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TIME TO REFORM IT ACQUISITION: THE FEDERAL 

IT ACQUISITION REFORM ACT 

HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 27, 2013 

Serial No. 113–42 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

JOHN L. MICA, Florida 

MICHAEL R. TURNER, Ohio 

JOHN J. DUNCAN, JR., Tennessee 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

TREY GOWDY, South Carolina 

BLAKE FARENTHOLD, Texas 

DOC HASTINGS, Washington 

CYNTHIA M. LUMMIS, Wyoming 

ROB WOODALL, Georgia 

THOMAS MASSIE, Kentucky 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

KERRY L. BENTIVOLIO, Michigan 

RON DESANTIS, Florida 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

JACKIE SPEIER, California 

MATTHEW A. CARTWRIGHT, Pennsylvania 

MARK POCAN, Wisconsin 

TAMMY DUCKWORTH, Illinois 

ROBIN L. KELLY, Illinois 

DANNY K. DAVIS, Illinois 

PETER WELCH, Vermont 

TONY CARDENAS, California 

STEVEN A. HORSFORD, Nevada 

MICHELLE LUJAN GRISHAM, New Mexico 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

STEPHEN CASTOR, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

(III) 

C O N T E N T S 

Page 

Hearing held on February 27, 2013 ....................................................................... 1 

WITNESSES 

Mr. Richard A. Spires, Chief Infomation Officer, U.S. Department of Home 

Security 

Oral Statement ................................................................................................. 7 

Written Statement ............................................................................................ 9 

Ms. Cristina Chaplain, Director of Acquisitions and Sourcing Management, 

Government Accountability Office 

Oral Statement ................................................................................................. 16 

Written Statement ............................................................................................ 18 

Mr. Daniel L. Gordon, Associate Dean for Government Procurement Law 

Studies, George Washington University 

Oral Statement ................................................................................................. 34 

Written Statement ............................................................................................ 36 

Mr. Stan Soloway, President and CEO, Professional Services Council 

Oral Statement ................................................................................................. 42 

Written Statement ............................................................................................ 45 

Mr. Paul Misener, Vice President, Global Public Policy, Amazon 

Oral Statement ................................................................................................. 54 

Written Statement ............................................................................................ 56 

APPENDIX 

The Hon. Elijah E. Cummings, a Member of Congress from the State of 

Maryland, Opening Statement ............................................................................ 90 

The Hon. Gerald E. Connolly, a Member of Congress from the State of 

Virginia, Opening Statement .............................................................................. 92 

IT–AAC Assessment of Draft Federal IT Acquisition Reform Act (FITARA) ..... 94 

The Perenial IT Acquisition Challenge .................................................................. 95 

(1) 

TIME TO REFORM IT ACQUISITION: THE 

FEDERAL IT ACQUISITION REFORM ACT 

Wednesday, February 27, 2013. 

HOUSE OF REPRESENTATIVES, COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, Washington, D.C. 

The committee met, pursuant to notice, at 9:30 a.m. in room 

2154, Rayburn House Office Building, the Honorable Darrell E. 

Issa [chairman of the committee], presiding. 

Present: Representatives Issa, Cummings, Mica, Farenthold, 

McHenry, DesJarlais, Lankford, Walberg, Turner, Lummis, 

Connolly, Cardenas, Horsford, Davis, Tierney, Duckworth, Pocan, 

Grisham, Duncan and Amash. 

Staff Present: Ali Ahmad, Majority Communications Advisor; 

Richard A. Beutel, Majority Senior Counsel; Robert Borden, Majority General Counsel; Molly Boyl, Majority Parliamentarian; Lawrence J. Brady, Majority Staff Director; Sharon Casey, Majority 

Senior Assistant Clerk; John Cuaderes, Majority Deputy Staff Director; Gwen D’Luzansky, Majority Research Analyst; Linda Good, 

Majority Chief Clerk; Mark D. Marin, Majority Director of Oversight; Peter Warren, Majority Legislative Policy Director; Rebecca 

Watkins, Majority Deputy Director of Communications; Meghan 

Berroya, Minority Counsel; Krista Boyd, Minority Deputy Director 

of Legislation/Counsel; Jennifer Hoffman, Minority Press Secretary; 

Carla Hultberg, Minority Chief Clerk; Elisa LaNier, Minority Deputy Clerk; Dave Rapallo, Minority Staff Director; Rory Sheehan, 

Minority New Media Press Secretary; Mark Stephenson, Minority 

Director of Legislation; and Thomas Cecelia, Minority Counsel. 

Chairman ISSA. The committee will come to order. 

I will read the Oversight Committee’s mission statement. We 

exist to secure two fundamental principles. First, Americans have 

a right to know the money Washington takes from them is well 

spent. And second, Americans deserve an efficient, effective Government that works for them. 

Our duty on the Oversight and Government Reform Committee 

is to protect these rights. Our solemn responsibility is to hold Government accountable to taxpayers because taxpayers have a right 

to know what they get from their Government. We will work tirelessly in partnership with citizen watchdogs to deliver the facts to 

the American people and bring genuine reform to the Federal bureaucracy. 

Today, in order to move that purpose forward, we hold the second Full Committee hearing this year concerning Federal Government’s approximately $80 billion Information Technology Budget. 

2 

We are all well aware that the Government Accountability Office 

and others have repeatedly identified problems and challenges in 

the area and this hearing is continuation toward a grand solution. 

One solution at the center of our discussion today is the draft IT 

Acquisition Reform legislation I posted on the Committee’s website 

last fall. In recent months, we have received generous feedback on 

the draft bill from more than a dozen parties, actually more than 

20 parties, some of them here today. 

We are going to continue with that feedback and continue having 

the public know what the feedback is. Ultimately, getting the 

whole system right requires not just that people tell us how to improve it, but that the rest of the public sees what we are being told 

and can further comment. We believe that this open dialogue is the 

best way, once and for all, to prove to the public that in the light 

of day, in clear transparency, we can, in fact, find the best of all 

suggestions, evaluate them, have our evaluations public and then, 

ultimately, produce better legislation. 

A number of things that we have come, or this Chairman has 

come to believe, every agency needs one Chief Information Officer 

who is clearly in charge. There are 243 CIOs in 24 major agencies. 

The Department of Transportation alone has 35 CIOs. That does 

not mean that the job is to layoff 34 CIOs. But there has to be a 

structure including a chain of command and including real authority to spend the money better, to be held accountable for that 

money and ultimately what budget authority needs and a CIO 

needs is to stop quickly when that money clearly is not being as 

well spent as was anticipated. The nature of why we have administration is not simply to spend the money that Congress allocates, 

but rather to spend it better than could be possibly considered at 

the beginning of the project. 

The third point that we have come to believe is that consolidated 

resources and expertise make smarter purchases. That does not 

mean that it needs to be consolidated in one place. But for any 

given area of expertise there needs to be a best of that you go to. 

Accomplishing these major reforms will not be easy. It will not be 

done on a partisan basis. It will not be done only in the House of 

Representatives. At the heart of the effort is, in fact, the open dialogue about how we produce effective spending but not so we buy 

IT for a few dollars less, but, in fact, so that we can protect taxpayer dollars from further waste, fraud, and abuse and mismanagement. 

Ultimately, IT is the tool to save and to better spend $3.5 trillion, not about the $80 billion that we spend on IT. 

And with that, I am please to recognize the Ranking Member for 

his opening statement. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman, and I 

want to thank you for holding this hearing today and picking up 

where you left off. 

What you are talking about, Mr. Chairman, is effectiveness and 

efficiency. And I think that is a good, those are good words to capsulize what we are trying to do here. Holding this hearing today 

on the need to reform Government’s information technology and acquisition policy is so very important. And I certainly commend you 

on your bipartisan approach to developing the legislation we are 

3 

considering today, the Federal IT Acquisition Reform Act, and I appreciate that you made a draft of the bill publicly available for comment. 

I also want to recognize Representative Gerry Connolly, the 

Ranking Member of the Government Operations Subcommittee, for 

his critical work on these technology issues. Back in May of 2012, 

we held a forum in his district. It was well attended and it was one 

that yielded a lot of very valuable information and I know that he 

was very pleased, and I was very pleased, to be a part of that. 

A significant portion of the Federal IT Acquisition Reform Act is 

based on Ranking Member Connolly’s legislation on consolidating 

Federal data centers and I appreciate you making sure that, again, 

this is a bipartisan effort. I agree with both you, Mr. Chairman, 

and Ranking Member Connolly that reforms are needed to ensure 

that the Federal Government is making wise and efficient investments in information technology. Every full Committee hearing so 

far in this Congress has focused on wasteful spending, including 

some in IT investments. 

Two weeks ago, the Government Accountability Office issued its 

newest high risk report which includes several IT investments. For 

example, the Department of Defense has contracts for a number of 

enterprise resource planning systems to modernize the management of logistics, finances and business operations. GAO and the 

Pentagon’s Inspector General have found that many of these contracts are behind schedule and significantly over budget. For instance, a contract to streamline the Army’s Inventory of Weapons 

System is unbelievably 12.5 years behind schedule. That is simply 

incredible. And, almost $4 billion over budget. 

Effective oversight is one of the best weapons against this kind 

of wasteful spending. Congress has a duty to conduct oversight as 

well as an obligation to give agencies the tools they need to conduct 

their own oversight. Agencies need more well-trained acquisition 

personnel to effectively oversee complex systems and to ensure that 

the Government is a smart and diligent consumer. The Federal IT 

Acquisition Reform Act recognizes this need. 

Congress must also ensure that agencies have the resources to 

hire and retain acquisition professionals. Almost every witness we 

hear from today will testify that the acquisition workforce is critical to ensuring that the Government is spending its money wisely. 

However, just two weeks ago the House voted to extend the 

freeze on Federal employee pay for a third consecutive year. And 

even worse, at the end of this week, hundreds of thousands of employees, including critical acquisition workforce personnel across 

every agency, will face furloughs as a result of the indiscriminate 

across-the-board cuts to agency budgets imposed by this sequester. 

We need these employees. Instead of repeatedly attacking these 

key Federal workers, Congress should be pursuing ways to retain 

their expertise, train them in the most cutting edge techniques, 

and support their critical work. If we do that, it will pay for itself 

over and over and over again. 

So, I want to thank each of our witnesses for testifying today. I 

look forward to hearing your thoughts on how Congress can most 

effectively and efficiently modernize the way the Government does 

business and save taxpayers money. 

4 

And again, Mr. Chairman, I want to thank you. And I yield back. 

Chairman ISSA. I thank the gentleman. 

We now recognize the Chairman of the Subcommittee, the gentleman from Florida, Mr. Mica. 

Mr. MICA. Thank you, Mr. Chairman, and thank you, Mr. 

Cummings, for holding this hearing. And it is extremely important, 

especially as we face in the next matter of hours, almost now, a 

very difficult time with our Nation’s finances, looking for ways to 

cut spending, to eliminate waste, fraud and abuse, that we focus 

on the dysfunctional manner in which Government agencies acquire essential resources such as the very basic tools that we have 

in our operations today, our Government operations, of computers, 

software, business systems which are absolutely essential to efficiently run Government. 

It does not appear that just throwing money at these problems 

or spending is, or lack of spending, that is the issue. In fact, between Fiscal Years 2002 and 2012, we grew from about one-quarter 

of a trillion to half a trillion dollars. The spending went from $264 

billion to $514 billion. So, half a trillion dollars is a significant 

amount of money. 

But I think what we will hear today, too, and I hope with Mr. 

Connolly, working with him, to drill down and look at some of the 

instances where we can and we must do a better job, but there are 

instances of again, wasteful approaches. And we will hear today 

from GAO, they found that in almost all cases in which IT investments are underperforming, the lack of overall skills and experience of the government-led program management team is the underlying issue. And I think that it is something that we are going 

to focus on. 

Another area that interests me, coming from the private sector, 

you could never operate a business the way we do Government and 

these Government agencies. But I would like to look in depth with 

Mr. Connolly and the Committee on duplicative IT operations. In 

fact, we will hear today that GAO reports in Fiscal Year 2011, our 

Government funded the acquisition of 622 separate human resources systems at a cost of $2.4 billion, 580 financial management 

systems at a cost of $2.7 billion, 777 supply chain management systems at a cost of $3.3 billion, and the list continues. Most of these 

back office systems perform the same function. 

And I think it is important, the Chairman has worked on this, 

the Committee has worked on this, he has proposed legislation that 

has lagged in adoption and it can solve some of these problems. We 

will hear more details from some of our witnesses today, work with 

them, and hopefully we can get this legislation moving and adopt 

the reforms that are necessary to correct the problems that will be 

exposed here again today in this hearing. 

Thank you again. I yield back the balance of my time. 

Chairman ISSA. I thank the gentleman. 

We now recognize the gentleman from Northern Virginia, Mr. 

Connolly. 

Mr. CONNOLLY. Thank you, Mr. Chairman, and I want to thank 

you, and I particularly want to thank the Ranking Member, Mr. 

Cummings, for his very gracious remarks. 

5 

I find myself in full agreement with everything you have said 

this morning, Mr. Chairman, Mr. Mica has just said and Mr. 

