government contractsWhen many people think about government contracting, stories about hammers or toilet seats purchased for use by the military and costing thousands of dollars and huge project cost overruns is often what comes to mind. Are excessive costs typical?

Over the last few months, the Wall Street Journal reported that the health care website promoted by President Obama was plagued by cost overruns, exceeding its $60 million budget and costing more than $200 million. There have also been stories about a contractor who overcharged the Pentagon up to seven times for the cost of plastic water bottles.  Of course, there is also the F-35 jet fighter contract that seemingly enjoys construction in every district of every congressman. The cost so far is more than $400 billion.

I recently discussed this issue with two potential faculty members who hope to teach courses in the Government Contracting and Acquisition program at APU. Both have decades of experience in contract management, plus degrees in this field and both said these and similar stories are part of ethics issues.  Ethics discussions are part of the government contracting culture, but are not pervasive enough.

A government and contractor guide book, Contract Management Body of Knowledge (CMBOK) defines ethics as a core or essential competency. Ethics is often a matter of paying attention and looking out for organizational conflicts of interest.

Many ethical issues arise from conflict between the government contract manager (CM) or contract management functions and the contractor’s project or program management (PM) functions. CMs and PMs don’t get along as one would expect.

This relationship and other ethics issues in contracting can be fixed through training and education. A lack of oversight and poor communication is causing unnecessary conflict and poor decision-making.. There are also structural issues created by the government managing prime contractors and leaving the responsibility for the many thousands of subcontractors to those prime contractors.

So, what do you think about the current state of contract management for our military, for the non-military sector of the government? I would like to know!

By Dr. Oliver Hedgepeth
Program Director, Government Contracting & Acquisitions at American Public University

About the Author

Dr. Oliver Hedgepeth is the Program Director (PD) for the Government Contracting and Acquisition programs in with American Military University and American Public University. He is the former PD of Reverse Logistics Management (RLMT) Program and the Transportation and Logistics Management (TLMT) Program. Prior to joining the AMU/APU team, Dr. Hedgepeth was as a tenured Associate Professor of Logistics at the University of Alaska Anchorage, and Chair of the Logistics Department. His book, RFID Metrics, was published in 2007 by CRC Press and is in revision.

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