agencies must keep abreast of and apply successful

commercial EC applications that make processes easier and simpler (taking into account the needs of

federal acquisition, finance, and IT offices), reduce cycle times, lower costs, improve quality, and
Electronic Commerce for Buyers and Sellers Page 18

increase productivity. To ensure effective change management, education, partnerships and performance

measurement are needed.

6. BUILDING BLOCKS

Building blocks identify projects and sets of activities that must be accomplished in order to

achieve the EC strategic positions identified earlier. Building blocks are activities associated with

achieving efficiency and effectiveness through (1) improved communication, (2) agency implementation

of commercial software, or (3) agency use of commercial transaction processing services. The three tiers

of the figure below correspond to these three methods of improving buying and paying processes.

Commercial services in the bottom row form the foundation for EC. This view assumes that both

the buyer and seller are authenticated for business transactions in cyberspace by a trusted commercial

party. It also assumes that buyers can do comparison shopping at pre-negotiated terms and conditions on

virtual shopping malls. It assumes that the authentication is tied to utilities that perform payment and

related transaction processing according to private sector rules, within a liability framework agreed to by

all parties involved.

The middle row of building blocks in the pyramid focuses on the use of commercial software EC

solutions that can enhance buying and paying even though use of end-to-end commercial services is not

possible or practical. One area where these opportunities exist is, in the early phases of the acquisition

process, to help sellers find out about market opportunity and negotiate a transaction. Similarly, EC

software solutions can help buyers write contracts. Another area of focus is in standardizing and reducing

the number of interfaces between government systems and commercial EC applications.

Finally, the building block on the top of the pyramid focuses on managing work across

stakeholders. The quality of activity in this area will affect the pace and smoothness of the organizational

transition to an EC environment.

BUILDING BLOCKS AND COMPONENTS
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Building Block Description and Components

Electronic Catalogs Interoperable Electronic Catalogs

(Tracks 2 and 3)

Interoperability Commercial Catalog Solutions

Payment Utilities Payment and Transaction Processing Utilities

(Track 2)

Purchase Cards

Account Management

Invoice/Remittance Processing

Intra-Governmental Transfers

Buyer & Seller ID/Authentication Standard Services for ID/Authentication of Buyers and Sellers

(Track 2)

Authenticating Buyers and

 Sellers

Commercial Risk Structures

Managing Seller Information

Market Research, Notice, Solicitation, Response, Negotiation

and Award Solutions

Contract Formation/Administration

(Track 3)

Market Research Tools

Notice, Solicitation, Negotiation

 and Award Systems

Past Performance

Contract Writing Systems

(Track 3)

Automated Acquisition:Contract Writing Systems

Federal System Interfaces Standard Federal System Interfaces

(Tracks 2 and 3)

Accounting and Reporting Performance Reporting

Change Management Education, Assistance, and Partnerships

(Track 1) External Stakeholder Relations Internal Management

Electronic Catalogs

Advances in technology -- especially the recent explosive growth of the Internet and web

applications and development of purchase cards (credit card products designed for businesses) -- and

increased use of multiple award task and delivery order contracts (to take better advantage of leverage and

market dynamics) has resulted in the emergence of federal “electronic catalogs.” Electronic catalogs are

web-based electronic systems that involve:

 • contracts with pre-established business arrangements with industry;

 • a way to identify and order goods and services, either from within an agency (intra-agency) or from

another agency (inter-agency);

 • sufficient and timely information to compare the items offered by performance, price and delivery;

and

 • mechanisms for vendor payment, including,

where possible, government purchase cards. Some Federal Electronic Catalogs
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Electronic catalogs can help shorten order

cycle-times and reduce the resources required to

fulfill needs -- especially for high-volume

purchases. In addition, agency buyers can use

electronic catalogs to gain greater awareness of the

products and services available under contract and

more easily make informed comparisons. This

improved visibility of products and services under

contract increases the competitive pressure among

contractors seeking orders. Catalogs also can

facilitate compliance with requirements to buy from

manditory sources. To take full advantage of the

benefits offered by electronic catalogs and the

evolving electronic commercial technologies that

support them, the government will: (1) work to

achieve interoperability among Federal electronic

catalogs and among Federal and commercial

catalogs; and (2) increase use of commercial software and solutions, whenever possible.

Interoperability

 Catalog interoperability is the structuring of catalog content, the formatting of catalog information,

and the provision of catalog access so that buyers may couple electronic catalogs with other systems for

the purpose of market research, ordering, payment, accounting and reporting. Interoperability between

catalogs increases visibility of products and services under contract, and facilitates comparison shopping

and better use of existing contract vehicles. More informed decision-making means better deals for the

government. The Federal Procurement Council will develop interoperability functional requirements that

address:

 • catalog content;

 • the formatting of information with an orientation toward developing a “common look and feel” (a

taxonomy) and establishing access privileges; and

 • access from the community of users, e.g., through web directories, registries, search engines or

software agents.

These specifications will be developed by examining current commercial standards and emerging

technologies and reviewing existing commercial catalogs as well as government catalogs operated by

agencies such as those listed in the figure above.

and Malls

· GSA Advantage On-Line Shopping Catalog

· NASA Government-wide ADP Contracts

· DLA Electronic Commerce Mall

· Navy Information Technology Electronic

Catalog

· Justice UNICOR On-Line Shopping Catalog

· NIH Computer OIRM Catalog

· National Industries for the Blind Office

Products Catalog

· DISA Defense Information Infrastructure

Operating System Stores (DIIOSS)

· Air Force Country Store On-Line Shopping

· Federal EC Navigator

Source: ARNET

http://www.arnet.gov/references/references.html

Types of Commercial
Electronic Commerce for Buyers and Sellers Page 21

Interoperability is a means of enhancing the

benefits of catalogs when consistent with agency

buying strategies and applicable requirements.

Toward this end, the Department of Defense has

implemented Federal EC Navigator

(http://www.fedecnavigator.disa.mil), an electronic

mall, as a web interface to support vendor

information exchange, easily moving between

catalogs and malls, and viewing both Federal and

private sector electronic catalogs and malls. To

leverage its internal buying power, an agency could

mandate use within the agency and preclude other

agencies from ordering. Regardless whether agency

catalogs are available for inter-agency use, access to

information still should be provided, when appropriate, to assist in market research efforts.

Commercial Catalog Solutions

In accordance with IT management best practices, agencies should operate catalogs on the same

types of software used for commercial catalogs. When buying commercially, costs and risk decrease,

while reliability, support and serviceability increase. Reliance on commercial solutions also reduces

barriers to entry, meaning that large and small contractors alike can more easily participate without having

to make significant investments in electronic catalog technologies.

Payment Utilities

Payment utilities are commercial entities that offer common financial transaction processing

services, including authorization control, transaction processing, reconciliation, and reporting. Examples

of payment and transaction processing utilities are financial institutions that issue credit cards, their

transaction processors and related integrators of technology (e.g., software, hardware, and

telecommunications) Commercial service providers can connect buyers and sellers in a seamless

manner. For many agencies, outdated financial systems and processes coupled with manual compliance

mechanisms have impeded their ability to operate efficiently and comply with accounting standards.

