Major shifts in contracting on the horizon
- By Howard Nevin
- Jan 30, 2006
I've been watching the federal IT scene for upwards of 30 years. I saw my first computer 40 years ago. The one constant is change. So here are a few of the buying trends I think are having a big impact on our world of federal IT procurement.
Howard Nevin has more than 30 years' experience in sales and program management with federal contractors. He is vice president for corporate development and technology at Highland Technology Services Inc.
- Getting a fast-track 8(a) certification based on exception. This may have some validity, but it does a disservice to the companies that already did it the regularly way. In general the small business area is getting more complex, with the trends towards favoring disabled veteran-owned and Alaska-native companies.
- Governmentwide acquisition contracts and multiple award contracts at the agency and cross-agency level?and outside of what the General Services Administration is doing?are in vogue. It makes me one wonder where the GSA's schedules contracts and GWACs fit in. Or what unique requirements exist in an agency that cannot be met elsewhere. Be assured that such procurements will create, or reaffirm, lists of preferred vendors for specific agencies.
- Cost plus and fixed price procurements will increase in popularity as agencies get more deliberate about contract and cost management. Time and material will be around, for sure, but more stringently managed.
- Service oriented architecture (SOA) is happening. Major initiatives at agencies are in line with that, and especially with agencies buying services from other agencies. One example is the Interior Department's National Business Center, which last year absorbed the franchised-funded GovWorks acquisition operation. It is one of five OMB-approved shared services providers. As such operations multiply, they might be accompanied by some practical and philosophical changes in how Congress appropriates agencies' budgets. You might also see a renewed push to more expansive service level agreements.
- Formal program management is in the rise. This is accompanied by increased use of certification processes similar to the capability maturity model. This trend calls for sufficient agency staff to become qualified to manage the applicable programs.
- Performance-based contracting that actually protects the government is on the rise, and it will continue. PBC will find a new home in broader IT work even on time-and-materials and cost-plus contracts. All contractors will face the increased visibility brought by the government-wide/NIH contractor performance system initiative (http://cps.od.nih.gov). Question: With contracting officers' evaluations open to the broader government buying community, will there be as many "excellent" ratings?.
- Earned Value Analysis is a way to measure the amount of work actually performed on a project and to forecast a project's cost and date of completion. EVA makes use of a more fundamental earned value management system, which is well-definable and must be certified to meet DOD criteria, at a minimum. EVA will apply to companies of all sizes. The fact is, even small contracts, if they are for mission critical work, should be subject to earned value analysis. For the Defense Department's take, check out this document.
- Vendors' marketing and direct proposal costs will increase as the character of opportunities and resulting proposals and requirements get stiffer. Such requirements include really demonstrating knowledge of the agency, or supplying sample tasks written and submitted, or identifying agency-specific issues and how they might be addressed by your company. More defined structures in organization, project management, and staffing will be the norm, regardless of your size.
- A-11 and CPIC requirements will continue to grow and get more detailed in the planning and budgeting process. This will affect everyone contributing to the plans, and even more so when the results of those plans, as implemented, are compared against the original plans in the future. It will very much be a matter of getting to good, not just to green.