Blockchain technology is a new way of passing information from point A to point B. The data passes through a "block" that gets validated by a network of unrelated computers, and democratizes the transfer of data. This creates a transparency for the path of the data and makes that path irreversible. It also allows for computational logic to be attached to data, enabling automation around actions associated with it.
Organizations across government have been experimenting with ways blockchain technology could make transactions more efficient, secure, and transparent. With the COVID-19 pandemic the ability to easily, securely, and transparently share data has never been more important. In the many areas of our lives affected by the pandemic, blockchain is proving to be a tool for meeting the quickly evolving demands of public health, financial markets, and even democracy itself.
The U.S. Department of the Treasury is the steward of U.S. economic and financial systems, and is responsible for maintaining the nation's financial infrastructure. This includes the production of currency, the disbursement of payments to the American public, revenue collection, and the borrowing of funds necessary to run the federal government. The most familiar agency within Treasury may also be the most dreaded, the Internal Revenue Service (IRS). With tax time approaching, we thought it was a good time to look at the challenges and focus of the Treasury.
- Cybercrime - The Treasury has always been focused on preventing fraud related to currency and tax evasion, but much like the Department of Defense has recognized cyberspace as a new battlefield. Treasury is now focusing on the Internet as the primary stage for money-related crimes. The speed at which crimes are carried out online require new techniques and tools. The use of cryptocurrencies to mask criminal behavior is also a huge focus of the Treasury's investigative departments.
- Blockchain - While blockchain has a tie to the movement of cryptocurrencies (both legitimate and criminal), Treasury is also looking at the technology as a way to better facilitate the management of federal grant funds. In one case, the National Science Foundation is using blockchain to track grant payments and ensure that the terms of the grant are being followed.
- Cloud - Like the Intelligence community, Treasury is looking to develop a cloud solution that meets the unique security needs of its mission while delivering on the efficiencies of the on-demand nature of cloud. The Department is developing a proposal for "T-Cloud," an enterprise wide suite of cloud and professional services across multiple providers. The goal to is award this contract and get it implemented by 2022.
- Citizen Experience - The IRS may be one of the most visible government agencies as citizens interact with them at least once a year. With their high touch with the public, the IRS has been a leader in redefining what customer service means in government. In fiscal 2018, 90% of customers were satisfied with their service via phone or a tax assistance center. This does not mean the work is done. A recent report gave the IRS a C+ on its use of language, saying the agency needs to make their web content more user-friendly using Plain Language
For those working at or supporting the Treasury, there are several upcoming events that can help bring these challenges and their solutions into focus.
Implementations and pilots of blockchain continue across government. The benefits of blockchain, including decentralization, immutability, security, and transparency, are appealing in government as they relate directly to mandates around security, privacy, and data openness. It is these needs that will drive further acceptance and use of blockchain.
As this article points out, innovation is not found in just one technology alone - it is a combination of inventions that when used together toward a specific goal create a new way of doing something. The example cited is the airplane. Human flight was made possible by the desire to travel faster and the combination of technologies and discoveries such as the gasoline engine and aerodynamics. Similarly, the goal of peer-to-peer transactions powered by blockchain will be achieved when the technology is combined with other innovations and processes. Some early successes fueling the wide application of blockchain include:
The phrase "Supply Chain" may make you immediately think of retail giants like Amazon and Walmart or manufacturers like GM and John Deere, but government is highly reliant on security supply chains. A supply chain is the network of all the people, organizations, resources, activities and technology involved in the creation and sale of a product. It encompasses the delivery of source materials from the supplier to the manufacturer, to its eventual delivery to the end user. In government, supply chains have come front and center with the Trump administration's rulings banning government use of products from certain Chinese manufacturers citing security concerns that products could contain ways for the Chinese to spy on the U.S. Companies selling technology to the government have to be able to trace the source of all elements of their products to ensure nothing originated with the banned distributors.
Being able to do this requires a mature supply chain process and solution. Interagency committees have been established to determine best practices in securing increasingly complex supply chains. Understanding supply chains is an expensive undertaking and one survey found that small and mid-sized businesses are opting out, counting on the fact that they will not be the ones called out to defend their supply chain to government. This mentality may not be an option for long.
DoD is getting more and more prescriptive in their security and supply chain guidance, adding the review of contractor purchasing systems as part of bid reviews. GSA has also explored banning the use of refurbished IT, since that includes products where a supply chain cannot be re-created.
The rules and regulations around supply chains can seem just as complex as the chains themselves. Luckily, it's a topic of discussion at a number of upcoming events.
With another Government Fiscal Year ramping up, we're starting with a whole new year of budget and contract opportunities in the government market. As we've written here before, the acquisition and procurement process in government is evolving to adapt to the technologies and services being procured as well as changes in the workforce that supports it.
The federal government has been rolling out a number of changes to modernize the procurement process. The Government Services Administration (GSA) is taking steps to streamline their scheduled offerings from two dozen into one. The goal of this consolidation is to remove overlap between schedules and eliminate confusion around what schedule should be used. This shift is happening in three phases:
- Phase 1 -- Issued a consolidated schedule solicitation with a simplified format, streamlined terms and conditions, and new categories and special item numbers (SINs) This phase is complete.
- Phase 2 -- Mass modifications of existing contracts. Finishing in 2019.
- Phase 3 - Final consolidation. Slated for July 2020.
In other efforts to be more efficient, procurement teams across government have been looking at implementing emerging technologies to automate manual processes, plus speed up and secure the overall acquisition lifecycle. For example, the use of blockchain is helping buyers "comparison shop" for pricing as well as closing out contracts.
Finally, acquisition groups are playing a big role in ensuring new technologies like Artificial Intelligence (AI) are consumable by the federal government. GSA is partnering with the Pentagon's Joint Artificial Intelligence Center to advance the efforts of the AI Center of Excellence, employing tactics that have worked in other agencies including the Department of Agriculture.
We've pulled together a number of events that are applicable to the procurement community as well as industry and government looking for ways to introduce new technologies and services into the government.