Category Archives: Business

THREE CHALLENGES FACING GSA-ADMINISTRATOR NOMINEE ROBIN CARNAHAN

President Biden nominated Missourian Robin Carnahan last week to be the next Administrator of the General Services Administration.  Carnahan comes to the position from Georgetown University where she co-founded the State Software Collaborative.  Carnahan also founded and led GSA’s 18F state and local consulting practice from 2018-2020.  The new Administrator-designee will face several challenges upon Senate confirmation.  Here are three that may become a focus, whether or not they’re part of the original plan: 

1.  Coordinating GSA’s technology and service portfolios:  GSA’s technology operation is a booming business.  The Schedules program, Alliant, StAR’s and other current programs are popular.  Right behind them are ASTRO and Polaris.  At the same time, the service portfolio is experiencing solid growth with the Professional Services Schedule and OASIS.  Coming soon will be the OASIS follow-on.  Keeping those programs growing without running into each other will be an increasing challenge.  So, too, will ensuring that new contracts are as popular and easy to use as existing vehicles. 

2.  Managing all of GSA’s seemingly competing acquisition methods:  The Federal Acquisition Service has the Schedules program, GWAC’s, the commercial E-Marketplace pilot, its own in-house requisition channel, and more.  Each serves a specific constituency and each has its detractors, as well.  Keeping the lines clear of how each portfolio can serve a specific customer type will be critical in terms of outward facing actions.  Ensuring that all GSA professionals work toward a positive strategic outcome at the agency level will be especially important internally. 

3.  Dealing with expiring commercial leases and a down-sizing federal office footprint:  No GSA Administrator can avoid Public Building Service issues.  Carnahan’s tenure would be no exception as 60% of the agency’s leases will expire between 2019-2023.  Figuring out how much space will continue to be required in the wake of a now decentralized workforce could make rocket science look easy by comparison. 

One area NOT to focus on?:  In our 30 plus years of federal acquisition experience, state and local governments have been very, very wary about “solutions” coming from their federal counterparts.  While coordinating federal, state, and local acquisitions may seem like a good strategic goal, it is fraught with political landmines, rice bowls, and other potential snares.  A substantial amount of capital could be expended on this front with little or nothing to show for it.  Resist the urge to make integrated acquisition across government lines an initial focus.

DOD ACQUISITION PICK SIGNALS DRIVE FOR INNOVATION

President Biden has nominated Michael Brown, the head of DOD’s innovation arm, to be the next Undersecretary of Defense for Acquisition and Sustainment (A&S).  Brown’s job at DIU focused on rapid prototyping and acquisition, but he also has a strong private-sector background.  His nomination, along with those of other senior acquisition leaders, indicates a strong preference for people with solid technology backgrounds and a desire for moving quickly to implement new solutions in that area.  The GSA Administrator-designee, Robin Carnahan, has a similar tech background and her FAS Commissioner, Sonny Hashmi, is a former Chief Information Officer.  The Administration clearly believes that the tech sector can bring lessons learned into the realm of acquisition.  Brown’s innovation unit has been hailed by many for bringing new companies into the defense supply chain and for sponsoring innovative technologies. They key now will be to try and implement those successes on a much larger scale.  Brown also brings with him a strong cybersecurity background from his time as CEO of Symantec.  Cyber remains a hot button issue and getting advanced solutions into the hands of DOD users more quickly may be a prime focus area for the new Undersecretary.  Current defense contractors may want to position themselves accordingly and be pro-active with ideas on how to bring innovative acquisition to more types of DOD projects than those Brown has previously worked on.  Being seen as both tech-forward and agile on acquisition may provide opportunities for industry to work more closely with the new DOD team. 

