Today's market conditions are driving customers and contractors to be more agile in the way they field IT projects so large companies need to adopt new models of partnership with smaller tech companies.
In today’s post-sequestration business climate, government contractors are continually challenged with shrinking margins, strong price competition and flat or decreased agency spending.
At the same time, new acquisition reform efforts aimed at streamlining and improving technology procurements are helping to ensure that agency CIOs are more involved in the process, and are responsible for the success or failure of all IT projects at their agency.
For the agency, the combination of these developments creates greater demand for technology collaboration and agile solution development. With increased CIO involvement and improved agency coordination, programs should benefit by sharing common capabilities through inter-program collaboration. At the same time, with a shift towards smaller, agile application solutions, as opposed to traditional grand-scale programs, agencies can lower the risk of cost overruns and schedule slippage.
For the large contractors supporting the agency, increased collaboration and more agile development increases the need to team with smaller innovative tech firms in emerging IT areas and then share those capabilities across programs.
For example, with the increasing need for sharing geospatial data across not only the Defense Department but also civilian agencies, contractors can help CIOs leverage their existing geographic software and imagery with available commercial-off-the-shelf solutions from smaller software companies, as opposed to developing custom applications.
When customization is required for success, the same small software companies can help large contractors fill highly specialized capability gaps without the need to directly acquire the innovation. Ultimately, with the right teaming arrangement, program outcomes are optimized which benefits all industry partners.
In addition, with successful mentorship and partnership programs, larger contractors gain access to contracts for which they would otherwise be ineligible. Conversely, smaller contractors that lack the resources for federal procurements can break into this competitive marketplace by teaming with larger providers.
However, there are always challenges when it comes to developing the right teaming relationship. According to the Washington Technology Insider Report 2015, there is often a lack of transparency and mistrust in the majority of teaming relationships.
Many of these challenges come down to a lack of communication, and a misunderstanding of what each side brings to the table. For smaller specialized companies, it is easier to show their value propositions to both the government customer and the larger primes.
In today’s rapidly evolving government IT arena, these unique value propositions can be anything from spatial data management to mobility to the Internet of Things (IoT) to specialized cybersecurity offerings. These are the new innovation areas that are moving away from being “talked about” to actually being implemented.
In particular, spatial data collection and visualization is fundamental to decision support for all federal agencies. There will never be a shortage in the need for insightful, actionable data for helping government become more responsive and effective. Government will always need on-demand decision support data about a wide-range of subjects – including disaster recovery, income levels, air quality, disease patterns, environmental incidents or population trends.
For larger contractors, it may be difficult to build out or acquire these types of capabilities in a rapid fashion. Furthermore, with acquisition reform efforts like FITARA giving agency CIOs more input in the procurement process, it’s even more important for larger contractors to demonstrate greater value with the right teaming arrangements.
Ultimately, we all want successful business outcomes produced by the unmitigated success of our customer agencies. This can be achieved through nimble teaming relationships where the smaller players and the larger contractors work together in a new model of agile programs.