“With many agency leaders facing a “use-it-or-lose-it” deadline for utilizing their budgets before the end of the fiscal year, the use of OTAs may be a critical and needed weapon for agencies to acquire the resources needed to execute on their fiscal 2020 initiatives.“
“The federal government’s year-end fourth quarter spend has become an annual ritual in Washington, D.C., every September, similar to the anticipation of kids returning to school and the start of fall sports.
It’s more than just the numbers that have revealed this new reality for fourth quarter spending. The entire contracting market has felt it. Government contractors anticipate the release of RFPs over a typical “federal summer” with contract awards to follow in the fall.
In 2018, the year-end spend was referred to as a spending spree of “historic proportions” with nearly 40 percent of contracts being awarded in the last quarter of the government’s fiscal year. Even in a normal year, it was anticipated that 2020 would continue the trend and final quarter spending was predicted to increase. Of course, 2020 has been anything but normal. And it appears this year’s final quarter spend will surpass the previous ones, but with good reason.
The Impact of COVID-19
Suffice to say, 2020 has had a few more challenges than previous years for federal executives. The COVID-19 pandemic has upended all facets of life, business and government. With so much uncertainty throughout the year, many agencies were not able to move forward with some initiatives as quickly as they hoped, thus they did not spend as much as anticipated in the spring and summer months.
Combined with the now-annual Q4 spending frenzy, it means that this year’s fourth quarter will be unlike any before when it comes to government spending. In IT spending alone, Bloomberg Government estimates that nearly $28 billion will be spent by agencies in fourth quarter of fiscal 2020.
An example of the spending push comes from the Department of Veterans Affairs (VA). The VA has spent only $1.7 billion on IT contracts so far this fiscal year, compared to its $7.8 billion IT budget request, which leaves a massive $6.1 billion that must be spent in the final quarter. Furthermore, the CARES Act appropriated the VA an additional $2.2 billion to modernize its IT and electronic health records systems.
OTAs May Be the Answer
While GSAs push to best in class (BIC) government wide acquisition contracts, has created preferred paths to the market, and the use of those BICs can often lend themselves to short turnaround times to make awards, OTAs seem to be on the rise as another alternative.
Other transaction authority (OTAs) have soared in recent years, as they allow agencies to enter into contracts quicker than some of the traditional procurement methods. These have been most popular within the Department of Defense, as they aim to seek to enlist capabilities faster. Their spending through OTAs has increased from about $1 billion in fiscal year 2015 to $7.8 billion in 2019, according to Bloomberg Government data.
However, the use of OTAs could quickly expand to other agencies in a response to COVID-19 and the need to utilize funding in a timely manner to keep pace with the increased demands that have risen in helping our Country get past this pandemic.
According to federal market analyst Chris Cornillie, this may also become the new normal for procurement moving forward.
“We expect that HHS will continue to use OTAs as it meets the needs of the COVID response, and we may see HHS normalize OTAs as a larger part of their R&D portfolio in future years,” he said.”
“In putting together the 2020 Washington Technology Top 100, we scoured websites and LinkedIn to gather the names and titles of the senior leadership at the biggest companies in the market.
This year we identified about 680 people who hold a senior position at a Top 100 company. This includes 98 CEOs. [We came up empty for two companies who do not disclose their leadership on their websites – Mythics, No. 51, and New Tech Solutions, No. 85.]”
“It is something we do each year and is one of the great values of the Top 100.
But given the heightened awareness around racial issues and the continuing challenge of women gaining senior leadership positions, I looked at this information in a different way this year. And while I can’t report any kind of upward or downward trend, I do think we can establish a baseline for the number of women and minorities in senior leadership positions at government contracting firms.
Of the 98 CEOs, 84 are male and 14 are female, so 14.3 percent of CEOs are women. Of the 678 total executives (including CEOs), 525 are male and 153 are female. By percentage, 22.6 percent of the senior leaders at Top 100 companies are female.
For the CEOs, I was able to go back to 2015 and compare the numbers and the split remains the same – 84 male CEOs and 14 female CEOs. [We couldn’t identify CEOs for two companies in 2015 as well.]
It’s interesting to note that some companies have swap out leaders. In 2015, Lockheed Martin and IBM Corp, both had female CEOs, but today they do not. Hewlett-Packard had a female CEO but they no longer are in the Top 100 thanks to splits and divestitures. SAIC and Northrop Grumman did not have female CEOs in 2015, but today they do.
