Adapting to Changing Government Tides: Gil Smith, Executive VP of YRCI, Sees Opportunity in New Markets

Gil Smith, Executive Vice President, YRCI

Gil Smith, Executive Vice President, YRCI

Gil Smith is the Executive Vice President of Federal Services at YRCI, a veteran-owned professional services and recruiting firm located in the greater Washington, DC area, providing consulting and recruiting services to federal and commercial customers around the world. He brings over 30 years of leadership and over 10 years of managing large global enterprises. His primary focus is to lead YRCI as an emerging large business and drive the growth and service offerings of the firm. While Smith has the Executive Leadership Responsibility for YRCI he also drives the Business Development and Marketing Functions.

Prior to his move into the federal contracting space, Smith retired as a Naval Officer, having served as a Chief Hospital Corpsman and earning a commission in the Medical Service Corps. He has earned a Master of Science in Business from Husson University in Bangor, Maine, a Bachelor of Science in Social Science from Albany University (SUNY) and attended the Naval War College.

WashingtonExec recently sat down with Smith to talk more in depth about his role at YRCI, opportunities for growth in the federal space, the leadership lessons he acquired from his Navy training, and his active membership role in the Scottish Heritage Society.

WashingtonExec:  Could you tell us a little about your background and describe your current role at YRCI?

Gil Smith:  My current role at YRCI is the Executive Vice President of Federal Services. I have overall responsibility for the day-to-day function of the company and the sales responsibility for selling our business offerings to the government, in the areas of human resources, acquisition management, and financial management services. I also have a role in strategic direction for the company, determining the markets in which we sell and what we offer, and  positioning the company in the federal marketplace. As the lead non-partner executive of the company, I also hold profit and loss responsibility for the overall performance of the company.

I started off in the Navy as an enlisted man. After a decade, I became a Naval Officer and spent another 10 years in that role. As an officer, I worked in the resource management contracting and finance role. From the Navy, I retired and went to American Management Systems (AMS), which was acquired by CGI and CACI in 2004. In that role I was the Director of Corporate Treasury. At the time, AMS was a billion dollar Fortune 1000 Global Company. I managed the liquidity for AMS, positioning their cash, doing foreign currency exchange, investments, positioning of assets, movement of cash around the world, banking relationships—all of those things that make a large company run from a liquidity management standpoint.

After AMS, I was fortunate to join the Bush Administration, where I was a political appointee and served three political appointments—first as an Associate Director of Peace Corps for Management and then, for a short period of time, as the Deputy Chief of Operations at the White House. I then moved to U.S. Department of Agriculture (USDA) as the Deputy Assistant Secretary for Management, where, again, I had the same portfolio of responsibilities: financial management, facilities, human resources, contracting, and security.


“We don’t think LPTA is the right approach in terms of acquisition strategy to get the best value for government. There are things that occur in an LPTA acquisition strategy that drive the solution away from quality. The result of that is that you end up getting services that are low-priced and barely technically acceptable.”



WashingtonExec:  Have you changed your overall business development strategy due to recent events, such as the 2013 government shutdown, Lowest Price Technically Acceptable (LPTA) Federal Proposals etc?  

Gil Smith:  There has definitely been a shift in the market. YRCI grew up as a staffing company and we worked primarily at the lower levels in an organization. We worked with Directors of Human Resources and procurement officers providing assistance in one or two seat fashions. As the company grew up, we moved into providing solutions for larger contracts, on which we provide a fully outsourced solution for a number of our clients.

When you are in that environment you have to change with the way government moves. Sequestration didn’t impact us very much because we have largely been a federal civilian support organization. Sequestration hit the defense industry a little harder than the federal civilian markets. When it came to the shutdown, we were also very fortunate in that a number of our clients are fee-funded clients so they were not affected by appropriated dollars.

We are a large business. We don’t have a lot of socioeconomic advantages, and, despite our position in the market, we don’t think LPTA is the right approach in terms of acquisition strategy to get the best value for government. There are things that occur in an LPTA acquisition strategy that drive the solution away from quality. The result of that is that you end up getting services that are low-priced and barely technically acceptable. In order to get low price, you end up with a company that has low overhead, not very deep management reach-back, and not very deep professional skills—very shallow. There just isn’t a lot of backbone and depth to some of these companies and when challenges occur they can’t be responsive. I think LPTA drives you into those kinds of scenarios. It’s not beneficial to government to do that. In order to be successful in LPTA, you have to drive rates so low that when you show up and try to rebadge the incumbent staff, you are offering the staff lesser salary than they were earning as an incumbent, and that immediately creates discourse on the project and with the government. The government then cannot retain the people they want to retain because it was an LPTA scenario and the new vendor has dissatisfied employees because you can’t offer them the package they were earning, so they experience a decrease in compensation, start looking for another job, and it destabilizes the project. There is a lot wrong with LPTA. In a professional services market, it’s just not the right answer.


