BD - 101:Best Practices for Teaming in the Federal Contracting Market

Insight 2011

Presented byBrian Haney, Senior Vice President, Deltek

04/15/20232

Project Manufacturing

Human Resources

Project Management

Financial Management

Enabling Success

©2011 Deltek, Inc. All Rights Reserved

Winning More Business

Reducing the Cost of Compliance

Increasing Project Visibility

Improving Cash Flow

CRM and Capture ManagementTeaming Solutions

Market Intelligence

Business Performance Management

Know More

Win More

Do More

04/15/20233

Project Manufacturing

Human Resources

Project Management

Financial Management

Win More

©2011 Deltek, Inc. All Rights Reserved

CRM and Capture ManagementTeaming Solutions

Market IntelligenceWin More

Do More

Opportunity Identification

Customer & Pipeline Mgnt

TeamingProposal

Development

Business Performance Management

Know More

IntroductionThe Contracting Landscape

• Prime Contracting in the Federal Market by Size of Company

Importance of Teaming

• When Decisions Are Made• Teaming Decision Makers• Post-Award Teaming Decisions

How Prime Contractors Make Teaming Decisions

• How Often Are New Partners Used• What Small Business Goals Are Hardest to Achieve• What Criteria Do Primes Use in Teaming Decisions

What Prime Contractors Look For & Where

Factors Impacting the IT Competitive Landscape

5

Fewer Large Programs

Modular/Agile

Development and

Acquisitions

• More competition (and potentially more bid protests) as the stakes of not being on a major contract are raised.

• Increased efforts on developing long-term teaming relationships and identifying niche players (especially small business).

• Large companies venturing into smaller program competitions

• Fuels the trend of large GWACs and agency-specific task order vehicles, making them even more competitive.

• Potentially smaller task order size. • More collaboration among vendors working on different modules of a

whole solution. Challenge: government understanding and articulating the holistic solution in an effective way in advance of modular awards.

• Potential competition with government shared services providers (e.g. DISA).

• Changing competitor pools as big players compete more with small firms for smaller opportunities.

• More scrutiny of task order spending and vendor performance.

Multi-Award Task Order Spending

04/15/20236 ©2011 Deltek, Inc. All Rights Reserved

Task order spending continues to increase

7

More Frequent Competitions

• Competitive strategies at each milestone could result in incumbents facing:• Competition from other programs• Work breakouts for subs • Strain on Bid and Proposal (B&P) dollars• More small business set-asides and pressure on primes to grow small

business utilization• Higher costs to incumbents to maintain position• Opportunities for non-incumbents (incl. through on-ramp provisions)• Shorter contracts

LengthenedAcquisition Timelines

• Longer acquisition timelines to perform and gain approval of affordability analysis

• More focus on requirements development and lower risk of significant scope creep

• More emphasis on market research to meet growing demands for data and analysis

• More robust performance metrics and reporting requirements• More formalized structure for no-bid contract negotiations will require more

in-depth cost analysis

Factors Impacting the IT Competitive Landscape

88

Cost Efficiency Pressures

• More pressure on contractors to drive down year-over-year costs• Potential cancellation of redundant programs within or across

components• Potential vendor profit gains for better management of supply chain and

indirect expense management• Increased pressure to and increased rewards for better management of

subcontractor costs• More focus on incentives to drive progress and performance• Much more scrutiny on services contracting (initial and changing

requirements, redundancy, cost and performance)• Vendor requirement to build cost efficiency into $1B+ projects

• Cost efficiencies gained by incumbents will drive down the cost baseline for new bidders

Pressure on Pricing Strategies

• Pricing strategies even more critical due to:• Preference for Firm-Fixed-Price contracts increasing risks.• Agencies’ need to cut costs adding pressure on contractors’ pricing

strategies/bid evaluations.• Intensifying competition as some providers “low-ball” bids to

increase odds of winning.

Factors Impacting the IT Competitive Landscape

9

Workforce• Increased competition with government for key IT talent (program

management, cybersecurity).• Increased competition with other contractors seeking expertise to enter

into or expand within new areas.

Business Strategies

• More M&A activity to acquire niche players that can provide entry or expansion within key markets. Competition between large players pursuing smaller firms with specialized expertise likely to increase.

• Refocusing of business emphasis and some internal resources from one-stop-shop to niche expertise in high-growth areas (e.g. cyber, HIT, cloud computing, etc.).

• Increased expansion of product companies into the services arena to create top-to-bottom solutions.

• Streamlining/reduction of BD/sales workforce to reduce overhead of opportunity pursuit.

• More focus on diversification, e.g. defense contractors putting more resources into pursuing more civilian work to mitigate overall impact of lost work in either area.

Factors Impacting the IT Competitive Landscape

Positive Impacts More competition could mean more opportunity to unseat incumbent

competitors Focus on small businesses offers an opportunity to leverage those

relationships even more to help agencies meet utilization requirements More task orders means more opportunity to recoup some of the cost of

contract pursuit Survival of the fittest – companies with the ability to streamline costs, lead

agencies into better program management and educate them on innovative solutions will be best positioned to survive in this environment

More market research could translate into more opportunities to appropriately influence program requirements

10

Importance of Teaming in the Federal Market

Estimate of Small Business Subcontracting Goal for Large Primes

Source: INPUT, FPDS

Survey of Prime Contractors on Teaming Decision Making Surveyed INPUT member companies engaged in Prime Contracting 86 total respondents

When Teaming Decisions Are Made

Source: INPUT

Teaming Decision Makers – Pre-Award

14

Source: INPUT

How Often Subs Are Added Post-Award

15

Source: INPUT

Teaming Decision Makers – Post-Award

Source: INPUT

How Often Primes Team with New Partners

Source: INPUT

Which Subcontracting Goal Is Hardest to Meet?

Source: INPUT

Use of Social Networking in Teaming Interactions

Source: INPUT

Factors in Qualifying & Selecting Subcontractors

Source: INPUT

The 3 Key Criteria

Recommendations Clearly present and demonstrate the three key criteria

Past Performance Agency Relationships Key Capabilities

For pre-award teaming Focus on relationship with BD, Capture and Senior Execs Identify and reach the primes before or immediately after draft solicitation

For post-award teaming, focus on the Program Manager

Don’t Forget!

Exclusive Events at Insightfor Business Development Attendees:

Tuesday, May 17, 2011

22

• Federal Teaming Expo from 6:00pm to 7:30pm in the Expo Hall

All teaming expo attendees will be entered in a drawing to win an iPad. Winners will be announced at the BD reception (must be present to win).

• Business Development Reception from 7:30pm to 9:30pm in the Magnolia Ballroom

Winners of iPad drawing will be

announced at 8:00 pm and 8:30 pm at

the BD Reception (must be present to

win).

Q & A

04/15/202323 ©2011 Deltek, Inc. All Rights Reserved

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