Cummings has said. When it comes to Federal management of IT, 

I am reminded of John Kennedy’s slogan in his first race for the 

Senate, the United States Senate in my home State of Massachusetts. His slogan was we can do better. And when it comes to the 

management of Federal IT, we can and must do better, whether it 

is commercial, off-the-shelf IT product management or major mission critical custom IT programs. 

Today, Federal IT acquisition is a cumbersome, bureaucratic and 

wasteful, often wasteful, exercise. In recent decades, taxpayers 

have watched tax dollars evaporate into massive IT program failures that pair staggeringly high costs with astonishingly poor performance. The Air Force, for example, invested six years in a modernization effort that cost over $1 billion but failed to deliver a usable product, prompting the Assistant Secretary of the Air Force to 

state, I am personally appalled at the limited capabilities that that 

program has produced relative to the amount of investment. 

The bottom line is all of us should be appalled at that kind of 

performance and it is sadly not limited to the U.S. Air Force. Massive IT program failures have real consequences for the safety, security and financial health of our Nation. From census handheld 

computers that jeopardized a critical Constitutional responsibility 

to promised electronic fences that never materialized, costs of IT 

failures cripple an agency’s ability to implement long-term strategic 

goals. 

For instance, the Office of Personnel Management dramatically 

reduced its claims processing staff in anticipation of completing its 

retirement systems modernization program, promising enhanced 

automated capabilities. Unfortunately, when OPM was finally 

forced to kill this IT program, the agency was left flat footed, without the resources or manpower to process retirement claims, forcing thousands of Federal retirees to experience outrageously long 

waits to receive their benefits. 

Nearly 17 years after enactment of the seminal Clinger-Cohen 

Act, it is clear that agency Chief Information Officers often lack the 

necessary authority and resources to effectively analyze, track and 

evaluate the risks and results of major IT programs. And here I 

echo what the Chairman has indicated. We have to have somebody 

who has the authority and responsibility centrally in each agency 

to manage these IT programs and investments. 

The GAO has found that many agencies struggle to maintain accurate costs and schedule data from Federal IT investments, undermining transparency and accountability while rating a questionably low percentage of IT programs as high or moderately high 

risk. Yet, the Department of Defense actually does not rate a single 

DOD IT investment as either high or moderately high risk. Not 

passing the giggle test. Meanwhile, independent research conducted by the nonprofit institute Defense Analyses found that DOD 

struggled to manage major IT modernization programs for nearly 

15 years. 

With respect to commercial off-the-shelf IT products, I am talking about email and other commercial business systems software 

that could purchase on Amazon.com, far too many agencies have 

6 

spent precious dollars and time creating duplicative, wasteful contracts for products and licenses the departments already own. 

The status quo is unacceptable and unsustainable, especially in 

light of what Mr. Mica referred to as the pending sequestration cliff 

here. That is why I am glad to be working with Chairman Issa and 

his staff to develop the Federal Information Technology Acquisition 

Reform Act, along with Ranking Member Mr. Cummings, to enhance IT procurement policy. 

Addressing Federal IT acquisition policy in a bipartisan manner 

is precisely the type of important substantive work this Committee 

should be conducting and I very much appreciate the outreach and 

the willingness on both sides of the aisle to listen and to refine this 

legislation to try to make sure we get it right. When we are investing $81 billion every year in Federal IT procurement, we have got 

to get it right, especially as we look at fewer resources overall in 

the coming decade. 

Mr. Chairman, I look forward to continuing to work with you and 

your staff and I thank you very much for holding this hearing. 

Chairman ISSA. I thank the gentleman. 

Members will have seven days to submit opening statements for 

the record. 

We now welcome our panel of witnesses. 

Mr. Richard Spires is Chief Information Officer at the Department of Homeland Security and Chairman of the DHS Chief Information Officer Council and Enterprise Architecture Board. Now, 

that is a long title, but we welcome you back. 

Ms. Cristina Chaplain is the Director of Acquisitions and 

Sourcing Management at the General Accountability Office. Mr. 

Daniel Gordon is the Associate Dean for Government Procurement 

Law Studies at George Washington University. Mr. Stan Soloway 

is President and CEO of Professional Services Council. 

And Mr. Paul Misener is Vice President of Global Public Policy 

for Amazon, previously mentioned as a place that we could buy 

software off the shelf. 

And with that, consistent with the rules of the Committee, I 

would ask that you all rise to take the oath. And raise your right 

arms. 

Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth and nothing but 

the trust? 

[Witnesses respond in the affirmative.] 

Chairman ISSA. Let the record reflect that all witnesses answered in the affirmative. 

This is a fairly large panel. Some of you are returning veterans, 

so you know the drill. Green light, yellow light, red light. By the 

time it gets to red light, I hope you are saying for the final time, 

and my final point is. 

[Laughter.] 

Chairman ISSA. Mr. Spires? 

7 

WITNESS STATEMENTS 

STATEMENT OF RICHARD A. SPIRES 

Mr. SPIRES. Good morning. Chairman Issa, Ranking Member 

Cummings and Members of the committee, thank you for the opportunity to discuss how the Federal Government invests in information technology to increase the efficiency and effectiveness of our 

Government. 

As a CIO of Homeland Security and the Vice Chair of the Federal CIO Council, I speak from real world experience on the challenge of delivering highly-effective IT across the Federal Government. At DHS, we have made significant strides in IT in four key 

areas. 

First, we are rationalizing our IT infrastructure. So far, we have 

closed 16 data centers as part of our data center consolidation initiative, resulting in an average savings of 14 percent. We are aggressively expanding the use of cloud computing across DHS by 

rolling out 11 cloud service offerings. In addition, we have significantly improved our cyber security posture through the established 

of inherited security controls in our data centers. 

Second, we are improving program management by instituting a 

rigorous review process of our IT portfolio and implementing a 

number of initiatives to improve oversight, more effectively engage 

key stakeholders and ensure best practices are used in running our 

programs. 

Third, we are leveraging IT across DHS to support more effective 

mission outcomes. Through the use of the DHS enterprise architecture and the implementation of portfolio governance, we are working to draw synergies from amongst DHS components that improve 

efficiency and effectiveness, eliminate system duplication and 

streamline processes. 

And fourth, we are focusing on IT staff and talent development. 

By establishing IT specific career paths, DHS can more formally 

address how new workers can progress along a technical or managerial career track. We are currently working to leverage DHS developmental, mentoring and rotational programs into this strategy. 

Even with the successes outlined above, there are also evolving 

and increasing expectations from mission customers and external 

stakeholders. We need to, and we can, manage IT more effectively. 

I see three root causes that are barriers to having Federal IT be 

on a par with leading private sector firms. 

First, we must standardize our IT infrastructure. An agency with 

a modern, homogenous infrastructure could save as much as 30 

percent on its infrastructure costs, field applications more quickly 

and less costly, and provide improved IT security. Given the structure of agency budgets in organizations, it is very difficult for an 

agency CIO to have the tools needed to drive such standardization. 

To address this root cause, I recommend we review the model 

used by the Department of Veteran Affairs where the IT organizations have been consolidated and consider its applicability on a 

broader basis within the Federal Government. Further, I recommend we implement an IT acquisition review process in which 

all IT procurements must be reviewed by the agency CIO. This will 

8 

help ensure that IT procurements meet architecture guidelines, are 

not duplicative and are properly staffed. 

As a second root cause, we must do more to develop and retain 

the skills it takes to run and manage IT programs. The common 

denominator for successful program execution is a solid program 

management office. To support this, I recommend we establish a 

program management center of excellence staffed by detailees from 

agencies which would harness best practices, tools, templates and 

training courses and drive the development of Federal-wide capabilities that programs can leverage. 

Third and finally, we must find ways to institutionalize flexibility 

to implement IT best practices. Agencies leaderships’ need for 

speed and agility has far outstripped the procurement and finance 

models in place in the Federal Government today. 

I recommend that we establish a Federal IT strategic sourcing 

organization. This organization, again supported by detailees from 

agencies, would be dedicated to IT’s strategic sourcing opportunities for Government-wide buying of IT hardware, software and 

services. We can bolster that organization through oversight provided by the newly-formed Strategic Sourcing Leadership Council. 

Finally, we need to reduce impediments to innovation by more 

fully leveraging existing initiatives to include a digital Government 

strategy and the use of such prize competitions to reward vendor 

innovation in helping us solve Government problems. 

Mr. Chairman, I am serving as a CIO today because IT can so 

meaningfully and measurably improve the mission and business effectiveness of our Government. 

Thank you for the opportunity to speak to you today and I look 

forward to your questions. 

[Prepared statement of Mr. Spires follows:] 

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Mr. FARENTHOLD. [Presiding] Thank you, Mr. Spires. Right on 

time. 

We now go to the Director of Acquisition and Sourcing Management of the GAO, Ms. Cristina Chaplain. 

Ms. Chaplain. 

STATEMENT OF CRISTINA CHAPLAIN 

Ms. CHAPLAIN. Thank you Mr. Chairman, Ranking Member 

Cummings and Members of the Committee. Thank you for inviting 

me today to discuss the proposed FITARA Act and how our best 

practice work reflects that act. 

Our best practice work provides a roadmap for overcoming acquisition problems experienced by IT and any other technology-intensive acquisitions such as weapons and space programs. At the tactical level, we have identified the basic ingredients for success on 

individual programs, such things as defining requirements early 

on, providing realistic cost estimates, and using prototypes to reduce risks. 

At the strategic level, we have identified protocol enablers for 

success such as having the right training and support for program 

mangers and having the right visibility over an investment portfolio and strategies that make tough trade-off decisions based on 

cost benefits and risks. 

FITARA emphasizes several of the enablers I have just mentioned. It also emphasizes the use of strategic sourcing, which is 

another enabler for generating procurement savings. I want to discuss this just a little bit because it is important. The Government 

is very far behind the private sector in this regard. 

As you know, strategic sourcing seeks to move an organization 

away from numerous individual procurements to a broader aggregate approach. Currently, Federal agencies act more like unrelated 

medium-sized businesses and often rely on hundreds of separate 

contracts for many commonly used items with prices that widely 

vary, including IT. 

Our work has shown that strategic sourcing has a potential to 

generate 10 to 20 percent savings for procurement spending and 

the companies that we studied strategically sourced the vast majority of their procurement dollars. By contrast, four large agencies we 

studied strategically sourced just 5 percent of their procurement 

dollars taken together. 

In addition, Federal agencies have been focused on strategically 

sourcing less complex acquisitions, such things as office supplies, 

telecommunications and delivery services. They generally do not 

believe more complex services and goods can be strategically 

sourced because of unique requirements, among other reasons. 

However, the companies we have studied have found ways to strategically source these types of items and services. 

Also, while some believe we have picked the low hanging fruit for 

strategic sourcing and cannot go further in the Federal arena, we 

have found pockets of success, notably with DHS and the Defense 

Logistics Agencies. For example, in Fiscal Year 2011, DHS had reported that it implemented 42 department-wide initiatives that 

covered 270 products and services ranging from software to profesVerDate Aug 31 2005 09:15 Aug 07, 2013 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 C:\DOCS\82274.TXT APRIL
17 

sional and program management support services. These efforts led 

to reported savings of $324 million. 

My written statement does focus mostly on strategic sourcing but 

I would like to emphasize that many of the other leading practices 

we have identified over the years have not taken root in the Federal arena. Short tenure of acquisition leaders, for instance, still 

seems to be an issue as well as the authority for program managers and, in this case the CIOs. There are also those basic ingredients for success we do not see fully taking hold yet, such things as 

defining requirements before you start programs, realistically 

meeting costs and providing good oversight. 

In conclusion, best practices can be introduced into the Government setting, but we know they do not always take hold. What 

threatens tactics like strategic sourcing the most is a lack of leadership, a lack of data and metrics, a desire to maintain control, a 

lack of incentives and weak enforcement. Reform sometimes end up 

adding new layers of oversight and bureaucracy rather than 

streamlining and simplifying and for this reason it is important 

that implementation be closely monitored, that early successful 

adopters be recognized, that incentives and disincentives be continually assessed and that leaders be held accountable for success. 

This concludes my statement. I am happy to answer any questions you have. 

[Prepared statement of Ms. Chaplain follows:] 

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Mr. FARENTHOLD. Thank you very much, Ms. Chaplain. We will 

get to the questions after all of the witnesses. 

Our next testimony will be from the Honorable Daniel Gordon. 

He is the Associate Dean for Government Procurement Law Studies at the George Washington University School of Law and the 

former Administrator, the Office of Federal Procurement Policy 

with the OMB. Mr. Gordon? 

STATEMENT OF DANIEL L. GORDON 

Mr. GORDON. Mr. Chairman, Ranking Member Cummings, Members of the Committee, good morning. I am grateful for the opportunity to testify before you today regarding the reform of Federal 

IT acquisition. 

This is the first time that I am testifying before this Committee 

not as a Federal employee but as the Associate Dean for Government Procurement Law Studies at The George Washington University Law School. As you know, GW Law’s Government Procurement 

Law Program has, for more than 50 years, been the premiere 

venue for the studying and teaching of procurement law in this 

Country. And I am pleased that we have both students and alumns 

of our program in the room this morning. 

