Page 1

October 2014 / The Voice of the Government Services Industry

The Next Move:

Aligning Acquisition for the Future


Taking PSC to the Next Level


ALso inside:

Nick Nayak on Moving Government Acquisition Forward


PSC’s Acquisition &Technology Policy Agenda


What I Learned as a PIF

No other employee benefits firm supports more benefits, more carriers, or provides more solutions to government contractors. Government Serv ice Administrato rs, your partner in ... Service Contract Act (SCA) Compl iance & Training Recordkeeping, Reporting and SCA Compliance Revi ew Compliance & Au dit Consulting Web-Based Bene fits Administrat ion Trust Establishm ent COBRA, FMLA an d Leave of Absenc e Legal Support Enrollment Tool s

Comprehensive Fringe Benefit Solutions

Government Service Administrators

October 2014 Service Contractor is a publication of the Professional Services Council 4401 Wilson Blvd., Suite 1110 Arlington, VA 22203 Phone: 703-875-8059 Fax: 703-875-8922 Web: All Rights Reserved PSC Staff Stan Z. Soloway President & CEO Alan Chvotkin Executive Vice President & Counsel Bryan Bowman Senior Manager, Marketing Matt Busby Director, Membership Joe Carden Vice President, Marketing & Membership Elise Castelli Senior Manager, Media Relations & Publications Charlene Dowdy Membership Associate Paul Foldi Vice President, International Development Karen L. Holmes Office Manager/Receptionist Roger Jordan Vice President, Government Relations Jeremy Madson Senior Manager, Public Policy Melissa R. Phillips Vice President, Events & Operations Robert Piening Vice President, Finance Jean Tarascio Senior Manager, Events Matthew Taylor Manager, Public Policy Kristine Thomas Executive Assistant Dave Wennergren Senior Vice President, Technology Policy For advertising or to submit articles or items for the Member News section, contact: Bryan Bowman

The Voice of the Government Services Industry


Challenges in Government Procurement and Acquisition

Moving Forward 7


Sounding board: engage your Taking PSC to community to the Next Level engage your employees



will innovation return


Using the “A” Team to perform Integrated Acquisition planning

4 President’s Letter / 10 Committee Corner / 15 PSC’s Acquisition and Technology Policy Agenda / 25 Bill Tracker / 37 What I learned as a PIF 40 Policy Spotlight / 41 Member News / 42 PSC Scene & Heard Cover photo illustration: Studio25

Professional Services Council

Service Contractor / October 2014 / 3


New Strategies…Same Mission


very October is a big month for PSC. As we cross from one fiscal year to the next, the PSC Annual Conference opens the month and brings together the largest and most significant array of industry leaders. Our Fall Service Contractor magazine issue hits mailboxes at around the same time as our annual Services Sector Review, our report on key trends and dynamics impacting the federal professional services and technology sectors. And this year, one core theme permeating all of what we are doing is clear: change. Internal. External. Industry. Government. And while that is not a new theme per se, on many levels, the elements of change we face are new. Thus, so too must our strategies and operations be refreshed. In June, I presented the PSC Board of Directors with a strategic vision that is already fundamentally changing the PSC operating model. The Board was virtually unanimous in its support for the new model recognizing, as we do, that the greatest risk to our longterm viability and success is resting easy. And thus we have made the decision to take advantage of our strong financial and organizational position to move PSC to the next level. As we have announced, the changes include the creation of a set of “councils” within PSC that will each have its own executive advisory board to guide agendas and priorities. Moreover, each of the EABs will be chaired by a member of the PSC Executive Committee. In the last issue of the magazine, I talked about the new Technology Council, chaired by Anne Altman of IBM and led internally by our newest staff addition, Dave Wennergren, who is now our senior vice president for technology policy. Operating in parallel to the Technology Council is our new Acquisition and Business Policy Council, chaired by Kymm McCabe of ASI Government and, of course, led by PSC Executive Vice President and Counsel Alan Chvotkin. Together, they amount to our primary policy forums. Beyond those two core councils, we now have three customer councils, each of which will play the key role in our agency interface and advocacy. Neil Albert of MCR is chairing the Defense and Intelligence Council, Kathleen Flanagan of Abt Associates is charing the Civilian Agencies Council, and Jim Boomgard of DAI continues to chair the already well-established Council of International Development Companies. So what will these councils do? What are their primary areas of focus? We discussed some of that in the last issue, particularly with regard to the Technology Council, and continue to do so with Dave Wennergren’s committee corner. For this issue, we asked Kymm McCabe and Jim Boomgard to share their perspectives on those questions as they relate to the acquisition and international development councils they lead respectively. In future issues, we will 4 / Service Contractor / October 2014

do the same with our new Defense and Intelligence and Civilian Agencies Councils. Beyond the internal structural changes, we are externally pursuing major changes to federal acquisition policy. In response to a range of requests for input from different quarters of the government, we formed this spring an Acquisition Policy Review Committee (APRC), chaired by PSC Vice Chair John Goodman of Accenture Federal Services, to consolidate and synthesize our acquisition agenda. He shares the key recommendations of the APRC in this issue, some of which reflect longstanding concerns while others are geared toward new ways of thinking about new challenges and dynamics. As usual, we are also delighted to include a set of articles from “the outside.” Nick Nayak, the recently departed Homeland Security Department procurement executive, shares some of his observations on what needs to be done to enhance federal acquisition and the acquisition workforce. Likewise, our friends at PSC member company Integrity Management explore the changes they believe are needed in “big A” acquisition. And Greg Gershman, a former Presidential Innovation Fellow (PIF) who was also a part of the “rescue” team, offers his perspectives on life as a PIF and how the program can help improve the overall environment for federal IT—or not. Finally, Todd Overman of Bass, Berry and Sims discusses the potential for expanding and otherwise modifying the federal small business innovation research program. Yes, we’ve heard it a lot. Change is the only constant. But being trite does not obviate the truth of a statement. From a policy perspective, change involves constantly seeking new and better ways to first improve, and ultimately transform, the acquisition landscape to help ensure the best possible outcomes for the government. For PSC, change involves taking major steps to ensure that we can continue to deliver on our promise of being the most effective advocate and resource for this remarkable industry. Indeed, that mission remains the only constant, even as our means of achieving it must constantly evolve.

Stan Soloway President & CEO Professional Services Council

ACA’s employer mandate will be in full effect this January. Are you ready?

For nearly 30 years, FCE Benefit Administrators has helped employers meet their obligations under SCA, DBA, Living Wage, Prevailing Wage and ACA. As a full-service TPA specializing in plan design, implementation and administration, FCE can help you: • Achieve SCA fringe compliance • Reduce payroll taxes • Promote employee welfare Join the industry leader in fringe benefit design, compliance and administration for government contractors. Talk to FCE!

Contact: Chris Porter, National Director, Sales & Marketing 650-291-4202 • 6 / Service Contractor / October 2014

Professional Services Council


In each issue, PSC asks members of our board of directors to offer their perspectives on key challenges facing the government services industry.

Taking PSC to the Next Level The chairs of two of PSC’s core councils discuss their priorities for advancing PSC’s policy agenda.


Jim Boomgard

Chair of PSC’s Council of International Development Companies and President and CEO of DAI

he Council of International Development Companies (CIDC) brings together 117 organizations, ranging from divisions of multinational corporations to mid-market companies and small businesses, representing many thousands of employees around the world. As development professionals, we are immensely proud of our history of working with USAID to promote global development. Thanks in part to that partnership, the agency has contributed to a period of dramatic progress in developing countries. According to USAID’s own statistics, over the past 20 years child mortality and the number of people living in poverty have been cut in half. Since 1999, the total number of those living in extreme poverty has declined by an average of 50 million people per year. Building on this success, and driven by the prospect of actually eliminating extreme poverty by 2030, USAID has launched an ambitious program of reforms and activities. The agency has added momentum to the radical changes under way in the global development landscape, with a strong emphasis on public-private partnerships and the mobilization of private capital. New technologies offer enormous potential for connecting and empowering impoverished people. New USAID initiatives such as Power Africa aim to expand power generation and drive economic growth on the continent. The new Global Development Lab will source, test, and deliver game-changing development innovations. continued on page 8


Kymm McCabe

Illustration: peterfactors/

Chair of PSC’s Acquisition & Business Policy Council and President and CEO, ASI Government Solutions

t’s time for a new conversation about federal acquisition. As chair of PSC’s new Acquisition and Business Policy Council, I intend to engage our membership, the industry and our government customers in a discussion focused not just on reform, but on transforming the way government buys and gains value in this era of constrained resources and digital disruption, but also great opportunity. PSC has long been in the forefront of debates about acquisition policy and has provided its members a variety of outlets to actively engage and offer their insights. As technology and services have converged and as the government has changed how it acquires professional services, PSC has rapidly responded. Today, federal procurement spending is dropping off after 10 years of historic highs. The discretionary budget is becoming more and more constrained. The Great Recession’s grip on the U.S. economy is loosening, but hasn’t been fully released and we continue to see government austerity shrinking our capability to act on the domestic and world stages. In response, federal agencies are changing their acquisition strategies and business models. The Defense Department, General Services Administration, the White House and Congress all are simultaneously engaged in efforts to reform acquisition policies, laws, regulations and practices. Initiatives ranging from DoD’s Better Buying Power and the Federal Information Technology Acquisition Reform Act to the U.S. Digital Service and GSA’s evolving Common Acquisition Platform, all are aimed at addressing the dynamics and needs of this new age. continued on page 8

Professional Services Council

Service Contractor / October 2014 / 7

Jim Boomgard

continued from pg. 7

The CIDC is delighted to be working with USAID on these and other initiatives, while at the same time offering our technical expertise to help the agency manage a number of operational challenges. This year, we have four priorities for our work.

Maintain a Constructive Dialogue with USAID

This year has seen open and fruitful discussions between USAID and CIDC. For instance, the CIDC Taskforce on Procurement Reform is working with the agency to streamline its procurement process. Reflecting the healthy spirit of cooperation in our industry, we are also engaged in tripartite discussions with our NGO counterpart, InterAction, and USAID on issues relating to compliance and value for money, in talks led by former U.S. Representative Howard Berman, D-Calif.

Help to Fix the Procurement System

The time taken between a USAID request for proposal and contract award is now, on average, 528 days. (It takes half this time for the agency to award a grant or cooperative agreement.) This lengthy procurement process strains the limited resources of development firms and USAID alike. It also leads the agency to depend more and more upon cooperative agreements and grants to move programs forward. In fact, the pendulum has swung from an even split between the contracting mechanisms to a 65/35 division in favor of cooperative agreements and grants. USAID’s ACES Blue Ribbon Panel report, led by consulting firm Oliver Wyman, recognized the immediate need for procurement reform and proposed 10 improvements to increase value for money in USAID’s award process. The CIDC taskforce is working with Angelique Crumbly, assistant administrator for USAID’s Bureau for Management, on procurement reforms including personnel policies, accounting standards for local agreements, timing of USAID approvals, and workplan approvals.

Ensure that Appropriate Contracting Mechanisms are Selected

As USAID implementing partners, we believe that there are appropriate uses for contracts, cooperative agreements, and grants, and that each mechanism has an important role to play in achieving the agency’s mission. Unfortunately, federal procurement standards—designed to guide the selection of instrument—are not being applied uniformly. According to a recent CIDC analysis of 183 USAID procurement actions issued as cooperative agreements or grants between November 2012 and 2013, 46 (or 25 percent) failed to meet four of the five mandatory requirements to qualify as a grant, and 18 percent failed to meet any of the five criteria. A recent Federal Circuit Court decision blocking the Department of Housing and Urban Development from using cooperative agreements

8 / Service Contractor / October 2014

when it should be using contracts has far-reaching implications for all federal agencies, including USAID. We are working closely with the agency to reach a consistent application of these federal contracting standards across its programs.