Industry is adopting and investing heavily in technology to upgrade the technical infrastructure

supporting financial services and data integration. Firms hope to realize strong returns on investment

based on a global network economy of transactions. Information technology development efforts of

government organizations do not have the business case, the core mission, or the resources to develop

parallel capabilities. The private sector is presenting these services to the government in the form of

payment utilities.

The Federal Government has been a leader in using payment utilities in some areas, such as

purchase cards and account management. The Office of Management and Budget (OMB), in conjunction

with the Chief Financial Officers (CFO) Council, will work to expand more advanced purchase card and

account management services from the pockets where they exist now and roll them out government-wide.

With respect to invoice and remittance processing services, the government has participated in

commercial pilots and expects to expand use of these services as the commercial market develops. And

recent inquiries into intra-governmental transfers have led the Federal Government to take a more

aggressive stance and play more of a leadership role for inter-entity payments.

Electronic Catalog Solutions

· Commercial Catalog Software --

used by an agency to operate a catalog.

· Commercial Catalog Services --

used by the private sector to operate a governmentonly catalog on behalf of an agency.

· Commercial Catalogs -- operated by

the private sector for government and other buyers.

· Electronic “Malls” -- to provide

access and information to a variety of contracts,

seller sites and product and service listings.
Electronic Commerce for Buyers and Sellers Page 22

Purchase Cards

In fiscal year 1997, Federal agencies used

purchase cards for more than 10 million transactions

worth in excess of $5 billion. Purchase card use has

grown more than 80 percent annually since the

program started. Despite this level of growth,

substantial potential remains for continued expansion

of the purchase card program. The Administration’s

goal is to use the purchase card for more than 90

percent of micropurchases. Acceptance by more

than 14 million vendors around the world and an

established indemnification structure make the

purchase card attractive for high-volume, low dollar

activity. Equally important, the purchase card also

dramatically reduces the administrative time and cost

associated with micropurchases. For example, in a

recent 17-agency study by the Purchase Card Council,

the purchase card could produce cost savings of

greater than 50 percent, or $54 per transaction, when

compared to purchase order processing. According to

the General Services Administration (GSA), the

purchase card was responsible for savings of $616 million in 1997.

To enhance the purchase card program, the GSA conducted a solicitation in 1997 for purchase,

travel, and fleet card services. The new card service contracts, awarded in February 1998, will offer new

and innovative services to Federal agencies to support EC and business process re-engineering, including:

 · A multiple award contract, with multiple service providers, to offer greater flexibility to agencies to

best meet their needs;

 · Integrated services which combine the service systems for the three business lines; and,

 · Value-added service options to enhance core functionality, including smart cards, financial systems

integration, enhanced reporting, secure Internet transactions.

The new card service contracts become operational in November 1998. These program enhancements

will lead to continued cost savings, increased accountability, and streamlined operations.

Account Management

As the market for payment utilities matures, financial service providers are capturing and making

available richer transaction-related information. For example, issuers of purchase cards could benefit

from a push being made by card associations to collect more data at the point of sale. This would be

accomplished by using terminals that capture and transmit line-item transaction detail, known as Level II

and Level III data, from the cash register or merchant Internet server. This rich information could assist

the government in accounting and measuring performance. Under the new GSA card services contract,

agencies will receive Level III data whenever merchants capture and report it. To expedite merchant

Federal Purchase Card Growth

Transactions Sales

(000)

%

Growth (000,000)

%

Growth

FY 1990 270 -- $56 --

FY 1991 639 136 $141 152

FY 1992 1,059 66 $276 96

FY 1993 1,512 43 $472 71

FY 1994 2,471 63 $808 71

FY 1995 4,248 72 $1,592 97

FY 1996 7,328 73 $2,914 83

FY 1997* 10,000 36 $5,000 72

* Estimated

Source: CFO Council Financial Implementation

Team on Electronic Commerce (FITEC)

http://www.gsa.gov/fitec/
Electronic Commerce for Buyers and Sellers Page 23

capture and reporting of Level III data, the agencies should include this requirement in negotiations with

sellers for volume buys.

Issuers now offer cardholders and agency managers desktop software “suites” to access this new

data. These browser suites can provide authorization, ordering, payment, general ledger, acceptance,

dispute and reporting services. Further, these suites can integrate system and user interfaces for multiple

payment methods using a single platform. Account management desktops also provide for transaction

acceptance, giving cardholders an opportunity to code transactions for object class, source of funds,

activity codes and for other accounting needs. Also, purchasing data can be aggregated, e.g., by product

codes. Similar web suites help merchants integrate management of multiple collections processes.

Buyers and sellers are using these suites to collect better data on purchases and sales while reducing the

number of interfaces with legacy systems.

Account management software affords managers new flexibility and control. Employee profiles

can control at a fine level what can and cannot be bought. For example, different spending controls could

be established for overhead purchases than for charges made to support a specific project. Account

management software also increases the timeliness and detail of reports, helping to quickly identify and

resolve suspicious charges. As a result, more employees in end-user organizations can be allowed to buy

as a result of the reduced risk of inappropriate purchasing. Account management services are available as

a value-added service in the new GSA card services contract.

Invoice and Remittance Processing

The Federal Government is exploring opportunities to use payment utilities for relationship

management broader than simply to make credit card purchases. In particular, several agencies rely on

outside transaction processors for receiving invoices and sending payment remittance information. This

will be accomplished both through traditional and new network relationships.

One of the longest standing Federal uses of a payment utility is the use of the ACH network of

banks for payments processing, such as for direct deposit. The National Automated Clearing House

Association (NACHA), which manages the ACH rules, will require as of September 1998, that financial

institutions be able to provide payment recipients with remittance information in the addenda to the

payment. The information must be provided by the opening of business two days following settlement.

In 1997, the NACHA estimated that only 1,200 institutions could receive, translate, and report this

information. To help financial institutions comply, the Federal Reserve System is enhancing its Fedline

software to support the needed translation and reporting. Fedline is used by an estimated 12,000 small to

medium sized financial institutions.

Several agencies currently post remittance information on password-protected Internet sites. For

example, the Treasury Department’s Financial Management Service posts remittance information on

payments from the National Aeronautics and Space Administration’s (NASA’s) Johnson Space Center.

The Department of Veterans Affairs, the GSA and the Defense Finance and Accounting Service (DFAS)

also operate sites. These sites do not address invoicing and require sellers to use separate passwords and

accounts for each agency site. The GSA has undertaken two pilots which try to overcome these barriers

for vendors who do business with multiple agencies. One pilot offers remittance translation services in

conjunction with standard electronic payment, while the other uses a financial invoice and bill payment

network.

