Key Efforts to Increase Small Business Contracts Focused on Expanding Contracting Opportunities, Finding More Qualified Small Businesses, and Improving Program Management and Oversight

DOE’s approach to increasing its prime contracting with small businesses  focused on three main areas: (1) identifying more contracting  opportunities for small businesses, (2) expanding small business  development and outreach activities to create a larger pool of qualified  small businesses, and (3) improving program management and oversight. Despite Increasing Its Contracting with Small Businesses, DOE Prime Contracting Achievement Continues to Fall Short of Its Annual Goal

Despite DOE’s efforts to strengthen its small business program, the  department has not achieved its small business prime contracting goal in 4  of the past 5 years. Two Key Management Challenges Hinder DOE’s Efforts to Further Improve Its Small Business Contracting Performance

DOE faces two management challenges in further improving its small  business prime contracting performance. Both types of practices are commonly associated with high- performing organizations and are consistent with principles contained in  the Government Performance and Results Act. DOE does not, however, collect sufficient information to provide the  department with insight on whether or how specific policies or processes  should be changed to further increase small business prime contracting. Conclusions

DOE has made progress since 2001 not only in increasing the total dollars  it awards to small businesses, but also in increasing the share of its  procurement dollars awarded to such businesses. Periodically conduct a comprehensive evaluation of the department’s and  program offices’ small business programs to determine if changes are  needed and use these assessments to guide improvement efforts. Appendix I: Objectives, Scope, and Methodology

Our objectives were to (1) provide an update on the Department of  Energy’s (DOE) key efforts to increase small business prime contracting  opportunities and the results of these efforts to date and (2) identify the  management challenges DOE faces in improving its small business prime  contracting performance. In addition to these objectives, we are providing  information on the management of small business programs by other  federal agencies that either share certain characteristics with DOE’s  largest program offices or that have components that share certain  characteristics with these offices. To provide information on how other federal agencies address small  business program management challenges, we obtained information on  the practices of the small business offices of three other agencies that  either share certain characteristics with DOE or have component  organizations that share characteristics with DOE: the National  Aeronautics and Space Administration, the Department of the Army (U.S.  Army Corps of Engineers), and the Department of Health and Human  Services (Centers for Disease Control and Prevention).
Why GAO Did This Study

Federal policy requires that small businesses receive the maximum practicable opportunity for providing goods and services to federal agencies through prime contracts--direct contracts between the government and a contractor. The Department of Energy (DOE) buys more than $20 billion in goods and services annually. GAO was asked to (1) discuss DOE's key efforts to increase small business prime contracting opportunities and (2) identify the management challenges DOE faces in improving its small business prime contracting performance. In addition to these objectives GAO is providing information on the management of small business programs by other federal agencies that either share certain characteristics with DOE's largest program offices or that have components that share certain characteristics with these offices.

What GAO Found

Key DOE efforts to increase small business prime contracting have included identifying more contracting opportunities for small businesses, expanding small business development and outreach activities, and increasing program management and oversight. The department has had some success in redirecting to small businesses portions of contracts to manage large DOE facilities, as well as in securing additional small business prime contracting opportunities from the department's other contracts. As a result, the total dollars awarded annually as prime contracts to small businesses have increased, and the share of procurement dollars awarded to small business in 2005 was DOE's second highest ever. Despite these gains, however, DOE was unable to meet its small business prime contracting goal in 4 of the past 5 years. DOE faces two key management challenges to improving its small business program. Addressing these challenges will bring DOE's small business program more in line with the practices associated with high-performing organizations and with principles contained in the Government Performance and Results Act. Specifically, DOE has not defined the concrete steps necessary to enable it to achieve its prime contracting goal and does not collect sufficient information to effectively assess its small business program efforts, identify problems, and implement changes that could further increase small business prime contracting. Other federal agencies with missions or agency components with missions similar to DOE periodically comprehensively evaluate their programs to determine effectiveness, identify problems and make changes intended to improve performance. GAO obtained information from the following three agencies: the National Aeronautics and Space Administration, the Department of the Army (U.S. Army Corps of Engineers), and the Department of Health and Human Services (Centers for Disease Control and Prevention).