Let me begin by commending you for focusing on improving the 

way the Federal Government buys IT goods and services. Despite 

the criticism and the obstacles you may face down the road, I am 

confident that we can improve the way the Government buys IT. 

You are particularly to be commended for your willingness to get 

input, what I think the Chairman referred to as generous feedback, 

from the many and varied stakeholders in this complex area. 

We at GW Law School hosted a symposium about this very draft 

bill last October 18th and we heard at that symposium the range 

of views that you have heard in your hearings and your other outreach. I hope as the bill moves forward you will continue to listen 

to the stakeholders and I hope this will be a genuinely bipartisan 

effort. 

With respect to the bill, my written statement includes comments 

on various provisions. I am happy to address them in question 

time. Let me highlight a couple of points here. 

First, strengthening the acquisition workforce of the Federal 

Government. I applaud the draft bill for drawing attention to the 

continuing need to strengthen and invest in our Federal acquisition 

workforce such as the provisions on the IT acquisition cadres and 

a more secure source of funding for them. 

It was striking to me that in last month’s hearing before this 

Committee, private sector witnesses talked about the importance 

that they attach to demonstrating to their employees how much 

they are valued. No successful company would treat its employees 

the way Federal employees have been treated recently, repeated 

pay freezes, threats of unpaid furlough days and general disrespect, 

as if our employees were causing our Nation’s fiscal imbalances. 

Second, reducing wasteful duplication in IT investment and contracts. During my service as Administrator for Federal Procurement Policy, I saw example after example of multiple agencies, and 

sometimes multiple components within a single agency, spending 

35 

time and resources creating duplicative contracts for the same 

goods or services. 

It is for that reason that I am particularly supportive of the draft 

bill’s effort to support strategic sourcing and to require that agencies establish a business case before they issue a solicitation that 

would create a new contract for goods or services already available 

under existing interagency contracts. And for the same reason, I 

support the draft bill’s effort to increase the transparency of blanket purchase agreements. 

Apart from these comments on the draft bill’s provisions, allow 

me to briefly mention a couple of additional factors that I think 

that you will want to keep in mind as you move forward. 

First, there are limits to what legislation can do in this area. The 

problems that plague large Federal IT projects, in particular, are 

often the result of management weaknesses in both acquisition 

planning and contract management. And they may not lend themselves to improvement through legislation. 

Second, the Federal Government should learn from industries’ 

practices but it cannot always copy them. We all agree the Federal 

Government should be focused on low prices and high quality, just 

like private companies. Unlike private companies though, Federal 

agencies have to ensure competition, transparency and small business participation that our laws require and that our citizens expect from the Government. 

In addition, Federal agencies face some unique obstacles. As 

members of this Committee well know, we generally insist on agencies using one year appropriations in their IT acquisitions, a constraint that no private company has to deal with. I will not go on 

and talk about the impact of continuing resolutions and sequestration that is certainly an obstacle private companies do not face. 

In conclusion, and the final point, many of the challenges before 

this Committee are genuinely difficult and it is best to proceed 

with caution. Legislation can be a blunt instrument and there is a 

risk that even the best intentioned legislation will lead to unintended and undesirable consequences. 

But in conclusion, let me again commend you for your work in 

this important but challenging area and thank you for the opportunity to appear before you today. I look forward to questions. 

Thank you. 

[Prepared statement of Mr. Gordon follows:] 

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Mr. FARENTHOLD. Mr. Gordon, thank you very much. 

We will now go to our next witness, Mr. Stan Soloway. He is the 

President and CEO of the Professional Services Council. Mr. 

Soloway? 

STATEMENT OF STAN SOLOWAY 

Mr. SOLOWAY. Mr. Chairman, Mr. Cummings, on behalf of the 

360 member companies of the Professional Services Council and 

their hundreds and thousands of employees across the Nation, we 

want to thank you for the opportunity to share our thoughts with 

you this morning. 

The legislation before us is both timely and important. And while 

we do have some concerns with the current draft, we strongly support its focus and intent and look forward to working with the 

Committee on further refinements. 

Clearly, the time is right for a thorough review of the progress 

that has been made, or not, and of the ways in which we can rapidly and effectively ensure even greater progress in the future to 

foster an environment that enables the Government to access the 

best and most innovative solutions at the best possible price while 

also enabling this critical industry to continue to invest, innovate 

and improve its service to the Government. 

In today’s environment of constrained resources, budget instability and dynamic workforce changes, that challenge has never 

been more difficult nor more important. This fact was highlighted 

in our biennial Acquisition Policy Survey of dozens of Federal Government acquisition officials who made eminently clear their concern that the state of acquisition and the acquisition workforce has 

not noticeably improved over the last decade or more despite enormous investments of time and money. And it is the foundation of 

the CEO Commission PSC formed earlier this year which will be 

reporting in April its perspectives on how to drive efficiency and innovation in a time of resource constraints. 

Hence, we are deeply committed in working with you and the 

Committee on this important bill. As difficult as the challenges before us might be, we also have a unique opportunity to fundamentally transform how Government utilizes technology and in so 

doing to dramatically improve Government performance and efficiency. 

With regard to the legislation, we strongly support the direction 

to bolster the role and effectiveness of Federal CIOs by providing 

them with greater budgetary and personnel authorities. Similarly, 

we are very supportive of the data center consolidation provisions 

and the creation of Assisted Acquisition Centers of Excellence provided that the requirements include adequate flexibility with regard to the actual nature and structure of those centers. Of greatest importance is ensuring that they each share the qualities and 

capabilities that are the hallmarks of excellence and best practices. 

There are also several aspects of the bill we believe merit additional attention in order to ensure the achievement of the bill’s 

stated objectives. Key among them is the treatment of so-called 

commodity IT and the creation of a Commodity IT Acquisition Center. 

43 

First and foremost, the very term commodity IT is fraught with 

risk and must be used with great care. Contemporary information 

technology offerings often involve myriad hardware, software and 

services solutions, some of which are highly complex, others of 

which are far simpler, more routine and more static. It is essential 

that any discussion of commodity IT include clear definitions and 

context so that this critical distinction is adequately and fully accounted for in both policy and strategy. 

And while the legislation does mandate that such definitions be 

developed by OMB, we believe that the legislation itself should address these distinctions and make clear the importance of avoiding 

a one-size-fits-all approach. 

We are also concerned with the tendency of some to equate commodity IT with commercial IT. While most commodity IT is commercial, a great deal of commercial IT is anything but a commodity. This distinction must also be very clear in the bill and reflected in any strategy associated with strategic sourcing or other 

approaches. 

This is also where the issue of buying for value versus price is 

so critical, which was alluded to by the Chairman in his opening 

remarks. Today, across Government, we witness the dominance of 

low-priced, technically-acceptable acquisition strategies both in 

name and in practice. For commodities, this might be appropriate. 

For more complex requirements, clearly it is not. Especially in a 

resource-constrained environment, it is more incumbent than ever 

on the buyer to ensure that their strategies are truly appropriate 

to their requirements and that where real complexity and risk is 

involved, where continuous improvement and innovation is called 

for, the best of the best are selected and incentivized for long-term 

success. 

We also believe that additional attention needs to be paid to the 

issue of competition, the single most effective means by which to 

drive costs down and performance up. One goal of the legislation 

must be to expand the competitive ecosystem and to preserve robust competition where it exists. This involves carefully assessing 

unique practices and policies that serve as barriers to entry as well 

as resisting efforts to significantly roll back current statute in ways 

that could cause current market participants to exit. 

So, it also means that we need to avoid overly limiting contract 

options. While the proliferation of multiple award vehicles has certainly created overlap and may have gone too far, it is also important to not allow that pendulum to swing back too far in the other 

direction. It is to the advantage of the Government to have multiple competitive contract vehicles that can be tapped for its IT and 

other requirements. 

This is the core of our concern with the creation of a single Commodity IT Center. That concern is exacerbated by the proposal to 

give the center both policy-making and purchase authority. Doing 

so, we believe, could create a conflict of interest that is actually at 

odds with the Government’s best interests. 

Finally, we greatly appreciate the attention paid to the human 

capital dimension but believe more could be done to bolster the 

ranks of the acquisition and technology workforces through this 

legislation. We face a series of very distinct but connected human 

44 

capital challenges and skills gaps that must be addressed holistically to include new strategies for workforce recruitment, development and training. Long-term success will simply not be possible 

without a well-resourced creatively and effectively developed and 

supported Federal acquisition and technology workforce. 

Whatever we have been doing for the last decade has clearly not 

been enough and this is a challenge we can no longer ignore. 

Mr. Chairman, Mr. Cummings, that concludes my oral statement 

and I look forward to your questions. 

[Prepared statement of Mr. Soloway follows:] 

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Chairman ISSA. [Presiding] Mr. Misener. 

STATEMENT OF PAUL MISENER 

Mr. MISENER. Good morning, Mr. Chairman, Mr. Cummings and 

Members of the Committee. Thank you very much for inviting me 

to testify today on behalf of Amazon.com and our customers on the 

reforms proposed to the draft FITARA legislation. 

Amazon opened on the worldwide web in July, 1995 and after a 

decade of building and running a highly-scalable web application 

known as Amazon.com, we embarked on a mission of serving a new 

customer segment, including businesses and Government agencies 

with a cloud computing business called Amazon Web Services or 

AWS. 

Today, AWS provides a highly-scalable, reliable, secure and lowcost infrastructure platform in the cloud that powers hundreds of 

thousands of enterprise, Government, education and start-up organizations. Customers include over 300 Government agencies. Notably, Amazon.com, the largest on-line retailer in the world, has itself 

adopted cloud computing services provided by AWS to enable rapid 

innovation and growth, to transform how we deliver our services to 

customers and to lower our IT costs substantially. 

One way to think about cloud computing is that, instead of buying, owning and maintaining data centers or servers, Government 

agencies, business and developers can acquire technology resources 

such as compute power and storage on an as-needed basis and dispose of it when it no longer is needed. 

The benefits of cloud computing to its users are first, users pay 

only for what IT they actually consume and only when they consume it. Second, expensive are lower than if the user self-provided 

the IT. Third, users do not need to guess their capacity needs. 

Fourth, virtually unlimited capacity is available to users within 

minutes. And fifth, cloud computing allows the users scarce technical talent without focus on its core mission, not on maintaining 

infrastructure to support it. 

Cloud users who enjoy these benefits include Federal Government users. Amazon supports Federal IT acquisition reform. Given 

the benefits I have just described, Amazon believes the principle 

aim of Federal IT acquisition reform legislation should be to facilitate Federal Government acquisition of cloud computing services. 

Amazon also generally supports the aims of the FITARA draft released last fall. Although we are not experts in several of the areas 

covered by the FITARA draft, we do know about cloud computing 

and serving public sector customers. So, here we offer our views on 

where the draft excels with respect to cloud computing and where 

we believe it could be improved. 

Title I of the FITARA draft would give Federal agency CIOs 

more authority and budget flexibility. Amazon supports this idea 

and believes it would lead to the adoption of more efficient solutions including cloud computing by Federal agencies. One area 

where CIOs should be given more authority and flexibility is with 

respect to spending models, specifically capital expenditures or 

CAPEX versus operating expenditures, OPEX. 

Title II of the draft already is strong but it should be strengthened to help Federal agencies provide Government services more 

55 

efficiently. In Section 203, we recommend including a direct link 

between the required plan for implementation of the Federal Data 

Center Optimization Initiative and OMB’s Cloud First policy. 

In Section 204, FITARA should explicitly clarify that using commercial cloud services is an equally valid is not preferred way to 

comply with the data center consolidation mandates because commercial service providers can make available more compute power 

and storage for a fraction of the cost based on what agencies actually use. 

Section 214 recognizes as a Sense of Congress the overall importance of cloud to Federal IT acquisition reform. However, without 

changes to the budget and acquisition process, the benefits of cloud 

computing may not be fully recognized by the Federal Government 

as soon as they could be. 

We support the development of Assisted Acquisition Centers of 

Excellence under Section 302. We believe that these centers could 

be well-positioned to examine and incorporate innovative approaches including pay as you go utility price models to acquire 

and deploy cloud computing services. 

In closing, Mr. Chairman, I would like to thank this Committee 

for working with the IT industry and other stakeholders as this 

legislation is developed and formally introduced. Amazon believes 

that the Federal Government, on behalf of the people it serves, 

would benefit greatly from expanded use if cloud computing. With 

FITARA, our Nation has an opportunity to eliminate duplication 

and waste but also, with the changes we have suggested today, to 

accelerate the adoption of technologies and practices that transfer 

how the Government performs its functions. 

We look forward to continuing to work with you and your Committee and thank you again for inviting me to testify. I look forward to your questions. 

[Prepared statement of Mr. Misener follows:] 

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Chairman ISSA. I hope you do. I will now recognize myself with 

some short questions. 

Mr. Spires, how many CIOs are there in the network of CIOs of 

the Federal Government? 

Mr. SPIRES. I think you recognized earlier, you said hundreds of 

CIOs in the Federal Government. 

Chairman ISSA. Well, the reason I did was because when we 

asked the Office of Management and Budget how many there were, 

although we have estimates and we have used numbers, OMB said 

OMB does not have a role in nor does it manage the direct hiring 

or titling of positions for specific agencies. In other words, you can 

make as many as you want. It is an agency decision and they can 

have a lot. 

