The U.S. government is the largest technology buyer in the world, spending ~$100B annually on IT year in and year out. This month, because our clients are increasingly asking us to include the federal market as part of our growth strategy engagements, we invited Kevin Robbins from our Federal Market partner Wolf Den Associates to share his insights.
For commercial technology vendors, the time has never been better to get a piece of the federal pie. To speed innovation, cut cost, and improve mission performance, federal buyers are rapidly moving from proprietary systems to commercial technologies. As Deputy Defense Secretary Robert Work recently stated, “In order to sustain technological superiority, the department must take advantage of the rapid evolution of emerging commercial technologies.”
Unfortunately, you cannot just roll up to a federal agency, knock on the door, and make a sale. Many companies have spent millions with little success because they didn’t understand the unique federal buying habits. In contrast, the ones that have learned to successfully navigate the federal procurement process have been richly rewarded.
So what does it take to be a winner in the Federal market? Here are the 4 things you must know.
1. It’s the Mission, not the Quadrant:
Unlike the private sector, where the vendor with the best technology is often the winner, federal customers are much more interested in vendors who can provide full solutions to their specific domain challenges. Each federal customer has its own unique mission and, because of their historic orientation on custom technology, bespoke IT infrastructure. What they look for are vendors who understand their mission and can help them achieve it by delivering solutions that fit into their existing environment. As a result, building, buying, or renting customer domain expertise and mission familiarity will drive far more results than fine-tuning where you fall in a Gartner Magic Quadrant.
2. Enter Through the Side Door:
Because of the buying complexity and nuanced solution requirements, the front door is usually not the best way in. Small fortunes have been squandered trying to buy access – through Rolodexes-for-hire, rent-a-Generals, and lobbying efforts – when the best way in is through the existing channels. Prime contract holders and systems integrators play the critical roles of gatekeepers and influencers to federal buyers and courting them portends a much higher return on investment.
3. Your Solutions Must Be Compliant:
To start, federal buyers cannot purchase solutions that are not compliant with applicable federal standards, which differ by agency, product category, etc. These standards vary from accounting requirements (SF1408 certificate, DCAA approved rates, approved purchasing system) to quality and technical standards (ISO, CMMI, ITIL, PMP), and regulatory matters (NISPOM, FCPA, ITAR). Start by determining if you can clear these hurdles at the outset before burning calories on pursuing any opportunities.
4. Be Patient:
In the federal market, sales cycles are measured in quarters and years, not days and months. If you have a 90 day mindset or mandate, this is not the place for you. Target RFP release dates slip to the right, adjudication of awards can take months, and lengthy post-award protests are very common. That said, the potential rewards more than justify the effort.
It is easy to get discouraged by the federal government’s idiosyncratic buying rhythms and the antibodies it appears to release to keep out newcomers. Don’t be. This is the largest technology market in the world and buyers crave commercial technologies to speed innovation, cut cost, and improve mission performance. Getting your share of it requires tailoring your offerings to mission needs and working within the existing channels. It isn’t easy, but the rewards are worth it.
Need help building your federal business? Contact us at email@example.com or contact Wolf Den directly at firstname.lastname@example.org.