The Federal Supply Chain Management Organization (FSCMO) is a virtual think tank dedicated to the responsible and productive use of taxpayer monies during the federal acquisition process. More specifically, the diverse professionals who make up the FSCMO are focused on the development of standards and practices that guarantee the compliant and cost-effective management of the hundreds of billions of taxpayer dollars distributed annually by contractors to members of their federal supply chains.
Every year the US Government issues between $500B - $1T ($1,000,000,000,000.00) in federal revenue to commercial companies via government contracts. Of that total, between 40-60% (up to $600B) is distributed by these prime contractors to subcontractors and suppliers (their “federal supply chain”) for the products and services required to meet US Government mission objectives across the country and around the world. “US Government mission objectives” span a wide array of support, from janitorial services for government buildings to issuing passports to developing the next generations of stealth weaponry and space travel technology.
Federal contractors must navigate hundreds of pages of contract documentation and thousands of pages of federal rules and regulations to compliantly provide support for US government missions and the men and women performing those missions on the ground. The decisions made by federal contractors to meet “just in time” delivery requirements in accordance with a myriad of legal restrictions are evaluated both during performance by their Government Customer and after the fact by government audit agencies that are empowered and encouraged to punish and penalize contractors for those decisions with which they do not agree, even if the mission was fulfilled on time and under budget.
These audits are not a collaborative process; government audit agencies are solely focused on regulatory compliance and ignore quality of performance when making their assessments. Responding to audit agencies (and their subjective interpretation of regulatory requirements) is a time-consuming and expensive process that often ends with government recommendations that slow contract performance while increasing the costs of that performance to both the contractor and the US taxpayer.
As a result of this contradictory tension between meeting aggressive contract schedules and performing to the “gold standard” of regulatory compliance applied by government audit agencies, thousands of government contractors are forced to make the same decision with every procurement – strict compliance with the potential expectations of a government auditor or timely delivery of quality support to the warfighter?
The FSCMO was founded to provide a third option: Practical compliance with objective federal requirements that allows contractors to enforce the rights of the taxpayer against its federal supply chains in ways that guarantee timely and cost-efficient support of US mission objectives at home and abroad while maintaining the integrity of their federal business systems during government audit.
Focus on Contractor Business Systems
Government agencies, in particular the Defense Contract Audit Agency (DCAA) and the Defense Contract Management Agency (DCMA), evaluate a contractor’s management of its federal supply chains via the Contractor Business System Audit and Review process. During these formal evaluations, government audit agencies determine how closely contractors comply with the agency’s interpretation of the laws and regulations that apply to federal supply chain management.
A “contractor business system” is a collection of policies, procedures, and processes that dictate how contractor time and resources are allocated in order to simultaneously comply with laws and regulations while completing mission objectives in a timely manner. During a business system audit or review, a government agency aggressively evaluates both system infrastructure and output to determine the effectiveness of system operation in accordance with agency interpretations of relevant laws, regulations and Executive Orders. Unfortunately for both contractors and the taxpayer, this singular focus of government audit agencies does not include any level of concern with the actual costs of system performance (including the time, funding, and resources required to comply with often impractical agency interpretations of federal law) or how those costs are recouped by contractors from tax revenue.
In order to balance complicated legal requirements with the US taxpayers’ right to expect the responsible use of their money during the federal acquisition process, FSCMO provides guidance and develops standards for effectively and efficiently navigating the audits and reviews that directly impact the cost of federal supply chain performance, including:
- Contractor Purchasing System Reviews (CPSR)
- Property System Audits
- Earned Value Management System (EVMS) Audits
- Small Business Audits
- Estimating System Audits
- Material Management and Accounting System (MMAS) Audits
The FSCMO is specifically focused on providing the most productive and cost-efficient options for legally compliant contractor business system management that reduce waste while guaranteeing timely quality support for US personnel and warfighters around the world.
What We Do
The FSCMO provides a number of resources to their members, many via its online portal:
Policy Statements and Guidance: The FSCMO Advisory Council (AC) issues Policy Statements regarding new issues impacting the federal supply chain management community and Guidance providing top level instruction for compliance with new requirements as they are applied to contractors by government agencies.
Work Instructions: The FSCMO AC creates and issues Work Instructions for the performance of specific tasks within the enormous framework of federal supply chain management. Work Instructions are segregated by Contractor Business System and organized by topic. Complete sets of Contractor Business System Work Instructions are collected and published on an annual basis.
Publications: FSCMO offers e-books and other publications for exclusive use by its members.
Training: FSCMO Training is offered via live and web-broadcast events; specific training options and certifications are available via the FSCMO online portal.
Online Collaboration: FSCMO Advisory Council representatives provide ad hoc guidance regarding federal supply chain management via the FSCMO online portal. Advisory Council representatives are also available to collaborate with members on their ongoing federal supply chain management issues via the portal.
Live Events: FSCMO hosts a variety of educational and social events for its members, including an annual celebration to mark the end of the Government Fiscal Year (GYE). All events are hosted by one or more Advisory Council representatives and are usually held in Washington, DC and surrounding areas.
Membership in the FSCMO is free to all federal supply chain management professionals. While membership is free, members are expected to participate in organization functions and contribute to the organization’s primary objectives. Because the FSCMO is focused on the standardization of best practices within the federal supply chain management community, membership is not offered to government agency representatives or personnel..