Army contracting officials say outdated procurement practices are slowing software purchases across the service, leading to efforts to consolidate contracts, modernize pricing and simplify procurement.
During a Dcode session, Danielle Moyer, executive director of the Army Contracting Command at Aberdeen Proving Ground, said the Army’s procurement system was largely designed for purchasing hardware and was struggling to keep up with commercial software.
“Every contract gets delayed,” Moyer said. “Any program I currently have that is waiting for an award will not be awarded due to price considerations.”
The Army Contracting Command oversees more than 1,000 contracting professionals who perform approximately $15 billion in contract work annually. As the Army’s digital center of excellence for software contracts, the organization reviews every Army system that includes software, giving it unique insight into systemic procurement challenges.
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Consolidation of software contracts
One of the biggest problems, Moyer said, is that the Army often purchases the same commercial software through dozens or even hundreds of separate contracts, limiting spending transparency and reducing its negotiating leverage.
She cited Oracle as an example. Army Contracting Command identified 109 separate brand justification and approval documents supporting independent Oracle purchases for the same product from different Army organizations.
“I’ve been on 109 different branding trips for the same thing,” Moyer said. “How? And there were 109 separate contracts.”
The command has noted similar purchasing patterns for platforms such as Palantir, SAP, Salesforce and Appian.
Instead of continuing to purchase identical software under separate contracts with different licensing terms and pricing structures, the Army plans to expand enterprise contract consolidation for products that are repeatedly purchased within the service.
“If you sell an item more than once to the Army, War Department or federal government, we will consider consolidating all of your contracts,” Moyer said.
Hardware procurement models
Moyer also argued that many Army procurement tools are not suitable for purchasing commercial software.
While the Army has adopted digital procurement marketplaces, many still rely on multiple-award, indefinite-delivery, indefinite-quantity contracts that require competition for each purchase. Moyer said this process prevents commanders from purchasing software through commercial marketplaces as easily as possible.
The Army Contracting Command is developing a smart contract tools initiative to begin building this purchasing architecture.
Rethink software prices
Moyer says pricing remains one of the biggest barriers to faster software purchases.
The Federal Acquisition Regulation does not contain a dedicated software section, meaning contracting officials have no framework for evaluating software work categories or commercial software prices. Cost estimators default to comparing specialized software engineers with general IT staff, leading to disputes that are holding up awards for the skills the Army is most actively pursuing.
“This software person – this is an SAP software person. This is very different than someone who is coming,” Moyer said, describing the disconnect between the way companies evaluate specialized workers and the way government assessors evaluate them. “They compare themselves to our internal IT people.”
Because each contracting officer manages approximately 300 actions per year in a portfolio that includes artificial intelligence, communications equipment, chemical and biological defense and business systems, the scope to develop deep market knowledge for each individual technology is limited.
To address this issue, the command is pushing for outcome- and value-based pricing frameworks that evaluate what a technology does rather than analyzing its cost drivers.
“What is the value of something… When you sell me something, you say if you buy this thing, you can get rid of at least four other things… that’s so valuable. And then you compare that to what’s affordable,” Moyer said.
She pointed to next-generation command software that cut a task from 17 minutes to less than a minute as an example of the type of operational improvement that procurement officials should consider in evaluations.
“Right now it takes me 17 minutes. With this new software it now takes me less than a minute,” Moyer said. “This is so valuable.”
She acknowledged that change requires a cultural shift within the contract workforce, not just a policy update.
“I need to start training our contract people to think like that,” she said.
The real impact of the recast regulation is cultural
Moyer also highlighted the Army’s implementation of the revolutionary FAR overhaul as another attempt to modernize software acquisition.
Last year, she led a review of the Army Contracting Command’s procurement supplement, bringing together personnel from contracting centers across the Army to identify unnecessary requirements. Within 12 weeks, the team was able to eliminate more than 75% of the supplement.
“I assembled a team across the entire Army Contracting Command, so not just my center. We handpicked people from each center,” Moyer said. “I think we got rid of over 75% in 12 weeks.”
The focus of the audit was to determine whether individual provisions created added value or unnecessarily slowed down acquisitions.
Moyer said reducing regulatory complexity gives contracting officials more confidence to take advantage of the flexibility already available under federal procurement rules.
“Even if you look at it in detail, the way it’s worded doesn’t give you the feeling that you have room to maneuver,” she said. “It comes with the companion guide…it changes the culture drastically.”
She also wants to revive the FAR Part 14 sealed solicitation for certain technology procurements. In this approach, the government tests and evaluates submitted products in the first step and then invites qualified suppliers to submit a price only in the second step, immediately awarding the contract to the lowest price.
“All done within 30 days,” Moyer said. “No written proposals, nothing. They walk out with a contract.”
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