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Managing Supply Chain Risk within the Commercial Platforms Proof of Concept

 

I would like to say a big thank you to all of our stakeholders for the feedback you’ve provided over the years to help the Commercial Platforms program achieve another major milestone. As you’ve seen from our most recent announcement, I’m excited to be at the point where we are about to launch the proof of concept with the three awarded e-marketplace platforms and participating agencies. 

 

Today’s post is the first in a series of Interact posts focused on topics that are important to our stakeholders. Our topic is supply chain risk management (SCRM) and counterfeit goods. We’ll share how we are managing these important topics within the proof of concept with the awarded e-marketplace platforms. SCRM challenges (i.e., cyber risks, counterfeit items) have been a consistent focus within the Commercial Platforms program, but these concerns aren’t unique to GSA and Section 846. In fact, they represent critical areas that both government and industry are looking to address through comprehensive and collaborative regulation and guidance. 

 

It is worth restating that federal spend taking place using the Government Purchase Card (GPC) via commercial e-commerce portals (from $135M in FY14 to over $300M in FY19) is growing, and introducing significant risk into the federal supply chain. These transactions are dispersed across a growing number of online platforms and suppliers, further heightening this risk. The continued growth of e-commerce buying presents a scenario where the risk will likely continue to increase. 

 

To address vulnerabilities within the supply chain, GSA is taking a number of steps within the proof of concept related to supply chain security, and specifically counterfeit goods:

 

1. Leveraging the existing supply chain risk practices of e-marketplace platforms to combat counterfeiting and vet third party suppliers, to include: 

  • supplier screening practices prior to onboarding,
  • use of tools such as machine learning and artificial intelligence to identify counterfeit items / counterfeiters,
  • product country of origin data, if available, 
  • detailed product descriptions and product/supplier reviews, and
  • proactive supplier quality control and monitoring practices.

2. Including the following SCRM requirements within each e-marketplace platform:

  • Restricting purchases from any excluded vendor listed on SAM.gov
  • Restricting purchases of at-risk products identified in statute
  • Requiring portal providers to allow agencies the ability to curate, filter, and/or restrict the purchase by Federal buyers of prohibited products or categories of products

3. Reviewing post-purchase spend data for anything that slips through the cracks, to identify any suspect purchases and ensure we properly educate buyers (and the portals) so that it doesn't happen again.

 

Additionally, GSA has actively been implementing supply chain risk management per Section 889 of the 2019 NDAA. The prohibition on procurement (referred to as Part A), and use (referred to as Part B) of certain telecommunication and video surveillance equipment applies every bit as much to the commercial e-commerce program as it does to every other federal contract. GSA included all of the necessary FAR requirements for Part A in the e-marketplace platform provider contracts. Part B requires all offerors to represent, after conducting a reasonable inquiry, that covered telecommunications equipment or services are not being used by the contractor. GSA will work closely with the contractors to ensure the Part B prohibition is fully communicated as further policy guidance is issued throughout its implementation. 

 

GSA is also closely following the latest developments in Federal policy guidance on the issue of anti-counterfeiting, to include the recent U.S. Department of Homeland Security (DHS) report entitled “Combating Trafficking in Counterfeit and Pirated Goods”. This report provides beneficial guidance to the awarded e-marketplace platforms as it identifies a set of ten private sector best practices for commercial providers. GSA is in active discussions with DHS to better understand how we can promote these best practices with our awarded platforms. In addition, GSA has been working with the awarded platforms to ensure awareness and understanding of the report.

 

The initial proof of concept is intended to be a viable channel for commercial purchases that also produce several short-term benefits for supply chain security at the agency level, particularly vis-a-vis open market buys. The data collected through the proof of concept and provided back to the agencies will offer better insight into what buyers are purchasing and where supply chain risk lies. As a result, the program can consider additional protections that may be needed for buyers. As stated by GSA Administrator Emily Murphy, “GSA is focused on offering a solution for purchasing commercial products online that protects our federal supply chain against malicious and counterfeit goods, furthering our national security.” 

 

Overall, GSA is focused on making the commercial platform buying experience safer than what it might be today through other open-market channels. Through the measures I’ve outlined above, we feel that GSA can help move the needle on supply chain security. I look forward to the launch of the proof of concept, and seeing the results of these efforts. 

 

Thank you for your continued support and participation in the Commercial Platforms program. 

 

- Laura 

 

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  This Interact group is designed to support the market research and phased implementation of procurement through Commercial E-Commerce Portals (... More

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