Intra-Governmental Transfers
Electronic Commerce for Buyers and Sellers Page 24

 Each year, Federal agencies make about 10 million transfers worth over $450 billion between

different entities within the Federal Government. Unlike in the commercial environment, intragovernmental transfers are “book-entry,” i.e., funds do not move between accounts at financial

institutions. The majority of these transfers, though less of the dollars (about $175 billion), are in

exchange for goods and services. The current processes for making these transfers do not provide

sufficient data for agencies to make reliable payments and accurate, timely reports. As a result, in many

instances agencies fail to pay each other promptly. In contrast, commercial payment services are welldefined, operate effectively, appear cost-effective, and are supported by robust corporate infrastructure.

The Federal Government would like to use commercial transaction processing services to make interentity payments effectively and efficiently. For example, the Department of the Treasury (Treasury) is

piloting and testing the services from a financial institution that makes use of browser technology and

card based technology to meet reporting requirements.

The EPIC, through the Department of Defense (DOD), GSA, and Treasury, have undertaken a study

to determine how best to use commercial processing services and improve compliance with governmentwide policies. The study will include analysis of the transaction market, agency needs, applicable

policies, available standards, audit requirements and how corporations and other governments process

inter-entity payments. Design specifications derived from the analysis will document how to use

commercial services to support intra-governmental transfers. Finally, these specifications will be

prototyped, tested, and reviewed to ensure compliance with relevant information systems, financial

systems, acquisition, cash management, debt management, accounting, budget reporting and management

control requirements. The key to making this effort a success will be the implementation of flexible,

robust management systems that interface between commercial “book-entry” processing and agency

systems.

Buyer and Seller ID and Authentication

The Internet holds great promise to reduce the time, cost and risk for the government to do business

and for others to do business with the government. The realization of this potential has been impeded by

new elements of risk present on the Internet and uncertainty surrounding how that risk will be managed.

To address the risks of Internet buying and paying, six questions must be answered.

 (1) Who is the buyer?

 (2)What trusted third-party stands behind the buyer’s activity?

 (3)Who is the seller?

 (4)What trusted third-party stands behind the seller’s activity?

 (5)Are there a set of written agreements and rules governing the buyer and seller’s transactions?

 (6)Within this framework, how are buyers and sellers registered and warranted?
Electronic Commerce for Buyers and Sellers Page 25

The same features that make the Internet a

cost-effective medium for communications add

elements of risk that merit additional security for

large-scale financial operations. The Internet is a

global, public, electronic network that shares

communications links. Without adequate security,

the electronic codes that signify our Internet

identity can be mimicked and messages routed on

the Internet can be intercepted and potentially

altered. Systems coupled to the Internet are

vulnerable to penetration and attack. And recourse

for Internet losses is problematic because

jurisdiction over Internet messages may be unclear.

These problems are known as authentication,

privacy and confidentiality, integrity, access

control, and remediation. There are commercially

available products and services which can address all of these except for remediation.

To address these concerns, agencies will work in partnerships with those with whom they share

common interests in order to help promote an electronic commerce infrastructure that is cheap, secure and

open. This will include managing vendor identifying information through several ways, each suited to a

different market segments and based on the volume and method of purchase and payment.

Authenticating Buyers and Sellers

Internet Risk Elements m Authentication--the risk of

inadequate assurance of trading partner

trustworthiness.

m Privacy and Confidentiality--the

risk of improper access to information.

m Integrity--the risk that messages

have been altered.

m Access Control--the risk of adverse

effects upon systems coupled to the Internet.

m Remediation--the risk that recourse

for losses is inadequate, ill-defined or not available.

Managing Credit Card Risk
Electronic Commerce for Buyers and Sellers Page 26

Authentication is an assurance of identity and

authority. Authentication can provide protection

against imposters, illegitimate businesses, nonrepudiation, and other risks. Authenticating buyers

and sellers involves receiving sufficient assurance

that there is simple and speedy recourse in the event

a trading partner causes a loss to be incurred. In

short, authentication answers the questions of “Who

is your trading partner?” and “Who underwrites your

trading partner’s activity?”

In existing payment systems, buyers are

identified through written agreements.

Cryptographic keys and/or hardware tokens typically

then are issued to operate within those agreements.

The ACH relies upon cryptographic keys, while for

credit and debit card systems, buyers are identified

by their plastic cards and signatures or PINs. Sellers

are identified in similar ways, e.g., ACH payees use

cryptographic keys, while credit and debit cards

merchants have hardware terminal keys. These

access devices are tightly controlled (e.g., through

credit checks), closely monitored (e.g., through

credit limits or fraud pattern detection), and have a

limited life. The inset box entitled “Managing

Credit Card Risk” offers a more detailed illustration

of how industry manages payment system risk. To

the extent that government EC applications can use

these techniques to mitigate risk, EC will expand

more rapidly.

Many in the payments industry expect to use

similar means to authenticate buyers and sellers on

the Internet. These new mechanisms must address

the additional risk posed by the public nature of the Internet. “Public key” cryptography will allow for

Internet transactions to be similarly secure to transactions on proprietary financial networks. Agencies

still will need to determine how to use public key cryptography to securely couple agency systems to the

Internet. The inset box entitled “Authenticating Buyers” offers more discussion of computer network

authentication.

The Federal Public Key Infrastructure (PKI) Steering Committee (chartered by the Government

Information Technology Services Board (GITSB)) is working with agencies and industry to field a

comprehensive network-based infrastructure to support cryptographic digital signatures as a cross-cutting

enabling technology. The PKI is an evolving combination of products, services, facilities, policies,

procedures, agreements, and people that provide for and sustain a secure operation of end-user

applications. It will be designed, built, owned, and operated by the private sector. The government,

through the steering committee, will facilitate the development of the PKI. Currently, the steering

committee is sponsoring 25 pilot projects across the government which are serving to develop and

Card associations manage credit card risk by

assigning losses to one of two banks: the issuer

or the acquirer. Issuers underwrite the activity of

initiating a credit card transaction while acquirers

underwrite the presentation of the merchant ticket

for reimbursement. In general, acquirers are

liable for losses the merchant could have

prevented and issuers are liable for losses

resulting from imprudent cardholder behavior.

These losses are reflected in cardholder and

merchant fees and the recourse available to them.

Lower-risk cardholders can obtain accounts with

fewer and lower fees (such as interest rates).

Merchants pay variable fees depending on the

amount of risk associated with the transaction,

e.g., higher fees for phone orders, lower fees for

in-person orders, etc. And dispute resolution

procedures vary based on the transaction risk,

e.g., phone orders are easier to charge back, etc.

Card associations are piloting the Secure

Electronic Transaction (SET) protocol to encrypt

and protect credit card transactions on the

Internet. These firms expect widespread use in

the near future. Internet transactions not using

the SET protocol usually are considered in the

same risk pool as phone orders. Industry expects

that SET transactions may be even more secure

than those conducted in-person. As a result, SET

merchant fees and dispute procedures could be

more favorable to merchants than those for inperson transactions.
Electronic Commerce for Buyers and Sellers Page 27

demonstrate the technology, and is preparing a strategic plan for Federal involvement in the emerging

public key infrastructure.

