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3 THE FIRST YEAR OF SPECIFICATION DEVELOPMENT: JANUARY 1985 TO JANUARY 1986 In which GSA developed a strawman request for proposal, the vendors becomeiinterested, and Terry Golden comes to GSA as its administrator. THE FIRST YEAR, THE FIRST DRAFT And so the project was formally under way. On the positive side the team had a strategy-that was to prove robust throughout and was led by people who not only believed passionately in it but were acutely aware that to do nothing, or even to delay, was a recipe for disaster. It was obvious, even at that time, that prices on the old FTS system would continue to escalate while service quality fell. The strongest customer agencies were already preparing to leave the system and the U.S. Postal Service, who did not at that time fall under GSA's regulations, was already in transition to a system of its own. Others would very quickly follow, unconcerned by the immense problems and costs of shutting down the old system they would leave behind. This scissor action of the appealing pull of the strategy and the push of the inevitable consequences of delay would prove to be the energizer for each successive player--from the administrator to the engineer--as they were drawn into the team. On the negative side the project already had opposition. Externally OMB, which thought little of GSA's telecommunications abilities, did not appreciate the complexity of the issues and perceived GSA's slow progress concerning FTS as ignoring its concerns. These bad relations were exacerbated by the weakness of GSA, which did not have an administrator at that time. The first administrator appointed by the Reagan administration was Gerald Carmen. He resigned in February 1984 and no successor was in sight. At such times conflict between agencies can escalate. GSA had no Reagan political appointee in the management chain of the FTS to provide stability, to appear publicly in support of the program, and to relate to other political appointees in the user agencies and OMB. The project also had opposition internally in GSA from a group within the Network Services staff, who were used to the central power of running a network, and felt their authority, and even jobs, threatened by the services approach represented by FTS2000. This 19

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20 opposition was exacerbated by the selection of an outsider, Bushelle, to head the organization rather than the promotion of one of their own. In addition, an innovative procurement such as suggested by the FTS2000 strategy constantly challenged the status quo of all GSA's telecommunications staff, so friction was inevitable. However, not all of the involved government interests were antipathetic. On the positive side, while the large customer agencies were not entirely happy with GSA and were still smarting from events such as Telpak and the satellite problems, they had seen progress being made with the cost cutting program and the ARS resolution and were willing to listen. They would prove later to become major collaborators. The vendors who potentially could bid on the replacement were skeptical about GSA's ability to accomplish a procurement of such size. Hence, they were wary of committing bid and proposal preparation money. Related projects undertaken by GSA, involving replacing local service in Washington, D.C., and other areas, had received much publicity several years earlier but were making little or no progress. In addition to having to overcome their~skepticism, the vendors were not yet organized to respond to the FTS replacement project. As was pointed out earlier, FTS2000 was a business decision not a marketing decision for even the largest corporations. The federal marketing arms were not highly enough placed in their corporations to serve as leaders for such a large procurement. Resolving this would take time. This was the picture as 1985 began. The constituencies and problems were clear and the plan of action was equally clear. Regarding OMB opposition, it was clear that the political management of OMB would wait for a Republican political appointee in GSA to make the decisions on FTS2000. As a consequence, the fact was faced that little progress would be made with OMB until GSA had a new administrator. Meanwhile GSA should build up as much momentum as possible with vendors and agencies so that OMB's opposition would become less and less tenable. Regarding internal GSA antipathy to the project, the team felt that reason would eventually prevail among the reasonable, and among others nothing could be done. Hence little attempt would be made in the early days to integrate the project with the existing FTS staff. Consequently, the project was deliberately separated and isolated from the day-to-day operation of the existing network. In addition, it was staffed largely with outsiders supported by the SETAMS contractor. The laissez faire attitude accorded to OMB and the existing FTS staff would not extend to customers, however. It was planned that they would be given real participation and authority in developing the procurement. The agencies' senior representatives were all reasonable people with difficult jobs of their own, not enough budget money or resources, and with little time or propensity to play games. They could be counted on to support GSA as long as progress was being made. On the other hand, if they felt the project would not meet their agencies' needs, they would be among the first to cut their losses and go their own ways. Finally, regarding the vendors, the plan was to approach them at the highest levels, give them all the information possible as it became available, and use the press to get them to understand the magnitude of