Support the Agency’s Innovation Agenda

Innovation is nothing new to development—it is an essential element of what we do as development professionals, and it underlies much of the recent progress in the developing world. It’s important that we acknowledge the role U.S. technical assistance has played in catalyzing this progress and the value we can add to the next big push to accelerate global development in the 21st century. And it’s especially important that we share the lessons learned from this experience with USAID’s younger cohort of technical and contracting staff, many of whom have been with the agency a relatively short time. Like them, we share the paradoxical career objective of trying to work ourselves—and USAID—out of a job. But if we are to achieve President Obama’s vision of ending extreme poverty by 2030, USAID and its implementing partners must push the boundaries of the possible still further, and incubate still better approaches to the work of international development. USAID will find CIDC companies to be full, active, and enthusiastic partners in the implementation of its innovation agenda, both in surfacing our “best and brightest” ideas and in sharing what we have learned about the application of innovation where it counts the most—in the field. 3

Kymm McCabe

continued from pg. 7

In addition to bringing new challenges, this age carries great promise. The Internet enables seamless communication, global openness and unequaled collaboration that have driven transaction costs below the threshold needed to bind people to organizations. The way we work and live are changing at the speed of Moore’s law thanks to the exponential advances in technology. Social media is becoming a means of social production. Digital natives, the first generation to grow up awash in technology, as well as our citizens, now expect and demand transparent communications, ubiquitous personal technology, full participation, joint creation and fast, trust-based online transactions. Agencies can now adopt, and indeed must adapt, to “consumptionbased” buying and other new acquisition models so that they can best use their available spending and draw on shifting market offerings. Professional services and technology are truly converging to meet citizen and national needs in new ways. It should come as no surprise that PSC has been actively engaged as this tumult and the business shifts in acquisition have occurred, and is once again adjusting to remain the leading voice of our industry. Working with the Technology Council and the three market-facing councils, the Acquisition and Business Policy Council (ABPC) is part of PSC’s Professional Services Council

strategy for this new era, and will spearhead our efforts to improve the acquisition and business policy environment for professional services and technology to benefit our government and our country. To advance federal acquisition outcomes, we must view market challenges through a new lens and wholeheartedly bring new thinking, innovative technologies, emerging models and the energy of a new generation. The ABPC will engage member companies and our government customers in an exhilarating process of envisioning the future of acquisition and providing insights, shaping policies, and forging recommendations on the strategic choices required to achieve them. This is the primary goal I want to achieve as chair of the Acquisition and Business Policy Council, along with an outstanding executive advisory board. Our council’s executive advisory board includes seasoned and senior company executives from a wide range of wellrespected services and technology companies. What team could be better suited to the task of reimagining acquisition for this era of disruptive technology, changing global dynamics and the growing expectations of a new generation of citizens and employees?

The executive advisory board held its first meeting in September to develop the council’s priorities and focus. One decision was to leverage three recent PSC initiatives —the December 2013 PSC Leadership Commission report, the July 2014 Acquisition Policy Review Committee report, and the 2014 biennial survey of federal acquisition leaders. To reimagine acquisition, we need to muster new possibilities. We and government need to deploy digital era expertise, approaches and solutions. Contracting professionals must be developed, encouraged and allowed to be creative, agile thinkers and market makers. Together, we can build a shared vision and measure our progress toward an even better, citizen-centric, cooperative, value-focused future. Acquisition is the most powerful force for driving results in government. Despite the challenges facing us in the moment, there is tremendous passion, yearning and hunger for something better to happen in acquisition. What’s needed now is a clear vision and framework for transformation and a commitment to action. I invite members of PSC’s Acquisition and Business Policy Council, and all PSC member companies, to join us in crafting the future for this “Collaboration Age” and beyond. 3

When you’re ready for success in a changing world. You are ready for American Public University. With more than 180 degrees and certificates to choose from, there’s almost no end to what you can learn. From Cybersecurity to Public Administration and Organizational Management, you’ll find respected programs at APU relevant to many government occupations and series— at a cost that’s 20% less than the published average in-state rates at public universities.* Visit



*College Board: Trends in College Pricing, 2013 We want you to make an informed decision about the university that’s right for you. For more about our graduation rates, the median debt of students who completed each program, and other important information, visit

Professional Services Council

Service Contractor / October 2014 / 9

Committee Corner:

A Call to Action – The Imperative for the Technology Council

by David M. Wennergren, PSC Senior Vice President of Technology Policy


he next administration will face a number of significant challenges: a human capital crisis for federal employees, continuing budget pressures, and a lack of access to technology and innovation. And, while we see a frenetic pace of innovation and technology advancements all around us, the federal government is currently illequipped to take advantage of new opportunities and partnerships that will provide more effective mission results. At PSC, we recognized early on that the on-going “convergence” of traditional professional services and technology work is creating innovative new solutions and approaches to address government requirements. The adoption of outcome-based solutions allows government to strategically partner with industry and gain the value of industry best practices, on-going research and development and a sharing of risks/rewards. Further, the migration to “consumption-based models” of acquisition, to include cloud computing as an opening salvo, will allow government to leverage the best ideas and innovations of industry, while allowing industry to share in managing risks, reducing costs (particularly the need for large, up-front capital investments), and bringing speed and agility to the creation of new capabilities. And yet, despite the flexibilities that acquisition rules allow, collectively, government is failing to take advantage of many of the important contributions that industry has to offer. It is a time to act boldly to create a better future. By successfully working the right set of policy and legislative issues, we can bring to bear the research and innovation engine of the private sector. By focusing the best minds and best practices that industry has to offer, we can help government rapidly embrace new technologies and gain efficiencies in operations. Together, we can provide a better return on the taxpayers’ investment in the future. Collectively, we can counter the current misperceptions about our industry’s ability to bring speed and innovation to solve government mission needs. With this backdrop in mind, PSC has significantly expanded our technology policy presence. With the creation of the Technology Council, we will deliver better mission results for the federal government by bringing together the best minds and best practices of the private sector in a collaborative dialogue with government leaders on the effective use of technology. We will drive the elimination of current practices that stifle innovation,

10 / Service Contractor / October 2014

speed or agility, while simultaneously addressing crucial technology policy issues and opportunities. Anne Altman, general manager for U.S. Federal Government and Industries at IBM, chairs the Technology Council, and a significant cadre of recognized technology thought leaders from PSC member companies have already agreed to contribute their time and attention to these crucial issues. In addition, new companies are joining PSC to contribute their expertise and views to this important work. The council’s work will: (1) create solutions to facilitate rapid innovation across the federal government, (2) educate government and industry on the significant federal market changes resulting from the shifts to convergence and consumptionbased models, and (3) advocate for the right legislative, regulatory and administrative policies to significantly reform and improve agencies’ acquisition and delivery of technology. While we will ensure that priority near-term issues are being addressed, we believe that there is a crucial opportunity to provide the next administration with the technology roadmap to successfully meet these challenges. Today, information technology is firmly woven into every mission across both government and industry. It is apparent and essential that government redesign how it will procure technology services and solutions. Beyond that though, it is equally apparent that industry will need to thoughtfully align the business models and approaches that it will offer going forward. The changes the Technology Council are seeking will create new opportunities and help companies and agencies position themselves to excel in the technology marketplace of the future. This work will also help companies and agencies effectively leverage technology within their organizations to improve operations and reduce costs. The importance of this agenda is not only for the long-term growth and health of the government technology market, but also for the future of this great country. We are at an inflection point, and the opportunities to improve the government’s delivery of crucial services to the nation are great. We encourage all member companies with an interest in advancing the technology agenda of access, security, performance and results to get engaged with PSC and our Technology Council. Contact me at, I’m happy to provide more information and would love to gain your insights and priorities. 3 Professional Services Council

What don’t we do for the US Military? While we don’t fly the helicopters or captain the aircraft carriers, EMCOR has plenty of boots on the ground to keep our troops and their facilities safer, more efficient and ever-ready. Below is a just sample of how we help the Military accomplish its missions…

It’s all about support—24/7/365 our people are on-call for virtually every type of on-site operations and maintenance service demanded by today’s complex base operations.

EMCOR Government Services takes many forms— our people support key facilities for the Army, Navy, Air Force, Marines, U.S. Coast Guard, and U.S. Customs and Border Protection and more.

High-tech, high-performance facilities deserve a higher caliber of preventive maintenance and repair—we are proud to provide vital services and Base Operations Support nationally.


Professional Services Council

Service Contractor / October 2014 / 11

Challenges in Government Procurement and Acquisition

Moving Forward by Dr. Nick Nayak,

former Chief Procurement Officer, Department of Homeland Security


ince graduating from college with a bachelor’s degree in finance and economics in 1986, I spent the last 28 years working virtually every angle of private, public and academic sector procurement and acquisition. When I was in the private sector, my main focus was to win contracts and drive profit; in academia, I analyzed best private and public sector buying behaviors in a world influenced by globalization and technology; and in the public sector, I analyzed how to buy efficiently and effectively given many unique constraints and stakeholders. My last federal government appointment was as Chief Procurement Officer (CPO) for the Department of Homeland Security (DHS), where I had the honor of leading more than 1,400 contracting officials across 11 federal agencies spending $19 billion (through more than 100,000 purchasing transactions) annually. The goal was simple—buy things to protect the United States, at the least cost the American taxpayer, while fulfilling many public policies. Thankfully, during my nearly four years of service, DHS delivered and daily attacks on the Homeland were prevented to preserve our wonderful freedoms in our great country. Battle tested through 28 years in the procurement and acquisition world, and with all humility, I wanted to share my thoughts on some challenges and potential solutions for government procurement and acquisition moving forward. Industry can and is helping with many of these challenges. I preface my thoughts by sharing that, while in government, I wholeheartedly supported and endorsed the solid recommendations for government and industry written in the 2013 PSC Leadership Commission Report. This is a very nice list of recommendations that can be acted upon now to create a new era of government efficiency, innovation and performance and I hope all will act on this list. Below are some big picture points to set the stage for sharing thoughts about challenges and potential solutions for federal procurement and acquisition moving forward.

Stay positive. Everything has and will improve over time. In spite of increasingly burdensome public policies, regulation and political disfunction, industry and government working together have produced great things for more than 50 years that maintain our country as the greatest on the planet. This is a good place to start. 12 / Service Contractor / October 2014

Professional Services Council

American citizens want more. If you listen to a growing percentage of American citizens, the federal government has far more needs than money to pay for everything. With the cost of entitlement programs growing, reductions elsewhere in the federal budget are imminent, but American citizens want more.

Government is still the largest buyer with continued opportunity for best-in-class companies. The U.S. government has been and will continue to be the largest buyer in the world. Over the last two decades, spending rose from $300 billion to $550 billion. While the trend line is definitely on the decline, there has been and will be opportunities for the best companies.

Government buying community can and must do better with what it has. The val-

ue of federal procurement and acquisition is obvious and it must be accomplished as efficiently as possible. Government must find ways to buy the right things that last the longest, at the right cost, while encouraging innovation amd getting the biggest bang for the buck.

Government needs to continuously be aware of what is going on globally, adapt to the latest technology quickly and hire and train people to be the best. When

tackling any issue, government must analyze people, technology and globalization before determining a path to a solution.

9 Challenges and Potential Solutions The list of challenges and potential solutions listed below is not intended to be exhaustive, but rather some thoughts on what might have the biggest immediate impact in a positive or negative direction depending on how they are addressed in the near term.

Getting People Smart Fast. Since federal

procurement and acquisition are unlike a beer bottling plant, people are needed to carry out most of its work. It is a people business that is enabled by technology for the most part. The good news is most procurement and acquisition positions can’t be outsourced and the career progression is enough to earn a comfortable living. The bad news is more than 30 percent of federal procurement personnel are retire-

ment eligible over the next five years and one in every four new employees with less than five years of experience are leaving for the private sector. All this is coupled with recent furloughs, pay freezes, sharply reduced training and development opportunities, as well as federal employee bashing by prominent stakeholders. The federal people challenge is really no different than the industry or global people challenge.

