Navigating Reality vs. DOGE Hype

Understanding the government contracting landscape and which trends to watch will help you position your business to take advantage of emerging services and keep up with the industry. As you work to develop a long-term strategy for business growth, staying ahead of your competition requires analyzing and predicting these trends.

In addition to keeping up with industry news, looking ahead to FY2020 and anticipating government spending will pay off down the road. This article discusses four trends in federal government spending you will want to watch closely.

1. The Continued Advancement of AI Technologies 

Artificial Intelligence (AI) is not a new technology at this point. AI continues to evolve as machines perform increasingly complex tasks such as driving cars and predicting global economic trends at levels equal to or better than the most skilled human beings. 

Now more than ever before, government agencies are seeing the potential applications of AI. Innovation in AI drives much of what we’re seeing in increased I.T. spending by federal agencies. The growing toolkit of AI promises to reinvent almost everything the government does from education to health care to national security and defense in 2020 and beyond.  

For government contractors specializing in the tech, cyber, digital, or telecommunications markets, it’s crucial to be plugged into this trend. When it comes to business growth, you can’t go wrong if you follow the data. In particular, these data signals are noteworthy:

• Around 1.3 billion hours could be freed up through automation in the U.S. Federal government.
• The estimated growth rate for spending on AI technologies by central governments around the world is 44%, which is faster than AI spending in consumer services.
• 84% of U.S. public sector executives cited data privacy and quality as the biggest challenge for AI adoption.
• 68% of respondents to one survey (Deloitte-NASACT) reported staff would be provided more training in AI and cognitive technologies.

2. The Rise of Data and AI Ethics

With the advancement of technology, the government will play a bigger role than ever when it comes to managing the ethical complexities of this new “industrial revolution.” In addition to being the “owner” of an enormous amount of data, citizens will continue to look to government to regulate corporate data use. 

As machines collect more and more information from us, the government and industry need to prioritize privacy, equity, and transparency. Using the Internet, Internet of Things, and sensors, machines can track an astonishing amount of data from individuals—everything from sleep habits, to location movement, to every keyboard click can be stored.

For government agencies seeking to formalize their ethical standards around the risks inherent in using algorithms, there is a growing need to contract with emerging technology consultants to help sort through these thorny issues. In many ways, the U.S. Federal government is playing catch-up to other nations here:

• 107 countries have passed legislation to protect citizens’ data and privacy.
• More than 91,500 complaints were received by the Data Protection Authorities under the EU General Data Protection Regulation (GDPR) legislation since its implementation.
• The UK Government launched a Centre for Data Ethics and Innovation with a £9 million budget.

3. Prioritizing Air and Missile Defense

In March of 2019, the U.S. Army published the Army Air and Missile Defense 2028. This document provides the Army’s vision for air and missile defense. By 2028, the AMD force aims to provide commanders with a flexible, agile, and integrated air and missile defense program. This AMD program will be capable of executing operations in multiple locations and supporting unified land operations. 

One of the biggest changes this new program calls for is the modernization of radars and radar systems. This means government contractors in this space should be on the lookout for opportunities to showcase new technologies and to build prototypes. 

4. Legislation Watch: FY 2020 National Defense Authorization Act 

With the Senate passing its version of the bill in June and the House subsequently passing its version in mid-July, Congress is getting closer to the passage of the 2020 National Defense Authorization Act (NDAA). This legislation is an annual spending authorization bill that lays out how the DoD should spend its budget. 

Although challenges remain in reconciling differences between the two bills and getting the President’s signature, potential changes relevant to government contractors include commercial items, data rights, and cost or pricing data. This article provides a detailed rundown of the provisions that could go into effect as soon as October 2019. 

Here are a few key points:

• The House bill would create a pilot program within the DoD to encourage engagement with commercial technology companies through the Small Business Innovation Research Program and the Small Business Technology Transfer Program, which are conducted under the Small Business Act, 15 U.S.C. § 638 (Sec. 878).
• The House bill would amend 10 U.S.C. § 2306a, frequently referred to as the Truth in Negotiations Act or “TINA,” in several important respects that would make it easier for the government to obtain a contractor’s cost or pricing data. 
• The Senate bill requires the DoD to review how it decides to use fixed-price contracts to support its acquisition objectives to ensure that its decisions are strategic and consistent (Sec. 806).
• The Senate and House bills would each require the DoD’s Office of Small Business to set performance goals and would expand the definition of “Disadvantaged Small Business Concern” (S 1790, Sec. 841, H.R. 2500, Sec. 881). 
• Both bills also would permanently authorize the DoD’s Mentor-Protégé Program, which is intended to increase the participation of small businesses by encouraging mentorships with DoD contractors.