“As we look to things like sequestration, shutdown, and appropriations issues, we had advantages in the market that current companies didn’t have. We’re looking to really continue to better balance our portfolio of clients; that means we are moving out of pure federal civilian and starting to look into the DOD and Intel markets to offer our services.”



WashingtonExec:  Has the uncertainty in the federal market caused you all to look at adjacent markets? Where are you seeing growth and opportunity in the federal space?

Gil Smith:  We are always looking for new markets. YRCI has largely been a federal civilian support company. As we look to things like sequestration, shutdown, and appropriations issues, we had advantages in the market that current companies didn’t have. We’re looking to really continue to better balance our portfolio of clients; that means we are moving out of pure federal civilian and starting to look into the DOD and Intel markets to offer our services. We haven’t marketed in that space. We are ready to do that and our past performance can carry us in there with great credibility. We recently won a contract with the National Guard Bureau, which is really a great move into the DOD for us. We are really proud of that project in supporting the Joint Staff and the National Guard Bureau. That’s our first big step into DOD. We recently received our top secret security clearance level, so we want to take advantage of that investment as well.

In addition, we had very tight vertical market with YRCI. We are in acquisitions, so it makes sense that we branch out into management, financial management, asset management, and those kinds of things because they are attached. In human resources, we are moving out into workforce planning, policy planning, human capital management development, and those more strategic areas. We are going to stay and maintain our position at a professional services level. We’re not going to step into low-level administrative services. We’re not going to be in competition with the Ability One contracts—we don’t have any interest in doing that. We are going to stay more at the professional services level and see our future competitive market containing Deloitte and Grant Thornton—the midsized companies that you would think of as professional services, think tank, auditing, true professional services. That is where we are going next. In FY-13, YRCI became the third largest provider of human capital services, third only to IBM and Deloitte. We are on our way!


“The Navy teaches you to train your relief. Everybody is expendable and therefore, if you are expendable, someone needs to be able to step into your place. You need to have the patience to understand that if you leave, your company will continue to go on without you.”



WashingtonExec: What kind of leadership skills did you learn in the Navy that made you successful in business?

Gil Smith:  I think it is patience. The Navy teaches you to train your relief. Everybody is expendable and therefore, if you are expendable, someone needs to be able to step into your place. You need to have the patience to understand that if you leave, your company will continue to go on without you. As it continues to go, if you really care about it, you better make sure there is somebody behind you that can keep it going. As a leadership approach, the Navy drives that into you from the first day you arrive and supports it throughout your career. You are always thinking about the whole picture. Navy people think about an entire enterprise running all at once—it’s a ship, an air station, a squadron, whereas the other services are more platoon-based or company-based.

There used to be training for Chief Petty Officers that was very intense that they called “initiation.” It was a process by which you earned a great manner of patience and the great ability to learn when not to say anything. There are times when you don’t need to say anything. You don’t need to fight back. You just need to shut up and color. Let it run its course and pick your battles. Some things are worth fighting over and some things are not. One of the tenants that I subscribed to in the Navy was the idea that there are no administrative emergencies. The paperwork is going to get done tomorrow—it’s not an emergency. That tends to calm me quite a bit to think that there are very few true administrative emergencies.

WashingtonExec:  What is the most recent book you have read? What is a book you have read that would help those who are looking to enhance their careers?

Gil Smith:  Right now I am reading a book called How Good Do You Want to Be?: A Champion’s Tips on How to Lead and Succeed at Work and in Life by Nick Saban, the coach of the Alabama football team. When I look at YRCI and the reason that I visited this book, I believe it was my intrigue for his success and ability to be successful year after year after year. It is proving to be pretty valuable.

As far as what I would recommend for up-and-coming leaders, The Art of War by Sun Tzu is a great piece of writing, not an easy read but there are a lot of good lessons in there. There is another classic called the Hagakure: The Book of the Samurai by Yamamoto Tsunetomo, which basically includes the lessons and tenants of a samurai warrior. A lot of what is in Hagakure talks about dedication and honor. The short story on that one is to “do what you say you are going to do and do it when you say you are going to do it.” There are a lot of good parables and examples in there that I tend to go back to as well.

WashingtonExec:  You are an active member of the Scottish Heritage Society. What made you want to take active role in your community?

Gil Smith:  I’m nearly 100% Scottish. My grandmother was Ella Mae McDonald; she is about as Scottish and Presbyterian as they come and she was very good at reminding me of my heritage. The Washington area has a very rich and active Scottish heritage community. A friend of mine introduced me to that and I became involved.

My current involvement is as the Treasurer of the Washington St. Andrews Society. We put on several events throughout the year; Tartan Ball just finished up, we do a Burns Night every January and tickets are available now (www.saintandrewsociety.org), and most people are familiar with the Scottish Christmas Walk in Alexandria. St. Andrews Society is a non-profit and we support the study of things Scottish with scholarships for undergraduate, graduate, and post-graduate school for individuals who are interested in studying things of that nature. Tartan Day is set on April 6th of every year by proclamation from the Senate, the House, and President Bush. This is the day that people of Scottish heritage come together and celebrate the heritage and the Country of Scotland.

 

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