With a proper understanding of the most frequently employed buying techniques…, coupled with a leap to emerging learning technology, federal procurement and acquisition professionals could become smarter faster. A POTENTIAL SOLUTION: Learning about federal acquisition is like understanding the tax code or learning a foreign language. It typically takes years to acquire knowledge and skill if you are lucky. With a proper understanding of the most frequently employed buying techniques (i.e., buying off GSA Schedules), coupled with a leap to emerging learning technology, federal procurement and acquisition professionals could become smarter faster. Like the public education system, it is hard to imagine getting rid of what is in place and maybe it isn’t even necessary. My recommended potential solution is to employ a technology to equip the procurement and acquisition professional like the warfighter. A tool, such as Google Glass, would provide immediate access to relevant information and direction based on the immediate task at hand. I’m convinced that, like all other technological innovations sprouting up daily, someone or some company will employ technology to make the federal procurement and acquisition workforce smarter faster. Sharing More To Get The Best From Industry. Industry and government are

joined at the hip in delivering value for the American taxpayer. This has and will be the case forever. Given this partner-

ship, government should make it easy for industry to understand the individual government agency missions and annual and five-year direction.

A POTENTIAL SOLUTION: In one location, all federal agencies should share their strategic plans, budgets, acquisition forecasts and IT roadmaps. These and other artifacts should be presented online as a means of being conveniently open and transparent to industry so individual companies can mine and map their solutions to specific agencies more easily and at no to low cost. Establishing Solid Requirements Upfront.

Today, there is no single official who is responsible for requirements in most agencies. A good requirement can be directly translated to quality taxpayer service. While there are Chief Procurement Officers, Chief Information Officers and other responsible chiefs, there is no Chief Requirements Officer; therefore, when a requirement is to blame for government not receiving what was desired, there is no real accountable official or body. In addition to no accountability for good requirements, there are system inefficiencies when it comes to looking at past requirements and conducting fast and updated market research, all of which would lead to faster procurements with companies who provide real value.

A POTENTIAL SOLUTION. Agencies should appointment a Chief Requirements Officer who is responsible for approving requirements above a certain dollar value. This official should have access to all past requirements in the agency and throughout government. This approach to requirements management would increase accountability as well as reduce or eliminate duplication throughout an agency. It would also create a touch point for industry interaction well before solicitation releases. In addition, government should consider relying on industry to conduct the latest market research before beginning an acquisition. There are companies that specialize in determining the best way to acquire supplies or services and government simply does not have that capability. Demonstrating The Value Of Procurement And Acquisition. While there are many

things that are success measures in federal procurement, the primary challenge for

continued on page 14 Professional Services Council

Service Contractor / October 2014 / 13

from page 13

any public or private sector procurement organization should be how to acquire supplies and services quickly at the least cost to the customer. Today, it is clear that government can do better at getting good deals more efficiently. While the single biggest contributing factor to getting a good deal lies with a clear requirement, there are many things procurement organizations can do to ensure taxpayer dollars are spent wisely. This is and should be their value added.

A POTENTIAL SOLUTION: Agencies should be required to first maximize contract closeouts so they can recoup money sitting on the books. They should further be required to conduct continuous spend analysis, which will eventually lead to leveraging buyer power, eliminating duplicative contracts (within agencies and across government), reducing low-dollar transactions, placing some buying directly in the hands of customers (with controls of course), and freeing procurement professionals to focus on higher value actions with the acquisition process. All these steps can be taken now and should simply be mandated across the government. Ensuring Program Success And Appropriate Risk Management. Government is not

in business to award contracts. Contracts are awarded to supports programs that subsequently should deliver value to the taxpayer. Unfortunately, there are too many past examples where large contracts were awarded, coupled with less than clear requirements and weak program management. This has led to agency program horror stories. The typical fall-out from these unfortunate scenarios is industry and government pointing fingers at each other, while the American public becomes increasingly frustrated with both.

A POTENTIAL SOLUTION: Risk is present in

many acquisitions. It is easier to digest the spending when it is titled “research and development.” There is more than enough oversight in the system. Unfortunately, all acquisitions cannot be labeled research and development and sometimes government must rush to solve immediate problems. While it might seem ridiculous, there should be a bipartisan congressional body to expeditiously approve all requirements above a certain estimated program lifecycle cost. In this way, all key stakeholders are

aware of and vested in the requirement upfront and all can share and explain the blame if things don’t go well. The silver lining is that while we have spent much in the past, we do have the strongest public services compared to other countries.

be applied across government. The model should take into account the number of debriefings and incorporate technology to accommodate the scale. The model should be endorsed by industry and the Chief Acquisition Officer’s Council.

Dealing With Many Companies With No Niche Or That Are In No Person’s Land (The Mid-Sized World). With the

Sharing Industry Issues With Government In One Place Free Of Charge. Just like it

increased emphasis on small business and the number of small business socioeconomic categories, there has been an increase in the number of government contractors. While the small business public policies are well intended and it is good to have robust competition, it is not the responsibility of government to award a contract to every company. Like the commercial market, only those providing the best value should be rewarded. The challenge for companies is to succinctly explain the specific niche or value to the right audience of agency program and procurement personnel. If traction through obtaining some contracts is achieved, the ability to stay alive once graduating from small business is the next level issue—the mid-sized world.


companies: as ridiculous as it sounds, first have niche. Being all things to everything is not clear enough. Be able to explain your value and how the government can connect with you in 5 minutes or less. Get help identifying target agencies and officials based on your niche. Be open to subcontracting and don’t expect there to be another program for mid-sized companies. Either demonstrate value and compete with all, retreat to small or exit.

Working Together To Do Better In The World Of Protests. While the speed of the

protest process leaves something to be desired, there must be an avenue to contest decisions that industry and government understand. The bigger challenge is how to minimize protests, which would be great for both sides. The truth lies in issuing draft solicitations upfront to correct any upfront flaws and open debriefings on the back end to appropriately explain the selection process.


should work with key industry associations to craft a model debriefing that can

14 / Service Contractor / October 2014

is good for government to be represented in one place, it would be nice if industry issues with government were listed in one place as well.


industry associations to get together and list the major collective industry concerns for anyone to see. In this manner, all federal employees can go to one place for awareness—the first step in making change happen.

Demistifying The World Of IT And Services Acquisiton. There is too much industry talk of how the government cannot buy the new world order of IT and services correctly.


collectively list examples of how government can do it within the current system. For example, if industry is selling IT as a service, share an example of how it can be bought within the current federal system. Identifying a problem is step one, but if you want change, provide a clear solution.


I’m optimistic about the future of federal procurement and acquisition. I’m optimistic because of the things that drive most people crazy—the intersection of globalization, technology innovation, the new generation of private and public sector employees, and the rate of change in the 21st century. Civilization has continuously evolved, and it will continue to do so at an even faster pace moving forward. I look forward to helping from yet another angle moving forward. Dr. Nick Nayak is the founder and president of Green Light Acquisition Consulting Practice. Green Light is dedicated to helping companies assist government to provide positive results for the American taxpayer. Contact information is greenlightacquisiton@gmail. com or 301-633-3045. Professional Services Council

PSC’s Acquisition and

Technology Policy Agenda

by John Goodman, PSC Vice Chairman of the Board of Directors

and Chief Operating Officer, Accenture Federal Services

Photo: alphaspirit/


n 2014, the federal government has, once again, been testing the murky waters of acquisition reform. PSC has been actively engaged in supporting these efforts to help the government avoid the potential hazards and pitfalls along this well-worn but difficult path. The latest acquisition and technology policy review and reform initiatives are unfolding on multiple fronts, including extensive work on defense acquisition practices in both the House and the Senate Armed Services Committees and the Department of Defense’s ongoing efforts to identify non-value-added requirements imposed on its industrial base. Combine these efforts with continuing initiatives in the Senate and the administration to improve information technology acquisition, and it is clear that there exists a real opportunity, along with real challenges, to improve the federal acquisition system. The need for improvements could not be greater. The current budget challenges, unprecedented evolution in technology, and changing demographics of the government workforce demand that we get acquisition and technology reform right this time, particularly for services. In light of this pressing need and promising opportunity, PSC convened the Acquisition Policy Review Committee (APRC), bringing together the deep knowledge and expertise within PSC’s membership to develop a unified PSC acquisition and technology policy agenda. The members of the APRC, and the companies they represent, work with virtually all federal departments and agencies, providing professional services, technology services, and more. They confront, firsthand, the challenges and obstacles of the existing acquisition process on a daily basis.

Professional Services Council

I was honored to serve as chair of the APRC. Given the scope and span of topics encompassed by the various government review efforts, the APRC formed three working groups to help flesh out our priorities and develop recommendations. Through these working groups, the APRC also engaged representatives from throughout the PSC membership and the government in crafting our slate of recommendations. The first working group, chaired by PSC Board Member Anne Altman of IBM, who also chairs our Technology Council, focused on technology and IT. This group highlighted the disconnect between the approaches used by the commercial sector to acquire and manage information technology and those

used within the government. Technology is changing at breakneck speed, and while companies in the commercial sector are rapidly adjusting their processes and policies to keep pace and leverage these new tools, the government is still hampered by an outdated acquisition system and an insufficient technology workforce. As one member of the APRC commented, the government is still attempting to run an analog government in the digital world. Our federal acquisition system must be capable of rapidly and flexibly acquiring the cutting edge technology solutions the government needs if it is to effectively and affordably complete its missions. continued on page 16 Service Contractor / October 2014 / 15

Marketview 2014

from page 15

The second working group, chaired by PSC board member Brad King of Robbins Gioia, focused on protest reform. The topic of protest reform emerged from PSC’s 2013 Leadership Commission, which noted that excessive protests, or perhaps even just the specter of protests, are having a chilling effect on the acquisition system and are restricting and penalizing innovation while increasing costs and slowing awards. While protests certainly play an important role in the acquisition process, this working group pinpointed where the process could be improved to retain the benefits of the current protest systems while mitigating and minimizing their drawbacks. The final working group, encompassing defense and general acquisition issues, was chaired by PSC Board member Neil Albert of MCR, who also chairs PSC’s Defense and Intelligence Council. Among the key themes that emerged from this working group was the importance of

communication and collaboration, the need for clear requirements and evaluation criteria, and the necessity of revamping how the federal acquisition workforce is trained and managed. Over several months, these working groups coalesced their proposals into a single PSC acquisition and technology policy agenda, with 42 specific recommendations for action. We have shared this report with members of the House and Senate Armed Services Committees, other key congressional offices and the acquisition leadership throughout government. These recommendations seek to improve acquisition outcomes and facilitate government leveraging industry to achieve its vital mission outcomes, all while driving transparency and accountability. I encourage you to review these recommendations and the full report. On their own, these recommendations will not fix the entire acquisition system; but

we are confident that they serve as an important step in righting the ship. The federal acquisition system is at an important crossroads. With the plethora of acquisition reform initiatives in progress, change to the acquisition system is inevitable. It is up to the leaders in government and industry to ensure that every change made is meaningful and effective. The growing convergence between technology and services necessitates transformative rethinking about how the government acquires solutions from the private sector. The way technology, services, and people interact is also evolving. If the acquisition process does not enable those transformations, the government risks being unable to fulfill its responsibilities. PSC will continue to be the recognized leader and advocate for actions across the entire range of acquisition and business policy and technology policy issues. I know that every PSC member company joins with us in that effort. 3

A financial relationship you can trust. Now, more than ever, you need a bank that stands beside you. Our Government Contracting team helps you make the most of every opportunity. We provide you with experience, guidance and smart solutions that position you and your business for success. • Asset-based lines of credit • Acquisition & recapitalization term debt • Treasury management services For a higher level of personal service, contact Timothy Duggan, Senior Vice President, at 1-703-663-7619 or

CrowdStrike Services President and CSO Shawn Henry, a former FBI executive assistant director, explains the human element of the cyber threat at Marketview 2014 in Ameilia Island, Fla. TD Bank, N.A. | Loans subject to credit approval. | Equal Housing Lender

16 / Service Contractor / October 2014

Professional Services Council

Federal Publications seminars

eXPert-leVel courses For Practiced ProFessionals

Extensive Multi-Day Government Contracting Training Seminars THE MASTERS INSTITUTE IN GOVERNMENT CONTRACTING

We bring in nationally recognized faculty to help you further develop the expertise and skills you need to navigate intricate legal and ethical concerns that often have no black and white answers. 2015 DATES may 4-8 in la Jolla, ca | July 20-24 in Hilton Head, sc | december 7-11 in arlington, Va


leave the classroom fully equipped with insights from professionals who have spent their careers in government contract costs and accounting. 2015 DATES may 5-7 in la Jolla, ca | July 21-23 in Hilton Head, sc | august 18-20 in sterling (dulles), Va For details and to register or call 1.888.494.3696 Š 2014 Federal Publications Seminars 9-14

Professional Services Council

Service Contractor / October 2014 / 17

Engage Your Community

to Engage Your Employees Employee engagement is always a buzz-worthy topic,

as many employers want to uncover the secret of retaining valuable employees. While the churn of employee turnover is inevitable, there is always a desire to hold on to those employees who become assets to the company. What is the carrot employees need to commit to one company for the long haul? Higher pay? More vacation days? Longer lunches? Telework flexibility? Glamorous perks?