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21 the prize and to believe that it would really happen. There were so many overlapping activities in what was really a continuous two year process leading to the release of the RFP in January 1987 that any division of the intervening time has to be somewhat artificial. Although they were not related, three major events occurred in 1985: the public announcement of the project in February, Terry Golden's appointment as administrator of GSA in June, and the release by GSA of the first strawman version of the RFP in October. ANNOUNCING THE PROJECT The public meeting announcing the project was advertised in the Commerce Business Daily for February 13, 1985. In preparation, letters were sent to 19 CEOs of the companies who seemed the likeliest candidates to be prime contractors inviting them to the meeting, briefly explaining its purpose, and pointing out that the annual budget of the system being replaced was about $400 million (Note 1~. Every press contact known was called and personally invited to the meeting as were the wire services and television networks. In the weeks preceding the meeting, the presentations to be delivered at the public announcement were reviewed with the FTS2000 Interagency Steering Committee, internal GSA staff, and OMB. The feeling that eventual teaming would bring together the unlikeliest of partners, both inside and between corporations, was confirmed by the variety of divisions from the big companies represented at the meeting and by the overall variety of attendees. As the public meeting was about to commence in the crowded hall with vendors' representatives standing in the aisles and television cameras ready to roll, OMB staff entered and advised GSA to stop the proceedings (Note 2). GSA declined to do so, but the next day GSA received a letter from David Stockman, the director of OMB, instructing them, r' to take no further action towards the award of a contract" without his approval. While it was expected that OMB might stop GSA it was a surprise that this was done at Stockman's level (Note 3~. No matter, the main aim was to get moving with the strawman specification and issue it as quickly as possible to begin to encourage industry and get them investing money and energy in the project. GSA chose to interpret Stockman's letter as not calling for work to cease but rather that a final RFP should not be released without OMB approval. In many ways, OMBts escalation helped the project by ensuring a very large press coverage. The drama created a corps of reporters who continued to track and write about progress. In terms of further damaging relations with OMB, in the leadership vacuum at GSA they were already as bad as they could be. Consequently, the team moved full speed ahead in developing the strawman specification promised to industry at the public meeting. The vendors were told that this would be the vehicle to include them in developing the procurement. GSA emphasized that it expected to work with them on refining the strawman into a final specification. The vendors were told to expect the strawman in August 1985. This was an estimate as GSA was not sure how long it would take. However, it seemed

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22 appropriate to create a climate of urgency to push the vendors to start thinking and applying resources. Meanwhile, three other activities continued while GSA awaited a new administrator, all aimed at advancing the project as far as possible and gaining momentum as quickly as possible. These included informing of agencies and gaining their support, informing the press of GSA's progress, and responding to OMB questions (Note 4~. INDUCTING THE AGENCIES The FTS2000 Interagency Steering Committee was formed by approaching the highest career SES manager responsible for telecommunications in the 10 biggest user agencies (Note 5~. Each was approached on a personal level and briefed as to the strategy and purpose of the project and their personal involvement sought. Each formal meeting of the assembled steering committee was given first-class treatment, and was well prepared, starting and finishing promptly with plenty of opportunity to interact and plenty of briefing materials. This was done to ensure that each member would feel it was good use of their time and would attend personally. Of the lO members, several emerged as key almost immediately and became major participants and supporters of the project. It was said many times that FTS2000 was a team effort and these were not empty words regarding GSA's customer agencies. The FTS2000 strategy was presented in detail to the Steering Committee on February 4, 198S. The message from GSA was clear, GSA intended to close down the FTS because it was obsolete. Did the steering committee want GSA to aggregate their traffic and procure a replacement? If so, then FTS2000 would be the strategy for their procurement. The answer initially-was a cautious accord that FTS2000 be pursued. In later years this became an enthusiastic commitment