Buying in to Consolidation

How do you consolidate your information technology operations through procurement practices? By collapsing the bulk of your IT needs—worth nearly $6 billion a year in the case of the Homeland Security Department—into just two buys.

"We're trying to bring as much of that 'spend' as we can under these two programs," Homeland Security Chief Procurement Officer Greg Rothwell explained, referring to the Eagle and First Source procurements, during a recent industry day in Washington.

DHS is preparing solicitations for the pair of buys that in addition to giving its agencies access to goods and services also aim to consolidate systems operations across the department's 22 component agencies.

Market analyst Input of McLean, Va., estimates that Eagle—which stands for Enterprise Acquisition Gateway for Leading Edge solutions—will be worth $45 billion and that First Source will top out at $3 billion.

The Rub

Integrating services and creating a standard IT infrastructure has been a challenge for the department, acknowledges Ronald Hewitt, the Coast Guard CIO. "We have been struggling with it for two years," since DHS opened its doors in March 2003, he says.

Hewitt led the creation of the current IT Infrastructure Transformation Program during the past year, after he stepped in as acting CIO when Steve Cooper left the post in June 2004. Scott Charbo, former systems chief at the Agriculture Department, took over as CIO in June of this year.

Charbo plans to live up to the promises in Hewitt's transformation plan and move forward on the department's big projects. "My English on that is, 'We have enough PowerPoints; let's go ahead and deliver something,' " he told the vendors at the industry day event.

As the department heads toward its third anniversary, its senior IT and procurement leaders want to award Eagle and First Source to cover the vast majority of IT needs departmentwide for the next several years.

"Eagle will be the tool that we use to implement our enterprise architecture," Homeland Security Chief Technology Officer Lee Holcomb said this month at an Input breakfast in Fairfax, Va. The buy provides a "path for consolidation because we can roll items into it" as existing contracts and programs expire, he said.

Through Eagle, DHS plans to award multiple contracts for five categories of services:

• infrastructure engineering design, development, implementation and integration;
• operations and maintenance;
• independent test, validation, verification and evaluation;
• software development;
• management support services.

The department's procurement plans call for issuing the Eagle request for proposals this year and making contract awards in 2006.

First Source, an all-small-business commodities buy, will be the vehicle for commercial computer and communications products. Homeland Security wants to award these set-aside deals before year's end.

"Eagle and other DHS contractors will be able to use First Source to acquire hardware and software for their DHS programs," First Source contracting officer Michael B. Smith says.

Central Proposition

There are eight buying commands within DHS that will acquire IT goods and services through Eagle and First Source going forward, Rothwell says. Each of the contracts awarded for these buys will have a five-year base period and two one-year options.

The new IT Acquisition Center will manage the buys. The department opened the center this summer to consolidate buying services for IT within DHS. [Related story].

Admittedly, there will be some unique needs—especially in the intelligence, new-technology and security areas—that neither of these two procurements will be able to handle, says William Thoreen, contracting officer for Eagle.

"We view this as a 90-percent solution," he says.

The Eagle and First Source contracts will not be open to buyers governmentwide, although DHS will let other agencies use them for IT purchases for homeland security programs.

Thoreen and Smith also caution that the buys are not just a way to bring every conceivable vendor of every conceivable technology under a couple of loosely tethered umbrellas.

Speaking about Eagle, Thoreen notes, "This is not an everybody-gets-a-contract-type of procurement."

The department wants enough vendors to get the services it seeks, but not so many as to make the buys unmanageable, he says. "We want a suite of contracts as flexible and as broad as possible to meet the needs of the department."