Economic concerns and new political priorities force contractors to be proactive

The second quarter of 2009 roared in with two critical — and in many ways related — occurrences within days of each other. On April 3, 1105 Government Information Group, which publishes Washington Technology, released the research study “Positioning to Win Federal Business,” compiled by Market Connections Inc. and subsequently discussed by a panel of industry leaders.

Then, on April 6, Defense Secretary Robert Gates announced the key recommendations he would make to President Barack Obama with respect to the fiscal 2010 defense budget.

Both events deserve further review.

The Defense Department announcement is significant for its revelations about the winners and losers in the budget for 2010 and beyond — not just based on possibilities and conjecture but based in cold reality as revealed by Gates.

The 1105 GIG/Market Connections study is noteworthy for its insight into what your peers in the federal market believe are the most pressing challenges ahead and how they are responding. The top two challenges in the next 12 months are:

• Changes in agency strategies and initiatives under the new administration.
• Achieving growth in a sluggish and uncertain economy.

Or as one respondent said: “The next 12 to 18 months [are] going to be a time of great confusion, figuring out what works and what doesn’t from the last administration and getting changes made.”

Concerns related to the economy and new government strategies affect organizations large and small. The fact is that leaner business development organizations are chasing fewer and shifting defense opportunities, with ever-increasing corporate competition.

The 1105 GIG study revealed key strategies that successful contractors are using to improve their capture processes and resulting win rates:

• Better relationships with existing and new clients.
• Close coordination of account/capture/business development and solutions organizations.
• More emphasis on the early capture process.
• More rigorous bid selection.
• Third-party evaluations of processes to ensure effectiveness.

In Washington Technology’s Top 100 issue in May, an article titled “Contractors mix worries with optimism” indicated that the principal challenges facing Top 100 company leaders are:

• Entering new markets.
• Developing new lines of business or expertise.
• Recruiting employees with specific expertise.
• Finding new teaming partners.

Even more critical is the revelation that 80 percent of the Top 100 executives believe the market is more competitive than it was just five years ago.

So what does all this mean for your organization? Given the revelations above and their impact on business development, some companies have taken a hard look at their business development organizations and discovered they are not as well prepared to tackle today’s new reality as they had thought. They’re finding critical gaps in their processes, such as an inability to identify and qualify opportunities and gather human intelligence. Coupled with essential skill disparities in their business development employees, those shortcomings will negatively affect their ability to win business.

In this uncertain environment, a wait-and-see stance will put your organization at a disadvantage. Now, more than ever, an assessment of your business — getting plans, people and processes correctly aligned and operating in a cohesive manner — is an essential strategy to achieve success. Training your teams to tackle the new reality is a prudent investment of time and money.