Outcome Over Process: Transforming DHS Procurement for Efficiency and Innovation Part 1

Welcome to “HSDF THE PODCAST,” a collection of policy discussions on government technology and homeland security brought to you by the Homeland Security and Defense Forum

In this episode, We unpack how DHS leaders move from compliance-heavy buying to outcome-based contracting that delivers speed, clarity, and measurable results. Coast Guard, TSA, and CBP share practical ways to define success, choose the right contract type, and adjust incentives without slowing the mission.

Featuring:
- Julie Koo, Chief of the Contracting Office for the Border Enforcement and Administration Portfolio, U.S. Customs and Border Protection (CBP)
- Denise Morales, Head of Contracting Activity, Transportation Security Administration (TSA)
- Shreena Morris, Head of Contracting Activity, U.S. Coast Guard
- Sarah Green, Deputy Chief Procurement Officer, DHS (moderator)

This discussion took place January 22nd, 2026, at HSDF’s Technology Innovation in Government Symposium

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Transcript

CPO, HCA, COCO And Warrants

Shift To Outcomes Over Compliance

Panelist Introductions

SPEAKER_03 0:01

So today, honored to be joined by this group of experts with diverse perspectives and extensive experience, including two of our heads of contracting activities and one of our chiefs of the contracting office. Before our panel, we had a question from the audience about sort of the difference between, you know, the chief procurement officer or the heads of contracting, the contracting officers COCOS. So let me, before we jump in, just sort of demystify that, if you will. So the chief procurement officer is a statutory position who also serves as the senior procurement executive. That is my boss, Mr. Paul Courtney. By law, the CPO is responsible for the acquisition workforce. And also may delegate key procurement functions to various heads of the contracting activities. So we have nine of those heads of contracting activities at DHS. They manage all the operational contracting activities within their respective components and are responsible for overseeing and directing those contracting operations and compliance with all of the myriad applicable laws, regulations, and policies that we have. Under that, we have the chiefs of the contracting office who are designated by the HCAs, and they typically oversee a functional area or a team, an office, if you will, and provide leadership and management to that team. And then finally, of course, we have the contracting officers, which is who you want that signs on the dotted line of those contracts. It enters into, administers, and terminates contracts for the federal government. They have authority to legally bind the government to those contractual agreements, but only within the bounds of their warrant, which is their sort of authority given to them by their head of contracting. And of course, subject to applicable reviews. So the core responsibilities of these roles remain under the FAR overhaul. Those don't change. But we do see that shift from rigid compliance model to a more focused on good business decisions and speed. So with that in mind, I'm pleased to introduce those with us today. As Megan said, Sharina Morris, HCA for U.S. Coast Guard. Sharina returns to DHS from her previous roles, the senior procurement executive of OPM. Denise Morales, the HCA for TSA, previously the deputy HCA for FEMA. Thank you, Denise, for joining us. Denise has only been in her role for a little over a month, so we're very excited to hear those sort of fresh perspectives. And then, of course, Julie Ku, who's the chief of the contracting office for CPP's Border Enforcement and Administration portfolio. So thank you all for being here today and sharing some expertise with us. But let me jump into the questions that we had to kick off the conversation. So I wanted to just take a look at the current landscape of outcome-based contracting at DHS. And I want you guys to talk to us about why this approach is important and what are you looking for from industry and what sort of dis incentives and disincentives that you think drive the most effective desired outcomes? Shrina, let's start with you. Sure. Well, good at is it afternoon yet?

