Loopholes to Load-Shed: Contract Management Capacity, Representative Bureaucracy, and Goal Displacement in Federal Procurement Decisions

ABSTRACT

Federal contracting is complicated by the conflict between system maintenance and the more intangible, normative goals of government. This study focuses on a federal procurement program that explicitly pursues equity as a normative goal in the contracting of services from small and disadvantaged businesses. For many federal agencies, low contract management capacity makes the pursuit of this goal difficult, prompting these agencies to focus on goals that are more proximate, easily achievable, and tangible. We argue that both behavioral and representative bureaucracy theories help explain how organizations can synthesize goals in this particular context, thereby reducing the propensity of federal agencies to displace equity for the more proximately achievable goal of system maintenance. Our findings indicate support for this argument. We discuss the contributions of this study to studies of goal displacement and, more generally, to theory integration in public management scholarship.

Notes

Note: N = 317.

Notes: N = 317; Robust standard errors in parentheses. Coefficients for agency and year dummies not shown.

*p < 0.1; **p < 0.05; ***p < 0.01.

Notes: N = 317.

*p < 0.1; **p < 0.05; ***p < 0.01.

We follow Nicholson-Crotty, Grissom, and Nicholson-Crotty (2011, 588) in using a “population proportionality standard” as a reasonable (but not objective) conceptualization of equity—which is (we argue) an ambiguous concept (Stone 2009).

Simon (1964, 11–12) explicitly admits to this caveat in his theory of role behavior: “in thus separating our consideration of organizational role-enacting behavior from our consideration of personal motivation—allowing the decision to join as the only bridge between them—we are proposing an abstraction from the complexities of real life.”

Available at http://www.sba.gov/content/8a-business-development-0.

Ibid.

Ibid.

See 13 CFR 124.506(b) for statutory guidance in this regulation. Available at http://edocket.access.gpo.gov/cfr_2005/janqtr/13cfr124.506.htm.

On the face of it, the intent of the provisions that apply to ANCs was economic development. Each corporation established by ANSCA was to serve as the economic driver for the villages and people under its auspices. Although the corporations were set up with capital through ANSCA, the corporations were limited by skill set, location, and experience. The provisions made within SBA 8(a), a program intended as a business development model rather than a macro-economic development model, were made to accommodate the reality that the ANCs needed a customer base. Thus, with the minimum standards of being native-owned and -operated, and the workforce being composed of a certain percentage of Alaska Natives, the company could use slack resources to train workers in an area of expertise fitting to a federal agency's needs. By taking on the contracts, incorporating the skills of other workers, and thereby diversifying its own workforce, it is inferred that the provision was meant to essentially push the struggling corporations (at least in part) “out of the nest” into the private sector, meanwhile developing their domestic economies within the villages back in Alaska. At the same time, the general SBA 8(a) program was presumably intended to be implemented in equitable degrees among participants (Waxman 2006).

Available at http://www.acquisition.gov/far/current/html/Subpart%2019_8.html.

Available at http://www.corpwatch.org/article.php?id=11793.

Expectations for the ratio of contract dollars to SBA 8(a) participants are set at a minimum of 5% across agencies.

Our empirical expectation is that non-native minority representation will be negatively associated with goal displacement. If we observe such an association, though, we cannot be sure why it is occurring. It may be the case that active representation is in fact going on—that is, that non-native minority bureaucrats are awarding contracts to non-native minority firms. But, it could also be the case that the presence of non-native minority bureaucrats is acting as a counterbalance to the goal-displacing behavior of other bureaucrats (Lim [2006] discusses this possibility at length). As Barnard (1938) notes, inducements toward a particular course of action can be shaped by the informal norms of the organizational setting—norms that non-native minorities can influence. We raise these points because we are observing associations between variables measured at the organizational-level, and so are unable to make inferences about individual-level behavior.

More precisely, the expectation here is not that Native Americans will be more likely to displace goals for reasons related to managerial capacity, but that they will be inclined toward the awarding of an SBA 8(a) contract to an ANC on the basis of shared race. The exercise of this bias is not goal displacement; nevertheless, we use the term above and below for the sake of consistency.

Available at http://www.opm.gov/FEDCLASS/gs1102.pdf.

Available at https://www.fpds.gov/common/html/public_welcome_text.html.