The obvious answers are not always the right ones.

18 / Service Contractor / October 2014

Professional Services Council

Photo: Carlos Castilla/

by Alessandra Colia, Director of Employer Partnerships, Urban Alliance


s noted in “Happy Community, Happy Employees, Happy Bottom Line,” a blog post I wrote for the Arlington Chamber of Commerce in May, keeping employees engaged at work leads to a more productive, efficient, and effective company. Ask any employee for their wish-list, and while those predictable incentivized items related to pay and vacation may be on there, often they also want something bigger. Employees want to feel workplace pride, to connect with others, to have a bigger sense of purpose, and to have a fair say. New generations of employees actually care a lot about their company’s corporate social responsibility (CSR) strategy. Nearly every company has some sort of program for community giving and CSR so that employees can engage in their community. To stand out as a company that cares about giving back, it is important to have a clear strategy. There are even consultants that exist (such as True Affects) just to help companies map out a plan for CSR. Creating the link between companies and employees and the community is not as easy as one may think. A lot of potential employees take notice of how your company is involved in the community. Studies have shown that 61 percent of all candidates take a company’s charity initiatives into consideration when evaluating a company and 83 percent of all employees prefer companies that focus on corporate giving (Adecco, USA). How often does your company give back to local non-profits? How often do you give employees the opportunity to participate in activities where they can interact with those in-need? Below are some tips on what your employees really want and how a robust corporate community giving program can help:

1. Employees want to feel proud. One key element of engagement of employees is building a sense of pride in the company. When an organization is making a difference, employees will boast about it. Being associated with a place that does good work in the community generates that pride in the overall mission. If their company is giving back in an impactful way, employees are more likely to engage in their corporate culture. Beyond current employees developing pride, you will attract future employees who care about a giving corporate culture. Determine ways to engage the community that will make your employees proud to stand behind your company name. 2. Employees want to build social connections. Engaging employees also requires building a strong group identity through social networking opportunities. To improve employee satisfaction, give them the space to give back to the community and bond around a cause. Employees want to feel connected to their co-workers, and working together for the common good is a great way to accomplish that. Beyond feeling connected to each other, staff will feel connected to community members at large. View giving back to the community as a chance to strengthen your own corporate community and culture. 3. Employees want to have an enriched sense of purpose. To determine employees’ level of engagement, start to think about their greater sense of purpose. Many employees strive to find purpose through their work, and achieving this can unleash productivity. When employees have perspective on the greater community, they can realize how they fit into it, and how their company’s altruism contributes. Purposeful partnerships with

non-profits have the power to connect your mission with community service. Engage your employees by tapping into their sense of purpose through corporate social responsibility to enrich your employees’ sense of purpose. 4. Employees want to have a fair say. Engaged employees are employees who feel they have a seat at the table when it comes to decision making. By giving your employees the platform to promote their causes, it will make it more difficult for them to leave since they are engaged on a personal social responsibility level. Employees will feel they have a voice in your company if you give them the opportunity to share where their passions lie. You may be surprised when you hear what’s important to your employees outside of work connects to what your company is doing. Take the time to hear what causes your employees believe in to see if there is alignment with your company. The benefits of corporate giving from the human resources perspective are numerous. Besides the proven benefit of employee retention, your company is more likely to attract new employees if your business has a clear CSR strategy. Corporate social responsibility is more than just charity; it is an opportunity to engage both the community and employees. Where are the critical junctions between your corporate values, employee passions, the communities in which you do business, and the financial success of your business? Seek meaningful partnerships with non-profit organizations to engage your community and employees alike. 3


Professional Services Council

Service Contractor / October 2014 / 19

Will “Innovation� Return

to the Small Business Innovation Research Program?

by Todd R. Overman, Bass, Berry & Sims PLC 20 / Service Contractor / October 2014

Professional Services Council

Photo: Ruslan Grumble/


n January 2013, the government implemented changes to the Small Business Innovation Research (SBIR) program authorized by the fiscal year 2012 National Defense Authorization Act.1 These changes were designed to spur more participation in a program that offers critical funding to start-up companies and is one of the primary sources for small business innovation in the federal government. At a time when research and development (R&D) in the United States is declining relative to China2, the SBIR program has the potential to help U.S. businesses close that gap and support start-up companies in the so-called “valley of death” when they are doing promising research but not generating revenue. Unfortunately, the jury is still out on whether the changes to the SBIR program go far enough and if the government is sufficiently committed to maximizing the potential of the program. Several witnesses at U.S. House of Representatives hearings on the SBIR program in May and July 2014 said government agencies charged with backing the program are not doing enough and that the new rules encouraging broader participation—particularly by companies whose ownership includes venture capital, hedge funds or private equity companies—may not go far enough. Under the SBIR law, created as part of the Small Business Innovation Development Act of 1982 and the Small Business Technology Transfer Act of 1992,3 federal agencies with extramural R&D budgets that exceed $100 million per year are required to allocate 2.8 percent of their R&D budget to their SBIR programs, with that growing to 3.2 percent in 2017. Currently, 11 federal agencies participate in the program, including Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, Homeland Security, Transportation, Environmental Protection Agency, National Aeronautics and Space Administration, and National

Science Foundation. The SBIR program awards up to $150,000 in the first phase to explore the feasibility of an idea and up to $1 million in a second phase for R&D. Agencies are permitted to exceed the amounts by up to 50 percent, provided they provide notice to the Small Business Administration (SBA) along with justification for exceeding the award amount.

Do Changes Go Far Enough?

While there have been success stories—Symantec and Qualcomm received early-stage funding from the program— in recent years, the tight eligibility rules have shut out many other small businesses and potentially other success stories.

...the tight eligibility rules have shut out many other small businesses and potentially other success stories. One of the biggest restraints has been a requirement that SBIR companies must be majority owned and controlled by “U.S. citizens”. Over a decade ago, the SBA interpreted this to mean real people, and therefore effectively excluded venture capital, private equity and hedge fund-backed small businesses from participation in the program. The intent of the rule was to limit SBIR companies to actual small, independent businesses, rather than the subsidiaries or affiliates of major companies. It also had the effect of not taking into

account funding mechanisms that were less prevalent when the eligibility requirements were initially promulgated in 1982. SBIR applicants are also limited to a total of 500 employees across all business units. This size requirement was another impediment to private equity ownership because if the private equity firm was determined to be affiliated with the SBIR applicant, than the SBIR applicant would have to count all of the private equity firm’s portfolio company’s employees in its employee count. As you might expect, many startups and R&D focused small businesses depend on venture capital or private equity funding as a source of funding as they develop. In addition, often the companies with the most promising technologies or concepts are the companies that receive third-party investment. Even with the outside investment, the SBIR program remains an important R&D funding source and, for several years, venture capital (VC)-backed small businesses have been asking Congress to loosen the eligibility requirements on ownership. In the 2012 reauthorization bill, Congress opened the door, a crack, to permit some private equity, hedge fund, and VC-backed small businesses back into the program. Under the new rule, effective January 28, 2013, VC, private equity and hedge funds can be majority owners of SBIR applicants, provided that no single such firm owns a majority or controlling interest.4 The rule also relieves the SBIR applicant of counting all of the employees of the private equity or VC firm’s affiliates5 and softens the requirement for U.S. citizenship or resident alien status, saying instead that the private equity or VC firm must have a place of business in the United States or have been created or organized in the U.S.6 This concession, however, came with several barriers to VC-backed firms. First, the 11 participating agencies are limited in the amount of SBIR funds that they can continued on page 23

National Defense Authorization Act for Fiscal Year 2012, Pub. L. No. 112-81, 125 Stat, 1298 § 5107; Small Business Size Regulation, Small Business Innovation Research (SBIR) Program and Small Business.Technology Transfer (STTR) Program, 77 Fed. Reg. 28520 (May 15, 2012) (proposed rule); 77 Fed. Reg. 76215 (Dec. 27, 2012) (final rule). 2 “The coming R&D crash” (B. Plumer), The Washington Post, February 26, 2013. 3 Pub. L. No. 102564, as codified at 15 U.S.C. § 638 (1992). 4 13 C.F.R. § 121.702(a). 5 13 C.F.R. § 121.702(c)(9). 6 13 C.F.R. § 121.701(b). 1

Professional Services Council

Service Contractor / October 2014 / 21

Most benefit brokers know their business. Only CBIZ NBA knows yours! Comprehensive benefits solutions designed specifically for G O V E R N M E N T C O N T R A C T O R S .

CBIZ NBA Benefit Administration Technology

Most Brokers Some

Premium Administration Hour Bank Accounting


COBRA & HIPAA Administration Carrier Eligibility Administration


SCA/Davis Bacon Compliance Consulting


Government Contract Transition Assistance


Exclusive SCA/DBA Benefit Plan Design


© Copyright 2013. CBIZ, Inc. NYSE Listed: CBZ. All rights reserved.

In House Legal/ Actuary Expert Resources

22 / Service Contractor / October 2014



CBIZ National Benefit Alliance Bicknell Robbins • 800.390.1224 x189 • Professional Services Council

from page 21

award to VC-backed firms. NIH, Department of Energy and NSF may award not more than 25 percent of their SBIR funds to majority VC-backed firms, and the remaining agencies are limited to no more than 15 percent of the agency’s SBIR funds to such small businesses.7 Second, the new rule contains a disclosure requirement some might consider onerous. In order to be part of the program, a SBIR applicant must disclose in a public database the amount of investment it has received from private equity, VC or hedge funds. Companies also must disclose in a non-public government database the percentage of ownership of such entities, as well as other information. VC and private equity firms are generally guarded about revealing details of their investments and it remains to be seen if this disclosure requirement will be a deterrent to VCbacked firms applying for SBIR awards.

Another potential problem with the change that allows majority ownership by multiple private equity or VC firms—but not by any one firm—is that many of these investors do not take minority positions in small businesses. Rather, they prefer to take majority ownership positions or control of the company’s board of directors, suggesting that the utility of the change may be limited to only a subset of previously ineligible firms. Finally, and perhaps the biggest hurdle to allowing these firms back in, is that only one agency, the Department of Health and Human Services (NIH) has opted to permit firms that are majority owned by multiple venture capital, private equity or hedge funds to receive SBIR awards.8 If the remaining 10 agencies don’t indicate their willingness to permit these firms back in, then the prospect of increased innovation will be further restrained.

