The Curious Case of VA and Its SDVOSB and VOSB “Goals” – Flatlined Advocacy = Flatlined Goals

By Wayne Simpson, an NVSBC member on thoughts regarding SDVOSB/VOSB advocacy at VA.

The Wikipedia Free Dictionary defines “Goal” as an idea of the future or desired result that a person or a group of people envisions, plans and commits to achieve.

Given this definition, could it honestly be the desired result of the Secretary of Veterans Affairs to spend less VA money with Veteran-Owned Small Businesses (VOSBs) and Service-Disabled Veteran-Owned Small Businesses (SDVOSBs)?  That’s exactly what VA’s SDVOSB and VOSB procurement preference program goals communicate.

Despite substantially exceeding its SDVOSB and VOSB socioeconomic procurement preference program goals for each of the last eight fiscal years, VA has flatlined its goals since Fiscal Year 2010.  From Fiscal Year 2010 through Fiscal Year 2017 (as of December 15, 2017), VA has posted average accomplishments of 18.79% for SDVOSBs and 20.89% for VOSBs, all while flatlining its goals at 10% and 12%, respectively.

The median SDVOSB and VOSB reported accomplishments during this time was 18.94% and 20.86% respectively.  VA’s highest reported accomplishments against its flatlined goals occurred in Fiscal Year 2010, with 20.31% for SDVOSBs and 23.36% for VOSBs.  VA’s lowest reported accomplishments still far exceeded the flatlined goals, occurring in Fiscal Year 2015 with 17.22% for SDVOSBs and 19.04% for VOSBs.

Yet the goals remain flatlined.  What could possibly be the cogent and compelling reason(s) or justification for not raising them?

During this same eight-year period, VA has been led by three different Secretaries of Veterans Affairs, covering two administrations.  The only common denominator relating to small business and socioeconomic procurement preference program goal establishment, other than the continuation of flatlined SDVOSB and VOSB goals, is the Senior Executive who serves as VA’s principal small business advocate is the same individual during this same time period.

VA’s principal small business advocate is organizationally titled Executive Director, Office of Small and Veteran Business Programs, a position encumbered by a career member of the Senior Executive Service, and an organizational element of the Office of the Secretary of Veterans Affairs.  This individual is responsible for preparing for the Secretary of Veterans Affairs, the Secretary’s annual small business and socioeconomic procurement preference goals, and advocating on behalf of all small businesses, especially SDVOSBs and VOSBs.

It seems in recent years goal development has not been accomplished timely, or in the case of Fiscal Years 2015 and 2016, not at all.  Consider in Fiscal Year 2014, VA issued its small and socioeconomic procurement preference program with only 38 days remaining in the fiscal year.  The Secretary issued no goals in Fiscal Years 2015 and 2016, as evidenced by a “no records” response to a Freedom of Information Act (FOIA) request submitted for these documents.  In Fiscal Year 2017, VA was slightly timelier than the last time it issued goals, issuing them on May 25, 2017 (shortly after our FOIA Request), with only 128 days remaining in Fiscal Year 2017.  As of December 22, 2017, VA has not published its Fiscal Year 2018 goals to the VA Office of Small and Disadvantaged Business Utilization website.  Apparently establishing meaningful goals in a timely manner is no longer a priority as it once was at VA.

The VA Secretary’s Fiscal Year 2017 Small Business Goaling Memorandum, dated May 25, 2017 [Click here to see the Memorandum] discusses a Fiscal Year 2016 piloted effort to concentrate on spend areas where active goals management is most likely to produce results.  VA identified “manageable spend” areas based on VA-funded contract actions, but excluded major health care contracts, large-dollar major construction actions, and mandatory domestic delivery service contracts under the Federal Strategic Sourcing Initiative.  Since no goaling memorandum was issued by the Secretary in Fiscal Year 2016, it is unlikely many people outside VA would have known of this change.  Talk about changing the rules of the game and moving the goal posts—how is this strategy advocating for small businesses?  Flatlined Advocacy.

Chart – SDVOSB VOSB Goaling FY 2005 thru 2017

Also during VA’s current principal small business advocate’s tenure, VA discontinued the practice of monthly publishing its socioeconomic procurement preference program accomplishments—once heralded by VA’s advocates and its critics alike because of its  stellar transparency——reporting the good, the bad, and yes, the ugly.  It would seem difficult to manage any process, including goaling, if a process cannot be measured or seen by the goal’s various stakeholders, both internal and external to VA.

There was also a time when VA’s principal small business advocate would adjust goals in new and ensuing goaling periods based on accomplishments, setting meaningful and realistic goals, as Wikipedia says for establishing “the future or desired result.”  But the former Executive, long-gone, was a true Federal champion of Veteran Business, a highly-regarded, respected and demonstrative Veteran business advocate who, fortunately for the Veteran business community continues his advocacy to this day.