When we looked at minorities, particularly African American CEOs, only three companies on the Top 100 have a CEO or chairman who is African American. They are all founders of their companies – Rene LaVigne, who led the spin-out of Apptis Technology Solutions to create Iron Bow Technologies (No. 60), Dave Steward, founder and chairman of World Wide Technologies (No. 50); and Charles Adams, founder and CEO of Adams Communications & Engineering (No. 97).
Counting these three CEOs, there are just 38 senior executives at Top 100 companies that are African America. Another 41 executives fall into other minority groups such as Asian and Hispanic. I did not separate out African Americans and other minority executives by sex.
The raw numbers for minority representation are bleak but the percentages make it look even worse. African Americans comprise just over half a percent of all senior executives we identified – 0.56 percent. The representation of other minorities is just as bad at 0.6 percent.
And combining all minorities together doesn’t improve things. We identified a total of 79 executives who are either African American or a member of another minority group. That’s just 1.16 percent of all 678 executives.
As I said, I don’t have enough past data to make any kind of statement on the trends. My gut tells me that women are doing better. It seems more women are finding leadership roles in mission areas and are leading business units that directly interact with customers.
Of the Top 100 companies, only 25 did not list a female in a senior executive role. That includes the two companies that listed no executives. Not great, and I would still argue that women are underrepresented as CEOs.
While there seem to some positive signs for women executives, when I look at African American and minority executives, the numbers are pathetic. There are 48 companies on the Top 100 where we could not identify a single minority senior executive. Not one.
As I said, I don’t have the data to identify any kind of trend, but even if the number of African American and minority executives is growing, it isn’t growing very quickly. But honestly, I don’t think it’s growing.
In the aftermath of George Floyd’s murder, I talked with a lot of executives who are sincerely pushing for more inclusion and diversity at their companies and the lack of a presence of African American and minority executives is something several acknowledged.
I believe them and these numbers are another indication of how much work there is to do.”
“The Office of Management and Budget has released an interim regulation outlining the interagency process that will allow agencies to bar companies from federal contracting when they constitute a supply chain security risk.
The rule, authorized by the the Federal Acquisition Supply Chain Security Act of 2018, offers a number of pathways to request excluding a particular vendor from contracting with the federal government.”
“Individual member agencies or the full Federal Acquisition Security Council can make a recommendation, outside agencies or governmental bodies can submit a written request, or the council can consider tips from “any individual or non-federal entity that the FASC determines to be credible.”
The council must then conduct “due diligence” to determine if the risks are valid, including “ensuring to the extent possible, that the information is credible or that the level of confidence in the information is appropriately taken into consideration,” examining “other relevant publicly available information as necessary and appropriate” and consulting with the National Institute for Standards and Technology to ensure such exclusion is in line with federal guidelines and standards.
After that, the council can make a recommendation to the Director of National Intelligence or Secretaries of Homeland Security or Defense, who will ultimately decide whether to issue an exclusion order barring that company or product from future federal contracts. They must also give notice to the supplier that they are being recommended for exclusion and offer an opportunity to clarify or rebut any credible claims that they their product or relationship with a foreign government poses a supply chain risk.
“This due process procedure is intended to provide the named source(s) with the information needed for the source(s) to respond to the recommendation,” the rule states.
Even if the council opts not to recommend exclusion, they may still share the information they received with others under certain circumstances.
The FASC is made up of representatives from across government and was designed to formalize the sort of ad-hoc decision-making that led to the banning of vendors like Kaspersky Labs, Huawei and ZTE from federal procurement channels, on the logic that they are too closely tied to adversarial foreign governments. Such connections, U.S. officials argue, represent an unacceptable risk of espionage through backdoors placed in their products or by the companies routing data to home countries where foreign laws may make it easier to access them. All three companies have vigorously denied charges that they spy or facilitate spying on behalf of foreign governments.
One thing the rule doesn’t address is legal liability for private companies who share information about possible supply chain threats. A working group under the Supply Chain Task Force has determined that private companies seeking to pass along tips or suspicious behaviors in the supply chain space could face lawsuits for defamation or interfering with a contract if the information doesn’t pan out. While federal officials want to take advantage of such tips, broad liability protections could also create an incentive for false reporting or bad faith accusations about competitors.