ANECDOTAL EVIDENCE SUGGESTS THAT USE OF SINGLE AWARD CONTRACTS IS ON THE RISE

Whether it’s NASA announcing a new cyber and personal security contract, DISA’s new DES contract, JEDI, or even two new projects at the IRS, there seems to be a trend back to single award contracts, at least for large government projects.  Single award contracts were the predominate contracting method until the mid-1990’s when the use of multiple award IDIQ contracts proliferated.  The idea was to drive better solutions through consistent competition among qualified companies. Further, both legislative and regulatory requirements limit the use of “contract bundling” to roll multiple needs into one large vehicle, thus making it more difficult for small businesses to participate.  The Biden Administration has indicated that it wants to further strengthen such prohibitions.  In the meantime, though, at least some agencies are reverting back to large, “winner take all” procurements.  The premise may be that it is easier to manage one contract and contractor, especially for enterprise-wide requirements.  Assuring a common security posture may be a specific driver.  One thing that such contract vehicles also ensure, however, is protests.  Protesting to try and get your company another look is a minor incremental expense when a company spends upwards of seven figures in bid and proposal costs and knows they’re either going to be “in” or “out”.  Contractors may need to adjust their overall approach to federal business if single award contracts increase in popularity.  Establishing relationships with key customer contacts as early as possible will be especially critical.  So, too, will be the ability to suggest acquisition provisions that could give the company an edge when an RFP or RFQ hits the street.  It’s too early to tell whether single award contracting will spread to more and smaller projects, but it is not too early to be prepared if it does. 

THE SCHEDULES PROGRAM DOES SO MUCH BUSINESS NOBODY USES IT ANYMORE

With apologies to Yogi Berra, there’s so much buzz over new contracts coming soon from GSA, NIH and other government agencies contractors could be forgiven for thinking that none of their customers use Multiple Award Schedule contracts anymore.  The numbers, however, make it abundantly clear that Schedule contracts remain an important piece of a company’s overall federal business strategy.  Schedule contracts topped $34 billion in business in FY’20, with final numbers likely being way higher.  Leading the way are IT contracts, formerly classified as Schedule 70.  Think NASA SEWP had more business?  Think again.  Over $18 billion in IT sales went through GSA Schedules last year.  In boxing terms that translates into “the winner and still champion” of Indefinite Delivery Indefinite Quantity (IDIQ) contracts.  Indeed, some contract vehicles that are classified as separate programs by industry analysts are, in fact, Schedules-based Blanket Purchase Agreements (BPA’s).  The Schedules program may not get the buzz of other contracts because it is perpetually open to new offers. Even some in GSA can get caught by the siren songs of other contracts or buy into the decades-old saw that Schedule prices are “too high”.  In this time of advanced data analytics and instantly available commercial pricing information, though, that saw has pretty well lost its teeth.  Federal customers rely on the program to meet a vast array of needs, including important market segments where there are no other IDIQ’s from which to purchase.  The Schedules are also the only contracts open to state and local government use.  Simply put, government buyers at all levels would have a significantly harder time meeting critical mission needs if there was no Schedules program.  Look beyond the headlines and you will see a program that serves customers, small businesses, and taxpayers well.  Contractors should plan their approach to the public sector market accordingly.

SELLING TO FEDERAL AGENCIES IS NOT A “ONE SIZE FITS ALL” BUSINESS

Although some in government insist that “the government is one customer”, experienced contractors know that federal business success requires a variety of approaches depending on what you’re selling and to whom you are selling it.  The approach a company uses to sell to a large agency may be very different than that for a smaller or independent government customer.  It’s even true that a successful program for Navy business will differ from growing sales to the Army.  Research and relationships are key to creating a business plan that will have the best chance to drive business with diverse customers.  That’s one reason why many contractors focus on a handful of potential customers, especially when starting a federal program.  They realize that few companies can develop the expertise needed to sell across the entire federal spectrum overnight.  Similarly, many a contractor CEO has also told us that federal business is not a “go it alone” proposition.  Developing a base of experienced partners with complementary capabilities, and often varying business sizes, is essential to sustained business growth.  So, too, is working with experienced market researchers, contract consultants, and even attorneys.  There is no reason to try and “reinvent the wheel” of federal success when knowledgeable partners are readily available.  Partners can significantly reduce the amount of time and effort it takes to grow a successful federal presence and help keep you away from falling off the compliance cliff.  Your wardrobe isn’t one size fits all, even after a year of working at home.  Neither, too, should be your approach to the federal market.