A playbook for thriving with OneGov and the FAR Overhaul

The rules of the procurement game are being written as we speak, but government contractors should not wait for the dust to settle.

Executives speaking at the GovExec Government Efficiency Summit on July 16 offered concrete examples of what companies should be doing as initiatives like the General Services Administration's OneGov tech acquisition program and the Revolutionary FAR Overhaul move forward.

“I tell my team that in chaos there’s opportunity,” said Rocky Thurston, CEO of DMI. His fellow panelists were Stephanie Kostro, president of the Professional Services Council; and Anirudh Kulkarni, CEO of CVP Corp.

Companies focused on providing labor will be less successful moving forward.

“If your value proposition was I know how to get great people, I think that value proposition is eroding very quickly,” Kulkarni said.

The mission is what should lead your sales pitch, not code and not labor hours. This is particularly true with agencies that have been early adopters of the class deviations that kicked off the overhaul of federal acquisition regulations, Thurston said.

“We are seeing this with a number of agencies that we support. They are moving toward the intent of the overhaul,” he said.

DMI has one customer that came to them to convert a contract from time-and-material to outcome-based.

“We’ve had a T&M contract for five years, but we came together and suggested that we make it firm-fixed unit price, outcome delivery contract and we are trying to get to pure outcomes,” he said. “They saw the writing on the wall.”

To make the conversion, DMI wrapped its existing agile delivery teams into a fixed-price unit. The customer now pays for a sprint rather than paying by labor hour.

The keys to making these conversions a possibility is education and supporting the government workforce, Kulkarni said.

“Everybody intellectually understands this where things are going but I would say we are very much in the early stages,” Kulkarni said. “A big issue is we have an overworked, understaffed, and in some cases, not a terribly knowledgeable contracting workforce.”

The Trump administration has focused on efficiency and speed with the Federal Acquisition Regulation overhaul, OneGov, the Defense Department’s Tradewinds program and other initiatives.

Contractors have to focus on efficiency and speed too, the panelists said.

"If you can demonstrate efficiency and prove it, you have an opportunity to distinguish yourself from a very large population of suppliers,” Kulkarni said.

It is also very important for contractors to explain to the customer how to buy from them, Kulkarni said.

Companies cannot do that via PowerPoint presentations, according to Thurston.

“The days of that are over,” Thurston said. “If you don’t come in with a demonstration of value add of a mission outcome, then you might as well not even get in the door.”

But even the panelists cautioned that speed and efficiency have limits if the government does not also fix how it defines what the needs are in the first place.

Kulkarni said it is too optimistic to expect substantive change over the next 18 months.

"Making the processes more efficient is going to take some time, but we also need to make the requirements process more straightforward," Kostro said. "If you only change the way in which you procure things and not the way in which you identify what you need, the timelines are going to be long."

Kostro pointed to a GAO report published July 2 that found the Defense Department still needs 12 years to go from concept to fielding a program despite multiple reform efforts over the years.

“Unacceptable. Twelve years," Kostro said.