How will government contracting trends affect your business?  Our world-class experts have insight into how to manage and capitalize on current and future government contracting trends. Connect with us and let’s get you on the pathway to phenomenal growth!

The end of the federal government’s fiscal year is upon us. Fiscal year 2019 ends on September 30th. If you’re a government contractor, this is likely not news to you. But what might be news is how your company can prepare for the end of the federal fiscal year and take advantage of opportunities to increase revenue.

Many government agencies increase spending in August and September, so if you were thinking you could wait until October to get those proposals ready, you might want to reconfigure your schedule. With this in mind, let’s dig into the reasons for the increase in contracting opportunities as well as some of the ways you can position your company to reap the benefits.

Why does the government increase spending this time of year?

Like many private corporations, government agencies have a “use it or lose it” mentality when it comes to fiscal year-end. Having money left in the account at the end of the year likely means that amount will be subtracted from the budget for fiscal year 2020 because the assumption is if they don’t use it, they don’t need it. So, the looming end of the budgetary year brings a rush of purchases as departments try to spend their “emergency” or “rainy day” funds. 

The end of the fiscal year also means that new funds will be released with the start of FY 2020. So many agencies that have spent all of their funds earlier in the year can now start thinking about how to use anticipated funds when the new budget takes effect.

What can your company do to prepare for the end of the federal fiscal year?

The first step in the process to be able to compete for federal contracts is to register your business in the System for Award Management (SAM). Basically, any person who wants to do business with the federal government needs to complete the SAM registration. This includes small businesses providing services such as construction, architecture, and engineering, as well as other product vendors.

If you’re reading this, though, you’re likely registered already as a pre-approved vendor and are very familiar with SAM. So let’s talk about how you can make the next few weeks count.

1. Focus on deals that you can close fast.

Because you are dealing with a hard deadline, it’s time to focus your efforts on deals that are ripe. These might be deals you’ve had in the pipeline for a while and just need a little shove. Or perhaps you can identify products and services customers are asking for now and target agencies with similar needs.

However, before you go too far chasing down money that isn’t there, do some research at the Congressional Budget Office (CBO). Learn what appropriations have been withdrawn and think about how they might affect your bids. For example, according to the June 2019 monthly budget review, defense spending was up 8 percent, with the largest increases being in operation and maintenance, procurement, and research and development.

2. Be on the lookout for new contract opportunities.

Most federal agencies post requests for proposals on websites such as FedBizOpps.gov or the Contract Opportunity Finder on usa.gov. With these services, you can create a free account using your email address, choose basic keyword or industry-specific searches, and set up daily alerts. 

To avoid the inevitable missteps involved in DIY-ing the process of researching opportunities, however, growth[period] offers opportunity identification as a client service. We begin by matching your firm’s core competencies with market areas and identifying opportunities in each space. Next, we research lateral markets to determine performance cross-over opportunities. Our research staff will keep you updated on all forms of contract and funding opportunities.

3. Stay persistent.

If you’re used to doing business with the private sector, you may be surprised to find that no response to a bid for a government contract doesn’t necessarily mean that you are out of the running. While it does take a fair amount of time and effort to have your bids considered, it is worth it to keep submitting. 

If this is your first time applying for a government contract, this is a great time to give it a shot since there is an increase in opportunities at fiscal year-end. You’ll want to pay attention to the specifics of each Invitation for Bid (IFB), Request for Proposal (RFP), Request for Tender (RFT), or Request for Quotation (RFQ) and be sure to address them in your submission. Once you understand the terminology, requirements, and qualifications it gets easier to submit.

Will there be another government shutdown?

This is a fair question to ask, in relation to what you need to do to prepare for the end of the federal fiscal year, especially if last year’s December federal government shutdown came as a surprise and left your company scrambling. Of course, we don’t have a crystal ball, but Congress passed and the president signed into law a two-year budget deal that increases federal spending and raises the spending ceiling.

The legislation eliminates the threat of a debt default until after the 2020 election and reduces the chances of another government shutdown. This is good news because if Congress had not taken action, the Treasury Department was projected to run out of money to pay its bills as early as September, which would have resulted in a default on U.S. obligations and likely shattering of financial markets.

Still, Lawmakers will return to the Capitol after Labor Day to hammer out the North America trade deal, the outcome of which remains uncertain, and a thin legislative agenda. They will also need to pass individual spending bills to avoid a government shutdown on October 1st.

So, while disaster appears to have been averted for now, none of the above guarantees there won’t be a government shutdown in the near future, which is all the more reason to go for FY 2019 contracts in the next several weeks. At growth[period] our team is ready to help you position yourself to take advantage of these opportunities. If you’re ready to try a new growth strategy, connect with us. We’re focused on your growth.