The Rise of DOGE in the US: What the Department of Government Efficiency Means for Public Procurement-and Why European Suppliers Should Be Paying Attention

As of May 2025, the U.S. Department of Government Efficiency (DOGE) has already claimed to save nearly $200 billion in government spending through contract terminations, process improvements, and organizational restructuring7. Whether you're a European supplier doing business with the American government or simply watching from across the Atlantic, these rapid transformations represent a significant shift in how the world's largest public procurer conducts business. This blog explores DOGE's impact on procurement practices and what European companies should be considering as similar reforms potentially reach their shores.

What Is DOGE and Why It Matters

The Department of Government Efficiency emerged from discussions between Donald Trump and Elon Musk during the 2024 presidential campaign, when Musk floated the idea of a "government efficiency commission"10. Officially established through Executive Order 14158 on January 20, 2025, DOGE represents a significant reorganization of the former United States Digital Service into the newly branded United States DOGE Service (USDS)110.

At its core, DOGE operates as a cross-departmental temporary organization housed within the Executive Office of the President, scheduled to dissolve on July 4, 20261019. Though temporary by design, its mission is transformative: to modernize federal technology and software systems to maximize governmental efficiency and productivity1.

The organization employs a multi-pronged approach to achieve its objectives:

1. DOGE Teams embedded within federal agencies that include engineers, HR specialists, and attorneys10

2. Direct access to unclassified agency records and IT systems10

3. Authority to terminate contracts deemed wasteful or inefficient7

4. Implementation of new digital systems to track and justify government expenditures15

What makes DOGE particularly noteworthy is its scale of ambition. Initially, Musk suggested cutting $2 trillion from federal spending, though he later revised this target to $1 trillion1017. While these figures may be aspirational, they signal unprecedented scrutiny of government procurement practices.

Procurement Impacts in the US

DOGE is fundamentally reshaping federal procurement with its strict focus on cost-cutting, contract consolidation, and operational streamlining2. Unlike traditional oversight bodies, DOGE operates with an efficiency-first mandate that makes conventional lobbying and procedural arguments largely ineffective2.

The transformation is already underway. Executive Order 14158 mandates that each agency build "a centralized technological system" to record every payment issued, complete with justification from the approving employee15. This unprecedented level of transparency aims to eliminate unnecessary spending and hold officials accountable for procurement decisions.

In practice, DOGE's impact on procurement has been swift and substantial:

Contract Terminations and Reviews

By February 2025, DOGE had announced the termination of 1,127 federal contracts spanning 39 federal departments and agencies10. While subsequent analysis revealed discrepancies in some savings calculations, the message was clear: no contract was above scrutiny10.

IT Modernization Initiatives

A key focus of DOGE has been modernizing outdated IT systems that are expensive to maintain and inefficient to operate3. The federal government spends over $100 billion on information technology and cybersecurity annually, with approximately 80% going toward operating and maintaining legacy systems, some more than 50 years old3.

Private Sector Alignment

Perhaps most tellingly, private businesses are also following DOGE's lead by doubling down on cost-cutting measures, especially as new tariffs threaten profit margins12. The latest Hackett Report reveals that procurement teams across the private sector plan to increase savings in 2025 compared to 2024, using both price reduction and cost avoidance strategies12.

Positive Implications for Europe

While DOGE is an American initiative, its approach and early results could catalyze similar reforms across the European Union, where public procurement accounts for approximately 14% of collective GDP-about €2 trillion annually511.

Cross-Border Procurement Opportunities

The EU has already been working to standardize public procurement between member states through initiatives like CEF eDelivery, which enables system-to-system communication across different eProcurement systems58. However, despite these efforts, direct cross-border procurement accounts for only 3.5% of total contract value5.

If the US demonstrates that efficiency-focused procurement reforms can yield substantial savings without compromising quality, European policymakers may accelerate their own reform agenda. The European Parliament is already considering proposals to reduce bureaucracy and simplify rules while standardizing tender procedures and structures for joint procurement at both national and cross-border levels11.

Competitive Advantage for Prepared Companies

European companies already accustomed to navigating complex compliance environments may actually gain a competitive advantage if similar reforms reach Europe. Their experience with rigorous documentation and process adherence could position them well for a more streamlined but still compliance-focused procurement landscape.

Furthermore, European firms with expertise in digital procurement solutions could find significant opportunities as governments seek to implement more efficient systems. This is particularly relevant given the EU's ongoing digital transformation of procurement processes5.

Why Public Sector-Focused Companies Should Prepare

For companies that rely on public sector contracts-whether in the US, Europe, or both-DOGE-inspired reforms present both challenges and opportunities.

Faster Procurement Cycles Require Agility

As procurement processes become more efficient, companies will have less time to respond to tenders. This acceleration demands greater organizational agility and better real-time monitoring of procurement opportunities.

Digital-First Is No Longer Optional

The emphasis on IT modernization means suppliers must be fully prepared for digital-first procurement processes. This includes capabilities for electronic bidding, digital contract management, and automated compliance verification.

Value Demonstration Becomes Critical

With the focus on cost-cutting and efficiency, suppliers must clearly articulate their value proposition in terms that resonate with procurement officials trained to prioritize measurable outcomes. This means developing robust methodologies for demonstrating return on investment and total cost of ownership.

Sectors Most Likely to Feel Impact

While all government suppliers will experience some change, certain sectors are positioned at the forefront of DOGE-inspired reforms:

1. IT services and software, particularly those offering modernization solutions

2. Management consulting, especially firms specializing in efficiency and process optimization

3. Infrastructure contractors who can demonstrate innovative cost-saving approaches

4. Healthcare suppliers able to balance cost efficiency with quality outcomes

Preparing for a New Procurement Landscape

European suppliers would be wise to view DOGE not as a distant American phenomenon but as a potential preview of coming attractions. The proposed reform of the EU Public Procurement Framework already aims to reduce and simplify rules while standardizing procedures11, suggesting alignment with DOGE's efficiency-focused approach.

To stay competitive in this evolving landscape, suppliers should:

1. Invest in procurement intelligence tools that provide real-time alerts and analytics

2. Streamline internal bid response processes to accommodate shorter timelines

3. Develop clear, data-driven value narratives that speak directly to efficiency and cost-effectiveness

4. Build expertise in digital procurement systems and compliance automation

The rise of DOGE signals a fundamental shift in how governments approach procurement. For prepared European suppliers, this shift represents not just a challenge to navigate but an opportunity to differentiate in an increasingly competitive global market for public contracts.

Conclusion

As DOGE reshapes the American procurement landscape with its relentless focus on efficiency and cost-effectiveness, European suppliers should take note. The winds of change rarely stop at national borders, particularly when they promise significant taxpayer savings. By understanding DOGE's approach and preparing for similar reforms at home, European companies can position themselves not just to survive but to thrive in the evolving public procurement environment.