Government Contracting and the New Administration

Politics and parties aside, the US Federal Government will continue to operate as Fortune 1 and procure more “stuff” from industry than any single purchaser in the world.

What does the future hold?  What should you expect?  What are the trends and considerations?

The future looks bright.  The next four years should be beneficial for companies looking to sell their wares in the government space.  Whether a Professional Services / Management Consulting firm or a services company specializing in product support you should consider expansion and investment in this space.  

Why, you ask… here are 10 trends to consider when planning to enter this market:

1. Unified Legislature: For the first time in a long time, the government will not have a divided legislature.  Funding for specific initiatives should not be held up because one party disagrees with the other. 

If an idea, solution, or value proposition can be created, understood, and delivered, then your organization should be able to create the vision, develop the methodology for implementation, and validate and utilize procurement contract vehicles for purchase and delivery. To deliver is to generate revenue.  Government procurement begins with a need and ends with a purchase using targeted, approved, allocated, and budgeted dollars. A unified Legislature means rapid budget approval and funding, unlike the delays caused by a divided House.

2. Return to Work: Now, here is an idea… The government…well, actually “WE THE PEOPLE” own 10,000 + buildings, many of which were abandoned after COVID. The new administration plans a return to “in-office” work for federal employees, which I support.  This is likely to drive two things related to government procurement … bring the buildings back into operation and accelerate the retirement of 100s of thousands of federal workers who have no desire to resume their daily commute.  This return to work will open the door for numerous contracting and Professional Services opportunities.  Areas of need such as facilities management, space planning, architectural design, renovations, organizational change management, new and innovative technologies, and many more offerings will provide thousands of new contracts for industry.

3. Military Strength: A focus on military and country strength will add to the Professional Services opportunity universe increasing requirements for new innovations to address manpower and recruiting, the use of artificial intelligence (AI) in all disciplines …security,  intelligence, planning, acquisition, simulation, training, and thousands of others required for offensive, defensive, and managerial elements.  In addition, areas such as interoperability, communications, and technology for the battlefield and space will be at the forefront.  This increase in opportunities will open the minds of industry and instigate significant innovations.  Opportunities to present these to the government are endless.  If you are smart, have solutions, and can provide innovation in any relevant area, “there is gold in them hills!”

4. Personnel Transition: If you are a Human Resources (HR) Specialist, the new market and the transformative nature of the Trump win will cause HR conditions on both sides.  New hires will be younger, more technologically savvy, more in tune with social media, and look at jobs and positions through a new lens.  Do you have a staffing company?  Look at the incoming opportunities, the growth in AI, Space, and transitioning into the new “vibe.” 

Simultaneously, there will be an exodus of those who are not fans of the new Administration and its changes; they will be looking to industry for jobs or maybe even taking an early retirement.  Think of the 55+ communities and their rising popularity.  If you are in real estate, development, investing, law, or the many services industries surrounding the retired… the change offers fantastic opportunities for you the service provider. Including out processing, retirement services and others.

5. Increased Access to Capital:  With the addition/creation of the Department of Government Efficiency, there is hope that recent statements made by Elon Musk regarding loans and grants to fund corporate innovation for the development of products that can affect change in government will become a reality.  Take advantage of loans and capital for your growth.  Today, look into your portfolio to determine how your new innovative thoughts, solutions, and products can benefit the government, the citizens, and you.  Plan, apply, wait, and deliver.

6. Transformation rather than Modernization: The government will no longer be focused on “modernization.”  The new buzz word is Transformation.  Modernization focused on the systems and processes.  Transformation focuses on results.  Transforming government involves replacing legacy long-term projects with shorter, more innovative products that quickly and efficiently solve the specified problem and eliminate significant ramp periods.  If you are a professional advisory firm “transformation” should be music to your ears.  Even the smallest organization, the smallest agency, should be able to transform its immediate universe.  You can help with this transformation.   Your Professional Services firm can help and can be the “best-in-class” product managers and manage specific deliverable in government.

7. Technology Alignment and Professional Services: First, focus on supporting and planning solutions for government built around their preferences.  Historically, they have selected technology solutions to solve problems and address constituent/citizen solutions.  Under the new Administration, this will become an area for cost savings and consolidation of support services.  Whether in the contact center business, software development, enterprise resource planning (ERP), cyber security, and many other areas,  organizations should target specific technology Original Equipment Manufacturers (OEMs) with whom to work.  For example, if you have a healthcare operational consulting company focused on hospital operations… invest in a consultant that understands Oracle Health, formerly Cerner.  The Oracle Health (Cerner) solutions are standardized across the Defense Health Agency (DHA) and Veterans Affairs (VA).  The federal government has almost a $10 billion dollar investment in Cerner, which prompted the $28 billion acquisition of Verner by Oracle.  You can, as a consulting services provider, realize real, near-term revenue with expertise in already deployed technologies.  Here is a short list of some of  the popular OEM technology providers

 (List extracted from the $100 Billion NASA SEWP VI Preferred Provider list):