Commercial Risk Structures

The infrastructures, consisting of liability frameworks and managerial corporate capability--needed

to support Internet commerce are not in place. Rather than develop these infrastructures de novo, there is

strong support in industry to “piggy-back” on existing infrastructures and to expand them to support new

methods of commerce. Industry leaders have testified that the current infrastructure can be expanded

to accommodate many types of EC without creating new legal and regulatory frameworks in which to

conduct Internet commerce.

The strength of existing commercial financial indemnification and risk structures makes them an

attractive base on which to build in the near term

for Internet commerce within multi-lateral

liability agreements. Financial institutions have a

distinct ability to bear and manage risk in a

network environment. This ability is demonstrated

in debit and credit card, electronic funds transfer

and wire transfer systems. The operating rules,

multi-lateral liability agreements, governing these

systems assign risk and loss commensurate with

ability to bear and mitigate risk. The financial

services industry also has corporate capability

developed over more than 30 years of managing

using operating rules. The financial services

infrastructure can be adapted successfully to

support safe and sound Internet buying, paying and

related information exchange.

Two sets of changes are needed to piggyback on existing financial infrastructures to support

new EC products: amendments to existing multilateral liability agreements (operating rules) and

new security mechanisms. The Federal

Government will work to support development of

these changes for defined market segments in

forums that represent buyers, sellers, and financial

intermediaries. For example, several agencies are

working under the new GSA card services contract to look at liability agreements for emerging EC

buying and paying applications. Other market segments, which require stronger authentication and

certifications, may take longer to migrate to end-to-end EC. This is because more substantial

amendments to existing risk structures, or perhaps even new risk structures, will be needed to

assure adequate protection against fraud.

Federal agencies are participating in partnerships with others who share common interests to

explore making these changes. Public-private efforts include CommerceNet and the NACHA’s Bankers

EDI Council. Agencies are working with States as well. For example, the GSA, the SSA, and others are

members of NACHA’s Internet Council, which is working with states and the private sector on assurance

For a vendor, the problem of authenticating buyers Authenticating Buyers

in cyberspace is more difficult than over the

telephone or face-to-face. The contextual clues

which the vendor instinctively uses to verify

genuine buyers are absent.

For years, passwords have been used to signify

identity in cyberspace. Though useful, passwords

alone are not adequately secure for high volume

financial operations across relatively open vendor

networks, such as to use an automated teller or

point-of-sale machine. In this case, a hardware

token such as a debit card is required to supplement

the password.

Transactions between computers process in short

time frames and can be submitted in high volumes

with high velocity. The limited memory and ease

of counterfeiting magnetic stripe cards makes them

inadequate for such an environment. For high

volume financial transactions in cyberspace, the

banking industry appears to be converging on smart

card technology -- plastic cards with microprocessing chips -- to provide secure, portable

network identification.
Electronic Commerce for Buyers and Sellers Page 28

standards for digital signatures. In addition, Treasury is working with the Banking Industry Technology

Secretariat (BITS) to develop standards for the rapidly emerging electronic money technologies. Treasury

also is collaborating with card associations and financial institutions to explore using SET to encrypt both

payments and collections. Finally, the Department of Commerce (DOC) is working with the World Wide

Web Consortium on Internet security protocols and with other industry groups.

Managing Seller Information

As a longstanding part of the contract process, Federal contractors have been required to remit data

to the government about themselves and their businesses. The information is used to determine contractor

compliance and eligibility under procurement laws, to satisfy legislative reporting requirements, and to

enable agencies to pay contractors and comply with tax laws. The Debt Collection Improvement Act

brought renewed attention to the collection of contractor information. The Act required that all vendor

payments be made electronically and that taxpayer identification numbers (TINs) be collected from all

trading partners.

Agencies currently have at least three options for managing seller information: (1) through a

central registry, in which sellers could centrally provide information for multiple-contracts; (2) through

financial intermediaries (networks), who could collectand maintain information on network members; and

(3) on a contract-by-contract basis. Agencies should consider options, including using commerciallyavailable services, in the light of their market of transactions and IT best practices. The DOD has

developed and is implementing a registration architecture and interfaces in early 1998. The Department

will add additional application functionality and consider the integration of commercial sources for this

architecture. As part of the GSA card services contract, purchase card issuers can maintain seller

information for payments made through them. Information likely will continue to be collected on a

contract-by-contract basis for many other relationships.

Contract Formation and Administration

Contract formation and administration tools can help buyers make better deals and monitor them

with less administrative burden. These tools can help vendors more easily sell their goods and services to

the government. To get good value for taxpayer dollars, a buyer (among other things) must have a keen

understanding of what the market offers, the ability to gain effective access to the marketplace, a way of

efficiently and effectively negotiating with interested sources, and the means to ensure that sellers are

keeping to the bargain during contract performance. Sellers, in turn, must be afforded easy access at

minimal cost.

While agencies have been able to make improvements, due in large part to recent statutory,

regulatory and policy changes, they continue to be hampered by the inefficiencies inherent in using paperbased processes. Keeping informed on the latest developments in the marketplace, for example, can be a

time-consuming process where surveillance must be done manually, e.g., by hand searches of paper

indices to catalogs, trade journals, or market surveys. By contrast, IT tools can give buyers the ability to

efficiently conduct sophisticated searches of a vast amount of information and to undertake the type of

product and service comparisons that form the underpinning of well-grounded, best value decisions.

Accordingly, the government will strive to take advantage of technological advances to improve how it

performs key functions of the buying and paying processes in the formation and administration of its

contracts.

On-Line Market Research
Electronic Commerce for Buyers and Sellers Page 29

Market Research

Buyers will use EC to improve their

knowledge of the marketplace. Federal

procurement offices will work to achieve this

goal by: (1) expanding use of on-line commercial

data bases and increasing buyer access to

information contained in commercial catalogs,

and (2) improving buyer ability to make

comparative analyses regarding products and

services currently available under various

government contracts and those available on the

open market.

Buyers find the growing number of Federal

and commercial electronic catalogs to be useful

research tools for learning about products and

services. As described earlier, Federal electronic

catalogs essentially are indefinite delivery

contracts that government buyers can access

electronically through use of a web browser.

Commercial catalogs are established by private sources in the marketplace to provide product and service

information and on-line ordering capabilities. Improved access to the growing number of Federal and

commercial electronic catalogs can enhance an agency’s ability to find useful, comparative information

about a broad array of products and services. Improved access to Federal electronic catalogs, in

particular, should also help buyers to take fuller advantage of the products and services already available

under contract, and avoid the waste and delay of entering into a new contract. Buying from statutorilymandated sources, such as UNICOR or JWOD, also is made easier. Representatives from selected

procuring agencies will work with industry representatives to improve the interoperability between and

among Federal and commercial catalogs.

Notice, Solicitation, Negotiation, and Award

Under the leadership of the Federal Procurement Council, Federal agencies will continue to expand

the application of EC in support of the contract formation process. These efforts include enhancing

current capabilities to provide sellers electronic notice of open market contracting opportunities above

$25,000.

