What is the difference between “Competitive Sourcing” and “Privatization?
Competitive Sourcing is an initiative to maximize cost effectiveness and efficiency and enhance mission capability by taking advantage of services available through the commercial sector (commercial activities). A function that is competitively sourced and maintained in-house will be converted to a civilian (DoD) workforce. In either case, the government retains responsibility and control of the function, either through service contracts or the DoD civilian Most Efficient Organization (MEO). Privatization is the transfer of control/ownership of a target business asset and/or the associated activity from the public to the private sector. In this case, the government gives up responsibility for and control of the function. Privatization is also characterized by the shift from public to private capital for the fundamental, long-term financial investment required to sustain the privatized activity.
