The U.S. government is the world's largest buyer of products and services. Purchases by military and civilian agencies amount to nearly $200 billion a year, and include everything from data management and cloud services to corrugated boxes and cancer research. In short, the government buys just about every category of commodity and service available. Many companies here in the Washington DC area already focus their business on the federal government market place. Other companies have developed a balance of government and commercial business in their portfolio. Having both a government as well as private sector business strategy has helped these firms to survive through economic downturns as well as when government budgets are tight. Now, thanks to evolving conditions in the federal government contracting space, the doors are open for more companies to take advantage of the reservoir of government business opportunities regardless of physical location or company size.
Partnerships in new technologies
One major reason for the improvement in the federal government’s business contracting environment is the gradual transformation that is taking place through the implementation of new technology and innovation. The federal government has been slowly but steadily exchanging old systems for new innovative technology. In order to successfully make this transition and to maintain it, the federal government agencies have had to count on the cooperation of the private sector. Federal government managers and executives are embracing the support of the private sector to help them keep up the pace with technological evolution and change. By incorporating new technologies, innovative software, data mining, analytics and artificial intelligence (AI), private sector companies in all industries are helping government to eliminate duplication of efforts, reduce waste, increase efficiency and reduce costs. For example one company, which works closely with our firm, successfully introduced its unique expense management technology to the US Department of Agriculture saving the agency millions of dollars annually. They have improved the agency’s inventory management while consolidating the annual number of agency invoices from one hundred thousand to fifteen! One of our other collaborating companies has implemented its unique enterprise architecture and data management technology at The Centers for Medicaid and Medicare Services (CMS) consolidating systems and data flow and saving the agency millions of dollars. These technological investments require a long time commitment of collaboration between the government and these private companies.
Private sector inclusion in procurement policy development
Another reason why now is a good time for private companies to consider doing business with the Federal government agencies is that the government has begun to include representation from the private sector into the procurement policy development process. The Department of Homeland Security (DHS) and the General Services Administration (GSA) have taken concrete steps to include private sector industry in on their contracting policy and procedures committees. This has led to new streamlined processes for government certification and registration and for the procurement process itself. The GSA for example, unveiled its innovative new Making It Easier (MIE) initiatives. They include the FASt Lane, a program that provides an expedited process for businesses to certify for the GSA schedule 70 contract vehicle and allows IT Schedule 70 vendors to provide products and services at the speed of innovation. Also introduced was GSA 18F, an organization within GSA's new Technology Transformation Service whose mission is to transform the way the government builds and buys Information Technology, with an emphasis on digital services. 18F works with the private sector to provide an Agile Software Delivery model that creates open source solutions.
Emphasis on small and medium sized companies
Legitimate business opportunities for small and medium sized companies is another factor that makes the federal government an attractive market place for your business. In fact, there has never been a more welcoming business environment in the federal government for small and medium sized companies than there is today. Federal agencies are required to establish contracting goals, such that 23% of all government buys are to go to small businesses. In addition, contract goals are established for women-owned businesses, small disadvantaged businesses, firms located in HUB Zones and service disabled veteran-owned businesses. These government-wide goals are 5%, 5%, 3% and 3%, respectively. These goals are not always met but they are being monitored and enforced now more than ever. In addition, innovative technology and solutions are leveling the playing field for small businesses. New, unique technology solutions are being developed with minimal investment allowing smaller firms to not only be on par but, in some cases, to actually provide better solutions than the larger firms. Government executives and procurement officials are growing aware of this reality. They understand that the smaller companies of today have key staff that have as much or more years of experience than their counterparts at larger companies.
Enhanced communication through social media
The Internet and social media have improved communication channels between government and the private sector. This helps insure that more companies have access to important information regarding government business opportunities in a timely matter. The internet and social media are bringing government and the business community closer together allowing for a clearer defining of the government’s needs and goals.
Grants
Government contracting is not the only way that a business can benefit from having a federal government business strategy. Government agencies like the USDA, the Department of Energy and others also provide competitive grants to companies to test and develop new innovative technologies and solutions. These grant opportunities allow for a proof of concepts that in some cases opens the door for full commercialization of new products and improved products and services for citizens.
Diversifying your company’s business development strategy with a federal government practice can significantly increase the available market for your products and services. Federal government contracts provide services all over the United States, the US Territories, as well as internationally. Cost of entry can be manageable and strategies exist to “test the waters” to see if federal government contracting is a worthwhile investment for your company. For more information on creating your company’s federal government business strategy, send an email to info@theinteramericagroup.com.