One of the first larger-scale efforts to harness

the vast information on the Internet involved the

DOD’s Commercial Advocates Forum, which

created an on-line “toolbox” to assist in market

research. The toolbox contains items such as (1)

a commercial register, which identifies

information on industrial products and services as

well as specifications and availability

information; (2) a commercial catalog, which

identifies and assists in evaluating potential

sellers based on purchasing needs; and (3) a

commercial report, which offers market research

information and reports on key industries.

Information on suppliers is “hot linked” to their

catalogs. The forum also assists officials in

identifying commercial terms and conditions, and

other information, such as lessons learned and

best practices.

http://www.acq.osd.mil/ar/cadv.htm
Electronic Commerce for Buyers and Sellers Page 29

Improving access to open market contracting opportunities through the use of EC has long been,

and remains, a key government initiative. Currently, all open market contract opportunities above

$25,000 are published electronically and are available through a convenient, universally accessible,

government-wide, single point of entry, called CBDNet. CBDNet gives acquisition professionals the

ability to post notices directly to an electronic version of the Commerce Business Daily (CBD) while

providing the public access to this information free of charge. In addition, CBDNet provides three search

engines: (1) text searches, (2) field searches, or (3) searches by classification code. Finally, CBDNet

supports hot links to agency home-pages and e-mail

links to designated officials.

In an effort to distribute acquisition-related

information to industry more quickly and cheaply,

CBDNet will be enhanced. The enhancement of

CBDNet will be called "CBDPlus." CBDPlus is

the result of a progressive partnership between the

DOC, the GSA, the DOD and the NASA. CBDPlus

will be developed in phases. Phase I will provide

basic posting of solicitations and other information,

search and e-mail notification capability with

additional features added later. CBDPlus will be

modular and enhanceable as the EC needs of the

Federal acquisition and vendor community are

more clearly defined.

Internet technology permits agency personnel to communicate internally or with sellers through

secure “chat rooms” to improve the effectiveness, efficiency, and timeliness of the proposal evaluation

process. From dispersed and remote locations throughout the agency, source evaluation panel members

can conduct their independent proposal evaluations, log on and enter the designated chat room to discuss

their individual concerns. EC applications also can be used to facilitate discussions with interested

offerors.

Past Performance

Government evaluation and greater consideration of contractor past performance information in

source selection decisions is motivating sellers to meet and exceed their cost, schedule, and performance

goals. The utility of such information can be enhanced further through easier government access to such

information. For this reason, agencies are choosing to increase their use of EC in the collection and

retrieval of past performance information.

For example, the DOD is developing an integrated data environment that will allow all its

component organizations and other agencies to collect and retrieve standardized past performance

information. The DOD plans to develop its automated architecture in coordination with the development

of its contract writing system (see the building block on contract writing systems).

As another example, the National Institutes of Health (NIH) has expanded its usage of EC in the

collection and retrieval of past performance information. The NIH has been using an automated system

since 1996 to gain access to past performance information. The system is projected by Spring of 1998 to

serve 34 different government agencies with over 2,500 users with offices in all 50 states. The NIH

intends to automate its entire past performance evaluation process. Under the new automated process, a

CBDPlus

CBDPlus, the next generation of CBDNet, will

permit government buyers to post solicitations

and other information directly to the Internet

from their desktop computers. CBDPlus will

support downloading documents for local

printing and editing and will provide automatic email notification about contracting opportunities

in specific categories of interest to vendors who

have signed up to receive such information. The

CBDPlus system will have robust, free-of-charge

search capabilities.

http://cbdnet.access.gpo.gov/index.html
Electronic Commerce for Buyers and Sellers Page 30

buyer’s technical representatives will be able to enter the initial data into the system. The contracting

official then electronically will be able to: (1) confirm and complete the evaluation; (2) transmit the

evaluation to the contractor; (3) receive contractor responses; and (4) store the responses in the database.

 Automated Acquisition: Contract Writing Systems

Automated acquisition/contract writing systems are used to automate a wide variety of buyingrelated business functions. With greater workloads falling on the shoulders of a shrinking workforce

operating under tighter budgets, agencies are turning to electronic acquisition systems to reduce and

eventually eliminate inefficient and administratively burdensome paper processes. Typical contract

system functionality includes electronic assistance in:

 · development and issuance of requisitions by the program office/requiring activity to the buying

office;

 · determination if funds are available for a contract;

 · preparation of synopsis for direct transmission to CBDNet (or its successor);

 · development and issuance of solicitations as well as electronic receipt of responses;

 · preparation and issuance of award documentation; and

 • preparation of receiving reports for transmission to and review by paying offices.

With the assistance of a contract writing system (and other EC initiatives), the DOD expects that

contracting for major weapons systems will be paper-free by the year 2000. This “paper free” initiative

will include all phases of the contracting process, including contractor selection, contract writing,

contract administration, payment and accounting, auditing, and contract reconciliation and close out.

Other agencies are undertaking similar efforts. For example, the Department of the Interior expects to

have all its major buying offices fully implemented in its automated acquisition system by the end of FY

1999.

Federal System Interfaces

System interfaces are those points where software capabilities are required to allow one system to

link up electronically (couple) with another, thereby eliminating any need for manual intervention,

crosswalks or re-entry of data. Interfaces are necessary to integrate Federal systems and allow automated

processing end-to-end. End-to-end transaction processing will require interfaces: (1) between Federal

financial management systems operated by the government and systems operated by commercial service

providers to support Federal transaction processing and information needs, and (2) among Federal

systems operated by the Federal Government (either using commercially available software or

government- developed system).

Many different types of interfaces between Federal and commercial systems exist as

commercially-available software or services. Software interfaces usually are designed to reuse

information from prior activities to subsequent activities. That is, while each government or commercial

system is designed to support a limited set of activities within the broad scope of the end-to-end buying

and paying process, each system also must transfer data to other systems and receive data from other

systems as the buying and paying process progresses. Examples in buying organizations include purchase

card management systems, requisitioning and ordering systems and contract writing systems. Examples

in paying organizations include financial and cost accounting system modules, and cash management

systems. Interface services sometimes can be used in place of interface software in areas such as market
Electronic Commerce for Buyers and Sellers Page 31

research, posting and payment. Examples include catalog systems, purchase card provider systems, card

management systems, invoice processing services, and third party payment systems.

The major processes that must be linked to Federal Government systems can be grouped into

three categories: (1) buying (i.e. notices/solicitations, offering and awarding), and (2) paying (i.e.,

invoicing, third party pay services, electronic funds transfer (EFT) and Treasury checks); and (3)

combined, where both buying and paying may be handled through the same support mechanism primarily

in the area of the use of cards. These major processes or capabilities must be linked up with the various

types of agency application systems which support transaction processing, financial accountability, and

performance measurement. These systems exist to support particular functions and will need to link

electronically with commercial services to properly track transactions and to ensure adequate

accountability over taxpayer dollars. In addition, performance data will be needed to monitor

procurement activity, e.g., Federal Procurement Data System (FPDS) and systems that monitor prompt

payment or vendor activity.