• Adobe Systems, Inc.
• Alphabet Inc
• Amazon.com Inc
• Appian Corp.
• Apple Computer, Inc.
• Avaya, Inc.
• Blackberry LTD
• BMC Software, Inc.
• Broadcom LTD (VMWare)
• Check Point Software Technologies Ltd.
• Ciena Corp.
• Cloud Software Group
• CommVault Systems, Inc.
• Curtiss-Wright Corporation
• Dell Technologies Inc (EMC)
• Document Storage Systems, Inc.
• Elasticsearch BV
• Everfox Holdings LLC
• F5 Networks, Inc.
• Forescout Technologies
• Gigamon Systems LLC
• HCL Technologies LTD
• Hewlett Packard Enterprise CO
• Hitachi, Ltd.
• Howard Industries Inc
• HP Inc.
• IBM Corporation
• Infoblox Inc.
• Informatica Corp.
• Intel Corp.
• Ivanti Software, Inc
• Juniper Networks, Inc.
• L3Harris Technologies, Inc.
• Microsoft Corp.
• Motorola Solutions
• NetApp, Inc.
• Netscout Systems Inc.
• Nutanix, Inc.
• NVIDIA Corp.
• Okta Inc
• Open Text Corp
• Oracle Corp.
• Palantir Technologies
• Palo Alto Networks
• Panasonic
• PegaSystems, Inc.
• Philips
• Pure Storage, Inc.
• Quest Software
• Red Hat, Inc.
• RedSeal, Inc.
• Ricoh
• Riverbed
• Salesforce.com
• Samsung
• SAP SE
• Schneider Electric
• ServiceNow, Inc.
• Software AG, Inc.
• Splunk, Inc.
• Stryker Corp
• Symphony Technology Group
• Tenable Network Security, Inc.
• Thales
• Veritas
• Zscaler, Inc.

8. Trade and a Secure Supply Chain: Following the alignment of services to the technologies selected by government agencies, the new Administration will directly pinpoint compliance with the Trade Agreements Act (TAA). TAA defines compliant countries from which products and solutions can be procured and from where exports are preferred. 

Products and Services from non-trade-compliant countries will continue to be “outlawed” in government solutions. As a Professional Services firm, it is imperative to recognize the technology and product compliance elements leading government procurements and determine how you can design offerings that present complementary solutions to/from the larger US / Trade Compliant Country list.

FAR Subpart 25.4  outlines the policies and procedures applicable to TAA-compliant acquisitions. Use this table to look up which countries are compliant with TAA.

Additionally, each provider, partner, and vendor must maintain a secure supply chain for all products and Professional Services delivered to the government.   Through various processes and certifications, the government mandates recognition of these rules and regulations, and this provides an opportunity for companies interested in providing compliance consulting services such as ISO certification support, CMMC for cyber secure risk management, and others.  Big prospective universe, big requirement.

9. Compliance: Is your organization compliant with the rules, regulations, laws, and mandates of government, whether as a private contractor to the commercial world or as a government contractor?  Professional Services firms can capitalize on the mandates of the government and offer solutions to support the 10,000 + contractors.  Below is a brief listing of some of the compliance certifications and mandates specific only to cyber security.  Build a practice around supporting government contractors in achieving these certifications, and you may create an unending revenue stream.  Per the General Services Administration (GSA), here is a partial list of some of the more common laws and requirements related to cybersecurity and privacy all of which you as a Professional Services firm could be offered by you to the many contractors:

Defense Federal Acquisition Regulation Supplement (DFARS): manufacturers in the defense supply chain may see one or more DFARS cybersecurity requirements in their contracts.

• The International Traffic in Arms Regulations
• Payment Card Industry Data Security Standard (PCI DSS
• Sarbanes-Oxley
• The Children’s Online Privacy Protection Act
• The General Data Protection Regulation (GDPR and others

Suppliers to the US Government

• If your company sells products to the US government, you must comply with the minimum cybersecurity standards set by FAR 52.202.21.
• FAR 52.202.21: Requires government contractors to follow 15 basic safeguarding requirements and procedures to protect systems used to collect, process, maintain, use, share, disseminate, or dispose of Federal Contract Information (FCI).
• DFARS 252.204-7012: Requires contractors with CUI to follow NIST SP 800-171, report cyber incidents, report cybersecurity gaps.
• DFARS 252.204-7019 (interim): Requires primes and subcontractors to submit self-assessment of NIST 800-171 controls through the Supplier Performance Risk System (SPRS).
• DFARS 252.204-7020 (interim): Requires primes and subcontractors give the DoD access to their infrastructure to verify the self-assessment (via DMCA); requires contractors roll requirements down to subcontractors.

Cybersecurity Maturity Model Certification (CMMC)

• The Cybersecurity Maturity Model Certification (CMMC) program is a multi-level process to verify that DoD cybersecurity requirements have been implemented. All entities within the Defensesupply chain will be required to have at least a Level 1 certification issued by the Cyber-AB by 2026. Any entity that handles DoD controlled unclassified information (CUI) will need to have at least a Level 3 certification.

10. Finally, number 10 …   Smaller government means more work for contractors.  Now is the time to venture into this market.  Pick a path, pick an offering, and become the best for the government in that discipline.  You will see small contracts targeting solutions rather than programs; you will see mandated small business utilization of up to 30% of each dollar spent.  Are you a small business?  If you were a manufacturer of technology products, a small business is any company smaller than 1250 people… Professional Services companies smaller than $9M, $34M, and others based on your North American Industry Classification (NAICS) annual revenue numbers will put you in a category for revenue.  Minority, Woman Owned, it all matters.  Just remember, smaller government does not mean that the service requirements go away… they just get redirected to industry.

In conclusion, if you are a small business Professional Services company and can offer solutions that support Personnel/HR functions, Return to Work, Military Strength, Organizational Transformation, Operational solutions through technology, Compliance, and Cyber Security and Solutions, the new Administration can be your growth engine for the next four years. The future is bright.

Good Luck and Good Selling!