Winning is everything!

Posted on June 23, 2011 by Dick Griffin

 

 

Article Title:                                      What It Takes To Win

Author:                                    Dick Griffin, CEO, The Griffin Method

Date:                                                      June 21, 2011

Picture of Author, and founder of TGMWinning isn’t optional: it’s required.  When it comes to federal awards, the winning contractor is usually the one whose proposal demonstrates the nuances of the proposal development process best.  Knowing the process inside out so that a contractor can, for example, react strategically when the government moves its deadline is a great advantage.  Resisting schedule disruptions and adhering to proposal development schedules, often despite the government’s frequent schedule changes and clarifications, and even sometimes by acts of nature, can be daunting and frustrating.  How can contractors move to counteract these challenges, using time extensions to polish their apparently finished proposals, rather than to ‘catch up’ or confuse their original timelines?  What companies that win have in common is their use of Work Flow Schedules.

As a former career federal procurement manager consulting for the past 8 years with companies large and small, my experience tells me that those who lose federal proposals share a similar problem.  The most common weakness or breakdown I encounter in a company’s proposal development process is its faulty scheduling of proposal development tasks.  Timeline management is directly linked to losing. 

Interference with quality assurance practices, restriction of opportunity to do market price comparisons or consider alternative approaches to improve overall technical ratings, and difficulty with schedule compliance are also directly linked to expanding costs related to development of proposals.  These are all time management issues.

According to a recent American Express study, costs relating to proposal development average $30,000, win or lose.  Directly linked to increased financial expenses, lateness in receiving team deliverables results in reducing or eliminating the opportunity for quality review and edits.  Nothing in the federal proposal business is more expensive in the proposal process than submitting an unreviewed draft rather than a polished proposal.

Breakdowns in proposal development scheduling not only add time but also disrupt both time and travel commitments for key personnel.  Often, the disruption results in frustration for staff members who are trying to develop or complete other major projects within their company.  A disciplined Work Flow Schedule for proposal task development consistently builds in ‘extra’ time to explore other options and also to work in other areas if necessary.    Lax scheduling routinely results in 'crunch' time scenarios associated with last minute rushing to meet delivery timelines, and loss of quality control.; clear scheduling lays down expectations and sequential deadlines for delivery.  Subsequent deliverables can be made within the process in a logical and timely manner.  Proposals assembled in well managed processes consistently get rated higher, and win more often.

Where scheduling has the biggest impact is in developing the information for what I call the "formula parts".  Many federal RFP's have three formula parts, driven by Federal Acquisition Regulation and Contracting Office policy.  They are outside of specific technical challenges for the project and provide supporting data.  Roughly, these three formula parts are documentation of Past Performance, a requirement to pass along socio-economic data that each agency is required to report to Congress, and a pricing section.  All are cross matched with the technical narratives section.

The nuance that contributes to many companies’ consistently higher ratings lies in their ability to relate the three 'formula' sections to the technical section.  Companies that develop mini-libraries of past performance data and subcontractor qualification data have a resource from which they pluck appropriate sections of supporting documentation to fill formula section requirements.  The actual amount of time winners commit to gathering this information isn't the real key to winning or losing; rather the key nuance or subtle advantage is WHEN the companies assemble the data required in the formula sections.    Completing the formula sections early and keeping them readily available allows the process to focus on the technical challenges and ameliorates 'crunch' time situations.  Allotting the appropriate time for readily available information  ensures leaving the path clear for a most critical segment of proposal development: the Red Team Review.

At the Griffin Method, we believe that the survival of our clients depends not on writing the proposal, but on winning it.  To respect and follow a clear and well-organized Work Flow Schedule will allow for managing the many contingencies that arise during the process.   And to embrace the proposal development process with its associated priorities as an integral part of all major projects in the company is key to winning consistently.

