Interior to merge procurement operations

Two fee-for-service procurement operations at the Interior Department will be merged in order to "create a consistency" between their business operations, a department official said Wednesday.

"We are in the process of putting together a team to look at how we would transition" the agency's GovWorks unit into its National Business Center, said Nina Hatfield, Interior's deputy assistant secretary for Business Management and Wildland Fire. GovWorks and NBC provide procurement and business services to agencies across the government.

Hatfield said the merger reflects a long-held desire by the department to better manage each organization. "For several years now, we have been trying to improve our overall business operations within the department," and increase "management accountability," she said. GovWorks and NBC, Hatfield said, are "operating with two different sets of business practices."

"They're not conflicting," Hatfield said, but in some cases both organizations offer similar services to the same customers.

Hatfield has asked NBC director Doug Bourgeois to name a transition team that will develop a timeline for moving GovWorks into the business center. She said she hoped the transition could be completed within the next 15 months.

GovWorks has long been regarded as one of the more innovative and competitive fee-for-service organizations in government. It has mounted a sophisticated advertising and marketing campaign to attract customers and at times has attempted to compete with much larger fee-for-service shops, including the General Services Administration's Federal Technology Service.

GovWorks, which is situated within Interior's Minerals Management Service, has often been viewed as something of an outsider. Its bureau-level location has distanced it from departmental officials. And GovWorks has not shied away from building its business outside the walls of Interior, a strategy procurement experts said piqued the ire of some department leaders.

Overall, NBC stands to gain significantly from the merger. Bourgeois said GovWorks does about 50 percent more business than NBC, in terms of contract dollars spent through the organization. But NBC has a prized new position, having been authorized to perform financial management services governmentwide as part of the Office of Management and Budget's Lines of Business initiative. The organization also is a strong contender to win OMB's blessing to provide human resources services, Bourgeois said.

Hatfield said during the past two years, GovWorks had improved its financial accountability and its management structure in response to concerns raised by the Interior inspector general. Bringing the organization into the departmental fold would also correct what Hatfield called the "anomaly" of having a fee-for-service organization running under the department's franchise fund at the bureau level. GovWorks and NBC use the fund to sustain their operations, but Hatfield said, the authority to administer it has always existed at the departmental level.

It was not clear how the transition would affect the leadership of GovWorks. The organization is led by David Sutfin, whom Bourgeois lauded for building GovWorks' business over the years. "David's going to play a key role in the transition team," Bourgeois said, adding that Sutfin will help determine the overall strategy and model for the integration.