Perhaps VA is not raising its goals because it foresees what some suspect is coming down the road.  Many changes being contemplated by VA, such as “Tiered Evaluations,” (a fancy VA term which is better known in the Federal contracting community as cascading set-asides) and its Med/Surg Prime Vendor 2.0, which could reduce VA’s spend with SDVOSBs and VOSB.  SDVOSBs and VOSBs should monitor these proposed changes with great interest in order to protect and preserve their interests.

Some have also opined VA keeps the goals so very low because by substantially exceeding them it is easier for VA Executives and others to justify cash bonuses come evaluation and performance rating time.  Let’s hope this isn’t the case, but given some of VA’s previous scandals involving cash bonuses, it wouldn’t be unreasonable or a stretch to think along these lines.

Maybe this would be an opportune time for Veteran Entrepreneurs and their advocates to respectfully start advocating for themselves and better advocacy at VA by asking the Secretary of Veterans Affairs some questions:

• Secretary, why has the SDVOSB and VOSB goals been flatlined since Fiscal Year 2010?
• Secretary, are you aware of the socioeconomic procurement preference program accomplishments since Fiscal Year 2010 and the significant delta between VA’s goals and its accomplishments?
• Secretary, although your Executive Director, Office of Small and Veteran Business Programs (VA’s Principal Small Business Advocate) is responsible for preparing the Secretary’s goals regardless of who serves as Secretary, why is it goals were not issued by your predecessors for Fiscal Years 2015 and 2016, and issued in Fiscal Year 2014 with only 38 days remaining in the Fiscal Year, and in Fiscal Year 2017 with only 128 days remaining in the fiscal year?
• Secretary, is VA’s principal small business advocate making the case to you to increase these goals, and if not, why not?
• Secretary, how often do you meet with your principal small business advocate and discuss goals and accomplishments?
• Secretary, is it really your intent to spend less VA procurement dollars with SDVOSBs and VOSBs, as the goals communicate?

To be certain, running VA has to be a monumental undertaking.  Undoubtedly, Veteran Entrepreneurship cannot be the Secretary’s highest priority, but it has to be at least a priority.  But the Secretary must rely on his principal small business advocate to ensure maximum practicable opportunities for SDVOSBs and VOSBs—to help guide the Secretary in these and related matters, and to help sort through the often competing interests of small business programs with VA’s procurement operations.  Is the principal small business advocate really doing right by SDVOSBs and VOSBs in flatlining the goals in these, the two highest procurement preference program groups in VA’s procurement hierarchy?

I posted an article on December 18, 2017, [Click here to see the December 18, 2017 Article] providing an analysis of VA’s record Veteran-Owned Small Business Spend.  To be sure, this was the “good news story” relating to SDVOSB and VOSB spending, and VA remains the Federal leader in contracting with SDVOSBs and VOSBs, and should be commended for channeling its prime and subcontracting dollars into the very community it is charged with serving.

It is important to note, despite the “flatlined advocacy” of some at VA, they are greatly and fortunately outnumbered by many dedicated and fine acquisition professionals, small business specialists, and others truly committed to providing maximum opportunities for all small businesses, especially SDVOSBs and VOSBs, and using all of the tools at their disposal to do so—the Veterans First Contracting Program, to include Kingdomware’s implementation.

Although the VA SDVOSB’s spend in Fiscal Year 2017 increased significantly, by over $1Billion, and over $900 Million with all VOSBs, the number of set-asides increased as well, overall transactions for SDVOSBs and VOSBs dropped significantly from Fiscal Year 2016.  It would seem to reason, given the “Rule of Two” is now ensconced at VA courtesy of the U.S. Supreme Court decision in Kingdomware, the number of transactions would have increased.  Will this the trend continue?  While VA’s spend is increasing in these two important socioeconomic procurement preference program categories, will it be fewer SDVOSBs and VOSBs participating in VA’s spend?  We are looking to do an analysis of the number of discrete SDVOSBs and VOSBs who received awards under SDVOSB and VOSB set-asides in Fiscal Year 2017—stay tuned.

The time has come:  SDVOSBs and VOSBs have to ask does VA’s principal small business advocate have enough influence with the Secretary (or even any interest in doing so) to increase the SDVOSB and VOSB goals, whenever (and if) they are issued for Fiscal Year 2018 (hopefully sooner than later)?

So far, and sadly so, based on the flatlined goals during the current principal small business advocate’s tenure and apparent “flatlined advocacy” it doesn’t appear he has any influence with the current or previous Secretaries in this important area, or perhaps he doesn’t even try, or even worse, doesn’t care, or doesn’t explain goaling and accomplishments to his bosses.  His bosses need to hold him accountable, and it will take the Veteran Business Community to do so.

Lastly, some readers may sadly recall from a small business conference in Chicago, shortly after the current principal VA small business advocate entered on duty at VA in which he attended, and opened his remarks by informing conferees, not once, but twice, and to the dismay of those in attendance, that he is not your advocate.  Sounds like the SDVOSB and VOSB flatlined goals are not the only thing that hasn’t changed, but in need of change.

Hopefully in 2018 VA’s Flatlined Advocacy disappears—hope springs eternal!!

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