 

Bio: Dick Griffin, CEO of The Griffin Method, brings private contractors 27 years experience from his career as a federal official overseeing contracting activities, as a private contracting business owner, and now as a private consultant on Business to Government contracting.  Sharing his unique perspective as an expert from both the federal and private contractor sides of the federal contracting process, Griffin uses his insights and understanding to provide leadership and vision to companies large and small.  Griffin’s public service career includes nine years managing projects at the U.S. Department of Education, the U.S. Department of Labor, and the White House.  His federal assignments included service as a technical analyst, policy analyst, project manager, project director, and Contracting Officer's Technical Representative, or COTR.  While in public service, he achieved Certification level II from Defense Acquisition University as a Contract Specialist.  For the past eight years, he has consulted with companies across America,  focussing their sights on improving their understanding of the federal procurement process and helping them win bigger projects more often.

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Who will manage the Internet if the government shuts down?

Posted on March 1, 2011 by Dick Griffin

 

 

How did we get here?

Fiscal Year (FY) 2010 budget was actually passed the 109th Congress, during calendar year 2009.  That as the year when the Republican minority frequently vocalized its strategy as "just say no" to anything the new Administration proposed. Republican voting patterns during the 111th Congress demonstrated solidarity behind their leadership aimed at frustrating the new Administration's efforts to make modifications to the lame duck budget submitted by the previous administration.  The opposition was specifically coordinated and nearly paralyzed the budget creation process that year.  The resulting budget was essentially as President Bush proposed with minor modifications.  One item of note was The American Recovery and Reinvestment Act of 2009, abbreviated ARRA (Pub.L. 111-5), and passed in February 2009. The leaders of both parties, knowing that during elections years not much budget legislation actually occurs, finally moved the proposed Bush budget through, establishing spending thresholds for FY2010 at the highest levels in U.S. history.

During 2010, Congress was in the campaign mode.  The Republican leadership's mantra of "Just say NO!" prevailed in what limited legislative activity occurred.  Other than Health Care legislation and war related authorizations, not a single one of the 13 spending authorization bill moved through Congress.  Republicans obstructed any spending legislation, preferring delay until the next fiscal year would give them an opportunity to have greater influence on spending should the midterm elections result in a larger number of Congressional votes in various appropriation committees.  Following midterm elections, a lame duck Congress struggled to provide 'Continuing Resolutions' to temporarily fund government pending the passage of formal legislation.  4 separate Continuing Resolutions resulted.   The last (H.R.3082.ENR) extended operations until March 4, 2011.

Meanwhile, recent Congressional Budget Office reports list 777 spending authorizations that expire before September 30, 2011.  Each of these must be re-legislated under FY2011 budget, or they die.  Normally programs authorized under expired law are not continued, unless or until specifically stipulated in new legislation.  Without new legislation, thousands of significant projects and programs will stop. .  

One such contract caught in this mix is for ICANN.  Its funding expires on September 30.   On the surface, The Internet Corporation for Assigned Names and Numbers (ICANN) formed in 1998 is a not-for-profit public-benefit corporation with participants from all over the world dedicated to keeping the Internet secure, stable and interoperable. It promotes competition and develops policy on the Internet’s unique identifiers.  Its contract with Commerce Department is to manage the Internet's addressing system.  Below the surface, ICANN's reality that it is the object of a worldwide controversy internationally supported quest to strip the control away from the USA and assign it to the U.N.

At Department of Commerce, where ICANN is funded under National Telecommunications and Information Administration, this is one of the 777 funding authorizations that will expire on September 30.  The current Continuing Resolutions expires Friday.  The question is will that fund ICANN if not by The U.S. Department of Commerce (DoC), National Telecommunications and Information Administration (NTIA)?

Or more simply, who will manage the Internet next year if the government shuts down?


 

 

 

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Perfect Storm= federal shutdown

Posted on February 23, 2011 by Dick Griffin

 

For federal contractors, there is a “perfect storm” in Washington: a looming federal shutdown.  Multiply forces are converging to buffet long held traditions and established patters for supporting our federal agency clients, and our citizens.  According to the Professional Services Council, an industry group, a government shut down will harm contractors more now than they were 15 years ago during the last government shutdown,

 


Media business shows are all abuzz about budgets, forecasting the demise of hundreds of programs being questioned by newly seated legislators intent on inserting austere cuts in official legislation.

Across the Washington Mall, domestic agencies and White House, Administration officials and senior career staff are burning up internal communication channels, exchanging contingency plans and suggesting alternatives to anticipated budgets cuts.  All the while freezing communication about upcoming contract competitions, some of which are simply expiring because federal agencies are becoming more paralyzed every day by the uncertainties they face.