“Several long terms trends are evident in the Top 100 that will continue to drive activity in the market regardless of the pandemic.
Mergers and acquisitions, divestitures, major contract awards, and more rapid adoption of business models such as the cloud and managed services will continue to influence what is happening in the market.“
Sign number one of a good year is that the aggregate value of the prime contracts for the Top 100 reached $126.3 billion, compared to $115.4 billion for the 2019 Top 100. That’s the fourth year in a row that we’ve seen growth since the market hit bottom with the 2016 Top 100 when the aggregate prime contracts totaled $97.2 billion. The low point came after five years of declines.
The market still hasn’t reached the peak we saw with the 2011 Top 100 when the aggregate prime contracts were valued at $132 billion.
And on a historical note, the 2001 Top 100 – 19 years ago – the aggregate prime contract number was $26.8 billion. That was before the Sept. 11 terrorist attacks super-charged the market.
It is important to note that the 2020 Top 100 is based on federal procurement data collected for calendar 2019. We analyze Federal Procurement Data System reports using over 700 product and service codes that represent IT, systems integration, telecommunication, professional services, engineering services and other technology spending.
An important caveat to this year’s Top 100 is that because we used calendar 2019 data, the rankings do not reflect the impact of the government’s response to the COVID-19 pandemic. Whether that impact is positive or negative will have to wait until next year’s Top 100.
You need look no farther than Leidos, the No. 1 company on the Top 100 with $8.1 billion in prime contracts.
The company pulled off two major acquisitions. It paid $1.65 billion for Dynetics, a space engineering firm, and then $1 billion for the airport security technology business of L3Harris. They also won a couple major recompetes valued in the billions – the $4 billion Hanford site cleanup contract and a $4.6 billion DISA contract to run a global network.
Still in the protest phase is the Navy $7.6 billion NGEN contract that Leidos took away from Perspecta.
But Leidos isn’t alone in big wins.
Science Applications International Corp., No. 11 with $3.7 billion in prime contracts, acquired Unisys Federal for $1.2 billion. It also captured a five-year, $2.9 billion OASIS task order to provide software development and other services to the Army. The company also captured a $1.4 billion Justice Department contract to continue supporting the agency’s asset forfeiture program.
Many others are reporting wins as well. For example, NCI Information Systems, No. 83 with $268.3 million in prime contracts, told us that their book to bill ratio for 2019 was two times revenue and will be better than 1.5 times for 2020.
CACI International, No. 12 with $2.9 billion, captured a significant new contract when it won BEAGLE, a $1.8 billion contract to modernize the back office systems for Customs and Border Protection.
A common theme that runs through many of these wins is the desire by many government agencies to modernize their IT infrastructure, applications and systems. The big buzz word many are using is digitization.
The work is attractive for many companies because it tends to be higher margin and it requires a closer working relationship with your customer.
For Serco Inc., No. 32 with $869.5 million in prime contracts, getting into position to win that kind of work meant walking away from lower margin contracts that were primarily competed on a lowest price, technically acceptable basis.
“In the past, we were just saying, let’s bid lower and then we’ll win the work,” said David Dacquino, CEO of Serco Inc., the U.S. subsidiary of the U.K.-based Serco PLC.
Moving away from that kind of work was a challenge. “It was a significant cultural change because we were comfortable with that, but our backyard was getting too small,” he said.
The shift to higher margin work required investments in people as well as acquisitions such as the deal it made for a portion of Alion Science and Technology that added more Navy work.
The government also played a role in pushing that kind of change at Serco. “We saw customers looking to get a better value,” Dacquino said.
That’s just one example of how the government and what it is asking for is driving companies to change. The market is definitely in an era of push and pull, where agencies are more open to commercial technologies and new ways of doing business and companies are finding new ways to introduce those concepts to their customers.
During our Top 100 event, panelists from Booz Allen Hamilton, No. 8 with $5.2 billion in prime contracts, and ManTech International, No. 28 with $1.2 billion in prime contracts, both described how customer demand for modernization drives change.
Many contractors have set up organizations that allow commercial tech vendors and government customers to come in and test drive solutions and try out cutting edge technologies. The result is we see many companies now with “Centers of Excellence” or “Innovation Labs.” And we see it in people’s titles. Srini Iyer is senior vice president of ManTech’s Innovation and Capability Office and Gary Labovich is the Next Generation Modernization Lead at Booz Allen.