Now, you had a council of people with the CIO title. How many 

do you have within your council? 

Mr. SPIRES. There are 13 of us, sir. 

Chairman ISSA. And, as the chief, how do you feel about having 

13 titles none of whom have budget authority? Is that really, is 

that manageable to have to create a council of chiefs and none of 

you in the room have direct and absolute budget authority? 

Mr. SPIRES. It is a true statement that none of us have absolute 

and direct budget authority. If I could frame what I see as the 

issue around this, we find ourselves in a position, and it really is 

a structure of the way Government is funded, right, so that budgets, like at Department of Homeland Security, are appropriated at 

the component level, like to FEMA and to CBP. And so they control 

those budgets. 

Chairman ISSA. Well, let me stop you for a second. 

Mr. SPIRES. Sure. 

Chairman ISSA. I completely concur that the dysfunctional way 

we do things down the hall at Appropriations and have done it, 

which is a chicken or the egg, Government formed this way, appropriators formed to match Government, Government then continued 

to conform to a system that had been established. So, as we have 

gone from two or three secretaries that George Washington had to 

a plethora of them and more being asked for, and then sub agencies, we have created, everybody gets a little pot of money. That is 

pretty much from George Washington until now how we got here, 

right? 

The question for you is, should money be allocated to IT and be 

reprogrammable and spendable in a way that although you anticipate an awful lot, there is accountability to a major block for that 

money being spent, not spent, converged into a common pool of 

money to do a job better, or, in fact, request reprogramming to use 

an appropriator term, but have a single point of accountability that 

ultimately has plenty of little chiefs but somebody in a major agency can say I have got $6 billion and I will be darned if I will waste 

it. 

Mr. SPIRES. Well, by the way, that is the way I feel every day when I get up, sir. I have got $6 billion and I do not want to waste 

a penny of it. 

Now, that being said, I concur with the concept that I need to, 

as the CIO as Homeland Security, drive real efficiencies. My first 

thing I talked about as what we need to fix is this issue of standVerDate Aug 31 2005 09:15 Aug 07, 2013 Jkt 000000 PO 00000 Frm 00066 Fmt 6633 Sfmt 6633 C:\DOCS\82274.TXT APRIL
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ardizing IT infrastructure through things like cloud computing. We 

need to do that to drive the efficiencies, okay? So, the model I am 

espousing, however that is done, all right, does that need to be full 

budget authority? That is one model and I think you should look 

at that model. There may be other ways to do it. But I need to be 

able to drive that set of efficiencies one way or another. 

Chairman ISSA. I appreciate that and we will get back to you on 

that. 

Ms. Chaplain, not to take the absolute of my explanation, but if 

we continue the way we are with pockets of money spread into 

hundreds or perhaps thousands of little fundings, don’t we almost 

guaranty that the big picture, the big solutions, the big let us converge on the cloud and save money, just simply will not happen? 

Ms. CHAPLAIN. Yes, and I think many, many studies point to the 

issue of diffuse authority, most recently in DOD, and I think if you 

do not have a single point of accountability, someone who actually 

can stop projects and has good visibility over the portfolio that can 

act on that, you do have a problem that is going to remain. 

Chairman ISSA. Any other weigh-ins from the other stakeholders 

here? Let me follow up with another question. I am going to go to 

Amazon. And thank you for saying you look forward to my questions. 

If there are five Federal entities and they decide that they want 

to all be on a, and let us just assume they are on Microsoft Exchange, and they want to all be together in one cloud and have all 

the bandwidth necessary or all the DADS and other resources necessary that they had, but be on one convergence, how long does 

that take at Amazon? Do you have an idea? 

Mr. MISENER. Well, thank you, Mr. Chairman, and I do look forward to the questions like this. 

Our experience has been that we can move very quickly. That is 

part of the beauty of cloud. You can ramp up and ramp down as 

quickly as you need. And so, it can be, we had an experience with 

a Federal agency who had a mission and knew that they could accomplish it in the cloud about 18 months faster than doing it on 

their own and yet they were not able to make anything but a capital expenditure. 

So, they ended up having to wait over a year, they spent $1 million on it, when it could have cost them about $120,000 a year instead. 

Chairman ISSA. Well, let me ask two questions that I know the 

answer to so I can yield time to the other side now. One is, is it 

not true you sell time essentially and processing by the minute? 

Mr. MISENER. Yes. 

Chairman ISSA. That you buy everything incrementally so that 

you buy, you pay for only what you buy? 

Ms. MISENER. That is correct. 

Chairman ISSA. And is it not true that a typical company, if 10 

of us had our own exchanges that we could all be in the cloud in 

hours at the minimum and days at the longest for a standard offthe-shelf product like Microsoft Exchange? 

Mr. MISENER. Well, it is minutes if you are a small enterprise. 

So, you can get on the cloud very quickly. It really is measured in 

that. And obviously more complex needs from enterprises or GovVerDate Aug 31 2005 09:15 Aug 07, 2013 Jkt 000000 PO 00000 Frm 00067 Fmt 6633 Sfmt 6633 C:\DOCS\82274.TXT APRIL
64 

ernment agencies, we want to be able to work directly if necessary 

with those customers to ensure that they get what they want. 

But again, certainly it depends on the scale, but we are faster. 

Chairman ISSA. Okay. And then I have an exit question, I have 

got to go to the gentleman from, I think Massachusetts, next. Is it 

not true that there are many other companies somewhat like Amazon, that we did not bring you here as the only one that could do 

it but that, in fact, whether it is Rackspace or lots of other companies, there are companies who provide similar services and there 

are no barriers to entry so you could have 100 bids of people who 

could do various Government cloud transfers? 

Mr. MISENER. Correct. And we are enthusiastic believers in the 

cloud, both as a provider and as a user of it. 

Chairman ISSA. Thank you. 

We now go to the gentleman from Massachusetts. 

Mr. TIERNEY. Thank you. Let me just pick up from there. Are 

there any security concerns or risks that we ought to be considering in talking about encouraging people to use the cloud? 

Mr. MISENER. Security is enabled by cloud. We are, because of 

our scale, we are able to dedicate more resources and invest more 

in policing and getting out ahead of threats in a way that smaller 

enterprises just cannot. And so, it actually is an enabler of security. 

Mr. TIERNEY. So, the Administration is already sort of heading 

in that direction and encouraging people on that. Do you think that 

putting incentives into this bill is a positive step or a necessary 

step? 

Mr. MISENER. Well, I think it is more permissions. The CIOs 

need the permission to be able to get cloud services. They need the 

permission to be able to go to an operating expense model rather 

than a capital expenditure model. I cannot tell you how many 

times we have had circumstances where the CIO wants to do it, 

but cannot, or believes that he or she cannot. That is a real impediment. 

The theme that we see is that the CIOs get it. They understand 

what is going on. They understand what is needed. They understand that it can be as secure as they want it to be. But they are 

not allowed, because of procurement policies, to go and get it. 

Mr. TIERNEY. Do you think the bill goes far enough? 

Mr. MISENER. No. 

Mr. TIERNEY. What would you do, in addition? 

Mr. MISENER. I would specify in many places that cloud computing is something to be considered as an option, not forced upon 

CIOs, but at least give them the option to do it and make sure they 

have the flexibility to spend money as an operating expense, not 

just as a capital expense. 

Mr. TIERNEY. Can you give us an example of something that 

Amazon utilizes as a best practice that is not captured in this bill 

but you think it might be beneficial to the Federal Government? 

Mr. MISENER. Well, we pride ourselves on doing our very best to 

serve our customers in whatever their needs are. So, for example, 

we are happy to work through integrators, large, our partners, to 

serve Federal Government agencies. We are also happy to work directly with the Federal Government agencies if they so choose. 

65 

And so, we try to be as flexible as our customer needs demand. 

We have helped them get FISMA approvals, for example, when 

they need it. And these sorts of customer-centric approaches are 

ones that say that, you tell us what you need, and we will provide 

it. 

Mr. TIERNEY. I have no further questions, Mr. Chairman. 

Chairman ISSA. Would the gentleman yield for a second? 

Mr. TIERNEY. I will yield. Certainly. 

Chairman ISSA. Wouldn’t you always also characterize that when 

you are in the cloud, by definition, if you are doing a hundred different agencies and there is a patch, an upgrade, a security change 

that typically the integrator of many, many stations is going to be 

able to do that for all the customers in real time much quicker than 

you would do at a typical offsite where they would have to learn 

about it and then they have to, the IT people have to go in and 

do it on servers locally? 

Mr. MISENER. Yes, Mr. Chairman. The countermeasures that we 

can deploy we can deploy globally in an instant. That is why we 

are able to keep out in front of the threats just by virtue of scale. 

It is not because we are more virtuous but the scale that we have 

allows us to take care of those threats in advance. 

Chairman ISSA. Thank you. I thank the gentleman. 

Mr. TIERNEY. May I reclaim my time for a second? I just want 

to yield it to Mr. Connolly who wants to make a statement. 

Mr. CONNOLLY. I thank my colleague. Actually, I did not want 

to make a statement. I wanted to use a little bit of extra time to 

get some more feedback. 

Chairman ISSA. The gentleman is recognized for a total of seven 

minutes. Let us just get it all done at once. 

Mr. CONNOLLY. Thank you, Mr. Chairman. Thank you very 

much. 

Chairman ISSA. Go ahead. 

Mr. CONNOLLY. Mr. Gordon, the bill, the draft bill we are talking 

about addresses open source, open source software, and it requires 

OMB to issue guidelines on its use and collaborative development. 

Do you think that would be, would have been a useful provision, 

if it had been in law when you had your previous position? 

Mr. GORDON. Thank you, Mr. Connolly. It is very important for 

there to be technology neutrality in this area. And I think, I am 

not an IT expert and my colleagues on this panel may have more 

to add on this, but my sense is that we need to be very careful to 

keep competition open and to be technologically neutral. If that is 

the intent of the bill’s language, I am very supportive of it and I 

think it would be helpful. 

Mr. CONNOLLY. Could it save money, Mr. Spires? 

Mr. SPIRES. Oh, absolutely, sir. In fact, we are using open source 

in numerous ways now within DHS and we look to use more of it 

into the future. 

Mr. CONNOLLY. Is there a differentiation of pricing in various 

contracts within the Federal family on off-the-shelf and open 

source? 

Mr. SPIRES. I mean, back to what Mr. Gordon was referring to. 

We want flexibility. We want to do what is in the best interests of 

the taxpayer in this regard. And we will be assessing all solutions 

66 

and more and more we are looking at open source solutions to meet 

our needs. 

Mr. CONNOLLY. Do you think that the Government could and 

should rely more often on open source software when it buys new 

products? 

Mr. SPIRES. I will go back to we need to do that assessment. I 

am not suggesting that we have an open source first policy. I think 

we have to look at both open source and standard products and 

what best meets the need for the Federal Government. But with 

the maturity of where open source is today, we can use it in mission operations spaces in a secure manner. 

Mr. CONNOLLY. Mr. Soloway, industry’s point of view about that? 

Mr. SOLOWAY. I think we are all in alignment on the basic question of open source and the needed flexibility. If I might just go 

back to a point that was made a moment ago, the discussion of 

cloud computing and the role of cloud, I would offer a couple of contextual comments. 

Number one, I do not think there is any disagreement about the 

cloud. I think there is still inconsistency in the agencies as to what 

they define as the kind of cloud they want to go into, whether it 

is their own, whether it is a broader commercial offering, and I 

think that issue is one that has not yet sunk in in the National 

security environment. There is still a lot of discussion and debate. 

So, there is a cultural issue that needs to be addressed there. 

The second point I would make is, and, Mr. Chairman, you made 

this comment earlier about the access to the commercial base and 

commercial best practices, even as we talk about that in this hearing, we are seeing a stark pulling back by many agencies of Government from commercial business practices on the acquisition 

side. 

The Department of Defense has tried for two years in a row to 

dramatically change the definition of a commercial item or service 

which, in fact, would have taken Amazon pretty much out of the 

Federal space because I discussed it with them and others who 

came in as a result of some of the reforms put in place by ClingerCohen and earlier legislation. 

So, we need to align the goals of our technology and IT policy 

with the acquisition policies and practices we expect and demand. 

One can have tremendous transparency and accountability and still 

use commercial best practices. But, unfortunately, we see a disconnect there between the acquisition and technology communities 

that I think we need to overcome. 

Mr. CONNOLLY. I guess by implication in terms of what you just 

said, you do not feel that the language in the draft bill goes far 

enough in that respect? 

Mr. SOLOWAY. No, I do not think, I think the language in the 

draft bill addresses the basic question. As I said in our testimony, 

I think there is more definitional context that is needed. I think 

there are some risks to the term commodity IT because it tends to 

be overused when it is, something is or is not a commodity. We are 

seeing buying practices across Government that assume everything 

is a commodity, which is not the case. So, some more context and 

definitional support, I think, would be important. 

67 

But also going back to Mr. Spires’ comment, maybe the most important thing would be substantially enhancing the focus on the 

workforce that the bill addresses. As I said, our Acquisition Policy 

Survey was stunning this year in that we had more than four 

dozen Federal acquisition leaders say to us, things are just not any 

better than they were a decade ago. 