Across the river in Arlington, Pentagon officials have slipped into siege mode, hunkering down to protect ‘sacred cow projects’ from rampaging budget cutters appointed by the Administration and in the Congress.   DoD Secretary Gates has thrown down the gauntlet, demanding 10% reduction in contracts every year for the next three years. 

And farther north, the 3 letter intelligence agencies no-one talks about are pushing and shoving at a trough full of established funding authorizations while they transition their varied roles to rear guard, mop up and on some fronts and balloon on others.  Are shadows looming over these sacred funding streams?  The intrigue is quiet, but complicated every day because of fluid dynamics of Middle Eastern events clashing with traditional issues and long standing challenges.   Each Alphabet Agency will struggle to keep its funding,

And supporting them all are massive groups of contractors.  Services aren’t paid for when a contract is signed, only when delivered.  During shutdowns, contractors stop delivering services, and furlough workers.  These workersrange from young people recently drawn into ‘the growth industry’ that has been government contracting in the Washington area to others who’ve contributed their skills and intellect for decades, toiling in relative obscurity, content to work hard on sharply focused, relatively narrow careen channels, on unusual challenges.

Some chose to come to meet the challenges of working with highly qualified peers, on sophisticated expansive projects. 

While federal employees will also likely be furloughed, they will be paid during the upcoming layoffs.  Contracted staff will most likely not be paid for the lost time.  But every cloud has a silver lining.  After the shutdown, the backlog of work will filter out to the contractors, who have higher levels of deliverables to process the demands on their projects while the government is shut down.  These new demands probably will be processed as ‘change orders’ and the contractors will likely charge premium prices establishing new precedence for higher pricing in the future.

 

 

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Predictions came to pass

Posted on January 29, 2011 by Dick Griffin

You might recall  my comments from the Oct. interview regarding the implications to government contractors of the elections, and the reference to what might happen if Tea Party candidates were elected.   Last year FY2011 spending decisions were held hostage to politicians running for re-election who sandbagged and delayed the FY2011 budget in hopes of seeing changes in the ratio between the parties.  The results of the election actually created an even more dysfunctional Congress. 

Implications are that the current Continuing Resolution (CR) under which the feds are operating, ending March 4, will be extended, though with  substantial modifications.  An extension of the CR will pretty much wipe out any responsibly managed opportunity for agencies to launch any significant acquisition initiatives.  CR's have already wiped out the first half of FY2011 spending cycles.   Normal acquisition activity  takes between 6 and 8 months in federal agencies to prioritize, plan, launch, evaluate and award a contract after the spending is authorized by Congress.   Any extension of the current Continuing Resolution will push any FY2011 allowed spending into Quarter 4 of FY2011.  The next CR will probably be more restrictive to federal agency spending, and almost certainly will create an even greater year-end frantic end-of-year spending frenzy than normal.

Implications to the ability of agencies to fulfill their missions are yet to be measured, but the CBO report lists the programs in many agencies that will be suspended or dramatically scaled back, pending approval or renewal of new spending authorizations, and the ramifications to government contracting are enormous and ominous.

 

REFERENCES:

CBO REPORT: Unauthorized Appropriations and Expiring Authorizations

January 2011 This annual report shows the total amount that the Congress has provided in appropriation acts for programs whose authorizations have expired. However, no appropriation acts have been signed into law for fiscal year 2011. All programs covered by those acts are currently funded under a continuing resolution (Public Law 111-322), which expires March 4, 2011. Thus, no information is available about unauthorized funding for 2011 as a whole because the full-year appropriations have not yet been enacted.

Gates: Budget stall imperils military   News servicesPublished: January 28, 2011 3:00 a.m.  

OTTAWA, Ontario – Defense Secretary Robert Gates is accusing Congress of dumping a “crisis on my doorstep” by holding the Pentagon to last year’s spending levels and creating a potential $23 billion gap that could weaken a wartime military.