They described a hunger by customers for new ways of doing business and getting results more quickly. The moves by the companies on the Top 100 reflect this overarching market driver.
Companies on the larger end of the Top 100 talked about a need to focus much the same way the smaller companies on the Top 100 spoke of focus.
As Tony Colangelo, founder and CEO of Minburn Technology Group, No. 94 with $225.3 million in prime contracts, said the key to his company’s success was the decision “to do a few things really well instead of a lot of things not well at all.”
“Every year, the federal government spends over $400 billion on goods and services, making it the largest purchaser of goods and services in the world. Today, the U.S. Small Business Administration released the annual Fiscal Year 2019 Small Business Federal Procurement Scorecard, which tracks and assesses each agency’s yearly and individually negotiated small business prime and subcontracting performance and determines grades ranging from A+ to F
We are very pleased to announce that in FY19 the federal government not only exceeded its small business contracting goal, it awarded a historic $132.9 billion or 26.50 percent in prime contract dollars to small businesses. This is an increase of $12 billion from FY18, earning the federal government an “A” on SBA’s Scorecard. This smashes the record-setting $120 billion the federal government awarded to small businesses in FY18!
It was a record-breaking year for women-owned small businesses too! For the second time ever since the implementation of the women-owned contracting goal, the federal government met the five percent contract goal awarding $26 billion in federal contracts, or 5.19 percent to women-owned small businesses.
The federal government also awarded nearly $90.7 billion in subcontracting dollars to small businesses. The prime and subcontracting dollars combined amount to one million jobs created that are supported annually through federal contracting. These jobs help to build communities and fuel the nation’s economy.
I have spent 25 years of my government tenure as a professional program administrator, the Chief Procurement Officer for the Federal Emergency Management Agency, the Director of Acquisition and Contracting for the Federal Aviation Administration and the Chief Acquisition Officer at the Department of Energy. I am pleased to oversee the SBA’s Office of Government Contracting and Business Development, which is charged with making sure that the federal government spends at least 23 percent of its contract dollars with small businesses annually.
The goal of my office is to increase support to the small business contracting community, namely, the agency procurement personnel which includes: SBA’s Procurement Center Representatives, Commercial Market Representatives, the Office of Small Disadvantaged Business Utilization, the Office of Small Business Programs and contracting officers who are responsible for actually making the contract awards to small businesses to achieve the 23 percent goal.
I am so pleased to see this shared result between the SBA and its colleague agencies and partners despite the challenges caused by the pandemic. Meeting these small business contracting goals is part of our commitment to ensuring that entrepreneurs are adequately supported and represented throughout the government.
These positive results are also because of small business owners like:
James Moore, Managing Partner of Expert Maintenance and Construction Services, LLC (EMCS), an 8(a) and Disadvantaged Business Enterprise-certified firm of Prairieville, Louisiana and SBA’s Louisiana 2020 Small Business Person of the Year. James founded his business with just two employees and has grown his business to 85 employees, with $16 million in revenues.
EMCS has performed numerous contracts with federal, state, and local agencies in addition to private entities and has completed projects in multiple states, including Louisiana, South Carolina, Kansas, Missouri, and Texas, with offices in all five states.
SBA is incredibly proud of the small businesses that we support. We are deeply gratified to work with our federal partners and are appreciative of their efforts in helping to achieve and exceed the 23 percent goal. This achievement is not only a win for the federal government; it is a win for small businesses and the nation’s economy.”
ABOUT THE AUTHOR:
Dr. Francis Spampinato is Associate Administrator for the Office of Government Contracting and Business Development
“The U.S. Army has invested another $190 million into a counter-small unmanned aircraft system (C-sUAS), but it’s determined that the system will need to be replaced by a U.S. Marine Corps alternative.”
Despite the Army investing in the program for years, M-LIDS is a casualty of redundancy. As the Department of Defense has become more concerned by the threat posed by small drones in recent years, the services have each developed their own C-sUAS responses — mobile, stationary and dismounted.
Recognizing the redundancy in that approach, the defense secretary delegated the Army to lead the effort to narrow the number of C-sUAS solutions for use by the joint forces.
