COMMENTARY: How DOGE will use AI to take aim at government contracting
Gettyimages.com/Andriy Onufriyenko
By
Derek Hoyt
The Department of Government Efficiency could revolutionize federal procurement, but contractors face uncertain future, writes GovSignals CEO Derek Hoyt.
President Trump's Department of Government Efficiency is both controversial and unavoidable.
Politics aside, most people can agree that there is certainly waste in government - time, money and resources. DOGE is intended to address it.
Government contractors are sure to be impacted, and while some contractors will benefit, most will face a reckoning.
How government procurement works today
Currently, the government contracting process is highly inefficient, plagued by red tape, delays and ill-defined requirements that make it all but impossible for anyone other than large incumbents to win prime contracts.
Furthermore, for new contractors the path from start to their first prime contract can take years, with it taking on average 18 months to get a GSA schedule and to obtain access to government procurement portals.
Finally, with more cyber security regulations coming online, larger companies are building moats to protect their contract pipelines and ensure the procurement system stays the same as it’s always been.
The end result is that the same large companies tend to win contracts over and over - because the burden to meet compliance and to have a seat at the table for pre-RFP requirement shaping exercises is specifically designed for large companies. As a result, the government only considers the same old ideas, rather than innovative new ones. This has put our country at a disadvantage and potentially caused national security risks.
Every procurement request represents a critical piece of technology or equipment that the government is trying to obtain. The current process requires months or even years of paperwork and regulatory reviews before the real work even starts. Vendors have complained that the process can be so long that the original technology proposed is obsolete before procurement is complete. Now consider that fact in the context of a missile system - delays or use of outdated technologies could put us at a military disadvantage.
More importantly, the most innovative ideas are never presented, so they can't be procured.
Addressing GovCon supply & demand
DOGE will change not only how our country spends money, but how private companies do business with the government, addressing both the demand and supply sides of the equation.
On the demand side, given Musk's involvement, I expect to see DOGE apply AI to address several key areas:
Procurement Optimization: Identify overlapping contracts, ridiculous contracts or unnecessary spending at scale.
Spending Analytics: Uncover trends in underutilized funding or highlight opportunities to reallocate resources effectively.
Staff and Contacts: Connecting relevant partners and stakeholders to reduce duplicate spending and to cut redundant offices pursuing the same mission sets.
Analyzing Requirements: Dive deep into funded and unfunded programs and determine the driving requirements source and true need for the government - highlighting waste and fraud within the procurement system.
To entice private companies to get involved in GovCon - the supply side - the government needs to make the process faster and easier. AI can help with this too:
Identifying opportunities: This is mostly a manual process today, requiring GovCon staff to manually search through online databases or comb through congressional hearing transcripts.
Developing compliance matrices to help contractors understand requirements: Depending on the size of the solicitation, this process currently takes one to two weeks, making it a challenge for smaller companies to participate at scale.
Crafting & submitting compliant proposals: This is perhaps the most time consuming aspect of applying for government contracts. Finding the right past performance, building out an effectively tailored technical approach, and reformatting resumes takes a surprising amount of direct labor and bogs down proposal teams ability to parallelize work to get more proposals submitted.
DOGE is sure to make waves in GovCon, and hopefully lead to a major housecleaning of the procurement system. The end result should be a more efficient contracting process featuring the most innovative ideas, not just the most well-connected people.
Derek Hoyt is the co-founder and CEO of GovSignals. He spent nine years as a Defense Intelligence Agency intelligence officer before joining Palantir, where he led the SEC contract and rollout of advanced AI tech to the U.S. Marine Corps.