Five Steps To Government Consulting Sales

The federal government is a multibillion-dollar IT market with numerous opportunities for new technology deployments driven by compliance and presidential initiatives. However, competition in this space is fierce, and a VAR or systems integrator needs to constantly evolve and keep abreast of the latest trends in order to get its share of the business that’s available.

CRI was founded in 1994 as a provider of image conversion services to federal government and commercial clients. Over the years, the integrator added technologies and expertise to address a larger portion of the needs its government clients were facing. For example, CRI added software development and professional services to its portfolio in the late ’90s, followed by integrated security solutions in 2000. Today, 90% of CRI’s business comes from federal government clients. Recently, most of this business can be attributed to CRI’s business process analysis and consulting services. In fact, the integrator expects a 40% revenue increase this year through its ability to propose government agency process improvements and implement technology systems designed to contribute to those improvements. CRI’s success is due in large part to five steps the integrator has identified as key to winning federal government process analysis business.

Step 1: Know Your Strengths

As mentioned, the federal government space is extremely competitive. A regional VAR or systems integrator will often find itself pitted against industry giants such as Lockheed Martin, Boeing, and Booz Allen Hamilton for many federal government IT opportunities. In order to compete with these notable companies, it is important for a VAR to know its strengths and not waste its time chasing business it doesn’t have a good chance of winning.

“You need to be realistic about the size of the opportunity you can tackle and the amount of effort you can dedicate to a project,” says Mark Schneider, director of business solutions for CRI. “We would love to be able to go after the $60 million nationwide agency contracts, but that would probably require us to travel extensively or employ hundreds of employees a year to support the project. We are more suited to compete for new technology initiatives in individual departments of agency offices in the Washington, D.C. area. These initiatives usually require in-depth customer attention to uncover process details and customization in developing a solution. These are areas in which regional integrators like CRI are strong.”

Although personalized customer attention is important, you need to have a well-rounded array of capabilities and expertise within your organization to maximize your success in landing business process analysis work in the federal government. “It is difficult to succeed in the federal government space if you only focus on software development or workflow,” says Schneider. “You need to have an understanding of business processes and be able to develop the tools to automate or streamline those processes as well.”

CRI has structured its organization in three distinct groups — business solutions, technology solutions, and security solutions — to address the overall solution requirements of its government clients. The business solutions group consists of consulting service personnel, analysts, subject matter experts, and project managers. The technology solutions group consists of requirements analysts, software developers, and quality assurance analysts. Finally, the security solutions group consists of technology specialists, engineers, and CAD (computer-aided design) technicians.

Step 2: Get To The Right People

All the capabilities and expertise in the world won’t mean a thing if you’re not promoting them to the right people within federal agencies. Typically, a federal government agency or department is divided into smaller agencies or bureaus. For example, APHIS (Animal and Plant Health Inspection Service)  is an agency of the USDA (U.S. Department of Agriculture) that focuses on plant and agriculture disease and control. CRI has had success selling to what it calls “program-level” employees within these government agencies.

“The employees that actually run government agencies or bureaus are typically too high-level to be interested in the detail of a business process improvement proposal,” says Schneider. “Program-level employees are much more receptive because they can envision how our process analysis services can actually ease the very specific pains with which they are faced.”

In the APHIS example, a program-level government employee may be an individual with the focused responsibility of disease control on plants being imported into the United States. This program may need to monitor 1,800 border points of entry and require process improvements, a piece of software, or a workflow system that CRI would provide to help automate the tracking of plants entering the country.

Step 3: Get On The GSA Schedule

To sell to the federal government, a VAR or integrator must have its offerings represented on the GSA (General Services Administration) schedule. This schedule lists the products and services approved for purchase and deployment in government IT initiatives.

There are three primary ways you can list your offerings on the GSA schedule — you can list hardware and software products and their set prices (you must be the manufacturer or authorized by the manufacturer to be a GSA reseller), you can list predefined services and their set prices (e.g. risk assessment $2,500), or you can list your company services as  hourly project implementation rates (e.g. an engineer is $70 an hour, an analyst is $80 an hour, etc.). On the IT GSA schedule, CRI feels it retains the most flexibility simply by listing its rates, but it depends on what products or services your company offers as to what is the best approach.

“Many commodity manufacturers list their products on the GSA schedule themselves, so it is very difficult for a smaller integrator like us to win commodity hardware business in the government market,” says Schneider. “We see a lot more opportunity on the services side. It is vital for a VAR to have its rates approved by the GSA if it wishes to earn this business.”

To get your service rates listed, you first need to become recognized as a small business. This requires you to apply with and submit your rates to the SBA (Small Business Administration). Application forms can be obtained at www.sba.gov. The SBA will require you to justify your service rates by quantifying your overhead costs, cost per hour, and other accounting particulars. The SBA may also conduct an audit or compare your rates to peers in your category to ensure they are in line and competitive.

Once approved by the SBA, your rates are good for five years, and you can then apply to have them listed on the GSA schedule. It typically takes a minimum of two to three months to get your business set up and approved by the SBA and at least another two to three months to get your service rates listed on the GSA schedule.

 
Step 4: Become OMB Exhibit 300 Savvy

While being listed on the GSA schedule is important, big money opportunities in the federal government space these days are going to companies that understand the OMB (Office of Management and Budget) Exhibit 300 process. Over the past few years, the federal government has become a lot more cost and technology conscious as a result of budget cuts. These budget cuts have forced the federal government to put investment control procedures in place and look for ways for separate agencies with similar application requirements to combine their efforts and collectively implement and share a single technology solution.

As a result, all major IT investments for the federal government must be outlined on an Exhibit 300 form and submitted according to OMB’s online electronic Capital Planning and Investment Control (eCPIC) system. The Exhibit 300 is a detailed document containing 13 components including a cost/benefit analysis, a technology alternatives analysis, and a risk management plan. Summarizing an investment business case in an Exhibit 300 is the responsibility of each government agency’s project manager and CIO. However, VARs and systems integrators can facilitate the services included in the eventual investment by helping government agencies understand the steps in the submission process. In some cases, due to the amount of work required to complete a complicated Exhibit 300, many government clients will actually pay a VAR or integrator to prepare these investment business cases for them.

“Completing an OMB Exhibit 300 form requires a tremendous amount of work and the sales cycle is longer — budgets for these larger investments are proposed for two years from the date of submission,” says Schneider. “However, if the project is approved, it has the potential to be funded for several years and can provide you with substantial recurring revenue.” More information on the OMB Exhibit 300 process can be obtained at www.osec.doc.gov.

Step 5: Feed Your Reputation

While customer satisfaction is important in any market segment, ensuring the job is done right and your clients are happy is particularly important in the federal government space. “Your reputation is the most important thing when working with government clients,” says Schneider. “In the commercial world, it’s likely you can get away with having a few bad experiences with clients because commercial companies don’t talk to one another that much and you can control what references you provide. Federal agencies, on the other hand, communicate with each other constantly, and all government client references — good and bad — are stored in a common GSA database that can be viewed by any agency. Therefore, your quality of work will ensure your longevity in the federal government space, more than in any other vertical.”