“Mobile-LIDS (M-LIDS) was not selected and will be replaced by the next generation mobile system,” said Jason Waggoner, an Army spokesman. In the meantime, “M-LIDS will be deployed with Army units to the CENTCOM area of operations.”
The Joint C-sUAS office told reporters in June that the services were conducting an analysis of how many systems would need to be replaced under the new arrangement. However, leaders were not able to provide a timeline for how quickly they expected to replace those systems.
The series of announcements in this market came quickly this summer.
Two days after the M-LIDS award, the Army announced a contract for one of the C-sUAS solutions that was included on the list for future investment: the Expeditionary-Low, Slow, Small Unmanned Aircraft System Integrated Defeat System (now known as FS-LIDS).
The $426 million contract with SRC Inc. provides for the development, production, deployment and support of FS-LIDS, one of three fixed-site solution approved for the joint forces by the Joint C-sUAS Office.
“Development of FS-LIDS is complete and systems are being deployed to U.S. forces globally, with a focus in the CENTCOM area of operations,” Waggoner said. “FS-LIDS will remain in use until replaced with newer technologies.”
C-sUAS spending hasn’t been limited to the Army in recent weeks. On Aug. 10, the U.S. Air Force issued Black River Systems Co. an $89 million contract for an operational C-sUAS open systems architecture.”
“Even as the movement to think critically about cutting the Pentagon’s budget slowly gains ground, wrong-headed arguments in favor of boosting military spending without question still prevail.
Just take a recent column in Defense One from Dakota Wood of the Heritage Foundation, who attempted to make the case that the character of the modern military operations justify $740 billion Pentagon budgets. In it, he claims that cost reductions just aren’t possible since arms and personnel costs have exploded faster than inflation since World War II.
Yet, he failed in most cases to address why military costs have grown so much and how increased budgets exacerbate problematic weapons programs.
The reality is, according to John Boyd, the legendary military thinker and central figure of the Reagan-era military reform movement, wars are won by good people using innovative ideas. The weapons they use are mere tools. As anyone who has tinkered around their garage knows, the best tools are the simple, reliable ones specifically engineered for the task at hand.
Sadly, the members of the military industrial congressional complex do not seem to understand this. They bought an aircraft carrier so loaded up with unproven technology that it is already five years behind schedule and still has at least three years of work to go before it can set sail. They will spend more than $400 billion to buy a fighter plane that can’t shoot straight.
The weapons the Pentagon buys are too often needlessly complex and thus unnecessarily expensive. While they are sold as vast improvements over earlier weapons, the new versions often provide only marginally improved capabilities in the best cases, but are way more expensive than their predecessors. Just as often, in the pursuit of new capabilities, the excessively complex weapons are actually less effective than what came before them. And the increased logistics and maintenance burdens make the systems even more expensive while reducing the overall combat effectiveness.
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These overly complex weapons often serve as a distraction on the battlefield because they force the troops to spend far too much time focused internally on what’s necessary to get the finicky contraptions to work. This distracts them from where their focus should be: on how to fight the enemy. Training becomes an issue as well because it takes far longer to teach someone how to use the new systems. For a force that is already burdened with more required training events than it has time to execute properly, the Pentagon should not further encumber troops with training on overly complicated weapons systems.
Defense contractors intentionally load up their products with as many gadgets as possible because by doing so they make more money. They receive money on the front end during the development process, and then make more money on the back end through lucrative long-term sustainment contracts.
Wood’s argument that the only way to deal with adversary technology is with better technology is also false. We don’t need to out-engineer the Russias and Chinas of the world, we need to out-think them. For virtually every high-tech weapon, there is a low-tech counter. Our struggles to deal with IEDs in Iraq is the perfect example of this. The Pentagon spent $20 billion to develop counter-IED systems only to come to the realization that nothing worked as well as a dog.
In the meantime, the ever-increasing costs of weapons mean that the services can afford to purchase fewer of them.
For example, the Air Force originally planned to purchase 132 B-2 “Spirit” bombers. As costs spiraled upward, the Pentagon pared back the total fleet size until just 21 were built at a total program cost of $2.1 billion a piece. The B-21 is being developed now along similar lines and could suffer the same fate. Interestingly, the Air Force has plans to retire the flashy B-2, which entered the fleet in 1993, but plans to retain the 1950s vintage B-52, proving that simpler technology has its advantages.
