The Top Three Issues Facing The Small Business GovCon Community: Suggestions From CEOs

President Obama has stated time and time again that the power of small business will lead to our nation’s economic recovery, causing the President to pursue an around-the-country campaign for Congress to pass the American Jobs Act. WashingtonExec interviewed small business CEO’s and asked specifically what small business in the government contracting space needs from Congress. WashingtonExec came to one conclusion: the government acquisition process needs to change. And if you think this piece will just consist of only complaints and no action, prepared to be pleasantly surprised.

The interviewees:

Larry Besterman, President and CEO of TWD & Associates

Deepak Hathiramani, President and CEO of Vistronix, Inc.

With 50+ years combined in the field, here are the common threads found in both government procurement and acquisition focused interviews:

A Need for Congressional Leadership:

Larry Besterman: Certainly more clarity on funding would help a lot.  The past year has been semi ridiculous with no budget, continuing resolution for weeks at a time, threatened government shut down, not having a budget until six months into the year.  That really threw a huge monkey wrench into a lot of procurement plans and a lot of procurements that are at various points in the process. Clarity on funding is not necessarily an obvious that really affects procurement, it really does.  I think we’ve really seen that in the last year.


The Disconnect From Small to Midsize Business:

Deepak Hathiramani: I think our size standard classification system is outdated and should be updated to reflect current market conditions.   In essence, the system supports the growth of small business but does little to support the transition from small to the mid-tier level.  As a result, mid-tier companies face significant competitive pressures from large businesses and from small businesses also.   Furthermore, the size standards should be adjusted in a timely manner and more frequently to account for changing market dynamics.


Protests: A Combative Environment Creates More Government Waste:

Larry Besterman: I think there is one other thing that’s going on that deserves some thought or some mention in your article.  This is certainly my opinion but the contracting community – it’s becoming an increasingly combative environment and what I mean by that is everybody is protesting every decision.  I’ve seen some statistics on this and the number of protests in the last couple of years have spiked dramatically.  The number of protests that have been sustained by GAO is also increasingly pretty significantly.  It almost becomes a part of the BD strategy, ‘well it’s if we don’t win it we are going to protest it’.  A long time ago you almost never wanted to protest.  Somehow the negative view towards protesting seems to have been torn down by the increasingly competitive nature of the business and the more combative the companies have become in fighting amongst themselves and fighting the government. All of us companies have become more combative.

Deepak Hathiramani: Based on current market conditions of shrinking budgets, increased usage of Firm Fixed price procurements and an increased focus on “technically acceptable low cost”, there has been an increased level of protest, to the point that companies use it as part of their strategy.    The cost of protests impacts both the government and industry.   The 25-Point Implementation Plan and the “Myth-Busting” campaign is a positive start to improving the relationship and communication between government and industry.  I am cautiously optimistic that it will achieve the results it was designed to – improve communications between government and industry to ensure that we leverage technology effectively to deliver more value to the taxpayer.

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