As the government increasingly outsources its IT projects to
contractors, I became interested on how companies become contractors and
navigate the contracting process as well as issues in the current contracting
landscape today. The Federal
Acquisition Regulation (FAR) contains many rules for government contracting in order to prevent corruption. There are also certain requirements that have been set:
-
Government
purchases from $3,000 to $100,000 must be go towards small businesses
-
23
percent of all contracts must be directed to small businesses
-
Contractors
must meet standards for safety and wages and keep track of their costs
-
Agencies
can purchase items with a credit card if it is below a certain amount. Above this amount, they must issue RFPs and
receive competing bids.
In order to become a contractor to the federal government,
companies have to do several things:
-
Figure out which and search for which agencies desire
their product. If it is a routinely
purchased item, it appears in the GSA schedule.
If it is a bid worth more than $25,000, it will appear in FedBizOpps.gov
-
Meet “Past Performance” requirements and respond in
time to bids
-
Receive a DUNs number, enroll in CCR, and be classified
as a business in the NAICS – if a business is small, minority or veteren-owned,
it can be to their advantage
-
Decide whether to be a subcontractor to a larger
contractor, or, if you are a large company, decide how to do small business
subcontracting. In order for businesses
to win contracts more than $550,000, they must include small businesses in
subcontracting.
-
Gain customer and competitive intelligence in order to
win contracts; network and lobby with government procurement officers and
attend procurement conferences; use procurement consultants to help win bids
After learning all this information on government contracting,
I wondered what were ways the process could improve and found this blog post
from the Sunlight Foundation (link is below) about how IT project
contracting. Several ways to improve are
recommended such as:
-
Open source software could be an alternative to
proprietary software and there should be guidelines from OMB on how it can be
used within government
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Reducing the past experience requirements for
contractors
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Having ways to effectively evaluate and do analysis on bids
to “to better understand where the biggest and smallest capacities lie in the
government contractor sector, which solicitations are likely to get more bids
and thus require more reviewing capacity, and which solicitations require more
publicity to get a broad set of competitors.” In addition, this bid analysis could identify
companies whom have had a bad performance record or other violations to make it
easier to sort through bids.
-
Reducing the requirement of the government to have to
be legally justified in rejecting a company and the ability of a company to
protest with GAO
This article was very interesting to read especially on how
with more analysis and data sharing about contract bids, it could be much
easier to choose contractors and create improvements. I also wonder if small business requirements
in contracting are helpful to the system.
It will be interesting to see if all the publicity from Healthcare.gov
will spur changes in the future.
Sources used:
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