The overall effect is that the American people end up spending more and receiving less. Wood points out that the Pentagon budget in 1970 was $78.5 billion, which, adjusted for inflation, would be the equivalent of $521 billion in 2020. He says that the $713 billion 2020 defense budget is only 27 percent higher. This is a misleading claim. The 1970 defense budget included a great deal of spending that is not included in Pentagon budgets now. Today, many of those costs are spread between the Department of Veterans Affairs, Department of Energy, and the Department of Homeland Security, and several other agencies. When all the defense-related spending across the various departments are added together, the American taxpayers were asked to spend more than $1.21 trillion this year.
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What does that support? The $78.5 billion in 1970 supported an active duty force of 3,066,294. The active duty force in 2020 is 480,000. So, the American people are paying 130% more for a force that is 84% smaller.
A recent proposal would have cut 10 percent from the Pentagon’s budget. Wood’s column demonstrates how nervous the defense industry becomes whenever someone threatens the free-flow of money from the treasury to their coffers.
Like most similar efforts, this latest budget cutting proposal was sold as a means of freeing up funds for domestic programs. President Eisenhower once said that for “every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.” His words ring especially true today as lawmakers debate how best to deliver resources to people and businesses most adversely impacted by the COVID response.
Just as importantly, cutting the Pentagon’s budget would also serve a useful military purpose. It would force service leaders to think harder about what they buy and why they buy it. In order to get the force size they want, they would have to pursue simpler designs rather than the highly complex systems that have become the norm today. In warfare, good enough beats sexy. It’s time the military industrial congressional complex learns that lesson.”
“The Cryptography for Hyper-scale Architectures in a Robust Internet Of Things (CHARIOT) program was established to “develop revolutionary approaches for fast, efficient, and quantum-resistant cryptographic operations for Internet of Things (IoT) devices,” according to a Small Business Innovation Research (SBIR) opportunity released by the agency Aug. 11.
Due partly to the low cost of the equipment, the military has been able to adopt “unprecedented numbers” of IoT-enabled devices, explains DARPA. However, not all of those devices have the cryptographic security they ought to, and the issue will only be exacerbated as quantum computing and 5G wireless networks come online.
The problem, DARPA says, is that the amount of power cryptography consumes reduces the lifespan of devices in the field, which ultimately disincentives manufactures from including security in their products. With some IoT devices expected to last over a decade in the field, the military needs cryptographic solutions that are low on power consumption.
“CHARIOT’s objective is solutions that are fast, efficient, and quantum-resistant on even the cheapest devices,” the solicitation reads.
The CHARIOT program will prototype “low-cost, low-footprint, post-quantum cryptographic techniques” that use up less energy. The solicitation notes that DARPA is particularly interested in vehicle-embedded and wearable use cases with a zero-trust network architecture, such as “uses within a larger scenario of wearable-equipped passengers entering, traveling in and departing from a vehicle such as a troop carrier or school bus.”
“While the COVID-19 pandemic has created challenges for the government contracting community over the past several months, there may be a silver lining on the horizon.
This situation has created a backlog of RFPs that procurement professionals will be releasing during the rest of the summer. And we can expect a larger-than-usual “end of the year” push during this time frame.“
“This summer, many believed that federal spending for contractor services would be fast with new RFPs being released rapidly. This reflects the fact that the addressable funds in the federal budget are the highest in 10 years.
According to a study from Market Connections, however, about two-thirds of procurement personnel went fully remote due to the virus, slowing down RFP releases. The report also found that 50 percent of respondents said the execution of new projects was put on hold.
This points to the need for the vendor community to help government customers and prospects work through this period of potential rapid procurement.
Time to Cultivate Relationships
The Market Connections study also found that 45 percent of government customers are looking to vendors to provide educational and consultative services, especially during the peak time of COVID-19. In addition, 41 percent stated that they wanted industry members to be nimble in providing both short- and long-term solutions and guidance.
Now is the ideal time to consider developing systematic plans to both cultivate and educate government buyers – especially since the pandemic continues today and will into the foreseeable future.
The COVID-19 pandemic has also made it very challenging to meet with government customers face-to-face. However, with or without the pandemic, the reality is that one chance meeting at an event would most likely not translate into a contract win.
A systemic plan to cultivate these relationships in the “new normal” should include thought leadership marketing, and other value-added content that can help with the education about your solutions.