We have a huge, huge problem. We do not support and empower 

the workforce. And, frankly, I think we could make an argument 

that we probably do not develop, train and advance them in the 

proper way. And so perhaps a fundamental rethinking to the point 

Mr. Spires talked about with the Program Management Center of 

Excellence gives you an opportunity on the civilian side to do something that has never been done before. 

What does program management mean? What kind of workforce 

of the future do we want and need and how do we best develop 

them? If you go to best commercial practices, they do not look anything like the way we develop our acquisition community in the 

Federal Government. 

Mr. CONNOLLY. Yes. I think maybe we do need to beef up the 

people part, the personnel part, of the draft legislation. I take your 

point very much. I know when I was in the private sector we were 

always experiencing the good, the bad and the ugly in terms of 

skill level in managing large, complex IT contracts. 

Mr. SOLOWAY. One of the stunning statistics that is relevant to 

this bill, and it is in the written testimony, is as much as we talk 

about the graying of the Federal workforce and having four times 

as many people over 50 as under 30, in the IT workforce in Government it is dramatically worse. According to the Office of Personnel 

Management, we have seven times as many people over 50 as 

under 30 in the IT workforce. 

Mr. CONNOLLY. Careful about that. 

[Laughter.] 

Mr. SOLOWAY. Well, I am of that same age, sir. 

Mr. CONNOLLY. Those are Renaissance men and women. 

[Laughter.] 

Mr. SOLOWAY. The point being, of course, that it is the diametric 

opposite of what you see in the commercial space. 

Mr. CONNOLLY. Yes. In my last one minute and 28 seconds, Mr. 

Gordon, Mr. Spires talked about, and the Chairman laid out, sort 

of the multiplicity of CIOs and respective areas of responsibility. It 

is so diffuse as to mean there is no really one locus of responsibility. 

Do you think the bill as currently drafted adequately addresses 

that and gives the proper authority to a person, a point person, in 

each Federal agency and if not, how can we improve on it? 

Mr. GORDON. I think the bill is commendable in trying to focus 

on having a person on the CIO side of the house. The only points 

of caution I would add for consideration as you go forward, and this 

may be more report language than statutory language, is that you 

do not want the CIO to be a bottleneck. You want a high level person to make high level decisions. You do not want every small IT 

decision to be sitting on her or his desk to get decided. That is one 

thing. 

68 

And a second thing, something that I have been worrying a lot 

about over the last 10 years, there is a risk of imbalance between 

the contracting workforce and the IT workforce. If you give too 

much power to the IT workforce and exclude the contracting workforce, you are going to lose the advocates for small businesses, the 

advocates for competition, following the FAR. That is why I have 

always been in favor of integrated teams with clear leadership. 

Thank you. 

Mr. CONNOLLY. Mr. Chairman, my time is up. Would you indulge 

Mr. Spires to be able to answer that question? 

Chairman ISSA. Absolutely. 

Mr. CONNOLLY. I thank the Chair. 

Chairman ISSA. Thank you, sir. 

Mr. SPIRES. A couple of points regarding this. Under the structure that I think would be best for larger departments and agencies, the central CIO, the individual in my role, does have that high 

level view but is also driving those enterprise capabilities that are 

leverageable then by all. And we talked a lot about cloud computing. I am a huge believer in it. We have 11 cloud-based services. 

I serve on the JAB at FedRAMP. That, I think, can be transformational to deal with some of the security issues that were 

raised. 

So, the notion then is once we have that infrastructure layer at 

an enterprise level standardized and modern, then the individuals 

within my components, like FEMA, they can focus on that value 

add, what is the functionality, how do we help the mission deliver 

more effectively. What we have right now is too many people out 

on the edge worried about infrastructure, worried about things 

they should not be worrying about. I yield. 

Chairman ISSA. Thank you. And now we go to the very young but 

prematurely gentleman from Michigan, Mr. Walberg. 

Mr. WALBERG. That is probably the most unusual introduction I 

have had. 

[Laughter.] 

Chairman ISSA. And I want you to live up to that youth, young, 

you now, you are not over 50 yet, so it is a lie on your birth certificate. 

Mr. WALBERG. Just keep feeding me good chocolates and nuts. 

That will work fine. 

Mr. Spires, I hesitate in a sense talking about a congressional 

budget cycle because I am not sure if one of the Houses understands there is a budget cycle. 

[Laughter.] 

Mr. WALBERG. But in any case, what impact does the Congressional budget cycle have on IT redundancies and wasteful spending? 

Mr. SPIRES. Well, it certainly makes it difficult at a program 

level, this notion, and Mr. Gordon alluded to it, of having one year 

funding, it really does make it very difficult to do good planning. 

And then when you get into things like continuing resolutions, and 

we are jammed up trying to actually issue procurements and complete procurements in a very short time frame near the end of a 

fiscal year, those things are just not best practice management or 

IT best practice. So I would look for more flexibility. 

69 

Mr. WALBERG. What are those flexibilities? 

Mr. SPIRES. Well, I mean, multi-year funding helps us and we do 

have some of that in certain instances so that we can, I mean, even 

though we move to more agile programs and we are getting releases out in four to six months on many of our programs, that 

does not mean we are going to complete the whole thing within one 

year. I mean, many of these are complex systems that take multiple releases. And so we need the kind of time frame to do the 

right kind of planning. 

And I also think more portfolio types of budgeting so that we 

have more flexibility. If we are in a cloud-based environment like 

we have development and test as a service and we can turn out 

product sometimes, I am saying simpler applications, within a matter of a couple of months, that does not fit with any Government 

budget cycle. But we need to have that kind of flexibility. 

So, if you will, funding us by a portfolio, an area. And then on 

the flip side what we owe you back is real transparency. What are 

we doing, how are we oversighting that, how is the progression 

going, what decisions did we make and how we made those decisions to allocate those funds, we owe you that transparency. 

Mr. WALBERG. And an end zone that you ultimately get to as 

well. 

Mr. SPIRES. That is true, sir. I agree. What is our objective, why 

do we need that portfolio money and what are we trying to achieve 

with it? That is fair. Very fair. 

Mr. WALBERG. Let me follow up. Our legislation provides CIOs 

with both a broader budget authority as well as more flexible use 

of revolving and capital working funds. Is that the right approach? 

Mr. SPIRES. I think it goes back to the Chairman’s discussion 

around the budget authorities. One way to do this is through those 

types of revolving funds, working capital funds. We have such a 

fund within DHS that we use to fund enterprise IT. I will say it 

is somewhat cumbersome but it does work. And so, if you are not 

going to, it is way at least to get the funds together. 

Although I will tell you, even in that kind of model, one of the 

problems that I have in trying to drive enterprise services is that 

it might be good for all of DHS, but if it is not good for a particular 

component, they are not going to play ball with you well. They are 

not going to want to do that. And this is a discussion I have many 

times with the CIO. I am talking to the CFO of that component. 

I am even talking to the head of that component because I am trying to optimize and provide, if you will, enterprise capabilities 

across the enterprise. So, that is an issue that we deal with by not 

having that consolidated funding for IT. 

Mr. WALBERG. Thank you. Mr. Gordon, in your testimony, you 

raised the concerns that there are limits to what legislation can accomplish. What are those limits? 

Mr. GORDON. Thank you, sir. I would, it may be worth thinking 

of IT acquisition as divided into two different types, very big 

projects and then purchases of small things, hardware, software, 

software licenses. The very big projects in many ways are more like 

DOD’s major weapons systems. The challenges we face are acquisition planning, very tough to legislate acquisition planning, contract 

management, a tough area to legislate. The idea of a CIO and 

70 

strengthening the CIO does go to large projects and may be helpful. 

But much of what I see as positive in the bill is actually relevant 

to those smaller purchases, the strategic sourcing and the other 

areas. 

Mr. WALBERG. Does our bill run afoul of those concerns? 

Mr. GORDON. No, not at all, sir. It is just that the bill does not, 

and it does not need to, distinguish between big projects and the 

small purchases or relatively small purchases. They are just different issues and the bill actually includes some positive things 

with respect to both. I do not see problems with respect to either 

one on a large scale in any event. 

Mr. WALBERG. Okay. You mentioned in your testimony that Government can learn from industries best practices but cannot copy 

them. Can you elaborate on that in five seconds? 

[Laughter.] 

Mr. WALBERG. Take a little time. 

Mr. GORDON. Sure. There are all sorts of things that industry 

can do that we cannot do in the Federal Government. You have 

heard about the appropriations problem, the competition issue. I 

will say, though, that I think that the Government has more flexibility in its procurement system today. In fact, I did not quite understand Mr. Misener’s reference to procurement policy getting in 

the way of shifting to the cloud. I think we already have a lot of 

flexibility under our procurement system. 

We do have to worry about things like small business participation, like transparency, that the private sector does not need to 

worry about. But overall, I think our procurement system can succeed and this bill is pushing us, I think, in a helpful direction. 

Mr. WALBERG. Thank you. And thank you, Mr. Chairman. 

Chairman ISSA. Thank you. As I go to the Ranking Member, Mr. 

Gordon, if I could summarize what you said? We cannot legislate 

out stupidity. 

[Laugher.] 

Mr. GORDON. I do not think I actually used those words. 

[Laughter.] 

Mr. GORDON. But good management, as you know from your experience before you came to Congress, sir, good management is 

something that you just cannot do by legislation. 

Chairman ISSA. And as we go to the Ranking Member, that is 

the point and the reason that we have to invest in our Federal 

workforce every single day. 

I recognize the Ranking Member. 

Mr. CUMMINGS. Mr. Soloway, you said in your written testimony, 

and I quote, long-term success is simply not possible without a 

well-resourced, creatively and effectively developed and strongly 

supported Federal acquisition and technology workforce. 

Do you believe that making investments in the acquisition workforce now will pay off with cost savings in the long term? 

Mr. SOLOWAY. Absolutely, if the investments are properly targeted and made. I think we have spent, over the last decade or 

more, a tremendous amount of money trying to develop the acquisition workforce. When I was in the Defense Department in the 

1990s, the Defense Acquisition University was part of my portfolio. 

I had a $100 million budget for acquisition training. 

71 

The question I think that needs to be asked is similar to the 

question the Chairman has asked with regard to the foundation for 

this bill. It has been 17 years since Clinger-Cohen. Why are things 

not better? It has been 20 years since the Federal Acquisition Reform Act. Why is our acquisition workforce still so beat down, 

under resourced and, frankly, under empowered. What we see on 

the acquisition side, this may be the dichotomy between what Mr. 

Gordon and Mr. Misener are seeing, it is not a matter of policy, it 

is workforce that is not incentivized to use critical thinking skills, 

to take some reasonable element of risk to know that their leadership will support them if they make a mistake or things go south 

which they inevitably do for reasons having nothing to do with 

what they did. 

Mr. CUMMINGS. Wait, wait, wait. So it is not about being properly trained? Is that what you are saying? 

Mr. SOLOWAY. No, I think that we have not necessarily done the 

right kind of training. I think there are gaps in the training. I 

think there are gaps in the degree to which we empower that workforce and support them. 

Mr. CUMMINGS. Yes, I tell the story that when I was Chairman 

of the Coast Guard Subcommittee of the Transportation Committee, we saw where because the acquisition people were not properly trained, I mean we literally, literally, were buying boats that 

did not float. I mean, we lost hundreds of millions of dollars under 

this Deepwater Program. And they just testified yesterday in 

Transportation that, because of the changes we made, they now are 

on sound footing. 

But they literally had to bring in a force, they had to work with 

the Navy, to upgrade their people, to teach their people how to do 

acquisition. And I do not think a lot of people realize how important acquisition personnel can be. 

Mr. SOLOWAY. If I could just share with you? First of all, Deepwater is a great example. 

Mr. CUMMINGS. You are familiar with it? 

Mr. SOLOWAY. Very much so. And when I was in the Defense Department, I got a call from the GAO wanting to know what we 

thought of Deepwater and my response was it depends on the nature and quality and skills of the people that are there to manage 

it. It is not necessarily the strategy that was wrong or correct, it 

is a people issue. 

But I think that it is worth rethinking how we develop our workforce, not just how much money, but what we are trying to train 

them to. We are talking here about commercial best practices. We 

are talking about asking them to make tough, complex business decisions. Yet, if you really look at the training that we do, there is 

a stark lack of business training involved in it. It is more about the 

rules of the Federal Acquisition Regulation, which are important, 

but that does not necessarily translate into then really thinking in 

a critical sense how do I apply those rules in different circumstances to come up with smart business decisions. 

Mr. CUMMINGS. And I guess that goes to your point a little bit 

earlier, when you talked about, I cannot remember your exact 

words, but you said something about, sometimes folks are looking 

at best price but not necessarily looking at quality. And sometimes 

72 

the price is nice but, in the long run, you are not really saving because you are not purchasing wisely and looking at the long run. 

Would that be part of the kind of training you are talking about? 

Mr. SOLOWAY. Absolutely. And part of what the workforce is encouraged to do, and this is where I differ a little bit with Mr. Gordon, I think that where the bill can help that issue is in the definitions of commodities versus more complex solutions because the 

way you approach the business relationship is very different. I am 

not sure there is enough explicit distinction there. But we are seeing that trend, Mr. Cummings, across the Government. Very complex requirements. 