Why Outcomes Matter At DHS

Coast Guard’s Mission-Driven Needs

SPEAKER_02 3:38

Good afternoon, everyone. Happy to be here. And I can say for Coast Guard, especially in this season, outcome-based contracting is critically important for us and enables us to focus on mission readiness and operational effectiveness, which is key, especially when it comes to OB3 and what we're trying to accomplish under this administration. I would say, especially considering our mission sets, which could span from environmental protection, maritime security, and search and rescue, those are very diverse mission sets. And we have to deliver. People are going to recognize if you didn't clean up the oil spill timely and undue damage occurred to the area that it impacted. So it's really critical that any of our industry partners who are working with us understand that diversity and the challenge that comes to trying to respond to such a diverse mission set all across Coast Guard. So what I'm looking for and what my contracting teams are looking for when they're engaging with industry is one, an understanding of the challenge. Sometimes we're going to come and we need to move really fast. Sometimes schedule is king. Sometimes seeing something very different and thinking outside the box is key. It's our goal to try to make sure we convey that to you so you know how to adequately engage with us. But then being willing to really find the flexibility, find the innovation when it exists to be able to hit the ground run and to deliver that mission is really key. And when it comes to incentives, because of our diverse mission set, it's really going to vary. But I would say the preponderance of what we do at Coast Guard is commercial-based, right? And so if it's commercial, you got firm fixed price, you've got to really think about the strategy, how you would get out, get out in front of that. Sometimes it's changing contract type and being flexible on that, but a lot of times it starts with how did we define it and how did we engage with you guys? So we're all here under the DHS umbrella. So at Coast Guard, we really try to lean forward and think about the Procurement Innovation Lab in terms of like how do we structure the solicitation? How do we start? It's hard to fix a problem down the line, right? So we really try to collaborate early on and think about that creativity and the contract structure, even the approach to solicit for a contract. That's really been key for us in terms of thinking innovative when it comes to disincentives. Uh, we don't love those, but sometimes we'll have to maybe withhold payment, um, partial invoice, or maybe restructure contracts as we get into it and we find out something's not working. We're not afraid to revisit metrics that don't serve us. So we've had a lot of success and kind of they're not completely outside the box thinking. A lot of it is, as we're hearing, more common sense. Let's not be afraid to change course if it's not serving us.

SPEAKER_03 6:19

Thank you. Uh Denise.

SPEAKER_01 6:21

No, thank you again for inviting me and being here. Um, yes, a month into TSA and learning a lot about the uh future of travel and learning a lot about what we're doing at TSA. Um, but similar to Trina, we're always looking for what is the solution. It's like uh adding to what Trina had mentioned, moving from problem solving in a way to a problem avoidance in when it comes to how do I get uh something solved in the new mission set and vision for the agency and the department. Uh so similarly, what we're looking is to hear more from you. I'm like very open to and understand from industry what they're seeing out there that could benefit uh how we move forward, how we progress. Speed is definitely one of the things we're looking into. How do we can make this faster? Because technology is constantly moving, constantly shifting, and how do we keep pace up with that? Um so ongoing conversations is what is key for us because it helps us understand proactively what is not working so we can shift the metrics and shift the conversations and make sure we have the right solutions in place. A contract can be changed and modified to adjust to that evolving need. So there's an engagement that it has to be ongoing. It can't be just fixed in a point in time, but looking proactively as to what is also changing outside of you know the federal space. What are the new things and the modernization so that we can be um up to date in what what we are approaching and what our solution is going to look like.

SPEAKER_00 8:02

Yeah, great.

SPEAKER_03 8:03

Uh Julia, CBP perspective.

Incentives, Metrics And Flexibility

SPEAKER_00 8:06

Um good morning, and I'm happy to be here representing Earl Lewis, our HCA and CBP. Um, yeah, similar to what Denise said and Shrina said, we are looking on saving not only on sometimes we have a lot of money, right? Everybody knows about that one big, beautiful bill, but at the same time, we still need to look for savings as far as dollars are concerned, time and also improve performance. So that is why this is very important to us. But bottom line is that we need to deliver at the speed of mission, and as many of you know, the speed of mission is very, very quick around here and it's faster than I've ever seen it before. So we need to be able to do that, and those outcome-based contract doing need to direct that mission and also deliver the high performance that we need for the men and women in the front line. Um I think what we need from industry is kind of ways to relook at uh the outcomes and help us define what success looks like because a lot of the SLAs that we were using in the past are no longer valid, right? Like many of you have seen many, many contracts with SLAs that are kind of easy to achieve. So we need to really look at like what is success look like, and we need to help, we need help to define what success looks like, also from industries internal but external as well. Um and one last thing, um kind of going off of what I just said is the outcome needs to be measurable and very clear because some of the times when we did have um measurements for incentive type contracts, for example, they tend to be very, very, very convoluted. And we need to do calculus to get to what the outcome is, right? So we need to make sure that we, in the spirit of streamlining and efficiency, that those outcomes and those measurements are clear and precise.