The study also highlighted how government buyers are tapping into vendor webinars, research firm websites, contractor websites, and trade associations to become educated on the most cutting-edge solutions in the marketplace.
Sales and BD teams should be fully armed with all educational content, and use it as potential gateway tools to open doors to virtual meetings with government prospects. If you want to get the attention of the prospect, figure out a low-risk solution that will help them to do their job more cost-effectively.
An Ideal Time for Incumbents
It is common knowledge that government decision-makers are risk averse, and are more likely to engage with industry members they already know. In today’s business climate, incumbents certainly have an advantage when it comes to winning recompetes.
Though it’s all too easy to fall into complacency traps when re-bidding on business. Even in normal times, the incumbent contractors lose between 25 and 30 percent of their recompletes. It’s all too easy to lose an existing government customer, and even harder to win additional contracts to fill the void from the revenue lost.
The key is to recognize the customer’s culture and strategic goals, leverage successes and evidence from the existing contract, and engage with internal operations teams six months before the RFP is due to be published.
In addition, the pace of innovations moves so quickly, even if the government customer has not changed the SOW. Being able to show how your solutions have adapted to meet new needs will help overcome any ‘business as usual’ fears that evaluators may have about your company and offerings.
Ultimately, you want to plan to win the contract from the start by creating a complete contract story, developing the right processes, and staying fully connected with the customer throughout this entire journey.
Getting Prepared for Rapid Procurement
During this time of potentially rapid procurement, developing the right resources for winning new contracts or a recompete is vital – such as leveraging the right proposal teams that have the subject-matter expertise, understanding the buyer agency, and including everything from writers to graphic artists to orals coaches.
No contractor wants to miss out on an opportunity for business growth – especially with a potentially strong summer selling season in front of us.
Being fully connected with the customer, providing ongoing educational resources, and not resting on your laurels when it comes to recompetes, could make for a prosperous time for contractors.”
“Undersecretary of Defense for Acquisition and Sustainment Ellen Lord has called the Adaptive Acquisition Framework “the most transformational change to acquisition policy in decades.” Her statement is difficult to argue given the revolutionary nature of the framework’s alterations to acquisition policy and the lack of truly transformational changes seen in acquisition policy and statute over the past 25 years.
For decades, Defense Department leaders have lamented the laborious, bureaucratic acquisition process and its hindrance to innovative breakthroughs within weapon systems programs.
Many defense technologies, once fielded, lose a non-trivial portion of their relevance due to acquisition delays, a concept identified by former Defense Secretary James Mattis in the 2018 National Defense Strategy. The document pointed to processes’ non-responsiveness and a department over-optimized for exceptional performance, both of which come at the expense of providing timely capability delivery to the warfighter.
In response, Lord rapidly pushed out sweeping new guidance in the form of a six-pathway framework — the Adaptive Acquisition Framework — which is designed to put authority and agility back in the hands of program managers. With this newfound ability, executives will transition between pathways in order to speed delivery of capabilities to the warfighter.
Still, acquisition is not a solo sport. Program managers must rely on their team of acquisition professionals to embrace this new paradigm of speed, agility and risk management for this “transformation” to result in real change in capability delivery. But increasing speed, agility and risk sends a measure of anxiety through the vertebrae of the many contracting professionals who have focused on delivering contracts that are protest-proof and rigidly built to withstand the assaults of indistinct scope and performance.
Nonetheless, for the framework to deliver capabilities at the speed of relevance, contracting professionals at all levels must be willing to embrace this revolutionary change.
This change comes with a prerequisite to develop not only new and inventive processes, but an expanded tool box of soft skills necessary to bring about innovation, active management of risk, and corporate synergy to the contracting community that will result in high-speed, low-drag contracting.
The “Contracting Professional’s Career Roadmap” is a nine-step list published by the Federal Acquisition Institute. It provides contracting professionals a succinct overview of gates through which a contracting professional must successfully pass in order to be effective. Curiously, the first stop on this path, “become familiar with the federal acquisition process,” is not a contract-centric element. The federal acquisition process is not contracting, but contracting is a major subset. The process is the overarching method encompassing all relevant skills and functions by which the federal government acquires products and services.
