GSA's New Engineering Schedule Awaits Big Business

By Nick Wakeman, Staff WriterThe General Services Administration's new Professional Engineering Services schedule has gotten off to a $10 million start in its first six months, and within a few years could outshine its cousin, the multibillion dollar information technology schedule, according to GSA officials."This schedule has the ability to be bigger than our IT schedule," said William Gormley, assistant commissioner for acquisitions in GSA's Federal Supply Service, which runs GSA schedule business. Services on the IT schedule hit about $2.4 billion in 1999, just two years after first being introduced.The engineering services schedule offers a wide range of services, from high-end systems design and development to operations and maintenance. The federal government spends about $60 billion a year on these types of services, sources said. While only 20 companies had won work via the engineering schedule through May 31, 150 companies are now schedule holders and another 100 are being evaluated, Gormley said."What really brings [contractors] in is when their customers ask them about it," he said, adding that the Navy so far has been the big user of the schedule.Gormley said it likely would take three to four years before the engineering services schedule grows as large as the IT services schedule. He expects agencies to transition work from traditional contracts to the schedule as those contracts expire.Some of the biggest names in systems integration, such as Affiliated Computer Services Inc., the Boeing Co., Computer Sciences Corp., Lockheed Martin Corp., and Science Applications International Corp., have won spots on the schedule, although they have not booked any business, according to GSA data."We knew everybody was going to want to get on it," said Tom Wilson, senior vice president of Swales Aerospace, Beltsville, Md. That company has done about $816,000 on the schedule, nabbing the No. 3 spot on GSA's list. "We jumped on it when we first heard about it," Wilson said.The big winner so far among contractors has been EG&G Technical Services Inc. of Gaithersburg, Md. The company has pulled in $4.9 million since winning a spot on the schedule in October, according to GSA data."We are very happy," said Phil Dodderidge, GSA schedule program manager for EG&G, a $500-million-a-year engineering and systems integration company. "This schedule gives us the flexibility to respond to our customer needs quickly." Almost all of EG&G's work has been for the Navy, taking on logistics and engineering tasks. The company also recently won work to help the Energy Department do an assessment of fire damage at the Los Alamos National Laboratory in New Mexico."They want to assess what has been damaged, what capabilities they have lost," Dodderidge said. The agency needs the data quickly to begin repairs.As with the IT services schedule, speed and flexibility is one of the most attractive features of the engineering services schedule, government and industry officials said.Before it was in place, agencies had to go through a longer procurement procedure that included issuing draft requests for proposals and follow-up RFPs, even for simple tasks."For the agencies, it provides yet another means to procure services with less hassle than traditional contract vehicles," said Kevin Plexico, an analyst with Input Inc., a Vienna, Va.-based market research firm.By creating the schedule, GSA is saving agencies about 80 percent of their procurement administrative costs, Gormley said. Getting approved to be on the schedule, in essence, pre-qualifies the contractor to perform the work. In addition, items such as basic pricing for services are established. All that saves time for the agencies, he noted."We've seen awards go from taking 90 days to as little as 72 hours," said Tom Ubl, GSA manager for ADI Technical Corp. of Alexandria, Va., a $34-million-a-year company that provides engineering, IT and environmental advisory services. ADI is No. 2 on GSA's list with $1.4 million."There is a tremendous amount of versatility with this schedule," Ubl said. ADI has been doing program management and engineering analysis work for the Navy.Wilson at Swales Aerospace said: "This schedule is a great way to get to your customer quickly."Swales' biggest customer so far is the Air Force, which needed design and development work for a launch vehicle adapter, he said. The company also has won work with NASA through the schedule."The schedule is just a very easy way for the government to do business," said Mark Sopp, chief information officer with Titan Systems, the government IT subsidiary for Titan Corp. of San Diego. Titan has done about $573,000 worth of business through two of its divisions, Advanced Communications Systems and recently acquired SenCom, which places the company fourth on the GSA list.Titan has been doing a lot of test and evaluation, and acquisition and life-cycle management work, primarily for the Defense Department, Sopp said.Industry officials said they see the schedule not only as a way to better serve current customers but also as a tool in winning new ones.New customers can use the schedule to award a smaller project to a new contractor as a way of evaluating the vendor without making a long-term commitment, Wilson said. "This is a great way to start to do work with a new customer," he said.Because most work under the schedule is done under a time and materials billing structure, which means the government pays a set hourly rate, the schedule can be more profitable for the contractor than the cost-plus structure of most contracts, Sopp said. Under cost-plus, a company charges its cost of doing business plus a set percentage of profit on top of that."Time and materials is slightly riskier but it can be more profitable if managed correctly," he said.XXXSPLITXXX-