Mixed Reviews at Congressional Hearing Highlight Challenges

There are other concerns with the new rules and administration of the overall program, according to several small business advocates who testified at the U.S. House of Representatives Committee on Small Business hearings in May and July 2014. John Clanton, the CEO of Lynntech Inc., a College Station, Texas, research and technology development company, told Congress in May that federal agencies have an “attitude problem” regarding SBIR awards. “We still have DoD personnel who complain about having to execute a ‘small business welfare program’” in regard to SBIR grants, he said, adding that his company often deals with government personnel who are uninformed about the changes Congress made to the program’s eligibility rules.9 Government officials are either “unaware of the tools or they have chosen continued on page 24

SBIR Policy Directive (February 24, 2014) at 16. 8 (visited on August 3, 2014). 9 Statement of John Clanton Before the Committee on Small Business, U.S House of Representatives, Washington, D.C., May 21, 2014. 7

Professional Services Council

Service Contractor / October 2014 / 23

from page 23

to ignore them,” he said.10 Clanton also noted that although Congress requires federal agencies to collect data and report details of their SBIR funding, they are not doing so. Another witness, Robert Schmidt, national co-chair of the Small Business Technology Council and head of several medical technology companies, told Congress that federal agencies have a culture that is “adverse to small business,” and this is reflected in how little attention they give the SBIR program.11 He called on the agencies to fulfill the mandate to report data on the program to Congress, to set goals for awards, and to increase the number of awards and dollar amounts. Most federal departments are not spending their allocation for this program, he noted. (A GAO report issued in 2013 said that eight of 11 federal departments

eligible for participation in the program did not spend their allocated funds for fiscal years 2006 to 2011.12 GAO reported in June 2014 that, for fiscal year 2012, eight of 11 federal agencies complied with SBIR spending requirements.13) Schmidt added that the current climate for small business, and especially tech companies, is “challenging.” Many big banks have pulled out of small business lending, he said, and there is less venture capital going to start-up enterprises, with most of what is invested focused on Silicon Valley companies. “The only bright spot for technology companies is the SBIR program,” he told Congress.14 The government has three objectives in making SBIR awards: to encourage R&D by small businesses, to create research useful to federal agencies, and to stimulate innovation that can be successful commer-

cially. In order to achieve these objectives, participating federal agencies need to maximize participation in the program and re-double their efforts to spend all allotted funds. As some of the witnesses at the congressional hearing noted, and recent GAO reports confirm, the central issue in SBIR funding is whether the federal government will make the most of this opportunity to encourage research that will help boast small businesses and increase American competitiveness. Todd R. Overman, is the chair of the Government Contracts practice at Bass, Berry & Sims PLC, and is based in the firm’s Washington, D.C., office. He has more than a decade of experience advising companies on the unique aspects of doing business with the federal government. He can be contacted at

Id. Statement of Robert Schmidt Before the Committee on Small Business, U.S House of Representatives, Washington, D.C., May 21, 2014. 12 GAO, Small Business Research Programs: Actions Needed to Improve Compliance with Spending and Reporting Requirements, GAO-13-421 (September 9, 2013). 13 GAO, Small Business Research Programs: More Guidance and Oversight Needed to Comply with Spending and Reporting Requirements, GAO-14-431 (June 6, 2014). 14 Statement of Robert Schmidt Before the Committee on Small Business, U.S House of Representatives, Washington, D.C., May 21, 2014. 10



Centre Law Group is now Fed Nexus Law

• Federal Contract Law & Compliance Services • GSA/VA Federal Supply Schedule Contracting • Service Contract Act & Labor Law Compliance • Bid Protest Litigation & Defense Services • Intellectual Property, Internet & Technology Law • Federal Audits & Investigation Services

Practical Solutions for Complex Problems /FedNexusLaw

P: 703 288 2800 F: 703 288 4868 W: 1953 Gallows Road, Suite 650, Tysons Corner, VA 22182


For the latest developments in federal contracting, sign up on our website for our free weekly blog: Fed Nexus Insight

24 / Service Contractor / October 2014

Professional Services Council

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

Cyber Intelligence Sharing and Protection Act, Rogers (R-MI) Summary Would establish cyber threat intelligence sharing procedures between the intelligence community and certain private sector entities. STATUS Passed by the House (288-127) on 4/18/2013.

H.R. 624

H.R. 731

Summary STATUS

Protecting Americans Abroad Act, Radel (R-FL) Would allow the State Department to use best-value contracting in awarding local guard or protective service contracts in high-risk areas abroad under the diplomatic security program. Referred to Foreign Affairs Committee on 2/14/2013. Related bills: H.R. 2723, H.R. 2848, S.1386.

H.R. 882 Contracting and Tax Accountability Act of 2013, Chaffetz (R-UT)

Summary STATUS

Would propose for debarment any contractor with an unpaid, seriously delinquent tax debt. Would require prospective contractors to certify that the contractor has no unpaid, seriously delinquent tax debt. Passed by the House (407-0) on 4/15/2013. Related bill: S. 2247.

H.R. 1163 Federal Information Security Amendments Act of 2013, Issa (R-CA)

Summary Seeks to enhance the governmentwide management, oversight, and coordination of information security risks, including contractor-related systems and information. STATUS Passed the House (416-0) on 4/16/2013. Federal Information Technology Acquisition Reform Act, Issa (R-CA) H.R. 1232 Seeks to reform federal government acquisition of information technology by providing additional Summary

authorities to agency CIOs, consolidating data centers, enhancing IT spending tracking and strategic sourcing, and creating assisted acquisition centers of excellence within the federal agencies. STATUS Passed the House on 2/25/14. Related bills: H.R. 4435, S.1611, S.1843. Global Partnerships Act of 2013, Connolly (D-VA) H.R. 1793 Seeks to streamline and improve USAID’s procurement process, to maximize transparency, Summary


efficiency, simplicity and speed. It also expresses the Congress’ preference for strong competition and a wide range of nonprofit and for-profit partners in development initiatives. Referred to Foreign Affairs, Oversight and Government Reform, Rules, and Ways and Means Committees on 4/26/2013.

H.R. 2008 Stop Taxing American Assistance to Afghanistan Act, Welch (D-VT)

Summary Would prohibit U.S. assistance for Afghanistan unless the two governments enter into a bilateral agreement that provides that work performed in Afghanistan by U. S. contractors is exempt from taxation by the government of Afghanistan.


Referred to Foreign Affairs Committee on 5/15/2013.

Civilian Contractors Engaged in Intelligence Activities Reduction Act of 2013, Jackson Lee (D-TX) H.R. 2434 Would mandate a 25 percent reduction in the number of contractors with top secret security Summary


clearances that are engaged in intelligence activities. Would direct the Director of National Intelligence to conduct a study to determine the extent to which contractors are used in the conduct of intelligence activities and the type of information that they can access. Referred to Intelligence Committee on 6/19/2013.

Professional Services Council

Service Contractor / October 2014 / 25

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 2444 Commonsense Contractor Compensation Act of 2013, Tonko (D-NY)

Summary Would limit the cap on allowable contractor compensation to the salary of the vice president, $230,700. STATUS Referred to Oversight and Government Reform and Armed Services Committees on 6/19/2013. Related bills: S. 1192, S. 2286.

H.R. 2606 Stabilization and Reconstruction Integration Act of 2013, Stockman (R-TX)

Summary Would establish an Office for Contingency Operations to consolidate reponsibility for “overseas stability and reconstruction operations” currently divided among the Department of Defense, Department of State, and USAID. The director of the Office for Contingency Operations would report to the Secretary of State and the Secretary of Defense. STATUS Referred to Armed Services, Foreign Affairs, and Oversight and Government Reform Committees on 6/28/2013.

H.R. 2638 Foreign Aid Transparency and Accountability Act of 2013, Poe (R-TX)

Summary STATUS

Would require the development of guidelines regarding the establishment of measurable goals, performance metrics, and monitoring and evaluation plans that can be applied with reasonable consistency to U.S. foreign assistance. Referred to Foreign Affairs Committee on 7/10/2013. Related bill: S. 1271.

H.R. 2719 Transportation Security Acquisition Reform Act, Hudson (R-NC)

Summary STATUS

Would direct the administrator of the Transportation Security Administration to develop a strategic multiyear technology acquisition plan. Would require the agency to report on the plan’s implementation as well as TSA’s goals for small business contracting. Passed by the House (416-0) on 12/3/2013. Related bill: S. 1893.

Summary STATUS

Would allow the Secretary of State to award local guard contracts on the basis of best value. Would reduce the bid price of proposals received from American citizens and joint ventures by 10 percent. Referred to Foreign Affairs and Oversight and Government Reform Committees on 7/18/2013. Related bills: H.R. 731, H.R. 2848, S. 1386.

H.R. 2723 Embassy Security and Enhancement Act of 2013, Engel (D-NY)

H.R. 2848

Department of State Operations and Embassy Security Authorization Act, FY 2014, Royce (R-CA) Summary Would allow the Department of State to use cost technical trade off source selection criteria for the selection of local guard services under the Diplomatic Security Program when such services are to be provided in an area that qualifies as a “high risk, high threat post”. STATUS Passed by the House (284-37) on 9/29/2013. Related bills: H.R. 731, H.R. 2723, S. 1386.

H.R. 2912 Afghanistan Suspension and Debarment Reform Act, Chaffetz (R-UT)

Summary STATUS

Would give the Special Inspector General for Afghanistan Reconstruction (SIGAR) suspension and debarment authority for foreign and Afghan contractors operating in Afghanistan when agencies fail to initiate a “timely” review of contractors identified by SIGAR. SIGAR would have the authority to make exceptions that permit a debarred or suspended contractor to be awarded new contracts in specific cases. Referred to Foreign Affairs and Oversight and Government Reform Committees on 8/1/2013.

26 / Service Contractor / October 2014

Professional Services Council

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 3032 Executive Cyberspace Coordination Act of 2013, Langevin (D-RI)

Summary STATUS

Would establish a National Office for Cyberspace to coordinate cybersecurity efforts. Would prohibit agencies from entering into contracts involving information technology without including in the contract requirements to provide effective security for that information. Would require contractors and subcontractors that operate or use an information system or information infrastructure on behalf of an agency to conduct an annual audit to assess compliance with cybersecurity regulations. Referred to Homeland Security and Oversight and Government Affairs Committees on 8/2/2013.

H.R. 3345 SUSPEND Act, Issa (R-CA)

Summary STATUS

Would establish a Board of Suspension and Debarment within the GSA to act as a centralized body to manage all executive agency suspension and debarment activities. Provides waiver authority for agencies that meet strict metrics. Retains, and expands, the authorities of the Interagency Suspension and Debarment Committee. Requires public posting of suspension and debarment officials’ decisions not to take suspension or debarment action on cases referred to the suspension and debarment official. Reported by Oversight and Government Reform Committee on 10/29/2013.

H.R. 3696

National Cybersecurity and Critical Infrastructure Protection Act of 2013, McCaul (R-TX) Summary Would provide liability coverage for providers of approved cybersecurity technologies that defend against cyber incidents. Would require DHS to assess the effectiveness of its existing authorities for acquiring cybersecurity technologies to ensure that such processes and authorities are capable of meeting the department’s cybersecurity missions. Would establish formal and meaningful information sharing procedures between DHS and private sector entities. STATUS Passed the House (voice vote) on 7/29/2014. Security Clearance Reform Act of 2014, Lynch (D-MA) H.R. 4022 Would require that the president submit to Congress a plan to reform the security clearance Summary

process based on a shift to continuous evaluation and monitoring of local government records, commercially available information such as credit history and foreign travel, and social media, among other information. Would require that certain federal funds be withheld from local governments that do not comply with requests for records by federal agencies or contractors performing background investigations on their behalf. Would require that only federal employees perform agency final quality reviews of background investigations, background investigation interviews with the individual seeking a clearance, and background investigations for clearances at the top secret level or higher. Would prohibit the award for investigative support services to a company that also holds a contract to perform background investigation fieldwork services, and vice versa. STATUS Referred to Oversight and Government Reform and Judiciary Committees on 2/10/2014. Greater Opportunities for Small Business Act of 2014, Graves (R-MO) Summary Would increase the government-wide small business prime contracting goal to 25 percent and would increase the subcontracting goals to 40 percent. STATUS Reported by the Small Business Committee on 4/9/2014. Related bills: H.R. 4435, S. 196.

H.R. 4093

DHS Acquisition Accountability and Efficiency Act, Duncan (R-SC) H.R. 4228 Would enhance a number of acquisition management and policy changes implemented by DHS’ Summary

Management Directorate over the past several years, including the codification of the existing Program Accountability and Risk Management (PARM) Office. Would also require DHS to develop a multiyear acquisition strategy and would require DHS to appropriately report and take corrective actions for any programs that experience significant cost overruns or schedule delays. STATUS Passed the House (voice vote) on 6/9/2014. Professional Services Council

Service Contractor / October 2014 / 27

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

NASA Authorization Act of 2014, Palazzo (R-MS) H.R. 4412 Would authorize NASA programs and activities, and STEM education funding. Includes provisions Summary


that would require the NASA FAR supplement to address contractor responsibilities regarding detection and avoidance of counterfeit electronic parts. Would also restrict contract awards to entities that have unpaid tax liabilities or criminal convictions. Passed the House (401-2) on 6/9/2014. Related bill: S. 1317.