by most agencies. Meanwhile a general presentation was developed that described the strategy and dealt with the common concerns point-by-point (Note 6~. This was given over 100 times at government seminars and to customer agencies, from the working to the management level, at the suggestion of the members of the Steering Committee. It was also turned into magazine articles for the technical and other press (Note 7~. This information campaign become the vehicle to build visibility for the project and form a constituency of supporters. In addition, GSA met with assistant secretaries in the largest user agencies accompanied by the relevant Steering Committee member. Visits were also made to other influential bodies such as the telecommunications commands of the Air Force and Army, the Defense Communications Agency (DCA), NCS, and the NSA. A NEW ADMINISTRATOR COMES ON BOARD The effort of reaching out to the agencies paid off. When Terry Golden became administrator three months later on the June 26, 1985, FTS2000 was not just a controversial project that appeared on his briefing

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23 list. He had heard enough positive opinions from enough individuals in the agencies that he too was ready to listen. Golden was by education an engineer from the Massachusetts Institute of Technology (MIT), intellectually capable of understanding the project and imbued with a constant curiosity, ready to be fascinated by this bold step into the future. Golden was to prove to be a key contributor to the project by personally making FTS2000 part of his agenda and personally leading the procurement to its close. Tall, slim, and athletic; ready to listen and having the right blend of humor and seriousness, he was a confident leader. Golden met within the first weeks of his administration with the senior teem members and indicated he did not want to be briefed on the project yet. He asked instead that they teach him telecommunications without any reference to the FTS. To do this, he promised that he would make himself available for hour-long sessions and would call for them with an hour's notice. The team worked on a training agenda, pulling in as many of the term members as possible to give the new administrator a flavor of the team's capabilities and enthusiasm. A screen and overhead projector were set up for the sessions. True to his word, Golden would call and say he had time free, whereupon he would walk down in his shirt sleeves to the briefing room where he and the team would go through the presentations and discuss and question items. Typically he would request a speed up on some items with a brief, "I've got that," and on others would ask penetrating questions, sometime extending a topic over more than one session. After many sessions over approximately a month's time, he said he was ready to hear about the FTS, but not yet about FTS2000. So, in a similar manner, the team briefed him on the existing network over the following two weeks. At that point Golden asked, "What next?," and the team told him that nothing else had been prepared. Only then did he say, "Brief me on FTS2000." It is typical for a new administrator in his early days to look for projects that will allow him to make a mark during his term of office--normally 18 months to 2 years. The team was very aware of this and that FTS2000 had to "catch the wave." Consequently, it was a crucial time with the new administrator's decision likely to be based on a complex assessment of the importance and visibility of the project coupled with the likelihood of it succeeding. A pivotal point came at an informal meeting between Golden and the senior team members when he asked if they believed that the project would succeed. There was only one honest answer to this, "We are so confident that this has to be done and will succeed that we have bet our careers on it." The message was clear--the team thought enough of FTS2000 that it was dedicated to it collectively and individually. From then on, Golden supported the project. On July 12, 1985, in one of his first public announcements concerning the focus of his administration, he said that FTS2000 was one of his priorities. ~ AN INDEPENDENT EVALUATION OF THE STRATEGY In truth, while Golden was convinced that the replacement of FTS must

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24 take place, he was not yet 100 percent convinced about the teds approach and in fact the team recognized that. After consultation with OMB and GSA management he informed the teem and OMB that he would hire a consulting firm to reexamine the alternatives and would make up his mind finally when they had completed their analysis. He also indicated that he intended to set up a blue-ribbon panel to listen to all inputs (the consulting firm, GSA, OMB, customer agencies, and any other interests) and would lean heavily on their advice in making his final decision. However, from the team's perspective his public statements of support were enough for the time being, it was now up to them to persuade him that the approach they were taking was the correct one. It was at this point that some of Golden's own staff became involved in the project--people who would become absolutely essential to progress of the project in later years. Of these, Gary Kowalczyk was his associate administrator for policy. Kowalczyk's key contributions to the project were