The news last week that IBM Corp. had filed a protest against the awarding of a $600 million CIA contract to Amazon Web Services is the strongest indication yet that Amazon wants to sell more than just a cloud computing service to government agencies.
According to FCW’s Frank Konkel, the CIA's desire for a large private cloud is being pushed by the intelligence agency’s rush to embrace big data analytics. The CIA wants to collect massive amounts of information from diverse sources such as sensors, drones, social media, etc.
"It is very nearly within our grasp to be able to compute on all human generated information,” CIA Chief Technology Officer Hunt told an audience at GigaOM's Structure:Data conference on March 20.
Sounds like a job right up Watson’s alley. Watson is the supercomputer that IBM built that won a Jeopardy tournament, and is now busy taking on other projects that require the swift analysis of hugely diverse data sources.
That’s what makes Amazon’s win so interesting. You don’t think of them as a cutting edge of technology, unless you stop and think about the amount of analytics Amazon does on shoppers buying habits.
So, Amazon’s push into high-end government computing and its ability to take on the likes of IBM should send a real signal to the rest of the market that a new player has emerged.
But that’s just part of what makes this deal interesting to me.
On a broader note, the approach also indicates to me how the idea of partnering with the government is evolving.
Granted, a lot of details are not publicly known about this contract, so this is a lot of speculation on my part, but it seems obvious that Amazon isn’t just selling servers, routers and hours of connectivity.
What is says to me is that if you want to be doing important, mission critical work with the government, you cannot have an order-taker mentality.
I spoke about this in a different context at the Association of Proposal Management Professionals conference in Atlanta last week, when I talked about how value-added resellers nearly disappeared from the market. But several are still successful today because they abandoned the order-taker approach, and are instead invested in bring solutions to their customers.
You see a similar strategy from companies that traditionally earned their revenues through charging billable hours to the government. The incentive for the contractor isn’t to solve the problem, but to charge more hours.
But in today’s budget environment, agencies are pushing for solutions. As former Veterans Affairs CIO Roger Baker said when he went to work at Agilex, you need to deliver a finished result.
To me, the Amazon-CIA contract indicates both the arrival of formidable new player in the market, but also a continuation of the trend toward delivering real solutions and addressing mission-critical priorities. And not selling more products.
Sure, product sales and billable hours will continue to fuel business for many companies, but the higher margin, more valuable business lies in solving problems.
Posted on Jun 03, 2013 at 7:24 PM0 comments
When the folks at the Association of Proposal Management Professionals asked me to talk about trends in the market, they gave me a set of questions to think about that covered things such as major changes in the market, sequestration and small business opportunities.
The format was a fireside chat at their annual conference in Atlanta, and my fellow fireside chatter was Beth Wingate, 2013 CEO of the association and managing director of Lohfeld Consulting. I feel like I’ve known Beth forever, so I had a good comfort level to talk about trends in the market in front a few hundred people.
Here’s a quick rundown of what we talked about, and what I see happening.
Changes in the Market
There are several items that could go into this bucket, but the top one for me has been the frantic pace of the market. Response times are shorter, the rate of change is quicker, but at the same time, there are more delays of work. So, there is uncertainty and a frantic pace. That’s a tough market to operate in.
I also include on my big changes list the rise of IDIQ contracts. These task order contracts are the dominant vehicle in the market, and have powered the more frantic pace. The combination of the pace, as well as the contract vehicles to support it, have pushed companies to develop more solutions allowing them to go to multiple customers with the technologies, processes and teammates in place to solve a problem.
Another major change has been the evolution of value-added resellers. A few years ago, I would have predicted they were going to disappear, but they haven’t. They’ve just changed. Gone for the most part are the order takers selling out of a vast catalogue of products. Instead, you see resellers developing more specific relationships with technology vendors, and going to market as the experts in those technologies.
Personalities for Success
I thought this was a great question to ask because I talk to a lot of senior executives, and I marvel at the range of personality types, from the gregarious and outgoing to the stoic ice kings or queens.
I don’t think a single personality dictates success, but a few common threads I see among these leaders are a tendency to try to hire people smarter than they are. They also trust the people that work for them.
And as clichéd as it might sound, they also are honest and transparent with how they deal with people. That kind of personality trait translates through an organization and is reflected in how they deal with customers and partners.
That’s the big question these days, and I don’t really have a good answer. There have been pockets of impact here and there. Lots of delays of contracts, but nothing catastrophic on a grand scale. Of course, if it is your company getting a contract cancelled, that can be very bad.
It seems we are seeing minimal impact so far, but many are telling me the real impact will be in 2014. Congress and the White House aren’t making it any easier. Not only are they expected to battle over appropriations, but the three budget proposals ignore sequestration and don’t meet its caps.
Landing the Big One
Whether it is the pace of procurements, the uncertainty around sequestration or just budget cuts in general, there really is only one thing companies can do to mitigate those risk factors – talk to customers. Understand their pain points, present solutions to problems, be a trusted partner.
In other words, the basics of blocking and tackling have never been more important.
Posted on May 31, 2013 at 7:24 PM0 comments
The news this week that former Environmental Protection Agency Administrator Lisa Jackson would join Apple as its vice president for environmental initiatives got me thinking about how often the term “sustainability” gets thrown around.
And I’m wondering how much is hype, and how much makes good business sense?
I know Apple has come under fire for its environmental policies, and that over the last year, it’s converted its data centers and other U.S. facilities to renewable energy sources. The move earned the company the No. 10 spot on EPA’s list of companies using the most green power.
Interestingly, Lockheed Martin Corp. is No. 9 on the list. Lockheed and other defense contractors, such as Northrop Grumman, are working on energy related projects that include power generation and smart grids.
Heck, there’s even a small solar farm at the Pentagon.
And I know that several years ago, ICF International, which does a lot of environmental consulting work, was touting its use of green energy, carbon credits and other activities to reduce its environmental impact.
So, I guess there is a business case to be made for sustainability.
But, there is a lot of image at work here too. Perhaps it’s not an "either/or," but a "both."
I wonder, though, if the sustainability/green label will get overused and lose its meaning. It might just become another "me too" kind of tag.
Care to comment? Is being green good business, or just hype?
Posted on May 30, 2013 at 7:24 PM1 comments