2015 Market Outlook: NTT Data’s Tim Conway — An Emphasis on ROI Will Create Smaller, Innovative Government Programs

WashingtonExec 2015 Market Outlook Series

We look forward to a new year and new opportunities for innovation and growth in the government contracting community. This past year, we experienced an increased emphasis on cybersecurity, the government’s procurement process and a perpetual focus on doing more with less.

WashingtonExec reached out to those most knowledgeable and experienced in the federal contracting space. We asked executives in and around the beltway for insight regarding where they see the government contracting community headed in 2015. Topics discussed include M&A activity, cloud computing, privacy issues, data collection, healthcare IT, defense and more.

NTT DATA Inc. President (Public Sector) Tim Conway predicts a continuous emphasis on pricing will improve government efficiencies and create smaller and more innovative programs.

Tim Conway: I expect that the continued pressure on IT budgets will result in maintaining a strong focus on the pricing component of contracts in 2015. This pressure will also drive increased focus on government efficiencies, shared service initiatives and citizen digital experience. I believe smaller and more innovative programs will receive funding at the expense of some reductions in big program funding – where political leadership will have to make the difficult funding decisions. In summary, while funding may not grow, there will be a push toward new initiatives that deliver a tangible, visible, return on investment during the next two years leading into the 2016 elections.

This year will see more agencies adopting cloud infrastructure. I expect an uptick and increased focus on enterprise data management initiatives to lay the foundation for and harness Big Data. I see increased adoption of data analytics for enhanced intelligence to aid operational decisions and reduce fraud, waste and abuse. We will also see agencies increasing their focus on real-time continuous monitoring of networks for cyber vulnerabilities in accordance with the recent FISMA update. Mobility initiatives will continue to expand and serve as a means for increasing interaction with both internal users and citizens.

There will be an increase in “smart” initiatives leading towards smart government, smart buildings and smart cities. The recently rolled out U.S. Digital Services Playbook has increased the focus on digital customer experiences and I expect some agencies to start thinking more strategically about their desired customer experiences in 2015. Furthermore, I think the user community will demand it.

Lastly, I anticipate that the increasing pace of Baby Boomer retirements, coupled with the talent shortage in the ultra-competitive IT job market and the ongoing budget pressures, will provide more opportunities for government contractors to sell alternate service delivery models including IT outsourcing, SaaS, Remote Services (including NOCs, SOCs) and Cloud.