Spending Reduction Act of 2011 January 2011 

The Spending Reduction Act of 2011 reduces federal spending by $2.5 trillion over ten years. The bill will specifically hold FY 2011 non-security discretionary spending to FY 08 levels, hold non-defense discretionary spending to FY 06 levels thereafter for the rest of the ten-year budget window (the same level as in effect during the last year of GOP control of the Congress), and include more than 100 other program eliminations or savings proposals, consisting of proposals from the RSC Sunset Caucus, YouCut, or past RSC budgets. 

 

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A caller talks to TGM

Posted on December 21, 2010 by Dick Griffin

 





“I don’t know who you are, but just read an email from you.  Can you tell us something about yourself?”  said the voice on the phone.

 

I responded, “I work with companies to develop their federal business.”  

 

“Why have I never heard of your company?” came next.  

 

“My company is privately owned, carefully managed, and selectively marketed.  Our  successes are dynamically linked to the successes of our clients.  Confidentiality agreements with our clients restrict us from revealing them to their competitors because we help our clients develop a competitive advantage within their vertical markets.  So, unless we’ve learned that you could benefit from what we do, you’re not likely to hear about us from your competitors.  We have an established outreach process including use of Twitter, Facebook, publication of articles in syndicated print media, and occasional Television and Radio interviews.  In your case, we might be a poorly kept secret.”

 

“Griffin, what is it you sell?” the caller asked.  I wanted to say, “Here are some hints: it ain’t pretty, sweet, simple, easy, or quick.   It’s critically needed in the vertical market we serve, and though it’s invisible to most people, it’s also essential to their success, and exceptionally valuable to those that already have it.”  Actually what I said was, “Services”.

 

“What is your company’s product?” pressed the caller.  My response was, “It’s not a product.  It’s services.  Sometimes there are tangible deliverables but always with nuances that apply to specific challenges facing our clients, while helping them develop vision and foresight and creating low risk relationships between themselves and their clients.”

 

“What does your company stand for?” was the next inquiry.   “We want to assure that our client is chosen as the most highly rated provider of the goods or services that can be delivered.  We help our clients promote value, integrity, quality and customer service.” I responded.

 

“I don’t know your company’s customers,”  came the reply.  That troubled me: “But you do! Our clients are companies scattered across America, and you use the products and services they produce every day.  You are their client.” I said.

 

“I don’t know your company’s record.” came next.  I wanted to respond, “If statistics reflect our record, some that speak for our success might be: We still have as a client our first customer.  We’ve never failed to deliver. Our business has doubled every year for four years in a row.”  

 

But the caller’s next statement came too quickly: “I don’t know your company’s reputation.”  I jumped in with, “More than 80% of our new business results from recommendations given by one person to another.  More than half of our new business comes from repeat customers.” 

 

“Now, what was it you wanted to sell me?” said the caller.  “Nothing,” was my answer, “but we do offer to help YOU when you think you need it.  Why did you call?”

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To Bid or Not to Bid…. Opportunities that build your win rate.

Posted on December 4, 2010 by Dick Griffin

A key part of winning is selecting RFP’s you can win. This is the first level of Bid/No Bid decision. No other part of the process will have more impact on your win rate. Selecting projects for which you are competitive is essential.

1. Finding which agencies will most likely buy what you sell isn’t always enough, but is always the first step – Most federal agencies are listed at http://www.usa.gov/Agencies.shtml.

2. Review how your business matches the potential target’s mission. As you create a list of Hi-Value targets agencies,  confirm how much (in $$$) each target buys of what you sell (that defines the SCOPE of your opportunity there). Review how often they buy it, from whom they've bought it in the past, how big the purchases were, and when will the contracts now in place to buy  will expire (that defines a SCALE for the agencies buying pattern). If their buying pattern is attractive, keep the target on your list…if you can’t sell them using their buying profile (SCOPE and SCALE don't match your capability), drop them.

3. For those targets that buy in the increments you sell (or want to sell), determine if they use an acquisition process you can qualify under, then review the target’s procurement forecast.  The agency's forecast is required to be posted at the agency's Website.  This could tell you about opportunities becoming available between now and the end of the fiscal year. Review the forecast list for any opportunities that meet your sales pattern and are inside the timeline to allow you to respond within the announcement horizon. Search www.usaspending.gov using the target’s ID to see how they have been buying similar products and services, and who from. Keep in mind, fewer than 40% of projects actually get posted through FedBizOpps.gov (FBO). FBO and USASpending research may also be usefull for to building lists of potential teammates or competitors.