TSA’s Push For Speed And Dialogue

SPEAKER_03 10:04

Yeah, I love that. So we we all want to work with uh a boss that gives us measurable and clear goals. And I think that like sort of translates directly into also the agreement between government and industry and focusing on those measurable, smart goals kind of gets us there. Heard some themes there, you know, kind of beginning with the end in mind, and we're in this environment where it seems to have its own centrifugal force and things are moving faster than ever. And we need that perspective from industry to help make sure that we can get there. So turning to some of the hurdles, um Diet has had a huge push this year to look at some of our contracts with our partners and see about moving some of those to uh outcome-based contracts as opposed to your more statement of work prescriptive, how we want industry to do the work. And we saw a tremendous, I think, step forward with some of our projects doing that and working with our partners there. Um but talk to us about some of the major challenges that you've encountered sort of implementing those outcome-based contracts. Denise, let's start with you.

CBP On Clarity And Measurable Success

SPEAKER_01 11:13

So looking at challenges, I think um, generally speaking, and what I've I've observed is really understanding what the solution looks like. Um I hate to sound like a broken record in a way, but the conversations and clarity and understanding what is that end goal. And not only like what are the little steps that even need to go through, like go from a program perspective, like government perspective, what are the uh hurdles that need to either be lowered or reduced earlier on so that we can achieve that bottom line uh mission set? I think that again, going back to conversations, uh good contract management, the relationship building is one of the things that is key to ensure that this is uh uh achieved with uh outcome-based contracts. Shrina?

SPEAKER_02 12:07

Uh I think it all starts if you are focusing on outcome-based, then you you have an end goal in mind, right? And if we're trying to incentivize, trying to develop metrics that are both meaningful to Coast Guard and then for you guys as our industry partners has been our biggest challenge. We know the thing we have to deliver, and you often know the deadline, you're usually behind. Um, so usually trying to reverse engineer that, and how do we get there ahead of this deadline that maybe we didn't know about, you know, six months ago would have been nice. Uh, you can't go back and put the genie in the bottle. So it's required us to really use a laser focus. Maybe it's having more collaborative workshops. Um, I've been in the contracting world for a while, and I don't have to tell you guys that sometimes the government isn't its own best uh ally in terms of bogarding our own problems, and then we want a solution to you guys, and we want to deliver, and we're like, hey, I need you to propose. And you're like, this is not feasible. I can't meet this, this is the wrong type, this is just doesn't work. So, really trying to carve out time where it doesn't exist to be able to have more of that collaborative engagement where we can clearly say this is what we need. How could you guys be incentivized? What's the reality? What's actually deliverable? What time frame does that look like? And really kind of figuring out what that wiggle room is is really been a challenge for us, especially with the very diverse mission set that I have here at Coast Guard. Um, it's gonna look different for search and rescue, it's gonna look different for some of our IT. Um, and it's not a one-size-fits-all. So you really have to get in for each acquisition and figure out the environment, figure out the stakeholders, and try to think creatively for every single scenario. And that's not an easy feat because sometimes you would love to copy paste. We just don't get to do that in our world.

SPEAKER_00 13:50

Yeah, Joey? Yeah, and I'm gonna get a little bit more tactical in the contracting world since I'm the chief of contracting. Um it is for us, it's been a little bit of the contract type. Um, it's hard to go to outcome-based contracting if we're doing TNM and labor hour contracts. So for us, we're trying to shift into more firm fixed price type contracts, and we are working on that now to be able to, you know, change the contract type. It doesn't happen overnight as much as people like us to do things firm fixed price overnight, then they're not gonna happen that way, right? We're gonna have to start with the things that we have clear deliverables, and then we're gonna also have to start the with the ones that are in sustainment mode, at least for the IT folks, right? So once we move that to a more firm fixed price environment, then we can also evolve into the outcome base. But if we have a lot of TNM and we don't do cost type anymore as much as we used to, but if we're still in that space, it's really hard to get to the outcome base. So incremental changes is what we need in all aspects of what we do.

