Bayesian Systems Targets New Software Niche

By John Makulowich, Senior WriterSit for five minutes with Joanne Damours to see a demo of her company's WinAward software, and your mind starts to reel with the possible applications to other industries. While she thinks three years is a reasonable time frame for taking the company public, a buyout much sooner could be a more likely scenario.Damours is president and CEO of Bayesian Systems Inc., Rockville, Md., which produces a software package geared to help companies win more and better contracts from government at all levels. Right now, she is riding the crest. She just signed Tracor Systems Engineering Inc., Rockville, to an enterprisewide license for her product, and is on the verge of another major contract. Her WinAward software, along with consulting, training and one year of technical support, starts at about $7,000 for a five-user license.According to Damours, the 5-year-old company expects to generate more than $3 million in fiscal 1999."We will soon be coming out with a Web-compatible version for 4.0," Damours said. "In the new version, the product will integrate seamlessly with the major databases, whether Oracle, Sybase, SQL or Access."The WinAward tool allows companies competing in the government market to introduce focus, discipline and order to their bid and tracking efforts. A Windows program, it allows the user to manage uncertainty, track leads and predict the likelihood of winning or losing government contracts.It is driven by an engine fueled with an arcane mathematical law known as Bayes' theorem, discovered by the 18th-century cleric Thomas Bayes. The theorem, honed by experts like Stan Kaplan, a co-founder of Bayesian Systems, is used to determine the degree of confidence one can have in the evidence for any given business decision. It leads to what Kaplan referred to as "evidence-based risk assessment" or "evidence-based decision making."In the hands of users, including capture managers, team members and senior executives, WinAward and its numerous modules become a highly effective tool for making bid/no-bid decisions on contracts from federal, state and local governments.Just ask Steve Wilkes, chief operating officer of Sherikon Inc. in Chantilly, Va. His company, a professional services firm in areas such as engineering, telecommunications, health services and ship repair, has been using the product since January at its 16 offices and numerous work sites in 21 states. It took Wilkes' company about eight months to reach "full standup." The company has contracts with the departments of Defense, Justice and Transportation, the General Services Administration and several states and municipalities, as well as commercial corporations. Annual sales last year were over $74 million."We are now tracking around 187 contracts worth about $6 billion that go out as far as four years," Wilkes said. "This year, we have so far won 12 major contracts. Four of those we would not have won without WinAward. "Since we started using WinAward, the sophistication of pursuit decisions has risen within the company," he said.After seamlessly collecting data on government opportunities from any one of a handful of vendors, then gathering information from senior management and staff that are in contact with customers and the competition, the software takes the user through a series of well-defined, carefully crafted steps to evaluate the opportunity. If a bid decision is made, a software module helps prepare the proposal."The software is extremely useful for major contract procurement and funded tasks, such as delivery orders and task orders," Wilkes said. "It also helps identify our weaknesses and serves as a road map for our managers on work leading up to procurement."According to Wilkes, one of the strongest drivers for WinAward was indefinite-delivery, indefinite-quantity contracts. In that case, the software put multiple requests from customers in a framework that could be managed easily. He also found WinAward valuable in sorting out leads, helping prevent different staff from chasing ones from the same customer. Furthermore, the software's win probability prediction module helps staff focus on customer awareness, cost competitiveness, strengths and areas for improvement in technical fields."One of the key factors in implementing the software was training. We started from the top down for the CEO and covered such areas as the operating scenario and the role of tactical and strategic leads," Wilkes said. "The task was made a little easier, since upper-level management had a solid foundation in all the elements of the business pursuit and all are marketers for the company." Another company recommending the product to customers is Advantage Consulting Inc., a business development and marketing support firm in Annandale, Va., that focuses on government contract clientele. A key part of its business is training government contractors on what it takes to get business.John Bender, Advantage director of business tool solutions, noted that as his company trains clients to be successful and find opportunities, they get overwhelmed with the number."You need to search and separate the opportunities that are good and those that are not. In the government arena, WinAward is almost a perfect fit for the organized business development process," Bender said. "Many of the smaller companies that do not have the right infrastructure in place can benefit from this product. It also helps them separate out the emotional side of bidding and focus on the objective."Bender described the software niche filled by WinAward as opportunity management programs, which fall somewhere between contact management and sales force automation. He feels the product's strength is that it fills a niche ignored by both small and larger vendors."The six to 12 vendors serving the top end of the market are set up for the regular sales process," Bender said. "The government business development process is not like that at all. It is more of a free-form process. "Focusing on the government market is a savvy strategy for Bayesian Systems," he said. "Their biggest competitor right now is a company's internal development organization."