4. Search for other opportunities in databases such as INPUT, ePipeline, GovernBids.com, www.fedbizopps.gov, or the U.S. Army posts on (ASFI):https://acquisition.army.mil/ and others.

 

 

5. Register where your customers post opportunities. Many opportunities never make it to www.fedbizopps.gov. For example, 70% of GSA Schedule competitions never get posted to FBO.  Most agencies have ‘registration requirements’, where providers register if/when viable opportunities in their procurement forecasts appear. Qualify your marketing targets by learning how the agency establishes their sources sought lists. (HINT: Look for the agencies Office of Small Business Development.)

6. Set up a “T” chart for each emerging opportunity. List the requirements on one side, your capabilities on the other. Your capabilities and resources may not align with the potential customer needs, and you may need partners or team mates to qualify. Determine how you will fill the gaps by finding a great subcontractor, hiring additional personnel, or developing an in-house capability. Carefully review your Past Performance and Performance evaluations to create clear reflections of relavance to the target RFP,  Define a clear set of criteria for yourself: know your scope/scale/and magnitude limitations.  Be very critical, if you do this right, a typical list of 10 should shrink to only 2 or 3 where you'll actually have a Hi-Value add to offer the target.

 

 

7. Make an appointment to visit the targeted agency AFTER your review informs you of what their needs are (and after you KNOW how you can help). Go prepared to discuss opportunities you know about (take along a White Paper that explains what your product or service does that meets the State-Of-The -Art, and a "Hip Pocket Proposal" prepared to meet the need you are there to discuss).  Let them know that you are aware of their need because of expiring contracts or the Procurement Forecasts. If you are a small business, start with an office of small business utilization (every federal government agency has one). They should be able to direct you to the right contracting officers and program managers.

8. If you have a working relationship within the targeted agency, take along a list of Point-of-Contact, and be prepared to Name-Drop, shamelessly.  The more familiar the person who is interviewing you thinks you are with the internals of their organization, the better you prospects for passing through the 'gatekeepers' to someone who is actually a decision maker.   If your are working inside the targeted agency, challenge your workforce and partners to find out about new opportunities. Remember: 80% of your business will come from 20% of your customers, and if you are now working with a program…. they are who most likely can work with you to open new opportunities.  Make it a practice to always mention your interest in any upcoming projects at every review or briefing. Enthusiastically attend and support your target’s networking breakfasts, roundtables, trade shows, conferences, and other formal and informal events sponsored by your targeted customers, and be sure they know you are supporting their outreach effort. At their functions, make it your first priority to meet specific people, and follow up relentlessly.  Face-to-face encounter is the best memory imprinting process and brand building technique available.

9. Don't neglect sub-contract work.   Even the largest government contractors need subcontractors, and frequently help smaller firms get established by subcontracting work to them. The government prefers working with teams of contractors because it 'freshens' the resource pool, and provides Specialists in critical areas.   In step 3 (above) you'll discover the names of Primes who already have contracts with your targeted agencies.  Many of those primes actually have Small Business Subcontracting officers who requite qualified subcontractors for their major agency clients.  Work with the larger Prime contractors who already is providers to your targets. Register with these primes using their Website procurement sections. Follow up with Prime contractor’s business development person – you can find their personnel names on FedBizOpps or INPUT, or their company's Website, or they sometimes have the Small Business POC listed on the GWAC information page.  Actively pursue being added to the Primes resource list in preparation for upcoming  opportunities where the Prime is already incumbent or has had previous experience..

10. Set high standards for selecting opportunities you will bid on and the people you will work with. Develop severe Bid/No Bid criteria based your capabilities and past performance and your understanding of the customer, your resources, and your level of readiness, to apply consistently to your "pursue-or-not" analysis. Say "no" way more frequently than "yes". Developing proposals is expensive – be convinced you can win, and know why.

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Tips for improving your Open Ratings Report

Posted on November 18, 2010 by Dick Griffin

Picture of Author, and founder of TGMTips for improving Open Ratings result for GSA Schedules.