Ironically, the second stop on the roadmap is “understand your role as a contracting professional” within this process. It was not by chance these items are numbers one and two on the path. That is because federal acquisition is a team sport, of which contracting is one player among many. As with any team sport, each player must understand his or her place and responsibilities within the team framework, otherwise the team will fail. The first thing a youth football coach should do is line up new players in formation — both offense and defense — so they can gain an understanding of where their position is in relation to all the other players. A single player lining up incorrectly could result in a penalty or failure for the team to properly execute the play.
Understanding where a manager fits in the overall formation is just as important in the acquisition team. Taking it to another level, each player also needs to understand how his play impacts his teammates. Commentators often praise a great player for their “knowledge of the game.” It isn’t just their knowledge of their specific responsibilities as a player, but the interrelation of how their play improves the play of those around them.
In federal acquisition, each team member must perform with that level of understanding in order for this new transformation to be successful. This may be even more imperative for contracting team members as the contracting processes tend to consume a significant portion of time while they deliberate source selection and performance risk.
Assistant Secretary of Defense for Acquisition Kevin Fahey identified a need to develop a culture of innovation and creative compliance, and enable critical thinking. In order to be innovative, creatively compliant and critical thinkers, department leadership wants acquisition teams to take calculated risks. As Gen. George S. Patton said, taking risks “is quite different from being rash.”
One tool that transforms rash behavior to measured performance is risk management. To take calculated risks, contracting professionals will need to learn how to actively manage risks. Program managers routinely manage risks and, as a programmatic community, have become comfortable mitigating, accepting, transferring or avoiding risks within their programs.
Contracting professionals must learn and implement these skills as they execute contractual actions. No longer will the acquisition community idly await the perfect contract. Perfection late is perfection lost. Too often contract award timeliness was sacrificed in an effort to gain contractual perfection through overly cumbersome approval chains and non-value-added reviews.
Timeliness has also been assaulted by excessive “documentation,” which has been a watchword for the contracting community and for good reason. However, as with any good thing, it tends to be overdone. In some ways the acquisition community may have become overly obsessive and unreasonably compulsive with its documentation, and some streamlining may be in order.
Procedural changes to contracting are only a first step. The real gains may be seen in a closer coupling of the acquisition team functional communities. In today’s continuously changing environment, requirements can no longer be developed in a vacuum only to be thrown over the fence to the next team. Requirement generators, program managers and contracting officers must integrate early and intimately in the requirements process to develop requirements, discuss possible options, perform market research, consider acquisition plans and jointly produce acquisition timelines. Contracting professionals often enter or are invited late into the acquisition process. Contracting organizations do it to themselves when they demand customers only turn over a requirement once it has been fully detailed with the finalized work statement, funding documents and cost estimates.
In today’s rapidly changing environment, contracting professionals better serve customers by entering as early in the requirements generation process as possible. The team must come together so closely and early that it would be difficult for an outsider to identify where program management stops and contracting starts.
If the first time a contracting professional sees a requirement is when it has been fully documented in a formal work statement, an opportunity to bring value to the process has been lost. Additionally, synergies that come from synchronized market research and critical thinking amid the program manager, contracting officer and other acquisition team members are missed; and with it early considerations for competition, innovative contracting and/or small business participation because the requirement has been fixed making change too difficult or time consuming.
Failing to capture the synergistic effects of close coordination, contracting will struggle to regain any status as an innovation enabler, and may continue to be relegated to chasing acquisition timelines and contract perfection.
The Adaptive Acquisition Framework is an opportunity to inject innovation, creativity and critical thinking into the federal acquisition process by placing authority and agility into the hands of program managers. However, this transformational change to acquisitions will not create true transformation unless the players are willing to embrace the change. Program and product managers can only deliver capability as fast as their team supports.
Although the framework is program management focused, it also presents a challenge to — and opportunity for — the contracting community. As a critical component to the delivery of products and services, the contracting community must get on board with the new vision being promoted by leadership. It is a vision overdue given the speed at which technological capabilities are progressing.
More specifically, contracting professionals must understand that timeliness can no longer be held hostage by contractual perfection, overly cumbersome approval chains and non-value-added reviews. Perfection late is perfection lost. As a result, contracting professionals must become intimately integrated early into the acquisition process starting at the notion of the requirement. Otherwise, they risk being a deterrent to the innovation and creativity crucial in today’s fast-moving environment.”