National Defense Authorization Act for Fiscal Year 2015, McKeon (R-CA) H.R. 4435 Would authorize appropriations for military activities of the Department of Defense for Fiscal Summary

Year 2015. Includes several acquisition-related provisions including an extension of existing caps on services contracting, increases to small business prime and subcontracting goals, and cost comparison requirements between military, contractor, and DoD civilians. Also includes provisions addressing unauthorized Afghan taxes and federal IT acquisition reform. STATUS Passed the House as amended (325-98) on 5/22/2014. Related bills: H.R. 1232, H.R. 4093, S. 196, S. 2410. Intelligence Authorization Act for FY 2014-2015, Rogers (R-MI) H.R. 4681 Would fund all U.S. intelligence activities across 16 different agencies through fiscal year 2014. Summary


Would require that intelligence contractors develop and operate a security plan consistent with standards to be established by the Director of National Intelligence (DNI). Would require that cleared contractor personnel be monitored continuously according to DNI standards, and require the development of information sharing procedures between the federal and private intelligence communities to assist with continuous evaluations. Reported by the Intelligence Committee on 5/27/2014. Related bill: S. 1681, became Public Law 113-126 on 7/7/2014.

Department of Defense Appropriations Act for FY 2015, Frelinghuysen (R-NJ) H.R. 4870 The House-passed version would increase fiscal year 2015 funding for O&M and RDT&E and NEW



decreases funding for military personnel and procurement. Includes policy provisions that would 1) act as an automatic debarment of contractors that have FLSA violations with a finding or acknowledgement of fault within the past 5 years 2) prevent contracts from being awarded to contractors who have been convicted within the last three years or are presently indicted for crimes such as fraud, theft, bribery, making false statements, or have delinquent tax debts. Passed by the House (340-73) on 6/20/2014. Reported, as amended, by the Senate Appropriations Committee on 7/17/2014.

Global Development Lab Act of 2014, Castro (D-TX) H.R. 4905 Would codify within USAID the administration’s recently launched program to leverage research NEW


universities and institutions to engage in the more rapid creation and scalability of foreign aid innovations. STATUS Referred to Science, Space and Technology Committee on 6/19/2014. Related bill: S. 2502.

Stop Corporate Inversion Act of 2014, Levin (D-MI) H.R. 4697 Would amend the definition of “inverted domestic corporation” retroactively to May 8, 2014.




Referred to the House Ways and Means Committee on 5/20/2014. Related bill: S.2360.

Civilian Extaterritorial Jurisdiction Act of 2014, Price (D-NC) H.R. 5096 Seeks to clarify the jurisdiction of the U.S. Justice Department over contractors and contractor NEW


employees that commit certain crimes overseas. STATUS Referred to Judiciary Committee on 7/14/2014. Related bill: S. 2598. 28 / Service Contractor / October 2014

Professional Services Council

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

Unified Savings and Accountability Act, Coffman (R-CO) H.R. 5196 Would require OFPP to issue guidance to reinvigorate the role of agency competition advocates




and would require OMB to develop governmentwide savings goals related to the use of strategic sourcing. Would also require agency CIOs to report on efforts to identify and eliminate duplicative IT investments. Referred to multiple congressional committees on 7/24/2014.

Reforming Federal Procurement of Information Technology Act, Eshoo (D-CA) H.R. 5255 Would raise to $500,000 the simplified acquisition threshold for IT services to be procured from




small businesses and would make permanent the Commercial Item Test Program. Would also codify the Presidential Innovation Fellows Program, the Digital Government Office, and would establish a Digital Service Pilot Program to support high-priority federal IT projects. Would also require a review of IT Schedule 70 and reports on the effectiveness of GSA’s 18F program. Referred to House Oversight and Government Reform Committee on 7/30/2014.

Assuring Contracting Equity, T. Udall (D-NM) S. 196 Would raise the government-wide small business contracting goal to 25 percent from 23 percent Summary


and would also increase the goals of certain small business subcategories to 10 percent. Would also limit to two the number of small business subcategories in which agencies could take credit for small business performance. Referred to Small Business and Entrepreneurship Committee on 1/31/2013. Related bills: H.R. 4093, H.R. 4435.

S. 1192

Commonsense Contractor Compensation Act of 2013, Boxer (D-CA) Summary Would limit the cap on allowable contractor compensation to the salary of the vice president, $230,700. STATUS Referred to Homeland Security and Governmental Affairs Committee on 6/19/2013. Related bills: H.R. 2444, S. 2286. Foreign Aid Transparency and Accountability Act of 2013, Rubio (R-FL) Summary Would require the development of guidelines regarding the establishment of measurable goals, performance metrics, and monitoring and evaluation plans that can be applied with reasonable consistency to U.S. foreign assistance. STATUS Reported by Foreign Relations Committee on 12/20/2013. Related bill: H.R. 2638. NASA Authorization Act of 2013, Nelson (D-FL) Summary Would authorize NASA programs and activities, and STEM education funding. STATUS Reported by Commerce, Science, and Transportation Committee on 7/30/2013. Related bill: H.R. 4412.

S. 1271

S. 1317

S. 1386

Chris Stevens, Sean Smith, Tyrone Woods, and Glen Doherty Embassy Security, Threat Mitigation, and Personnel Protection Act of 2013, Menendez (D-NJ) Summary Would allow the use of cost-technical tradeoff analysis as the basis for source selection criteria for local guard contracts under the Diplomatic Security Program and would provide a 10 percent price advantage for U.S. firms’ proposals for such work. Would also restrict the ability of interested parties to file a protest against a Department of State contract awarded under non-competitive procedures for an emergency security requirement. STATUS Reported by Foreign Relations Committee on 12/9/2013. Related bills: H.R. 731, H.R. 2723, H.R. 2848.

Professional Services Council

Service Contractor / October 2014 / 29

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

S. 1611

Federal Data Center Consolidation Act of 2013, Bennet (D-CO) Summary Would require covered federal agencies to conduct assessments of federal data centers, develop data center consolidation and optimization plans, and measure cost savings associated with data center optimization initiatives. STATUS Reported by the Homeland Security and Governmental Affairs Committee on 5/6/2014. Related bill: H.R. 1232.

S. 1618

Enhanced Security Clearance Act of 2013, Collins (R-ME) Summary Would establish an enhanced security clearance system by directing modifications to the existing security clearance database and would require more frequent security clearance reviews using the enhanced security clearance system. STATUS Approved by the Homeland Security and Governmental Affairs Committee on 7/30/2014.

S. 1681

Intelligence Authorization Act for Fiscal Year 2014, Feinstein (D-CA) Summary Would require DNI to collaborate with DoD and OPM in the analysis of costs and benefits of improving the security clearance background process and seeks to establish greater security clearance reciprocity among federal agencies. STATUS Became Public Law 113-126 on 7/7/2014. Related bill: H.R. 4681.

S. 1744

Security Clearance Accountability, Reform, and Enhancement Act, Tester (D-MT) Summary Would terminate or debar, respectively, any individual OPM employ directly or through a contract if found to be intentionally involved in misconduct affecting the integrity of a background investigation. Would automatically place on administrative leave or suspend, respectively, any individual employed directly by or through a contract of OPM during an investigation to determine whether that person was intentionally involved in misconduct. The bill would also require that contracts for background investigative services include a provision requiring the company to report any misconduct affecting the integrity of an investigation within 90 days of the discovery of the misconduct. Would mandate that the president review and update agency guidance regarding what positions require clearances every five years. STATUS Approved by the Homeland Security and Governmental Affairs Committee on 5/21/2014. Federal Information Technology Savings, Accountability, and Transparency Act of 2013, Udall (D-NM) Summary Would mandate that all federal agencies, with the exception of DoD, have only one Chief Information Officer, who would have authority over budget planning processes related to IT, programs including significant IT components, commercial items, and commercially available off-the-shelf items. Would grant each agency CIO hiring authority over personnel responsible for IT within the agency. Would designate the CIO Council as the lead interagency forum for the development and improvement of cross-agency IT-related policy and processes. STATUS Referred to Homeland Security and Governmental Affairs Committee on 12/17/2013. Related bill: H.R. 1232. Transportation Security Acquisition Reform Act, Ayotte (R-NH) Summary Would require that the administrator of TSA develop a multiyear technology investment plan that, among other things, identifies (1) opportunities for public-private partnerships; (2) TSA’s acquisition workforce needs as required for the implementation of the multiyear plan; and (3) initiatives to streamline and clarify TSA’s acquisition process for businesses of all sizes. Would encourage the authors of the plan to include feedback from the private sector. Would require the administrator of the TSA to submit to Congress a justification of any potential technology acquisition valued over $30 million. STATUS Referred to Commerce, Science, and Transportation Committee on 12/20/2013. Related bill: H.R. 2719.

S. 1843

S. 1893

30 / Service Contractor / October 2014

Professional Services Council

Bill Tracker: 113th Congress-Second Session (2014) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

S. 2247 Contracting and Tax Accountability Act of 2014, McCaskill (D-MO)

Summary STATUS


Would propose for debarment any contractor with an unpaid, seriously delinquent tax debt. Would require prospective contractors to certify that the contractor has no unpaid, seriously delinquent tax debt. Referred to Homeland Security and Governmental Affairs Committee on 4/10/2014. Related bill: H.R. 882.

S. 2286 Cutting Contractor Use and Taxpayer Savings Act of 2014, Walsh (D-MT)

Summary STATUS

Would require additional DoD reporting requirements regarding service contract inventories and would require a DoD reduction in services contracting that would bring such spending levels in line with DoD spending on services in 2002 (adjusted for inflation). Would limit the allowable costs for contractor compensation to be no greater than the salary of the President of the United States. Referred to Armed Services Committee on 5/1/2014. Related bills: S. 1192, H.R. 2444.

S. 2360

Stop Corporate Inversion Act of 2014, Levin (D-MI) Summary Would amend the definition of “inverted domestic corporation” retroactively to May 8, 2014.



Referred to Finance Committee on 5/20/2014. Related bill: H.R. 4697.

S. 2410 National Defense Authorization Act for Fiscal Year 2015, Levin (D-MI)

Summary Contains a number of provisions affecting the contracting community including provisions that clarify DCAA authority to interview contractor employees as part of an audit, expand “contracting with the enemy” provisions previously enacted, and would reform security clearances procedures.


Approved by the Armed Services Committee on 5/22/2014. Related bills: H.R. 4435. NEW

NEW Global Development Lab Act of 2014, Cardin (D-MD) Summary Would codify within USAID the administration’s recently launched program to leverage research universities and institutions to engage in the more rapid creation and scalability of foreign aid innovations.

S. 2502


Referred to Foreign Relations Committee on 6/19/2014. Related bill: H.R. 4905.

S. 2598

Civilian Extaterritorial Jurisdiction Act of 2014, Leahy (D-VT) Summary Seeks to clarify the jurisdiction of the U.S. Justice Department over contractors and contractor employees that commit certain crimes overseas.



Referred to the Judiciary Committee on 7/14/2014. Related bill: H.R. 5096.