And there is in the acquisition requirements a term called low 

price technically acceptable and what that says is anybody who is 

minimally acceptable submits a bid and the lowest price automatically has to win. That does not give you any flexibility to say well, 

if I spent 3 percent more over here, I got a little bit better performance or a better history or what have you. 

So, a low price approach to complex solutions does not make 

sense. But, unfortunately, that is now what the workforce sort of 

thinks that they are expected to do. And that all comes back to 

training and, in a big way, comes back to leadership. 

Mr. CUMMINGS. Mr. Spires, these upcoming furloughs, does that 

affect you? Are you concerned about that? I have heard the Secretary talk about the Department overall. 

Mr. SPIRES. I do not want to talk for the Secretary. But of course 

we are concerned about that, sir. 

Mr. CUMMINGS. I am talking with regard to this particular issue. 

Mr. SPIRES. For ourselves, here, and we are in a position to keep 

our mission critical systems operational. 

Can I go back and just comment, please, on this whole issue of 

acquisition workforce and the like? 

I would rather use the term for large, complex development programs or IT programs, I use the term program management because one, I come from the private sector and that is what we used, 

but two, I want to make that distinction. I have reviewed hundreds 

of programs in the Federal Government over my eight years of 

service in this Government, and many in the private sector, and I 

have always found that it is the competency of those that are running the program and how they are doing it is the determining factor for success. 

And so, I will take exception a little bit to Mr. Gordon that focus 

on contract is important, but you have got to be able to run a program and a contract vehicle or contract vehicles is a part of the 

program. And if you focus on the program, what is important there 

first, that is where you have got to start. That is how, when I 

evaluate programs I am always talking about that first. Do we 

have the right skill sets to be able to effectively run this program? 

Mr. CUMMINGS. Thank you, Mr. Chairman. 

Chairman ISSA. Thank you. 

We now go to the gentleman from Florida, Mr. Mica. 

Mr. MICA. Thank you. An interesting discussion. A couple of comments. 

Mr. Cummings was talking about the Coast Guard and Deepwater and, having followed that pretty closely, some of the, I guess 

73 

the issues that we have to deal with is do we have the authority 

and part of this bill is trying to make certain that we have the authority. Some of you have said we do have the authority. Then the 

next thing would be the skill sets or the management, the administration of the program. 

I noticed, just to reminisce a second on Deepwater, I looked at 

that, and the Coast Guard is a relatively small agency and they got 

into building these they call them National Security-sized Cutters 

which they did not have the in-house expertise to do. There was 

a whole host of issues there, I found. They could not first retain 

the personnel to do that, they pay so low. The Coast Guard are 

paid just a fraction of what some of the Federal bureaucrats are. 

And then, did you want to create an agency which was going to 

build a half a dozen of these ships with this massive thing that 

they, that the United States Navy was having difficulty acquiring 

the skills sets and personnel. 

So, do you all think there is enough authority in the bill as revised? You had some good, well, you gave some specifics. Rarely do 

we have any anybody who actually comes up with specific legislative remedies. So, we have yours. Does anyone else have any specifics? 

Mr. SOLOWAY. Mr. Mica, I would like to suggest, and this has occurred to me as we have listened to the testimony this morning, 

that Mr. Spires’ comment around program management, I, along 

with some Federal CIOs and others several years ago looked at this 

issue, three or four years ago. And I am wondering if the bill, if 

Mr. Spires’ objectives, which I think are correct in terms of the program management function and capability, could not be strengthened in terms of identifying and defining a true program management career field on the civilian side. 

We have people in the civilian agencies who have some program 

management skills but it is a very roughly defined, and not clearly 

defined. 

Mr. MICA. Well, yes. Are you talking about for CIOs and other 

officials? 

Mr. SOLOWAY. I am talking, I am sorry, sir, I did not mean to 

interrupt. If you look at the Defense Department, not that all the 

Defense Department programs are successful, but they do have a 

very clearly defined program management skill workforce with 

very clear training and development requirements. That it still relatively nascent in the civilian sector and I think to Mr. Spires 

point, perhaps one of the things in the bill is to help define that 

and advance that objective. Because that is where it all comes together at the end of the day, is through program management and 

the leadership of the team. 

Mr. SPIRES. Picking up on that, sir, I recommended this idea of 

the Center of Excellence. We are never going to be able to go out 

and hire all of the talent we need into the Government to really 

use commercial best practices for running our programs. But we 

have real pockets of excellence. We have excellent people. If we can 

leverage those people in a way that can be leveraged across agencies, I think we would do ourselves good. So, I gave some, in my 

written testimony, some ideas on how to do that. 

74 

Mr. MICA. Okay. Well, the first thing, again, is authority, then 

the skill sets and the personnel are important. It is interesting, the 

aging workforce is a fascinating factor because, you know, if I want 

anything IT done in my office I have the geriatric ward, having 

been here 20 years that I employ, but I do not go to any of them, 

I go to sort of the new kids on the block and they are wired, they 

know how to do it and get it done. But it looks like we are headed 

in the wrong direction. 

And it is not that we do not pay people enough or there is instability in the Federal Government, Mr. Gordon, it is probably one 

of the most stable employers. I was Chairman of Civil Service. Nobody gets fired in the Federal Government, period. And we do pay 

above scale. The question is, who we are paying and how much and 

getting those skills. 

When I was chairman of a subcommittee here, we did IRS and 

one of the things we found is we were not paying people to pay 

these systems the wages they could get on the outside. We had to 

change that. We may have to do that. And also a campaign to attract the young talent. 

You have to have people who really know how to, and not me, 

but GAO said that in most cases IT investments are underperforming, overall lack of skills experience of Government-led management teams. So, authority and then somebody who knows what 

the hell they are doing and how the hell to do it. 

[Laughter.] 

Mr. MICA. So, again, as we craft the bill, the Chairman has done 

a great job in putting this together, you want something that gives 

us the tools and then the personnel to do it. So, I only have 11, 

well, I am already over time, so yield back my over time. 

Chairman ISSA. Okay, that is 18 seconds of negative yield back. 

[Laughter.] 

Chairman ISSA. Thank you. 

We now go to the gentleman from Illinois, Mr. Davis. 

Mr. DAVIS. Thank you very much, Mr. Chairman. And let me 

thank you for calling this hearing. 

I was thinking that the people in my district would really appreciate listening to this discussion, especially given the fact that we 

are talking about how do we get the most mileage, or the most effective results, from the monies that we spend, the money that we 

allocate, the resources that we use, and how do we create the systems and the workforce that will give us results. 

OMB estimates that consolidating Federal data centers could 

save us between $3 and $5 billion. So, I am thinking about that 

and I guess my first question to the panel is do you believe that 

the consolidation of data centers is actually helping to modernize 

the Federal Government’s IT investments and do we save from this 

process? 

Mr. Spires, why don’t I begin with you? 

Mr. SPIRES. Sure, because we are in the middle of this, sir, and 

I think the proper consolidation of data centers. So, as you consolidate you need to not just set up the same servers that you had in 

your old data center in a new data center, but you need to look at 

virtualization technologies and now cloud technologies and leverage 

those appropriately. 

75 

I am very heartened by what we are doing around the Data Center Consolidation Initiative, together with the cloud first policy, because it is, I believe, the right formula to move us forward. And 

we are seeing very significant savings. We at DHS, we are looking 

at a 10 percent cut in an overall infrastructure budget. 

So, I am pushing very, very hard to get this done because we can 

realize that level of savings by doing these things with the Data 

Center Consolidation and the cloud first. 

Mr. DAVIS. Mr. Gordon, let me just ask you, the workforce, we 

have had some discussion, the kind of training that people receive, 

can we create, or do we create, training modules that will produce 

the kind of results that you talked about, perhaps, and how do we 

do that? 

Mr. GORDON. Thank you, Congressman Davis. It is very important that we have enough people and that we give them good training. And I can tell you that there are efforts both at DOD through 

the Defense Acquisition University and the civilian agency SOD 

through the Federal Acquisition Institute to get good training, including online training which is an area we are working on. 

I am honored to be a Director of the Procurement Roundtable 

which has had sessions devoted to training of the acquisition workforce. We actually have a couple of sessions with junior people in 

the acquisition workforce tomorrow at GW Law School. 

What we often hear is that the acquisition workforce is simply 

traumatized. They are traumatized by continuing resolutions, by 

disrespect that they get. When they go to low price technically acceptable, Mr. Soloway pointed out, it is not because they think it 

is the best path but they are scared, they are scared of getting in 

trouble for picking something that costs more even though it is 

higher quality. They are worried about, perhaps, being dragged in 

front of this Committee. They are worried about IT reports. 

Chairman ISSA. I want to state that we welcome people, we invite them. They have never actually been dragged in here. 

[Laughter.] 

Mr. GORDON. And I am honored to be here, Mr. Chairman. 

We need to change from an atmosphere of fear, a poisoned atmosphere where people don’t feel appreciated, don’t feel empowered, to one where they believe that they can be trusted. There is 

cognitive dissonance when we say on the one hand, oh sure, we are 

going to support the acquisition workforce but on the other hand 

we bash them all the time. 

You cannot expect to get positive results when you do not show 

respect and support for your workforce. 

Mr. DAVIS. Thank you. Mr. Chairman, I know that my time is 

about to expire, but could we allow Mr. Soloway to respond to that? 

And Mr. Misener? 

Mr. SOLOWAY. Very briefly, I agree with almost everything that 

Mr. Gordon said. I just offer a couple of observations. 

We do a biennial survey of Federal acquisition leaders. It is the 

Government talking to us about what is on their plate, what is 

bothering them. I think the findings this year, as I mentioned earlier, were very stunning and that they clearly concluded that 

things are not getting any better for many of the reasons that Mr. 

Gordon cited. 

76 

But two other things that jumped out of this. By a margin of almost seven to one, they said they do not feel that their workforce 

has adequate skills to acquire complex IT. And by a margin of nine 

to one, they felt that their workforce did not have adequate negotiating skills. 

What that led them and us to conclude is that while we are investing in and constantly trying to reevaluate the training and development, we do not have it right yet. And perhaps it is time to 

break out of the mold, to really open the aperture to much more, 

and I will use the term loosely, commercial training and commercial development tools. 

We do not take our workforce and rotate them throughout the organization as the best companies do when they hire new people so 

that, as they move up the chain, they have experience and knowledge of very different aspects of company operations, for example. 

And as I said earlier, there are, I think, some huge gaps in just 

basic business training and how that aligns or doesn’t with the specific and unique policies of Federal acquisition. 

Mr. DAVIS. Mr. Misener, if you have anything, briefly. 

Mr. MISENER. Thank you, thank you both, Mr. Davis. A lot of 

discussion has been around the nature of the procurement workforce and our experience has been that they are extremely talented 

and they know what they are doing. But they also feel inhibited 

by vague or counterproductive rules from above. They know what 

they need to buy. They know the best solutions. But they just are 

not empowered to choose those solutions. 

And so I think the FITARA could go a long way to giving them 

that confidence they have to choose the correct solution for the 

Government and the taxpayer. 

Mr. DAVIS. Thank you, Mr. Chairman. 

Chairman ISSA. Of course. 

We now go to a man who is a young entrepreneur in the IT area, 

Mr. Farenthold. 

Mr. FARENTHOLD. Thank you, Mr. Chairman, and I am happy 

that you guys all chose to testify. I think there is a whole lot of 

savings to be had and I appreciate your input. 

When I was back in the computer consulting business in the ancient history in computer days, one of the things that I liked to tell 

my clients was that you need to change your mindset about IT. Admittedly, I was primarily dealing with small businesses, but with 

the technological cycles you almost need to look at IT as an expense more than a capital item, specifically with respect to the dayto-day stuff, the desk top PCs and some of the things you go there. 

I know Mr. Misener and Amazon whose name appears way too 

often on my credit card bill, puts that as a, software, as a service. 

[Laughter.] 

Ms. FARENTHOLD. But I wanted to visit with you, Mr. Spires. Obviously, the big massive technology projects do need to be handled 

in a different fashion. But how do we get to, or can we get to, or 

is it appropriate to get to, technology more as a day-to-day technology as an expense rather than a capital item? 

Mr. SPIRES. That is a great point. In fact, we are trying to get 

there. I mentioned 11 cloud-based services we are moving to. As an 

example, we have got 110,000 of our employees on our emails as 

77 

a service offering now. And that is an expensed item. We are buying it as a cloud-based service, there was very little in the way of 

capital outlay, we had some migration costs to get to it, but not 

large, and we pay on a monthly basis. 

And by the way, I really want to move, as you say, our day-today IT operations to that model. 

Mr. FARENTHOLD. You have got a four-year lifespan, four to eight 

year lifespan on a PC depending on how techie you are. 

Mr. SPIRES. Well, we struggle, we have old gear because we do 

not have the capital to replace it. So, I want to move out of that 

model into a consumption-based model where it is then in the service agreement to replace that and keep that gear current where we 

are paying on a monthly basis. 