twofold: first, he provided the link between the project team and the administrator to forge it into a single, smooth working unit; second, he later became manager of the evaluation and award process. Kowalczyk was quiet, serious, intelligent, hardworking, and easy to get on with. He had come to GSA with Golden from Treasury. Kowalczyk was tasked with working with the team to immediately establish the blue-ribbon panel and the consulting firm that would review FTS2000. This was a situation that could have caused difficulties as the team was understandably nervous about so many new participants--Golden's staff, a panel, and a consulting firm. However, Golden's staff were so reasonable and so obviously dedicated to achieving Golden's priorities (of which FTS2000 now formed an important part) that there could be no reason not to work wholeheartedly together. The blue-ribbon panel and consulting firm were more unsettling. One concern was that anyone being placed in a position of influence in a huge, visible procurement would have the opportunity to meddle and trade influence for their own ends. Also, it would take time and willingness to listen on the part of new players to understand what GSA was trying to achieve with the FTS2000 strategy. The selection of the consulting firm and the blue-ribbon panel was hence a very important step. In the case of the blue-ribbon panel, it had to be independent or it would not serve the purpose, as a self-interested panel would certainly not satisfy Golden. Panel members were selected for their unquestioned expertise nationally as well as, in some cases, their prior knowledge of the FTS. They also had no vested interest in the outcome of the procurement, but rather were practitioners from the user side of the industry and pragmatic representatives of academe. The MITRE Corporation was hired to form and manage the panel, to manage the proceedings, and to produce the final report (Note 8~. In selecting the consulting firm, GSA felt that an engineering company would be unsuitable because its natural proclivity would be toward hardware and toward designing a network and replacing the FTS with a look-alike system. What was needed was a company skilled in telecommunications, but from a broad business and policy perspective, who would examine all alternatives with equal weight. So, the specification , .:

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25 for the consulting firm was written to ensure a proper balance of policy and technical expertise. After an open competitive procurement, the contract was awarded to the winning company, Kalba Bowen Associates, Inc., with Economics and Technology, Inc. (ETI) as a subcontractor to advise them on policy and regulatory affairs (Note 9~. WORK CONTINUES IN PARALLEL ON DEVELOPING THE STRAWMAN Meanwhile, work on the strawman specification proceeded, slowly if measured by the public schedule, but in fact quickly considering the level of detail and the novelty of specifying services. Services included a full menu from voice to data to video and included every feature and service that GSA could conceive as a starting point for negotiations. The strawman specification also included the standards for delivery of services and an outline of the terms and conditions of the contract. In early October 1985 GSA was able to issue the strawman (Note 10~. Now industry had something tangible to analyze and a reason to start staffing proposal teams. The plan was that vendors would generate questions and suggestions from the specification and would work with GSA to refine it into a final RFP. The final RFP was to be a consensus product of the potential bidders and the government, and in many ways was to represent the common set of services planned by the carriers. In effect, industry was being given the opportunity to play a major role in specification development and to air their differences and problems before the RFP release to ensure a smooth, swift award process. Initial reaction from the community was that the strawman was far too broad but interestingly enough, as people grew comfortable with the specification, very little was excluded from the final RFP. The balancing act of keeping the momentum going and keeping the work directed toward an RFP continued to the end of the year. This involved developing consensus throughout the constituency: users, vendors, and the central agencies. During the rest of the year, GSA continued to court the customer agencies, the press, the vendors, and all concerned in order to build momentum. Reflections at the end of 1985 showed a fruitful year: GSA had released the strawman specification. As a consequence, companies such as MCI, IBM, GTE Sprint, Martin-Marietta, AT&T, U.S. Telcom, Contel, and Northern Telecom were actively working to analyze the project. In effect, they were helping GSA solve the problem of replacing the obsolete network (Note 11~. Golden not only supported the project but was an active booster and was applying unique staff resources in its support. The were more and more convinced that this approach would customer agencies meet their needs. GSA's spectacular progress and Golden's commitment were quieting the agencies' push to go their own way and bringing their p-ublic support. Finally, mechanisms were under way that would eventually lead to resolution with OMB. In short, GSA had begun the year with a strategy and ended it with a project.