Stay up-to-date on the state of our industry and get engaged with PSC:

Schedule a

PSC Market & Policy Briefing or a Membership Engagement Session Visit to schedule yours today! Professional Services Council

Service Contractor / October 2014 / 31

M A E “A”T

Illustration: Studio25

by Michael Ipsaro, CPCM, PMP, CCE/A, Integrity Management Consulting

32 / Service Contractor / October 2014

Professional Services Council


n the past, mission and business owners often would define their requirements, “throw them over the fence,” and then the contracting and contractor community would proceed with conducting activities to obtain and deliver the contracted solutions. The result: greater risks in execution often leading to schedule delays, cost overruns, performance problems, and even mission degradation. These risks stem from factors such as: • The need to go from idea to usable capability faster; • Rapid changes in technology; • Reduced budget levels; • A greater complexity in what we buy; • Expanded legal and regulatory compliance requirements; and • Significant changes in the workforce. When these relatively new and growing factors are overlaid on a business as usual or status quo operating model that has delivered tremendous capability for decades, but also numerous cost and schedule overruns and delays, the picture looks troubling. What’s needed is a paradigm that may seem recent to some, yet retro or vintage to others. That’s because it’s both. This paradigm revolves around three main areas and provides “point of view checks and balances” for ensuring your organization is both doing the right things, and doing things right.


The decades-old proven concepts of “big A” acquisition life cycle management and integrated product team (IPT) in formulating and implementing strategies and plans to drive results. Specifically, the importance of having an organization that leverages proven best practices from “big A” acquisition life cycle management, including the proper use of an integrated product/process team

Professional Services Council

(IPT). It should involve cross-trained specialists from multiple disciplines, such as program management, system engineering, test and evaluation, logistics, IT, budget and finance, legal, etc., as well as from multiple organizations (e.g., executive agency, oversight agency, industry). Having this type of matrixed, multi-disciplinary team can solve staffing challenges by ensuring you have the appropriate cadre of people to provide coverage for the required areas across an investment’s life cycle.


The lean and agile movements and its application to the innovation and operations challenges facing the acquisition workforce community. Folks should be well-versed in applying proven principles and practices that are reshaping and reinterpreting the nature of work (what it is, how we do it, etc.). An often perceived notion is that what is learned in one field does not or could not apply in another field. A key factor of innovation is synthesis of two seemingly disparate things, or leveraging validated learning from one area to another area.


Incorporating lessons learned from team dynamics. Since acquisition management is often referred to as a “team sport” and its success often hinges on the quality of the team, this transforming acquisition workforce should be aware of new discoveries from the evolving field of team dynamics and how to integrate them into the acquisition community.

Think big (picture) for big problems “Big A” acquisition is a systems approach to thinking about how to fulfill an agency’s mission needs. Key tenets include expanding the definition of acquisition beyond the function of contracting or procurement. This planning translates to a budget that, in many cases. covers a period decades long. In

other words, a life cycle management approach spanning “cradle to grave.” For example, think about elements such as operating and maintenance costs as well as disposal costs when defining and designing a system from inception. With change becoming an increasing constant, the need for and ability to deliver useful capability to investment beneficiaries, sponsors, and stakeholders in increasingly shorter cycles is becoming the standard. Therefore, in addition to thinking big, thinking fast becomes a mantra for organizations as they look for ways to drive return on investment (ROI) through customer satisfaction, operational efficiency and effectiveness.

Act fast so you don’t lose the big picture In the book “Lean Thinking,” James Womack and Daniel Jones tell a story of daughters competing with their father to see who could stuff envelopes faster— by folding all letters and then stuffing all envelopes, or by completing each letter start to finish one at a time. The father’s one at a time approach won even though intuitively it seems inefficient. Why? Because our intuition doesn’t consider the extra time required to sort, stack, and move around the large piles of half-completed envelopes or the fact that individual performance may not improve markedly with repetition when it’s done step-by-step versus one envelope at a time. Also, imagine the letters didn’t fit in the envelopes. With the daughters’ approach, we wouldn’t find that out until almost the end, while we’d know it much sooner with the father’s method. In acquisition, what if it turns out that the customers or end users have decided they don’t want the product? What if the decision maker or oversight group has decided your acquisition/program management-related strategy, plan or document is not acceptable as is, and needs significant changes? Which approach would permit you to learn this seminal revelation sooner? continued on page 35 Service Contractor / October 2014 / 33

PSC’s Service Contract Act Training The Service Contract Act is one of the most technically challenging aspects of competing for the award of, and successfully administering a federal service contract. SCA sets minimum pay and benefit rates for many service occupations.


The SCA affects many different decisions made by many different people in a company. Everyone, from executive leadership to proposal writers, to accountants, project managers, and human resource specialists, needs to be conversant with the requirements of the act. This course will give your staff the knowledge to be SCAsavvy in opportunity identification, capture strategy, bid/no-bid decisions, contract pricing, contract price adjustments, wage determinations, and fringe benefit calculations. PSC is pleased to offer the only SCA training conducted in partnership with the U.S. Department of Labor, Wage & Hour Division.

Upcoming sessions held at the NRECA Conference Center 4301 Wilson Blvd., Arlington, VA:

November 4-5, 2014 This course has been approved for 12.5 CLE or HRCI credits!

Visit for more details and registration. 34 / Service Contractor / October 2014

Professional Services Council

from page 33

Being fast and big Organizations of a larger scale such as Toyota, Amazon and even the Consumer Financial Protection Bureau (CFPB) in the federal government have applied lean principles to make themselves more efficient and sustainable. Specifically, applying lean principles (when suitable) to the acquisition life cycle management framework such as retooling assets to meet emerging needs/demand, experimenting rapidly against business hypothesis, and incorporating continuous feedback loops can help your organization minimize outlays of time, money, and effort that ultimately may turn out to have been wasted if that critical information arrived too late. In applying lean principles to transform organizations, existing systems often need to be reimagined and

The benefits of stopping the production line flow to find and fix problems sooner outweigh the cost.

restructured. Every investment in better systems, people, and tools accelerates innovation, speed and quality. One of the most important advantages of applying lean thinking is that quality and customer satisfaction problems can be identified much sooner. This is the origin of Toyota’s famous Andon cord, which allows any worker to ask for help as soon as they notice any problem, such as a defect in a physical part, stopping the entire production line if it cannot be corrected immediately. This seemingly counterintuitive technique is best summed up in the saying “stopping the production line in order to not stop production.” The benefits of stopping the production line flow to find and fix problems sooner outweigh the cost. It is believed by many to be the root cause of Toyota’s historic high quality ratings and low costs. continued on page 36

Spread Thin Managing SpreadSheetS? Discover Unanet, the complete project management solution for government contractors, supporting: •


DCAA Compliant Time & Expense Reporting with Federal Per Diems

Real-Time Project Reporting on Actual vs. Budget, Profitability/Costing, Employee Utilization, etc.

Billing & Revenue Recognition

For more information on Unanet, the spreadsheet terminator, visit or call 703.689.9440.

Professional Services Council

Service Contractor / October 2014 / 35

from page 35

Imagine if a tiger team type of IPT is chartered to formulate strategy and planning documentation to support an upcoming milestone decision that significantly impacts the enterprise. Suppose they create this documentation in an agile way, holding “scrum” sessions, using collaboration tools, and soliciting rapid feedback from customers and stakeholders regarding products and priorities. I’ve seen this first-hand lead to faster decisions, as document development cycles are expedited, disagreements and rationale tested and then recommendations and rationale are achieved. This reimagining of the IPT may help sustain its initial intent to speed planning and execution through integrated process and product planning development (IPPD). Understanding, appreciating, adopting and applying these lean prin-

ciples rigorously within the acquisition life cycle management community can lead to greater systemic culture change of continuous improvement and innovation, two themes that underpin the evolving Better Buying Power (BBP) Initiatives advocated by the Office of the Secretary of Defense (OSD).

There is no I in team – however there can be an R-O-I in it An IPT designed intelligently can lead to effective team dynamics that drives productivity, spurs creativity and innovation, and speeds execution. With increased focus and few distractions, people with shared goals and complementary interpersonal or intangible skills can collaborate, often in real time and with remarkable effectiveness. Building intersections like rotating assignments and cross-functional tours,

and “offline” activities or events into your organization’s cultural roadmap, fosters innovation and communication, and esprit de corps. In fact, formal and informal communication, especially the patterns of team communication and the energy supplying it, have been found to correlate with tangible positive outcomes and results. So as your organizations and clients face today’s and tomorrow’s challenges, consider an “A” team that thinks big, acts fast, and embraces collaboration. Michael Ipsaro is technical director at Integrity Management Consulting. Over 17 years he has supported a wide range of federal agencies, providing expertise in acquisition, program management and financial management. Reach him at mipsaro@

Value of thought. Value of solution. SAME VALUES. NEW LOOK. NEW WEB SITE.

For nearly 30 years, JBS International has worked across the U.S. and around the world—in health care, social services, and education—to create sustainable change that improves people’s lives. Our customized solutions leverage the latest technologies and are backed by the brainpower of in-house experts in a range of fields. Visit our Web site and contact us today to learn how we can help you!

5515 Security Lane, Suite 800, North Bethesda, MD 20852 | 301-495-1080 |

36 / Service Contractor / October 2014

Professional Services Council

What I Learned as a

by Greg Gershman, Principal and Co-founder, Ad Hoc LLC.


Photo: Dusit/


rom July 2012 to January 2013, I had the privilege to serve in the first class of a new program from the White House called the Presidential Innovation Fellowship, or PIF for short. The PIF program’s goal was to pair top innovators from the private sector with government agencies for a period of six months to a year to work on key projects. I was teamed with four other individuals with varying backgrounds on a project called MyGov (since renamed MyUSA), working with the Office of Citizen Services and Innovative Technologies team at the General Services Administration. Our task: reimagine how the government interacts with citizens. My background is in both technology (I’m a software developer) and in entrepreneurship (I’ve founded and worked for a few startups). In the private sector, the field of software development is rapidly changing. As companies like Google, Facebook and Amazon have grown, they’ve faced new technical challenges in scaling their services, requiring them to innovate technical solutions. As software development has matured, new processes, tools and methodologies arose that make the task of building services more efficient and produce better results. These new technologies and processes, while commonplace in the private sector, are less common in the government environment, for various reasons. It was these technologies and methodologies that I hoped to bring to government in my time as a PIF. My assumption was that by introducing a project into the government that used modern, open source tools and frame-

works, and by managing a project with agility and responsiveness to change, we’d introduce and help spread these new ideas into government. Those of you who’ve embarked on your own entrepreneurial endeavors in the past know that, in most cases, your first assumptions about the problem you need to solve is dead wrong. Such was the case here as well. As the fellowship project began and we created a set of tools for government agencies to use to build citizen-

facing services, I quickly realized that my assumptions on what it would take to change were wrong. While in isolation our team was quickly able to build out our toolset, as we started to engage with other agencies, and as we neared the end of our fellowship, it became clear that there was more work that needed to be done. Although we had a solid prototype, ready for beta testing, we had to find a scalable hosting solution that was both cost-efficient and provided the services continued on page 38

Professional Services Council

Service Contractor / October 2014 / 37

we were accustomed to in the private sector. Before engaging with users to get their feedback on our application flow and design, our application had to complete a security review, privacy assessment and comply with the Paperwork Reduction Act, a well-meaning law enacted well before the Internet became a part of our daily lives and which severely and needlessly limits how the government interacts with citizens. And most pressing of all, we needed to find funding and a team capable of picking up the product ownership and software development, ideally some combination of government leadership with procured technical talent. All of these things, it turns out, are huge undertakings for government. IT procurement, both for products like cloud services and technical services like software development, are incredibly complex. Raising capital for a new venture and hiring new employees, something that in the private sector has

been streamlined (it’s practically offered as a service from organizations like Y Combinator), takes months, if not years, in the government, with budgets and funding planned out at least a year in advance, if not more. Navigating the requirements to actually get an application in front of real users also takes months, and one wrong step and you’re back at square one. It became clear to me that six months was not enough time. To really see this through would take at least two years, unless the government can come up with innovative solutions to these other problems: fixing IT procurement so that agencies can get the right tools and people; streamline a new application’s path to launch to real users, without sacrifices; and have the right tools available for these kinds of services. While I remain optimistic about the future of technology in government and the value of the PIF program, what I learned from my experience as a PIF

is that it’s going to take more than just bringing in private sector people and ideas for short term stints. There needs to be a framework to enable the government to interface with the private sector in a persistent manner. It’s clear to me that government can’t do this on its own: it needs partners in the private sector it can trust to guide them, and helps them take advantage of new ideas, processes and technologies. It’s all about getting the right people to solve the right problems. If we can do that, there is a bright future ahead. Greg Gershman is principal and co-founder of Ad Hoc LLC., a company that aims to bring the best of private sector technical knowledge to the public sector. Before founding Ad Hoc LLC, he was part of the tech surge team that helped save, and was an inaugural Presidential Innovation Fellow with the White House. He’s been a software engineer and entrepreneur in the Baltimore/Washington, D.C. area for 15 years.