Interfaces between Federal and Commercial Systems

Federal Systems

Transaction Tracking

Acquisition Accounting

Financial Accountability Performance

Information

Commercial

Services

Contractin

g

Ordering

Payables/

Disbursement

s

Property/

Inventory Travel

Fin/Cost

Accounting

Cash Mgt

(Treas) FPDS Other

Buying

Notice/

Solicitation

• • •

Offering • • •

Awarding • • •

Paying

Invoicing • •

Third Party

Pay Services

• •

EFT • • •

Treasury

Checks

• •

Combined

Card Services

Purchase • • • • •

Travel • • • •

Fleet • • • • •

Intragovernmental

• • • •

( An “•” indicates the system in the column and row header must exchange data.)

The government recognizes the challenge and opportunity Federal systems interfacing represents

for improved efficiency in the buying and paying process, and will address that issue as part of the future

growth management of Federal EC. In particular, the government will undertake the following actions to

ensure maximum benefits are derived from the initiatives in this plan.
Electronic Commerce for Buyers and Sellers Page 32

 · The CFO Council Financial Systems Committee, the Joint Financial Management Improvement

Program (JFMIP), and the EC Program Office will work in partnership with commercial systems

and service providers to define the standard interface points necessary for common data exchange

between component systems. Existing national and international standards will be used (when

possible) in exchanging data at those interface points. Industry-led consortia standards, e.g., SET,

SSL, digital encryption standard (DES), etc, also will be considered in this process. The goal is

to maximize the availability and use of commercially-developed off-the-shelf interoperable

component systems which can be modularly assembled into fuller-function procurement and

financial support systems. Priority will be on Federal systems interface agreements with

commercial transaction processors who collect, transmit, or report, information necessary for

government operations or management.

 · The CFO Council Financial Systems Committee and the JFMIP will work to take advantage of

commercially available capabilities by re-designing the Federal financial systems architectures.

New systems capability will be developed to replace or supplement existing Federal systems

capabilities to enhance interoperability of these commercial systems with existing Federal

systems.

 · Under the auspices of the PKI Steering Committee, agencies will work in partnership with

industry information technology and security experts to create and adopt standards needed to

bring Internet security for system inter-connectivity to an acceptable level of trust for interfacing

systems.

 · The EPIC will work with commercially segmented associations representing commodity groups

(e.g., automobile industry, aerospace, medical, information technology services, financial, office

supplies, etc.) where there is interest to standardize across industry lines. Where this is possible,

the government can reduce the number of interfaces needed to do business.

 In addition to these interfaces, the government must link agency systems. The myriad of existing

agency systems architectures precludes the concise presentation of a structure of electronic links among

Federal systems and extends beyond the scope of simply buying and paying. Agencies will need to both

work independently and together where there are commonalities to address these interfaces.

Collecting and Reporting Performance Information

Measuring the performance of government operations in terms relevant to the customer can help

increase public confidence in government. EC can facilitate the collection of timely, accurate and

detailed performance information by reporting performance information in an automated process,

reducing the risk of lost or erroneous data.

Automated procurement data collection systems traditionally are developed as stand alone

applications. As a result, users are forced to connect to a multitude of systems -- through unique

connections, method, interfaces, and protocols -- and re-key data already existing in other systems. In the

short run, the amount of information collected could be supplemented by techniques such as sampling.

The long term challenge is to build a framework in which necessary reporting systems are coupled

(interoperable). The ability for these systems to interface with one another would greatly enhance system

functionality and the ease of collecting performance information.

The value of reporting systems can be increased by giving managers on-line access for data

submission and retrieval throughout the procurement cycle. For example, information in the FPDS could

be used for market research. FPDS data is now available on the Internet for program managers to access.
Electronic Commerce for Buyers and Sellers Page 33

Change Management Process

No matter how great its potential,

achievement of the long-term benefits of EC will be

delayed unless there is effective management of

the transition from paper based to electronic buying

and paying processes. Change management

involves a coordinated effort by Federal agencies to

identify and leverage the common interests of

stakeholders to achieve the strategic positions

described in this EC plan. This requires leadership

across organization boundaries. Starting with the

EC plan as a road map, there are change

management functions to be fulfilled in an

organized manner by Federal and state governments and the private sector community of trading

partners. Efforts must be directed at stakeholders both within and outside government.

External Access to Markets and a Uniform Operating Environment

Two important conditions for stimulating the buy-in needed for large scale Federal EC are: (1)

the ability for sellers to have easy and less costly access to government contract opportunities; and (2) the

existence of a uniform operating environment for payment and related transaction processing.

 · The government’s continuing efforts take into account the need for easy and inexpensive access

as well as the importance of educating buyers and sellers about the government’s EC activities.

Existing government change agents will help accomplish these objectives.

 · Agencies will work in specific areas, such as intra-governmental transfers or PKI, with their

commercial counterparts to address issues related to developing a uniform operating environment.

A uniform operating environment for EC ordering and payment includes, among other things,

technical components (e.g., physical and application standards); performance requirements (e.g.,

processing times, volumes, etc.); and, privacy, liability, risk management and audit requirements

(reflecting applicable laws and regulations). For large scale transaction processing, these

components are reflected in private sector operating rules (multi-party liability agreements) that

govern the behavior of all parties to the transaction.

Several aspects of the operating environment needed to support large scale EC are a work in

progress, particularly as risk management and liability structures strive to keep pace with technological

advances. Across the Federal Government, states

and the private sector there are common interests

in speeding the development of the operating

environment in a responsible manner. States,

state trade associations and private sector trade

associations offer open forums to pursue such

operating environment issues. The large scale EC

prototypes and operations contemplated by this

plan, because of the market opportunity they

represent, can offer a useful context and timetable

for resolving issues related to the EC operating

environment. Federal Chief Financial Officers,

Existing Government Change Agents

· ARNET -- the Acquisition Reform

Network, serves as a central location for Federal

acquisition related issues for both government and

industry

· PRONet -- the Procurement Marketing

and Access Network, is a free, on-line search engine

providing access to the profiles of more than 170,000

small, disadvantaged and women owned businesses.

· ECRCs -- 16 regional EC Resource

Centers (ECRCs) within the Department of Defense

promote EC among small and medium sized businesses

by providing training and technical assistance.

Management by Association Private sector operating rules for retail and

wholesale payment processing incorporate

technical and application standards for

transactions; and roles, responsibilities,

performance criteria, liabilities and audit

requirements for the various parties involved in a

transaction. They are managed by a series of

committees, with rotating chairs, populated by

representatives of the various processing entities

and functional areas in the association. The rules

form the basis of multi-party agreements that

support operations and their structure provides a

management framework.
Electronic Commerce for Buyers and Sellers Page 34

Reduc

e

Admi

nistrat

ive

Costs

Facilit

ate

Best

Value

Buyin

g and

Payin

g

Use

Prove

n

Comm

ercial

Applic

ations

Outso

urce

Transa

ction

Proces

sing

Monit

or

Invest

ments

for

Return

s

Mana

ge the

Chang

e

Proces

s

B

ui

ld

in

g

B

Chief Information Officers, and Senior Procurement Executives involved in Federal EC projects will

work with their State counterparts to identify and capitalize on areas of common interest.