Q. What is this about?
Getting on a GSA schedule is important for positioning your company as a government service provider within a narrow field of pre-qualified competitors. It is closed community where the government can award you work. They are Multiple Award Contracts where your government clients can select your company as the preferred service provider, and make awards in very short time frames. The application process for a GSA schedule includes an evaluation process performed by Open Ratings for Dunn and Bradstreet.
The Government evaluation team will review the results and use the relevancy definitions of the identified Standard Industry Classifications (SIC codes) to determine whether responses are relevant to the product or service covered in the GSA Schedule you intend to apply for.

So, what is an Open Ratings Past Performance Evaluation?
Results from the Open Ratings survey indicate where your Overall performance rating falls in comparison to rated companies in your SIC group. The evaluation process requires that you provide Open Ratings a list of customers you wish to use as references.

It provides a breakdown of survey responses received from people you identify. A minimum of 4 customer references is required. The survey responses are rated on a 0-10 scale for each question. Open Ratings recommends that 15 customer references are given, but you may provide up to 20. A “customer reference” is defined as a person or company that has purchased products or services from your company. Vendor references are not accepted.

  • 9-10 – Positive Feedback
  • 5-8 – Neutral Feedback
  • 0-4 – Negative Feedback

Q. What happens to the list?
Open Ratings provides GSA with an “Overall Performance Rating, which is an assessment of ‘likely overall performance, using a benchmark referenced to Standard Industrial Classification (abbreviated SIC) codes, a United States government system for classifying industries by a four-digit code. The SICs of the companies you submit to Open Ratings who’ve worked with you in the past are compared to yours, and will be compared to those SICs used in the GSA Schedule you’ll be applying for.

Open Ratings will send each customer a survey asking 10 questions, allowing the responder to rate the answer using a scale of 1 to 10, with 10 being the best, most desirable result. The questions are to rate the following criteria for your past performance:

  • Overall Performance
  • Reliability
  • Cost
  • Order Accuracy
  • Delivery/Timeliness
  • Quality
  • Business Relations
  • Personnel
  • Customer Support
  • Responsiveness

Q. How can you assure you’ll get the best results?
Choose the people you submit to Open Rating very carefully, and consult with each person before submitting him or her as a reference.

  • Make a preliminary list of as many ‘satisfied’ customers that you’ve done business with in the past two years.
  • For each person, provide the Name, Address, Email address and Phone number, that is the information you’ll have to submit to Open Ratings.
  • Create your own ‘ghost survey’ using the same criteria that they’ll be asked on the Open Rating survey
  • Create a spreadsheet, using each criterion as a column header, and list of your select people less than one column and their score for each criterion in the appropriate columns.
  • Have someone contact people and provide him or her a briefing, explaining that you are considering using them as a reference for you company. Ask each person to rate your performance for each of the criteria, using the same 1 to 10 point scale.
  • Below the list of names, add a row that averages the scores in each column.

After you’ve completed your ghost survey, select only the people who’ve rated your services the highest before consideration submitting those names to Open Sources.

  • One way of assuring a higher score is to delete those people who’ve rated you lower in your ‘ghost survey’, and submitting only those that contribute to the higher range of your average for each column.
  • A second option is to consult with people that rated you low.  Try to ascertain if you can help him or her adjust their response to be more positive.  Keep in mind, you will need to explain what your company is doing to correct the low score should you use this person’s rating.

What are acceptable ratings?
GSA’s objective is to select superior service providers for GSA Schedule. Ratings below 9.0 are not considered superior.If results of your Open Rating Past Performance Evaluation survey are above 9.0, your application will likely move on to the next phase of consideration without comment from GSA.

A rating of 8 is marginal.  If your results are below 7.5 you will have to explain what actions your firm has taken to minimise the problems that resulted in negative feedback. With the majority of your criteria being rated higher while one or two are not above the threshold, and an excepted explanation, GSA may still allow your application to be considered.

What if you don’t get acceptable ratings from Open Sources?
Proof of acceptable past performance and customer satisfaction is crucial, and if your scores do not represent your past performance favourably, you should reconsider submitting an application or proposal.

