How new initiatives might make federal sales easier

Selling to the federal government can be complicated, particularly for startups, smaller companies, and those unfamiliar with government contracting. The procurement process creates a jungle of barriers including crushing complexity, awkward communications and significant expense just to try and compete for business. 

As a result, a number of companies with innovative products and services have chosen either not to work with government at all, or have given up in futility after trying. That represents a real loss to the public as well as to the business community, and it’s one that federal procurement professionals are well aware of.

In a recent podcast underwritten by my company, two procurement officials – Sandra Oliver Schmidt from the Department of Homeland Security and Jaime Garcia from the IRS – talked about some of the ways their agencies were responding to these acquisition barriers and using innovative approaches to the purchasing process. 

DHS for example, established a Procurement Innovation Lab whose teams are testing the flexibilities built into the Federal Acquisition Regulation (FAR). Its mission is to reduce the barriers to competition and bring more non-traditional companies into the supplier mix by creating their own terms and making multiple awards from a single solicitation. Together with the Department of Defense and General Services Administration, the agency established the Commercial Solutions Opening Pilot, which allows participants greater discretion and flexibility in buying innovative products valued below $10 million.

The IRS is also attempting to push the envelope with its Pilot IRS program. Its goal is to work with non-traditional and small business to quickly prototype and test emerging technologies. It is also looking carefully at project phasing to avoid becoming locked into a single vendor’s solution when there are better options available. 

In addition to the complexity of federal contracting terms and conditions, one of the most off-putting aspects of selling to the federal government has been the cost of writing a proposal. Proposals that follow FAR’s prescriptive guidelines are lengthy, time-consuming, and expensive to prepare. Whereas a commercial deal can often be closed in a matter of weeks or even days, the federal sales cycle can run anywhere from 12 to 18 months. Beyond that, it has been somewhere between difficult and impossible for potential suppliers to meet with the decision-makers who hold the fate of business proposals in their hands.

One way that DHS is trying to open up the process is with phased proposals. The first phase could involve a lightweight proposal of perhaps five pages, or maybe even a 30-minute phone interview. The agency then advises the company on how competitive it thinks the idea is and leaves up to the vendor to decide whether to move ahead with the detailed proposal. The agency is also welcoming oral presentations and product demonstrations using a paperless process. Not only does it give suppliers a better opportunity to showcase their wares, but it gives the government more confidence in making an award. Initiatives like these also show suppliers that the government is cognizant of small suppliers’ costs and resource limitations, which allow suppliers to remain willing to engage across multiple bids and projects and preserves a competitive and innovative supply base.

Contracting with the federal government is often frustrating, but agencies are trying hard to broaden their base of participating businesses. But it is incumbent on the business sector to try harder too.