Make Compliance in Employee Benefits Our Job, Not Yours! Today, The Boon Group is recognized as the fringe benefits industry leader for government contractors, providing … l




Your Fringe Benefit Challenges ... Our Tailored Solutions.

Hourly major medical plans to meet government compliance/ACA requirements In-house administration to streamline the administrative processes Retirement plans through a Registered Investment Advisor Onsite wellness services to reduce costs and improve employee productivity

For guaranteed compliance solutions, turn to The Boon Group! Contact Boon Today 866 831 0847

psc spring ad.indd /1October 2014 38 boon / Service Contractor

11:55 AM Professional 3/8/13 Services Council

Professional Services Council

The Voice of the Government Services Industry

11/18/14 Washington Marriott Georgetown 8 a.m.-1:30 p.m. Registration: $150 Register today at



International development work is an ever-changing landscape of mission priorities and difficult program delivery. Couple that with the need to work with local communities, in-theater logistical issues and complicated geo-political forces and you have an industry that must operate under unique operational challenges. The 2nd Annual CIDC Conference builds on the success of our last conference as we explore the factors shaping the evolution of international capacity building and related government and international development company objectives, and the roles and contributions of international development companies supporting U.S. government agencies’ critical missions.

Premier Sponsors:

Media Partner:

Policy Spotlight

Surprise! Another Fiscal Year, Another Continuing Resolution

by Alan Chvotkin, PSC Executive Vice President & Counsel


t’s disappointing, but not surprising, that another federal fiscal year kicked off October 1 without Congress passing the full complement of regular appropriations bills. Having most of the federal government work under a “continuing resolution,” or CR, into the new fiscal year is understandable and predictable only in the byzantine world of federal budgeting, which combines significant restrictions on agency spending and the blood sport of national politics. Only two good things come of this current budget stand-off. The first is that Congress and the president agreed not to shut down the government this year. Agencies are still dealing with the fallout from last year’s painful and puzzling decision to shutter the Defense Department for four days and most civilian agencies for 16 days. The second is that there is nothing newsworthy in the fact that Congress has not enacted all of the necessary appropriations acts before the start of a federal fiscal year. Agencies and contractors have a well-worn playbook to guide their respective actions when working under a CR. We don’t like it but we do know how to deal with it. That is why, starting this past summer, we had been encouraging our member companies to begin implementing actions to minimize the disruptions that would be caused by a CR. In addition, whenever policymakers ask for PSC’s views on this state of affairs, we highlight the importance of predictability and stability in the federal budget for the agencies and contractors alike. While the levels of funding for agencies and their programs is important, in our view there is a reasonable trade to be made between slight reductions in appropriations levels in exchange for long-term authority for agencies to plan and to act. We know that agencies, businesses and individuals value having a longer duration of their authority more than they do continuously debating for every available dollar. PSC President Stan Soloway detailed our views and concerns about “crisis budgeting” in his March 2013 testimony before the Senate Homeland Security and Governmental Affairs Committee.1 We had hoped for a breakthrough in this annual stalemate when the Bipartisan Budget Act of 2013 became law in December 2013. Despite containing several objectionable provi1

sions, that law set new top-line discretionary spending levels for the federal government for the next decade and included a fixed allocation between the defense and non-defense sectors for the next two fiscal years. Although by the time it was enacted we were already three months into that fiscal year, that agreement paved the way for Congress to subsequently enact an omnibus appropriations bill that covered the balance of fiscal year 2014 for all federal agencies. It also provided the basis on which the House and Senate were able to separately pass fiscal year 2015 budget resolutions for their respective chambers in early 2014 and the appropriations committees were able to adopt their allocations to kick-off the annual appropriations cycle. Regrettably regular order has not been achieved. And we are far from being out of danger going forward. There are significant chasms still to cross to get funds to the agencies and its programs for the rest of this current fiscal year. The first will be the congressional mid-term election on November 4. The outcome of that election on some individual races, but more importantly on the party control in both the House and Senate, will dictate the immediate course of action for how Congress will address the appropriations requirements for the balance of federal fiscal year 2015. The permutations are too numerous to outline here. Then by no later than February 2015, Congress and the president will also have to again deal with the weight of the debt ceiling that will be overhanging the start of the new Congress. While annual deficits are coming down because of reduced spending and increased revenues, few good options are foreseeable for dealing with the significant debt owed by the federal government. And while the debt ceiling limit would not shut down the government, it could still have a significant impact on major elements of the government’s operations, including the ability of contractors to be paid in full and in a timely manner for their work. The challenges facing Congress and the president in federal fiscal year 2016 are even more significant. Through our “market briefings” and interactions with our members, PSC stays engaged on these congressional (in)actions, how agencies are responding, and what PSC member companies can do to navigate these issues. We are a resource to those who ask. 3

Available at

40 / Service Contractor / October 2014

Professional Services Council

MEMBER NEWS dTS Wins USAID Small Business of the Year Award

The U.S. Agency for International Development’s (USAID) Office of Small and Disadvantaged Business Utilization (OSDBU) presented Development & Training Services, Inc. (dTS) with the 2013 Small Business of the Year Award on May 22, 2014. USAID selected dTS based on its outstanding success in securing and performing USAID prime contracts both domestically and at USAID missions overseas over a period of several years.

• Ivy Ren of Springfield, Va. (Yale University) • Sonia Lee of Leonardtown, Md. (Carnegie Mellon University) • Sarah Bednar of Lansdale, Pa. (University of Pittsburgh)

The Sabre STEM scholarship program was launched in 2013 in an effort help steer students into these curriculum by helping reduce the financial barriers to attend college.

Wyle Appoints John Jordan to Lead Its CAS Group

Wyle announced in May that John Jordan is the new group president of the firm’s Huntsville, Ala.–based CAS Group. Jordan has served with Wyle and its predecessor organizations for over 30 years. Wyle’s CAS Group provides services throughout the Department of Defense, specializing in weapons system support and analysis. For the last 7 years, he has led the group’s Air and Missile Defense Systems Division, which provides full-spectrum technical and programmatic support to the U.S. Army in its oversight of PATRIOT; MEADS; Counter Rocket, Artillery and Mortar (C-RAM); Cruise Missile Defense Systems; and other weapons programs. Jordan also assumed overall responsibility for Wyle’s three test labs in 2011 and oversaw operations until their sale earlier this year.

Have a story for Service Contractor’s Member News section? E-mail Bryan Bowman at

Sabre Opens New Office in Augusta, Ga.

Sabre Systems, Inc., opened a new office in Augusta, Ga. in September. Sabre selected Augusta as its newest office location in order to support current customers in the area and to position the company for growth following the announcement that the Cyber Command would relocate to Fort Gordon.

NeoSystems Appoints Laurie Powers as New Chief Marketing Officer

NeoSystems Corp., announced in July that Laurie Powers has been appointed Chief Marketing Officer (CMO). In this newly created position, Powers will lead all corporate, channel, and field marketing initiatives worldwide. Her team will be responsible for developing and executing marketing and communications strategies to drive growth, engagement, client satisfaction, and brand awareness.

Sabre Awards STEM Scholarships to Outstanding Students

Sabre Systems, Inc., has awarded $1,500 STEM Scholarships to the following rising college freshmen in recognition of their outstanding STEM (Science, Technology, Engineering and Mathematics) accomplishments:

Professional Services Council


resPonsive legal counsel with a

strong focus on all asPects of government contracting, small business Programs,

litigation, emPloyment, and corPorate issues

PrinciPal Practice grouPs

HigHligHting: litigation

Government Contracts Law Business and Corporate Law Small Business Programs Labor and Employment Law Litigation Intellectual Property Law

• • • • • •

General Civil Litigation Contract Disputes Shareholder/Owner Disputes Defending Employee Claims Mediation Alternative Dispute Resolution

Our lawyers pursue each case with tenacity in a cost effective way. We litigate cases nationwide. Guiding growth. Securing success.

888 17th Street, NW 11th Floor | Washington, D.C. 20006 202-857-1000 |

Service Contractor / October 2014 / 41

PSC: SCENE & HEARD PSC President and CEO Stan Soloway spoke at Houlihan Lokey’s 9th Annual Market Meets Market event in May. Don Beyer, the Democratic candidate for Virginia’s 8th congressional district seat, meets PSC members at a May event. Micah Edmond, the Republican candidate for Virginia’s 8th congressional district seat, meets with PSC members in June. GSA’s Jim Ghiloni and OPM’s George Price discussed their partnership to bring a new OPM Training and Management Assistance contract to fruition, at a May PSC event. Former DHS Secretary Michael Chertoff, founder of the Chertoff Group, talks about the future of DHS and how it will affect the government technology market, at a joint PSC and Chertoff Group event in June. PSC’s Stan Soloway moderates a panel on the future of DHS and the technology market at a joint PSC and Chertoff Group event in June. The panel featured from left to right Paul Schneider, former DHS deputy secretary and principal at The Chertoff Group; Luke McCormack, DHS CIO; Craig Chambers, senior advisor for commercialization at DHS’s Science and Technology Directorate; Ben Nicholson, staff member of the House Committee on Appropriations Subcommittee on Homeland Security; and Anne Altman, general manager of U.S. Federal and Government Industries at IBM. Accenture Federal Services COO John Goodman was elected vice chair of PSC’s Board of Directors at the June Board meeting. PSC President and CEO Stan Soloway presents PSC‘s new operational model at the June Board meeting. The Board of Directors approved the model. PSC’s Technology Council Executive Advisory Board held its first meeting in June. Virginia Rep. Rob Wittman addressed PSC members at a June meeting. PSC SVP of Technology Policy Dave Wennergren gives a Market Briefing to Microsoft in July. Howard Opinsky, executive vice president at Hill+Knowlton Strategies; Sterling Phillips, president and CEO of USIS; and Jim Moorhead, partner at Steptoe & Johnson LLP, discuss strategies for responding to crises during the July Crisis Communications: Protecting Your Reputation in the Federal Market event PSC cosponsored with Hill+Knowlton. PSC President and CEO Stan Soloway moderated the panel.

42 / Service Contractor / October 2014

Professional Services Council

Problem Solved.


Large-scale programs have multiple twists and turns. If you don’t plan carefully, you can go down a few blind alleys. Integrity’s innovative acquisition, financial, and program management strategies help Federal agencies set priorities and create efficiencies that save time and money. Find the optimal path to solutions when you work … with INTEGRITY.

Professional Services Council

© 2014 Integrity Management Consulting, Inc. All rights reserved.

Service Contractor / March 2014 / 43

“We need a lender who understands that coming in second isn’t an option.”

WELLS FARGO cApitAL FinAncE Our Government Services team provides financing to support: Working capital Recapitalization Refinancing Growth turnarounds

Government contracts are unique. And so is your business. Knowing this, we strive to provide solutions that meet the one-of-a-kind challenges you face at every stage. That’s why it’s smart to put the experience, resources, and knowledge of the Government Services Group at Wells Fargo Capital Finance to work for you. We have a variety of different financing options so we can craft a solution that best fits your needs. To give your business the competitive advantage it needs to succeed, let’s start a conversation today.

Learn more at or call 703-760-6031. © 2014 Wells Fargo Bank, N.A. All rights reserved. Products and services require credit approval. Wells Fargo Capital Finance is the trade name for certain asset-based lending services, senior secured lending services, accounts receivable and purchase order finance services, and channel finance services of Wells Fargo & Company and its subsidiaries. WCS-1180684

Profile for Professional Services Council

PSC's Service Contractor Magazine - October 2014  

The Next Move: Aligning Acquisition for the Future

PSC's Service Contractor Magazine - October 2014  

The Next Move: Aligning Acquisition for the Future