Mr. FARENTHOLD. All right, and Ms. Chaplain, you talked about 

strategic sourcing. I see two issues there as we do these types of 

contracts. Do we not keep up enough with technology and do we 

cut out vendors. I mean, do we get, you know, Dell, HP or Apple, 

those are your choices, and do we cut out other folks? 

Ms. CHAPLAIN. In the Strategic Sourcing Initiatives that have 

been done to date, we found that we can include small businesses 

and a wide variety of companies, not just the Dells and people like 

that. They had one on office supplies where 13 of the 15, or a good 

majority of the contracts, went to small businesses. 

Mr. FARENTHOLD. Okay, let me go back to Mr. Spires. I’m sorry 

I’m bouncing all over. I have a lot of questions. 

We talked about, I want to talk a second about open standards 

in API. I think one of our big problems is one Government computer does not talk to another Government computer. And we are 

seeing in the VA, even though they are doing a massive technology 

project right now, getting information from DOD and people coming out into the VA is resulting in year-long delays at times getting 

benefits. 

Do you think there is an opportunity there? It seems like, to me, 

like the internet, which was actually kind of developed at our expense through RFC open source, not so much open source but open 

standards, is that something we can replicate throughout the Government? 

Mr. SPIRES. We are in a number of ways. I mean, under the digital government strategy being driven by OMB, I mean, there is a 

whole area there about how do you build APIs to be able to access 

data. Another example of this is the National Information Exchange Model which is used for exchanging data for law enforcement, for first responders, for many other uses, between ourselves 

as a Federal Government and the State and local governments. 

Mr. FARENTHOLD. Do you think it is reasonably doable to come 

up with some API standards for Federal Government websites so 

advocacy organizations can, and the public, can aggregate data? Do 

you think that is doable? 

Mr. SPIRES. That is part of the initiative under the digital Government strategy. 

Mr. FARENTHOLD. All right. And let me go, you talk about bailing 

out of failed projects and I hate to pick on Homeland Security but 

we look no further than the back scanners that TSA has and TWIC 

78 

cards. How do we encourage folks to fix those problems before we 

keep throwing good money after bad? 

Mr. SPIRES. Well, I come back, sir, to this whole notion of increasing the capability of our program management workforce, part 

of the acquisition workforce. We need to do that and we need to 

give programs help. One of the things we have done at DHS, I will 

just be quick, is we have instituted a more aggressive oversight 

model so that the right stakeholders are meeting with the program 

management team on a monthly, or every other month, basis to 

make sure that things are being dealt with. 

Mr. FARENTHOLD. All right, great. My last comment is to Mr. 

Misener. Would you do me a favor and talk to GSA and see if you 

can use some of the Amazon technology to update their website. I 

try to buy stuff for my office off the GSA website and I finally just 

given up. You could certainly save the Government a lot of money. 

We would appreciate your helping them out. 

Mr. MISENER. I would be happy to. Can they spend OPEX? 

[Laughter.] 

Mr. FARENTHOLD. Yeah, right. Thank you very much. And I yield 

back. 

Chairman ISSA. I believe Mr. Horsford is next for our side. 

Mr. HORSFORD. Thank you, Mr. Chairman, and having just visited Switch and Cobalt in Southern Nevada last week, this is a 

very opportune panel focusing on issues that really are important 

to streamlining our IT functions. 

I do find it interesting, though, that technology continues to 

change rapidly and no provision in any one bill is going to be able 

to keep up with those changes. And I think we all have to be cognizant and aware of that. 

My other committee, Mr. Chairman, is the Committee on Homeland Security so I do want to ask a question of Mr. Spires. 

Because Homeland Security is the third largest Federal agency 

in the Federal Government, the IT budget is also one of the largest. 

In Fiscal Year 2012, the Department of Homeland Security’s IT 

budget was approximately $5.6 billion. You are responsible for over 

360 IT programs, 83 of which have life cycles, cost estimates of 

over $50 million or more. 

So, obviously the size and complexity of what you are responsible 

for provides us, I think, a great opportunity to support a well 

planned governing structure that allows you to carry out those 

functions. 

Now, we received the GAO high risk report recently. We had a 

hearing on that in this Committee. And in that report it indicated 

that in July of 2012 that the governance structure currently covers 

less than 20 percent, 16 out of 80 of the departments major IT investment, and 3 of its 13 portfolios within the department had not 

yet finalized the policies and procedures that are necessary. 

So, I just wanted Mr. Spires, if you could, to comment on that, 

since that is an area that this Committee is specifically charged 

with from an oversight role. 

Mr. SPIRES. Yes, sir. And in fact this is near and dear to my 

heart to get this better. When I came on three and one half years 

ago it was one of the areas where I felt like the governance of our 

IT was very weak. And so, we have taken it on in two major ways. 

79 

One, to your point, we are now up to 88 major IT programs from 

the 83 that you had cited and I, as I said, as I just was reflecting, 

we need a more active governance model, a better oversight model, 

on many of these. 

Now, to scale the 88 programs, many of which, by the way, are 

in operations and maintenance and we do not need perhaps that 

level of scrutiny on all programs at the same level, but those 16 

programs you alluded to are the ones that I viewed as the highest 

risk programs in the department, the IT programs, and that is 

where we have added this additional layer of governance. So, these 

are Executive Steering Committees where the right executive 

stakeholders meet on a very regular basis with the program team 

to address issues, to set direction for them, to give them help. And 

it has made a meaningful difference in many of these 16 programs. 

On the portfolio level, we have 13 separate portfolios within the 

department that are functions. They are not components, they are 

the functions, they are screening, they are incident response, they 

are finance, the mission and business of DHS. And we are working 

feverishly to get, if you will, the right portfolio look and governance 

around each of those so we can eliminate duplication, and we can 

streamline processes and we can get the synergies of each of the 

components across those functional views. So that is what we are 

working on, sir. 

Mr. HORSFORD. And to that point, I would just encourage the department to just continue your effort in working with local and 

State stakeholders in that regard. I just met with our sheriff in 

Clark County and, you know, he indicated that in some respects it 

is very good, in other respects they are not at the table and there 

are some best practices happening at the local and State level that 

we should be adopting, not necessarily having a top down approach 

from the Federal Government. 

Where are you in the final development or your policies and procedures? 

Mr. SPIRES. Those will be finalized within the next month. There 

is a couple of documents that we still have to sign off that I am 

reviewing right now, sir. I could be happy to report back to this 

Committee on that when those are completed. 

Mr. HORSFORD. That would be great. Thank you very much for 

being here. Thank you to all the witnesses. 

Mr. DUNCAN. [Presiding] Well, thank you very much. 

A few weeks ago, at the earlier hearing on this subject, we got 

into this and our Committee memorandum says at that hearing it 

was established that despite spending more than $600 billion over 

the past decade, too often Federal IT budgets run over budget, behind schedule, never deliver on the promised solution or 

functionality. 

Now, it was mentioned at that hearing, and I was at that hearing, that we spent $81 billion over the last Fiscal Year and it is 

going to be a little bit more this Fiscal Year which, interestingly 

enough, is about identical to the amount of the sequester. 

I have read and heard that the computers and off shoot products 

are obsolete as soon as they are taken out of the box. Now, that 

may be an exaggeration, but apparently our technology is moving 

so fast that things become obsolete very fast. 

80 

Now, my wife and I have three cars, two of them have well over 

100,000 miles on them, the third one has, I think, 98,000 miles on 

it, but they are still doing real well. And Mayor Rendell, former 

Governor of Pennsylvania now, but when he was mayor of Philadelphia, he testified in front of a Congressional Committee and said 

that one of the main problems in Government is there is no incentive to save money so much of it is squandered. Those were his 

words. 

And I noticed, Mr. Soloway that you said what to me, I think, 

is the key word when you said we have go incentivize people because it seems to all the IT people, since the Federal Government 

purchases, the money is not coming out of their pocket like it is 

when I have to buy a new car. They want the latest bells and whistles. They want the most advanced. The want the newest thing. 

How can we incentivize people to get more use out of the technology that they have and hold onto it and use it one year longer 

or two years longer, or not only incentivize individuals but 

incentivize departments and agencies? Because it seems to me that 

if we do not come up with a way to do that, the spending is going 

to continue to spiral out of control because I am sure they thought 

that they were taking care of this problem when the passed the 

Clinger-Cohen Bill that is mentioned here 16 years ago. Sixteen 

years from now, is another Congressional committee going to be 

here facing the same problem except just multiplied many times 

over? 

Mr. SOLOWAY. It is a large issue and a large question, Mr. Duncan. Let me take it from the beginning and go back to the beginning of your comments. 

I think one of the things we have not talked a lot about here is 

the requirements generation process being so critical to ultimately 

what the Government buys. And so a lot of that, and I think the 

governance model that Mr. Spires is talking about will directly and 

aggressively deal with are the requirements the right requirements, are we structuring them in the right way, are there area 

in which we do not need to be on the leading edge or even the 

bleeding edge. 

We can continue to operate, I mean, we have some systems in 

Government that are still COBOL-based that might be worth taking a look at. But there is going to be a variety of need and, as 

you said, it is not automatic that I need to go for every bell and 

whistle. 

That said, I think again that it gets back to the development of 

the workforce and of the program management structure and 

teams. What is celebrated? We do not celebrate acquisition success. 

We hammer people for failure, we do not celebrate success. I think 

that there are a lot of things you could do to balance this out. But 

again, I think it ultimately comes back to how we develop and prepare our workforces and empower them because I think they are 

generally highly responsive and responsible and are not looking to 

spend money they do not have to. 

Mr. DUNCAN. All right. Anybody else want to say anything? Yes, 

madam. 

Ms. CHAPLAIN. The bill does talk about having to have a business 

case to justify some of the larger purchases and that is a good place 

81 

where you could be asking those questions, do we need to move to 

something new, what is the cost and benefit of that versus staying 

with the legacy. 

Mr. DUNCAN. Well, it seems to me the Chairman is trying to 

move in the right direction, trying to do something about this problem in his bill and giving the CIOs more flexibility or more power 

and along with that would hopefully have to come more accountability. So, maybe we can make some progress. 

Mr. Pocan? 

Mr. POCAN. Thank you, Mr. Chairman. I would like to yield my 

time to Mr. Connolly please. 

Mr. CONNOLLY. I thank my colleague. I have two more questions, 

if I might, of first Mr. Gordon. There have been concerns raised by 

some of the industry groups with respect to the draft legislation on 

the provision calling for the transparency of blanket purchase 

agreements. Specifically, the concern is that the final negotiated 

price for a purchase agreement is often proprietary and exposing 

it would weaken a company’s bargaining power. Your take on that? 

Mr. GORDON. Sir, I was raised to understand that public contracts were public documents and I find it baffling that a company 

would claim that the price it is charging a Federal agency for a 

good or service for that matter would be proprietary. In any event, 

we need transparency across BPAs. Again and again, when I 

worked at OMB, I discovered that one agency, when it was negotiating a blanket purchase agreement which is typically under the 

GSA Federal Supply Schedule, had no idea that another agency 

had already negotiated with the same vendor for the same product 

but, of course, at a different price. 

The vendors know how much they are charging different agencies. I do not understand why the Federal Government is not sharing that information. Today, it should be readily available for Federal purchasers. I think it is an excellent idea in this bill. 

Mr. CONNOLLY. Mr. Soloway or Mr. Misener, any industry reaction to that? 

Mr. SOLOWAY. I think the caution I would offer here is that there 

is a difference between price and cost and I think it is one thing 

to have public disclosure of a public contract, what the Government 

is paying, but the underlying elements and cost elements are highly proprietary and I think that that is an area where we would 

have to protect against the inappropriate sharing of information. 

The second piece is, if you are dealing with a commercial contract and it is fixed price, the only thing that matters is the ultimate price that you pay. You say I am paying X dollars for this 

per minute or per hour and I am done the hours. But divulging my 

labor rates, specifically how I characterize them, or my other costs 

I think would cross the line. 

Mr. CONNOLLY. Okay. Final question. We have been talking 

about workforce development. And it has always bothered me as 

well that in addition to the reasons you gave rather passionately, 

Mr. Gordon, and I could not agree with you more, disparaging the 

workforce does not get you skilled workers, especially when we look 

to the next generation of skilled workers let alone retaining them. 

But what about training? I note a huge imbalance in terms of the 

resources, for example, put into the Defense Acquisition University 

82 

and the resources put into the Federal Acquisition Institute. I 

mean, it is night and day. And I wonder if you would comment on 

that. Could the Federal Acquisition Institute, with some beefing 

up, help us? Because right now a lot of those are in fact online 

courses but they are refresher courses. They do not solve the underlying problem of do we have the requisite skill set to manage 

large systems integration contracts. 

And it seems to me the Pentagon is doing a much better job of 

that because it puts serious resources into it. Maybe, Mr. Spires, 

you could begin commenting on that because you are on the civilian 

side. 

Mr. SPIRES. Sure, I am. Yes, I would agree that we need to beef 

up our training capabilities. But we also need to marry that with 

something that Mr. Soloway mentioned. We need to have a career 

track for these kinds of professionals on the program management 

side. And that is more than just training. That is mentoring, that 

it bringing th em along on smaller programs and then building 

until they are taking on these large programs. Because there is 

nothing that beats experience in actually delivering these kinds of 

large complex IT programs. 