Internal Government Marketing and Management

The President’s Management Council, comprised of cabinet agency chief operating officers, has

created the Electronic Processes Initiatives Committee (EPIC). The EPIC is a functionally-integrated,

interagency body, to coordinate EC development activity across the Federal acquisition, finance and

information technology communities. The EPIC will review the current cross-functional needs of these

communities and assess the effectiveness of existing interagency bodies to meet those needs. Within the

next six months, the EPIC will develop a plan for reshaping or eliminating existing bodies and

establishing new bodies, as necessary, to facilitate government EC partnerships and successful large scale

reeingineering guided by the policy principles.

Relationship of Policy Principles and Building Blocks

Policy Principles

Key

l Strongly Supports

l Supports

Building blocks signify

identifiable groups of

activities that support

increased compliance

with policy principles

Assig

n

Liabili

ty

Based

on

Abilit

y to

Mitiga

te

Electronic Catalogs l l l l l l l

Payment Utilities l l l l l l l

Buyer & Seller ID/Authentication l l l l l l l

Planning & Contract Formation l l l l l

Contract Writing Systems l l l l l

Federal System Interfaces l l l l

Change Management l l l l l

The Track 2 scope and vision statements call for Federal EC program managers to assume a new

role and rely upon commercial transaction processing services of payment utilities. To exploit the

potential of these services, each party must be educated about the other. Agencies must be able to

access and analyze the menu of available services, across payment utilities competing for their business.

Payment utilities need a description of agency transactions, a checklist of agency service needs, and a

portrait of each agency’s systems landscape. For payment utilities to yield important value added
Electronic Commerce for Buyers and Sellers Page 35

services, agencies together must agree on and document their service needs in areas such as

intragovernmental transfers, use of electronic malls, and smart card applications. Utilties will have to

understand these value added processing needs and match them up with their own commercial product

offerings. The EPIC is establishing a group of senior technical advisors from interested agencies to

coordinate these functions within the framework of the new GSA card services contract.

Beyond the initial wave of education, operations staff at agencies and at the utilities have to hook

up new systems interfaces and manage roll out of the new services within agencies. As work proceeds

across agencies and across utilities, policy and operational guidance issues in acquisition, finance and

information technology will have to be resolved in a consistent manner and in a timely manner.

The Track 3 change management functions associated with reengineering steps in the acquisition

cycle are more developmental in nature. Transaction processing for internal acquisition cycle functions

are, at least for the time being, less like the processes supported by commercial services for ordering and

payment. More process reeingineering needs to occur. Track 3 work requires both a dedicated effort

within the acquisition community and forum for coordination across functional areas. Over the next six

months, the President’s Management Council will work with OMB and the Federal Procurement Council

to establish an acquisition cycle reengineering structure. As the acquisition cycle development effort

creates requirements, a measure of their success will be the extent to which they can be linked to

commercial service systems for ordering and payment. When considering proposed EC investments in

the budget process and in agency IT review boards, agencies and OMB will use the policy principles as

criteria for judging the merit of investments into building block activities.
Electronic Commerce for Buyers and Sellers Page 36

7. MIGRATION PATH

The EPIC will provide a forum for inter-agency coordination on the activities below. The

responsible party(ies) for each activity is (are) identified in parentheses in the description of each

activity. Progress on these activities will be reported in subsequent iterations of this plan. Given the

dynamic nature of the EC environment, these iterations will also report on changes in expected timelines.

Track One: Foster Partnerships by 1998 Estimated

Completion

Building Blocks: Change Management

1. Provide direction for agency-specific EC plans (OMB) 3rd Qtr FY 1998

2. Establish management framework to support government-wide card

service EC applications (EPIC, GSA)

3rd Qtr FY 1998

3. Develop agency-specific EC plans (PMC agencies) 4th Qtr FY 1998

4. Review mission and relationship of existing inter-agency EC groups

to EC plan (EPIC)

4th Qtr FY 1998

5. Identify acquisition cycle reengineering structure (PMC) 4th Qtr FY 1998

6. Report on status of migration path activities (OMB) 1st Qtr FY 1999

Track Two: Reengineer and Integrate High Volume Services End-toEnd by 2000

Building Blocks: Electronic Catalogs

Payment Utilities

Buyer and Seller ID/Authentication

Federal System Interfaces

Estimated

Completion

7. Establish government-wide performance measures for use of payment

utilities [e.g., purchase cards] (OMB, CFO Council)

3rd Qtr FY 1998

8. Begin using payment utilities to support standard catalog access

(EPIC, ECPO, Catalog Agencies.)

1st Qtr FY 1999

9. Begin using payment utilities to support intra-governmental transfers

(Treasury, Defense, GSA)

1st Qtr FY 1999

10. Begin using payment utilities to support Internet ID and

authentication (GITSB, PKI Steering Committee, EPIC, Selected

Agencies)

1st Qtr FY 1999

11 Develop interfaces standards between payment utilities and agency

legacy systems (CFO Systems Committee/JFMIP)

1st Qtr FY 1999

12. Conduct and evaluate EC payment pilots using next-generation

commercial technology (Treasury)

1st Qtr FY 1999
Electronic Commerce for Buyers and Sellers Page A-37

13. Implement prototype for integrated smart card EC access. (GSA,

Selected Agencies)

2nd Qtr FY 1999Track Three: Reengineer Additional Buying and

Paying Functions by 2001

Building Blocks: Electronic Catalogs

Buyer and Seller ID/authentication

Contract Formation and Administration

Contract Writing Systems

Federal System Interfaces

Estimated

Completion

14 Establish government-wide performance measures for EC (Federal

Procurement Council [FPC], with EPIC and ECPO assistance)

4th Qtr FY 1998

15 Issue plan for identifying and implementing EC applications related

to acquisition functions. (FPC, with assistance from EPIC and ECPO)

1st Qtr FY 1999

16 Issue plan for enhancing electronic catalog purchasing. (FPC, with

assistance from IAIC, ECPO and EPIC)

1st Qtr FY 1999

17 Roll-out CBDPlus (Pilot agencies) 1st Qtr FY 1999
Electronic Commerce for Buyers and Sellers Page A-38

Authentication: A security measure that verifies that an electronic data interchange message was not

tampered with or altered during transit.

Authorization: The act of insuring that the cardholder has adequate funds available against an account at

a financial institution.

Business Case: A rationale for action that includes analysis of costs and benefits over time, market

position, willingness to bear risk, and other business factors.

Cardholder: Any person who makes purchases using a purchase card.

Cryptography: The application of mathematical theories to realize a certain level of security or secrecy.

Digital Signature: A transformation of a message using an asymetirc cryptosystem (and public key

cryptography) and a hash function such that a person having the initial message and the signer’s public

key can accurately determine wheter the transformation was created using the private key that

corresponds to the signer’s public key and whether the initial message has been altered since the

transformation was made.

Electronic Catalog: A web-based electronic ordering system which involves (1) a contract with preestablished business arrangements with industry,(2) a means for the customer to identify and order goods

and services, and (3) sufficient information for the customer to compare the items offered by

performance, price and delivery.

