In 2016, the Small Business Administration (SBA) established a new government wide mentor-protégé program for small businesses called the All Small Mentor-Protégé Program (ASMPP). The purpose of the program was for established government contractors to serve as mentors to protégé small businesses by providing business development assistance and to improve the protégé’s ability to successfully compete for federal contracts.
This relationship between the two companies is intended to be mutually beneficial. For protégés, the program creates a framework under which firms obtain valuable technical, management, financial, and contracting assistance from established government contractors. For mentors, one of the benefits was the ability to form a joint venture with their protégé to pursue small business set aside contracts without the two companies being considered affiliated for purposes of SBA’s small business size standards.
Three Findings from SBA’s OIG Review of ASMPP
The SBA’s Office of Inspector General (OIG) reviewed the ASMPP with the objectives of determining whether SBA implemented effective controls to ensure that it conducted initial application reviews and annual evaluations in accordance with the program regulations and if the SBA successfully measured program success.
Upon review, the OIG had three findings:
- Key controls were missing to prevent unqualified mentors from receiving program benefits.
- Program controls were not effective at ensuring small businesses developed as intended.
- The SBA did not adequately measure benefits of the ASMPP.
OIG Recommends SBA Develop Application Review and Annual Evaluation Procedures
Regarding the first finding, the OIG determined that, despite program officials generally aligning the application review and annual evaluation processes to program regulations, they did not design procedures to review mentor qualifications before approving applications or while reviewing annual evaluation reports. The program has a streamlined application form and annual evaluation report that focuses on the protégés and relied on the protégés to assess the mentors’ qualifications. For example, while reviewing a sample set of 12 applications, the OIG determined that program officials did not ensure mentors met four required qualifications in nine of those applications. During OIG’s evaluation, the SBA did take steps to correct missing regulatory components in the application process. Specifically, SBA drafted a certification form for mentors to complete and submit during the application process. The not yet mandatory form includes an attestation regarding the mentor’s compliance with the four required qualifications for mentors. In order to address this program shortcoming, the OIG recommended that the SBA develop and implement application review and annual evaluation procedures to ensure mentors are qualified, including implementing mandatory use of the non-mandatory mentor certification form.
OIG Recommends SBA Add Additional Staffing Resources
With respect to the second finding, the OIG determined that program officials did not fully adhere to established application review and annual evaluation processes or ensure assessments were appropriately documented. Because of the lack of effective quality controls within the program, the SBA has insufficient ability to assess whether mentors possessed the qualifications to assist protégés and provide support to develop small businesses in line with the program’s goals. The OIG determined that these lack of quality controls can be attributed to both staffing and technical resource constraints affecting oversight, and poor quality and consistency in its established processes. For example, when SBA officials designed the program, they indicated that the program would initially need 12 full-time employees to effectively implement the program. However, the program has only had five employees and a program director since its initiation. The OIG made the following three recommendations to address the second finding:
- The SBA should develop and implement procedures to ensure quality and consistency in application reviews and annual evaluations, including maintaining adequate documentation to support completion of each step in the application review and annual evaluation processes.
- The SBA should prioritize staff resources to ensure application reviews and annual evaluations are conducted in accordance with regulatory and program requirements.
- The SBA should ensure that certify.SBA.gov has the functionality needed for program officials to conduct application reviews and annual evaluations.
OIG Recommends SBA Better Monitor and Evaluate Program Results
As to the third finding, the OIG determined that the SBA did not adequately measure the benefits of the ASMPP. Although the SBA did identify outcome-focused performance measures, the SBA collected insufficient data to accurately assess whether the program had its intended effect. The OIG found that program officials collected less than 24 percent of the data needed to determine the effectiveness of the program in its first year. Moreover, program officials did not verify the data that they collected from program participants was accurate and complete or analyze the results. The OIG indicated that the recommendations from the second finding, if implemented, should ensure that program officials effectively monitor and evaluate program results.
SBA Response to OIG Recommendations
The SBA management ultimately agreed with and resolved three of the four recommendations the OIG provided from its evaluation. The SBA management did not agree with the recommendation regarding staff prioritization, stating that it reserves the right to allocate resources as it deems appropriate to meet the regulatory and program requirements of the organization. SBA management has not proposed an alternative course to address the issues the OIG indicated and the recommendation will remain open until an alternative solution is put forth.