Mr. CONNOLLY. Mr. Soloway. 

Mr. SOLOWAY. Yes, I would caution, I think your point it well 

taken. I would caution the linear connection. In the Defense Department, the acquisition workforce is much more broadly defined 

than it is in the civilian space. I had that responsibility when I was 

in the Pentagon. 

There are far more career categories and fields that are considered a part of the acquisition workforce. So, it is a much larger entity. It is about 175,000 or so people. Maybe 150,000. In the civilian 

agency traditionally the acquisition community has been contracting officers and contracting officers’ technical representatives 

and limited to that. So, you may only have one-quarter or maybe 

even one-fifth or even less numerically so that the numbers are not 

a linear connection. 

That said, to Mr. Spires’ point, one is beefing up the definition 

and the skill sets around Acquisition with a capital A which involves all of the program management skills and so forth, marrying 

that with the technology requirements and really defining career 

categories and training and development opportunities that are 

contemporary and reflect the need of the Government in terms of 

what it is buying, not the need of the Government as to what it 

used to buy. 

Mr. CONNOLLY. And if the Chair would just allow Mr. Gordon, 

who is seeking recognition, and I thank the Chair for its indulgence. 

Mr. GORDON. Thank you. Very briefly, I very much agree. As you 

know, Congressman Connolly, there has been strengthening on the 

civilian side at the Federal Acquisition Institute. There is more 

work to be done. 

One quick point may be worth mentioning. It is a nice example. 

One of the problems that we often see is poor requirements put in 

the solicitation initially which causes problems the whole length of 

the contract. When I used to ask contracting officers, what is causVerDate Aug 31 2005 09:15 Aug 07, 2013 Jkt 000000 PO 00000 Frm 00086 Fmt 6633 Sfmt 6633 C:\DOCS\82274.TXT APRIL
83 

ing this, the answer I often got was oh, well we were afraid to talk 

to industry when we were writing the solicitation initially. 

One of the things I always push for, and I am glad the Administration is continuing to push, is what we call the Myth Busters 

Campaign, to improve communication between industry and Government, it reinforces Government people’s understanding that it is 

okay to talk to industry early on a solicitation. If there were a way 

to get that into the bill, it might actually be a helpful message. 

Chairman ISSA. Excellent. And I would like to do a quick second 

round because I have heard a lot of things that were particularly 

of interest to me. 

Mr. Soloway, when you were asked about essentially making 

public costs/price, you made a good point which was that there is 

only so much information that is helpful and at some point it becomes proprietary. I am assuming you were only answering as the 

to the public that in a reform, if anybody who is part of us, the 

Federal Government, wants to know what us, the Federal Government is paying for something, they should have a level of transparency to get that, either online or through a briefing structure. 

In other words, you would not support any closure of Mr. Spires 

and six other counterparts in other agencies having full access so 

they could be the smartest buyer. In other words, if you bid higher 

at the next, or Mr. Misener’s bids higher at the next contract bid, 

that would be known to Government that somehow your price had 

risen rather than fallen. 

Is that a fair statement? 

Mr. SOLOWAY. I think that it is the top line price that I am buying. My contract with Amazon is for X dollars, that is going to be 

public, I do not have any problem with that. 

Chairman ISSA. No, actually what I am saying more specifically, 

and I am going to go to Mr. Spires in a second and Mr. Misener, 

this bill envisions that the Federal Government is a single entity. 

We do not buy that way now. We buy as though we are different 

companies and we pay different prices and actually we redundantly 

end up buying excess licenses, which is another factor that we 

know is low-hanging fruit to save money, at least if the price of a 

pro license does not change. 

My question to you is, do you agree with one of the premises of 

the IT reform which is that the Federal Government is a single entity, therefore any piece of information, let us just call it the explanation of how a price was reached on a contract, should be available to that entity in any and all parts internally looking, the Federal Government has a right to know. Mr. Spires should never go 

out for a bid with a company and not know what they charge for 

a similar product at a previous quote. 

Mr. SOLOWAY. With your permission, I would like to take part of 

that under advisement and come back with a written response for 

the record because I think there are several elements to this that 

I think we need to think through. 

Chairman ISSA. Okay, because this is a value of the IT reform 

that we have had over 20 major entities, including yours, make 

comments on. I do not want it to be a secret that my view is some 

of the savings is by the Government considering itself a single entity for the first time. 

84 

Mr. SOLOWAY. Right, and I think to a significant extent we would 

agree with you. But I think there are going to be limitations that 

we would like to think through and how to define them best so I 

do not misstate anything here. 

I would make one comment, though, at this point on that question. We hear this question a lot with the issue of strategic 

sourcing. A lot of discussion about well, I brought this solution but 

I am paying x dollars an hour for this kind of engineer from a company but why for that same engineer in another contract and I 

think this is part and parcel of really defining the whole concept 

of what strategic sourcing is and what its objective is. 

In some cases, it strictly is an effort to use bulk buying to get 

costs down. In other cases, it is truly to be strategic in how I source 

things but recognizing the driving price is not the only issue. If I 

am dealing with cloud services, the kind of work that Amazon does, 

it is a little bit cleaner and clearer than if I am dealing with a complex integrated solution. So, if you do not mind, I would like to take 

that question over the record. 

Chairman ISSA. And Mr. Gordon, you are, as Mr. Connolly noticed, is eager to answer also. 

Mr. GORDON. Yes, sir. Thank you, Mr. Chairman. I enthusiastically endorse the view that you are setting out. Let me give you 

a couple of points along those lines. 

The fact is, when the Government buys, if it is a big agency like 

the Department of Homeland Security, it is really important to do, 

to make those decisions across the entire department and, as much 

as possible, we should be making our decisions across the entire 

Federal Government. That is why I so much support the idea of 

BPA transparency. 

I want to point out that my former and wonderful colleagues at 

GAO, in the high risk report that came before this Committee recently, they did something very unusual. They took something off 

the high risk list and it is really relevant to this bill. They took 

interagency contracting management off the high risk list because 

the Executive Branch had worked to improve it and frankly leaving 

it on the high risk sent a message to agencies, oh, interagency contracting is bad. In my opinion, interagency contracting, when managed properly, is a very good thing, fully consistent with your draft 

bill. 

Chairman ISSA. Ms. Chaplain, this goes right squarely into what 

you look at every day, that much of the savings is through interagency activities and finding the most qualified prime and then 

being able to tag onto that. 

Ms. CHAPLAIN. Yes, and I completely agree with the notion that 

the Government should be acting, where possible, as a single 

buyer. Also, with regard to strategic sourcing, you cannot put everything in one bucket. Not everything is a commodity. There are 

more complex requirements and there are scenarios where there 

are fewer suppliers and you have a very specialized thing you are 

after. 

But in those cases, the best practice companies we have studied 

tailor their tactics, too. They look at cost drivers, they develop new 

suppliers, they prioritize with suppliers. So, there are different 

85 

things you can do beyond just the basic strategic sourcing when 

you get to these more complex types of products. 

Chairman ISSA. We are going to get to Mr. Misener, but Mr. 

Spires, I am going to give you a tangential question to what we 

have already been talking about. You are a sophisticated manager 

of these kinds of things and DHS, I am presuming routinely in 

your council, deals with, hey, we are buying something similar to 

just like, and therefore you begin to say why can we not buy just 

like for the same price. And you go out, in a sense, with that concept often, don’t you? 

Mr. SPIRES. Yes, we do. And we have had a very aggressive strategic sourcing internal effort, working with our Chief Procurement 

Office. And I agree, we need to do more of this across the Federal 

Government in IT. There are many things that do not lend themselves to strategic sourcing. But there are many things that we buy 

that do, billions of dollars worth, within DHS alone that I think 

would be, we would offer up as to try to be a part of strategic 

sourcing for the whole Federal Government. 

Chairman ISSA. Mr. Misener, I said I would get back to you. 

Mr. MISENER. Thank you, Mr. Chairman. Just to add that we 

would greatly appreciate the clarity Government-wide that your 

bill would bring. And so, we focused on cloud computing, that it 

what we are expert in. I will note that we have dropped our prices 

two dozen times since we began in 2006. 

Chairman ISSA. I might note that I am familiar somewhat with 

Amazon in the private sector. You dropped prices, for some reasons, even while you are under contract with somebody for a twoyear period. That has befuddled people who have observed it. I do 

not believe that happens in a Government contract at this time, 

but if it does, I am pleased. 

Mr. MISENER. Well, we have, and will continue to, drive our 

prices down, greater efficiencies and economy of skills. I think one 

thing that would be helpful, if I may, is to recognize that our cloud 

computing business, we report in our finances as part of a category 

we call other and that obviously includes other things. 

Chairman ISSA. I was on the board of a public company. I understand why you throw things into other rather than letting people 

see what is growing and not growing if you can help it. There are 

a couple of CFOs behind you laughing right now. 

Mr. MISENER. That other category had revenues of about $2.5 billion. 

Chairman ISSA. So it was peanuts really. 

Mr. MISENER. Well, it was out of $60 billion for the whole company. 

Chairman ISSA. I always wanted to say that about $2.5 billion. 

[Laughter.] 

Mr. MISENER. In a sense, if my math is right, that is less than 

5 percent. Now, obviously we are very happy with the business and 

how it is going and how we are able to serve as customers, both 

private and in Government side, but something important to recognize is that $2.5 billion is an interesting calibration within our 

company. 

But the most important point that I want to make on that is that the other $57.5 billion is supported by the cloud. We have enVerDate Aug 31 2005 09:15 Aug 07, 2013 Jkt 000000 PO 00000 Frm 00089 Fmt 6633 Sfmt 6633 C:\DOCS\82274.TXT APRIL
86 

trusted that business to the cloud. We have put our legacy and our 

core retail business on cloud because we really believe in it. So we 

are enthusiastic supporters, unabashedly so, but not just as providers of the service, we are also users of the service. 

Chairman ISSA. Okay, I have one final question, with the ranking member’s indulgence. 

GAO reports in 2011 the Government had funded 622 separate 

human resource systems and 580 financial management systems, 

and 777, lucky triple 7, supply chain management systems. Now, 

I have dollar figures and all that. 

But let me just ask a fundamental question and some of it will 

go to GAO but some of it maybe goes to Mr. Soloway and so on, 

when you have this many systems, even if you bought every one 

of them right, and even if every one of them did their job perfectly, 

you go to big picture because they were separate, what we use to 

call WYSIWYG, you know what you see is what you get kind of a 

term, if you go to train, if you go to have somebody go from Department of Homeland Security to Department of Defense, they are inherently going to a different system they have to learn over again. 

Is it not one of the goals that we should have in IT reform to 

make the portability of the employee, the expertise transferable to 

the broadest extent possible whether it is in payroll, in purchasing, 

or in fact, in any other system, so that the training cycle goes way 

down because more and more people can have on their resume I 

know how to use the Federal procurement system and it is one system even if the parts they are looking at are different for a different part. 

Is that not one of the biggest goals that IT should have, is to 

drive down the training costs by driving up the common interface, 

user interface, that people train? And I will start with Ms. Chaplain. 

Ms. CHAPLAIN. Generally, the more that you can standardize 

your requirements and make things more alike, you are driving 

down the costs just by its nature. And then if you get to a point 

where they can be sort of in the same category or just the same, 

that is where you can bring in more strategic sourcing techniques. 

So, it should be done, not just from a workforce side but a cost side, 

too. 

Chairman ISSA. Mr. Soloway. 

Mr. SOLOWAY. Yes, I think that is absolutely true. That is clearly 

a goal of technology, it is an initiative that has, fits and starts if 

you will, across Government over the years, the lines of business 

initiatives and shared services initiatives and other work that is 

being done, but there is no question that should be an objective, 

to harmonize these systems to the maximum extent possible. We 

see this in other non-technology way with security clearances 

where they are different for every agency and I have a clearance 

at Justice but it is not even usable in the FBI. I mean, you see all 

kinds of disconnects, but I think you are absolutely correct. 

Chairman ISSA. And Mr. Connolly, do you have any closing remarks? 

Mr. CONNOLLY. No, Mr. Chairman, I just want to thank you for 

the hearing. I think this has been very, very thoughtful. I really 

appreciate all of the testimony and I think it is going to help us 

87 

in the drafting of our bill. And again, I thank the Chair for reaching out and I want to commend his staff who have been wonderful 

to work with. We really appreciate the collaboration. 

Chairman ISSA. Thank you. And with that, I would like to announce that our goal on the Committee is to bring to a published 

bill by the time we leave for the spring recess which is later in 

March. So, less than about three weeks until we expect to turn it 

into a published bill from which we will begin the process of further proposing mark-ups. And I do that because I would like both 

people on the outside and, quite frankly, all of staff and members 

to be aware that we think we have gone far enough that we should 

be able to put it into a bill that will not be perfect but at least will 

be modestly amendable with some help. 

I want to thank all of you for comments. I am going to leave this 

hearing’s notes open for all of you for five business days, giving you 

an opportunity to come back, Mr. Soloway and others, with the 

ideas and answers that may not have been able to be done live 

here today. 

And with that, we stand adjourned. 

[Whereupon, at 11:40 a.m., the committee was adjourned.] 

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