Electronic Commerce (EC): Electronic techniques for accomplishing business transactions, including

electronic mail or messaging, World Wide Web technology, electronic bulletin boards, purchase cards,

electronic funds transfers, and electronic data interchange.

Electronic Data Interchange (EDI): The computer to computer exchange of business data in a

standardized format between Trading Partners.

Electronic Funds Transfer (EFT): The exchange of payment and remittance information electronically.

Electronic Signature: A code or symbol that is the electronic equivalent of a written signature.

Encryption: The transformation of confidential plain text into a cipher text in order to protect it.

End-to-End Services: Services that support the complete buying or paying process, from needs

assessment through final payment; usually focused on order and payment processing.

Federal Procurement Data Center (FPDS): Established by the Office of Federal Procurement Policy

Act as the central repository of information on federal contracting.
Electronic Commerce for Buyers and Sellers Page B-39

Intranet: A proprietary network that uses Internet Protocol for communications.

Internet: A data infrastructure that connects computers via telecommunication networks. It is estimated

that in 1995 the Internet consists of over 120,000 host computers connecting more than 40 million users

through 70,000 networks. Today, an estimate 58 million users in North America access the Internet

Internet Commerce: Business transactions conducted on the Internet

Intra-Governmental Transfer: A transfer between two different budgetary accounts in the Federal

Government that occurs outside of a single general ledger system.

Market Opportunities: Opportunities to send signals into the marketplace about a product, service or

market segment that have a good chance of changing market position of that product, service or market

segment.

Payment Utility: Commercial entities that provide common financial services including

authorization control, transaction processing, reconciliation, and reporting.

Private Key Cryptography: Cryptography using symmetric keys, or the same key for encryption and

decryption.

Public Key Cryptography: Cryptography using asymmetric keys, or different keys for encryption and

decryption.

Purchase Card: A charge card product oriented towards institutional (business) customers.

Remittance: The process of identifying the purpose of a payment and detail about the payment, such as

with a remittance stub included with a check for bill payment.

Smart Card: A plastic card in which is embedded an IC chip and has both data-processing and storage

functionality.

System Interface: The link between two computer systems.

Trading Partners: Commercial entities that do business with each other using EDI.

Transaction: A generic term used to describe any step or set of steps, usually grouped together for legal,

processing, selection or liability purposes, in the end-to-end processing of orders and payments.
Electronic Commerce for Buyers and Sellers Page B-40

APPENDIX B: ABBREVIATIONS
APPENDIX C: CONTRIBUTORS

Electronic Commerce for Buyers and Sellers Page C-41

ACH -- Automated Clearing House

ADP -- Automated Data Processing

ARNET -- Acquisition Reform Network

BITS -- Bankers Industry Technology Secretariat

BPA -- Blanket Purchase Agreement

CBD -- Commerce Business Daily

CFO -- Chief Financial Officer

CIO -- Chief Information Officer

DES -- Digital Encryption Standard

DOC -- Department of Commerce

DOD -- Department of Defense

EBT -- Electronic Benefits Transfer

EC -- Electronic Commerce

ECPO -- Electronic Commerce Program Office

EDI -- Electronic Data Interchange

EFT -- Electronic Funds Transfer

EPIC -- Electronic Processes Initiatives

Committee

FASA -- Federal Acquisition Streamlining Act

FPC -- Federal Procurement Council

FPDS -- Federal Procurement Data System

GITSB -- Government Information Technology

Services Board

GMRA -- Government Management Reform Act

GPRA -- Government Performance and Results

Act

GSA -- General Services Administration

IAIC -- Inter-Agency Internet Council

ID -- Identification

IDIQ -- Indefinite Deliery, Indefinite Quantity

IRS -- Internal Revenue Service

IT -- Information Technology

JFMIP -- Joint Financial Management

Improvement Program

NACHA -- National Automated Clearing House

Association

NASA -- National Aeronautics and Space

Administration

NIH -- National Institutes of Health

OMB -- Office of Management of Budget

PBSC -- Performance-Based Service Contracting

PMC -- President’s Management Council

PIN -- Personal Identification Number

PKI -- Public Key Infrastructure

SET -- Secure Electronic Transaction

SSA -- Social Security Administration

SSL -- Secure Socket Layer

TIN -- Taxpayer Identification Number

Treasury -- Department of the Treasury
APPENDIX C: CONTRIBUTORS

Electronic Commerce for Buyers and Sellers Page C-42

This report is a result of the dedication and

hard work of many contributors. The

Electronic Processes Initiatives Committee

(EPIC) principals and their senior staff on the

EPIC support group charted the course,

reviewed the draft reports and provided

valuable input. Staff from the Office of

Management and Budget (OMB) prepared the

draft based on input and advice from a wide

range of Federal contributors.

OMB Staff Writers

James Bessin, Office of Federal Financial

Management

Allan Brown, Office of Federal Procurement

Policy

Mathew Blum, Office of Federal Procurement

Policy

Linda Mesaros,Office of Federal Procurement

Policy

Jack Radzikowski, Office of Federal Financial

Management

EPIC Support Group

Ron Adolphi, Department of Defense

Allan Brown, Office of Management and Budget

Kim Corthell, Department of Defense

Don Hammond, Department of the Treasury

Sky Lesher, Chief Financial Officers Council

Jack Radzikowski, Office of Management and

Budget

Tom Stack, Office of Management and Budget

Marty Wagner, General Services Administration

Agency Contributors

Karen Alderman, Joint Financial Management

Improvement Program

Ken Carfine, Department of the Treasury

Elizabeth Cowan, Joint Financial Management

Improvement Program

Benjamin Davis, Department of Defense

Manny DeVera, Department of Defense

Tim Fain, Office of Management and Budget

Brian Fisher, Office of Management and Budget

Paul Fontaine, General Services Administration

Ron Good, Department of Defense

Paul Grant, Department of Defense

Kathy Hollis, Department of Defense

Wiley Horsley, Department of Interior

LTC Dave Kerrins, Department of Defense

Donna Kotelnicki, Department of the Treasury

Roger Kurland, Department of State

Sky Lesher, Department of Interior

Jack MacGuire, Department of the Treasury

Bruce McConnell, Office of Management and

Budget

John McMonigle, Department of Defense

Mike Mestrovich, Department of Defense

Harry Pape, Department of Defense

Nancy Provenzano, Department of the Treasury

Steve Schooner, Office of Management and

Budget

Deborah Sonderman, Department of Interior

Ken Stepka, National Aeronautics and Space

Administration

Robert Suda, General Services Administration
APPENDIX C: CONTRIBUTORS

Electronic Commerce for Buyers and Sellers Page C-43

Ron Taylor, General Services Administration

David Temoshok, General Services Administration

Greg Till, Department of the Treasury

Tony Trenkle, General Services Administration

Ida Ustad, General Services Administration

Peter Weiss, Office of Management and Budget

Steve Willett, Department of Commerce

Jerry Williams, Department of Defense