The federal acquisition process is notoriously complex. A primary reason is the extensive regulatory framework governing government contracting. Federal agencies must adhere to numerous statutes, regulations, and policies as outlined in the Federal Acquisition Regulation (FAR) and its supplements such as Defense Federal Acquisition Regulation Supplement (DFARS). They outline the rules for acquiring goods and services as well as the workflow that federal agencies need to follow.
The 5-phase federal acquisition process flowchart
The structured framework ensures consistency, transparency, and efficiency in the federal acquisition process. When executed properly, it contributes to risk reduction by systematically addressing potential issues and uncertainties at each stage of procurement. The goal of the framework is to increase the likelihood of successful outcomes and minimize the impact of potential risks on government acquisition initiatives.
Overcoming common obstacles in the federal acquisition process
Improper execution of the federal acquisition process can undermine transparency, fairness, and efficiency, jeopardizing the success of government procurement initiatives. Below we highlight the top three challenges in each phase of the acquisition process and what you can do about them.
Challenges in phase 1: Acquisition planning
Unclear requirements. Program offices may have vague or evolving needs, requiring careful collaboration and a guided process that clearly identifies what is needed from them.
The program office can tackle this challenge by identifying subject matter experts responsible for clarifying needs and ensuring alignment with overarching agency objectives. They should assemble and consult with a team of stakeholders committed to the project and continuously refining and documenting requirements as they evolve.
Stakeholder communication. Effectively communicating with all relevant stakeholders (program managers, legal, finance) can be challenging, especially since they may have varying priorities, expertise levels, and expectations.
To address this issue, it's essential to foster open communication channels, establish clear objectives and expectations, and actively engage stakeholders throughout the planning process to ensure their input is considered and incorporated into the acquisition strategy. Having communications in a standardized system makes it easy to communicate with vendors. It also enables the agency to carry forward institutional knowledge even in the case of personnel changes or absences, something that is difficult to do with chats and email communications.
- Market research. Identifying potential suppliers, assessing market trends, and gauging industry capabilities require time and resources. Past procurements can offer a wealth of useful information, but it’s difficult to find similar procurements on public government websites.
Challenges in phase 2: Solicitation
Developing high-quality solicitations. Ensuring clarity, consistency, and completeness in documents such as the Request for Proposals (RFP) requires detailed knowledge of the agency’s needs and the relevant regulations.
In addition to collaborating closely with stakeholders to thoroughly understand requirements, the contracting professional should leverage standardized templates and best practices for solicitation documents and engage legal and subject matter experts to ensure clarity, consistency, and completeness in procurement documents. Checklists in an automated solution help assure document completeness. Centrally managed templates with version control minimize the risk of using templates that are out of compliance. And generative AI tools can create good initial draft documents that can save hours of work.
Promoting small business participation and meeting socio-economic goals. Meeting small business participation goals and engaging socioeconomically diverse businesses (e.g., women-owned small businesses) can be difficult.
The contracting office can implement targeted outreach efforts to connect with small and diverse businesses, provide assistance and resources to navigate the procurement process, and incorporate set-aside requirements or incentives for small and disadvantaged businesses in solicitation documents to encourage their participation. Fostering partnerships with small business advocacy organizations and leveraging existing socioeconomic contracting programs can further enhance opportunities for small and diverse businesses to compete for government contracts.
- Timeliness. Developing solicitations within tight timelines and with resource constraints is a challenge, and navigating through internal reviews and obtaining the proper approvals adds complexity.
Template-based document creation, workflow management, and real-time collaboration can help keep the acquisition on track. By automating repetitive tasks, such as document formatting and routing for approvals, an automated solution can accelerate the development and review of solicitations, ensuring that deadlines are met while minimizing manual errors and administrative burdens. And features such as notifications and tracking capabilities can help keep stakeholders informed and accountable, facilitating smoother coordination and faster decision-making throughout the solicitation process.
Best-in-class government procurement applications use process automation and AI to improve procurement outcomes:
Challenges in phase 3: Evaluation
Compliance. Adhering to strict timelines, maintaining documentation integrity, protecting sensitive information, and safeguarding against potential protests requires attention to detail and adherence to best practices.