Defining Success With Smart SLAs

SPEAKER_03 14:59

Yeah, no, that's that's excellent. I think um the contract type issue, I think you'll see a lot of this year because the revolutionary far overhaul um has um given us a few more tools to sort of exploit looking at with our partners can we negotiate a different contract type? Can we do a contract conversion from a time of materials to a firm fixed price? And there are times when that doesn't make sense, and there are times when that has worked out amazing for us, and we've done some of that this year. So I would encourage industry to you know be forthcoming if you see those opportunities to contact your program, to contact your contracting officer and say, hey, we could do something here, we could we could change this to get a better outcome for the government or to get you know, find those innovative uh flexibilities and and try to exploit that for better outcomes. But that's definitely something I think you'll see more of this year. Um so as we all know, a major focus in federal procurement right now is improving the efficiency and effectiveness of the process itself. Uh, right. And so let me start with Julie again. Um at CBP, how do you balance the need for those rapid solution deliveries with the pursuit of innovative uh outcomes?

Converting Contract Types For Outcomes

SPEAKER_00 16:22

Yeah, so we're actually doing this quite a bit now. Um we're realizing that contracts are not a one-and-done thing, right? I think Shwino, you mentioned this. You know, we're not gonna negotiate a contract with you know, with you all and then say, okay, now we're done, let's close the book and move on. We really need to look at what are we getting delivered? Are the the outcomes that we're receiving still pertinent? Are the incentives and disincentives still working? And we need to relook at how we're doing things. And we need to, if if we're not getting the outcomes that we need, we need to come back to the table with you all and have that conversation and be like, hey, this is not the direction in which we're trying to go. And I think there's a lot of things that are going on, especially with a far overhaul about modular contracting, especially in IT. And I think in the um operational realm, we are very, very accustomed to the modular like delivery of goods and services. But I don't think we're as uh comfortable in the contracting sense, right? So we need to be able to marry up the the delivery of products and services, right, with with the type of contracting that requires constant uh re-baseling and and looking at what we're getting delivered through these contract vehicles.

SPEAKER_01 17:43

Great, Denise. So um I think most of you, if not all, were here earlier and heard my uh counterpart, Mr. Um Balanji, talking about what he saw for TSA. And one of the things that he had mentioned is like all of this modernization, great, but it's gotta be a sustainable innovation. It's gotta be repeatable. So to us in contracting is how do I make that happen? That is what I'm always gonna look and have my team look. Um, and again, I said it earlier as well as repeated record here and the communications that's like has to be ongoing, looking at what works, what's not working, what can be changed, um, have check-ins, uh, things like that, uh, to make sure that we have a that partnership to make things happen. And obviously, what we want out of this partnership is a continued partnership. That's again going back to an incentive. What does here's the solution that we were providing? Uh, industry has helped, you know, TSA in our case, you know, develop uh this this new vision, this new era. How do we make it long term? Um, so an ongoing conversation, the ongoing discussions of what's working, what's not working, um, is going to be critical for the success of outcomes, you know, and solutions-based.

SPEAKER_03 19:02

Yeah, yeah, balancing speed and innovation. Trina?

Modular Contracting And Rebaselining

SPEAKER_02 19:06

Yeah, uh kind of echoing what others have said. So rapid solution delivery, it's obviously key. But one of the things I talked to my team is everything doesn't need to be innovative. Sometimes what worked, worked. Um, maybe it's looking at what do we need to get to um and what minor tweaks do we make in that process that will either improve the speed in which we deliver something or even the success of what we deliver. So um it's almost kind of thinking about it just a little bit differently, not throwing the baby out with a bathwater, but just like, all right, let's let's make some minor tweaks to how we did this last time. Because ultimately at Coast Guard, what we always get back to is we need to not create any degradation to mission. So if delivering this service or this widget is still critical, I don't need to impact that. I need to maybe deliver something faster. I maybe need to improve what I've delivered. Um, so that's where our challenge has been at Coast Guard, trying to figure out what does reimagining look like with some of the things that quite frankly weren't broken. Um, maybe we could just make a couple of tweaks and we would be in a better place. Um, and that all gets back to setting realistic outcomes as with you guys as our industry partners, and it's internally, us setting better expectations about when we start to define when we're about to go out on the follow-on procurement, um, letting people know it's not status quo, but we want your feedback. Um, we want to know what meaningful tweaks we could make in advance so that you guys have time to think about those strategies and tweaks that you would make to our strategy and kind of create that win win for more successful mission delivery.