The results of the survey are available for one year.  To limit the negative impact of poor results, immediately contact those people submitted as references to Open Source for evaluation. Evaluate the issues they have and develop an explanation that explains how your company will address those concerns.

  • If you continue with applying for GSA schedule after having gotten an unfavourable rating, you will need to prepare a rebuttal to the report. You will be required to explain what actions your firm has taken to minimise the problems that resulted in negative feedback. Failure to provide an acceptable explanation will result in your application being rejected.
  • The report has a lifecycle of one year, after which a new survey is required.
  • A separate Open Ratings survey is for each GSA Schedule application will evaluate using different SIC comparisons. Reconsider the people you selected as references if you consider submitting under a different schedule.
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TGM’s projections for FY2012 funding streams…

Posted on November 4, 2010 by Dick Griffin

What can Federal Contractors expect for FY2012?

For federal contractors, October is traditionally a month of reflection and analysis as they wait for the implications of the next year’s budgets to float down to the programs where they work on projects.   This quarter is usually a time best used to review last year’s triumphs and disappointments, and to  scout for emerging opportunities within their traditional agency partners and try to identify new opportunities in other agencies.   Successful contractors examine crucial feedback from their government partners and set out next year’s goals and targets.

This year is different.

For the second consecutive year Not one of the 12 authorization bills passed Congress.   For contractors waiting on FY2012 appropriations bills, it is simply not realistic to assume much will happen that will expanding  funding of operations, more likely will be another extended Continuing Resolution operations until the end of March 2012, probably base on the FY2010 budgets less 10 to 15%.

The big question is, what will be the impact on the volume of Federal business during fiscal year 2012?  What can we expect for volume in federal RFP releases from the Federal government during FY2012?

The biggest wildcard factor is the Congress’ ability to pass new appropriations bills.   And there may be another Continuing Resolution following that in March. 

Other clouds already overshadow decisions about the levels of spending for DoD services contracts from FY 2012 through FY 2013 for the DoD's new Secretary Panetta.  Outside of DoD, there are bright spots, including several multi-billion-dollar MATOC RFPs already in the queue and scheduled for release next year, and while these will likely not be affected by either the Continuing Resolution actions or DoD policy, there are no certainties that these will actually be competed.

One near certainty that contractors can expect is a slight increase in RFP activity during the first two quarters of FY2012, probably followed by very intense activity during the final two quarters.   Contracting shops will experience the building urgency to compete contracts using FY2011 funds and FY2012 funds though agencies will not have a green light to launch new programs or expansion of existing programs where the FY2012 funding streams have not been established.   Spending policy inside the administration has been slowly developing as the mood of the Congress becomes more apparent. The current pending spending streams reviewed indicate that current Congressional spending authorizations will be adjusted downward, in some cases radically. Radical changes in the authorization bills will result in extending the time lag in contracting activity as the administration adjusts the Executive branch’s policy to the new spending authorization.  The end result will be that the actual spending activities associated with FY2012 money will be crowded deeper into the year, but the law will still require that the money be spent or turned back to Congress by September 30.

The statistics are rarely clean, because the 12 top-level appropriations bills that were caught in past Congressional committees frequently have been repackaged to include or exclude various initiates.    There is a greater cloud of mystery surrounding the actual new spending laws, which continues to add confusion.  This budget cycle will like result in many more of FY2012's competitions taking the form of larger MATOC and SATOC competitions that combine several projects and call for quick responses, and in many cases having socio-economic set-aside 'sister' competitions to accommodate the Small Business goals..

The current appropriations bills pending in the Senate originated under vastly different leadership in the House, as with new leadership firmly in  control of the House Committees.  But the House’s leadership has been too weak to ram legislation through without bi-partisan support, and the Senate has been reluctant to act on any legislation.  The result could well be continued gridlock, with the end result for contractors being that they face having a Continuing Resolution control their operations for another  entire year.

While the agencies operate under continuing resolution funding, contractors should expect a 10 – 15% decline in their business, The agencies will be very cautious about committing to spending money on projects before they see the actual funding allocations.

This projection is based as much on my personal experience as on numbers that can be derived from research.  This looks to be a contracting season in which the faint of heart may want to consider other options.   FY2011 will be the most competitive federal contracting year in recent memory; every competition will be intense.

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