Agencies can maintain compliance by using an automated solution that enforces strict timelines, ensures documentation integrity through version control and audit trails, restricts access to sensitive information based on user permissions, and provides templates and guidance to adhere to best practices.
Price analysis. Ensuring that proposed costs are realistic, reasonable, and consistent with the scope of work while complying with FAR requirements requires expertise in cost estimation, financial analysis, and negotiation strategies.
A solution that integrates with cost analysis systems like the CADE system at the US Department of Defense simplifies the user experience and saves time.
- Past performance evaluation. Developing effective past performance evaluation methodologies, obtaining accurate and timely information, and ensuring fairness and consistency in the evaluation process are key challenges.
Federal agencies can better evaluate past supplier performance by implementing standardized criteria, comprehensive data collection methods, and clear performance metrics. Regular reviews, collaboration among agencies, and leveraging technology for automation also play crucial roles in enhancing the accuracy and efficiency of past performance evaluations.
Challenges in phase 4: Award
Mitigating risk. Identifying and mitigating risks associated with the awarded contract is crucial during the award phase. This includes managing risks related to performance, schedule, cost, cybersecurity, and other factors that may impact the success of the contract.
By centralizing contract data, streamlining risk identification processes, and facilitating collaboration among stakeholders, an automated procurement solution enables proactive risk management, timely mitigation actions, and improved contract oversight, ultimately enhancing the likelihood of contract success.
Transparency. Ensuring that all stakeholders have access to relevant information, decision-making processes are documented, and actions are taken in accordance with established procedures.
Agencies can enhance transparency by using a solution that centralizes documentation, provides real-time access to relevant information for stakeholders, and generates audit trails of decision-making processes. By standardizing procedures and workflows, the solution can ensure consistency and accountability, promoting transparency throughout the award process and fostering trust among stakeholders.
- Workload management. Balancing the need to expedite contract awards with the requirement for thoroughness and compliance requires strategic resource allocation, prioritization of tasks, and effective project management techniques.
An automated procurement solution can streamline administrative tasks, automate routine processes, and provide tools for task prioritization and resource allocation. By optimizing workflows and enabling efficient communication and collaboration among team members, the solution enhances productivity, reduces manual effort, and ensures that contracts are awarded promptly without compromising thoroughness or compliance.
Challenges in phase 5: Post-award
Supplier performance. Challenges may arise in monitoring supplier performance, tracking deliverables, and addressing any deviations or deficiencies promptly.
Tools for real-time performance monitoring, automated alerts for deviations or deficiencies, and centralized documentation of deliverables and milestones can alleviate these issues. By facilitating proactive communication, tracking, and issue resolution, an automated solution enables timely intervention and fosters accountability, ultimately improving supplier performance and contract outcomes.
Managing contract modifications. Changes in scope, pricing adjustments, or contract terms pose challenges during the post-award phase.
Streamlined change management processes, automated notifications for stakeholders, and centralized documentation of modifications are some of the ways an automated procurement makes it easy to manage changes. A good solution also facilitates efficient communication, tracking, and implementation of contract changes while maintaining compliance and transparency.
- Contract closeout. The complexity of contract terms, administrative burden, coordination with stakeholders, compliance requirements, and the need for timeliness contribute to the difficulty of properly closing out contracts—which can lead to audit findings and damage relationships with contractors.
Establishing clear policies and procedures, dedicating sufficient resources and expertise to closeout activities, leveraging automation and technology solutions to streamline processes, and fostering effective communication and collaboration among stakeholders can help ensure timely and accurate completion of contract closeout tasks.
An automated procurement solution can facilitate contract closeout activities by providing tools for centralized documentation management, automated reminders and notifications for upcoming deadlines, templates for standard closeout documentation, and workflows to track and monitor progress. Automation can also ensure compliance with regulatory requirements and improve communication and collaboration among stakeholders, ultimately enhancing the efficiency and effectiveness of contract closeout processes.
