2013 - Defense Authorization Act - Small Business Contracting Reform Signed Into Law

Notable Contracting Provisions In The NDAA:
• Enforces existing small business contracting goals by requiring that meeting the goals be a part of senior agency employee reviews and bonus discussions. The federal government has missed the 23% small business goal for six consecutive years.
• Changes limitations on subcontracting from cost to price, which will make it easier for small businesses to comply with procurement rules, while also allowing them to team together to pursue larger contracts.
• Prevents contracting fraud by placing penalties on violating limitations on subcontracting, and makes it easier to suspend and debar companies intentionally defrauding the government.
• Helps woman-owned small contractors by removing the set-aside caps on the women’s contracting program.
• Requires the SBA to develop size standards that accurately define what is a small business for each of the over 1100 industries where small firms operate, instead of allowing SBA to continue taking short cuts for its own administrative convenience.  
• Gives small business a “safe harbor” if they acted on a written advisory opinion from either a Small Business Development Center or Procurement Technical Assistance Center and violated a rule by mistake. 
• Brings transparency to insourcing decisions by requiring OMB and agencies to publish procedures, methodologies, and guidance documents associated with the decisions.
• Fights contract bundling, the practice of grouping several contracts together for bidding, thereby making it difficult for small businesses to compete. The law requires additional oversight and a report that will analyze whether contract bundlings are justified.

The Cold Harsh Reality - Veterans Unemployment

I wanted to take the time to share this information with you about Veteran unemployment from the Department of Labor & VA. As of August 2, 2013, the Bureau of Labor Statistics release the below unemployment data.  The "cheat sheet" was released by the Deputy Under Secretary for Economic Opportunity at the VA and the following are key data points:

National:    7.4% (down .2%)

All Vets:     6.4% (up .1%)

Post- 9/11: 7.7% (up .5%)

The cold harsh reality is that Veteran unemployment will be increasing over the next few years because of another reduction of forces.  Many Veterans do not have the skills, education, and certifications to qualify for the jobs they are presently performing on Active Duty or in the Reserves today.  As government contractors or as commercial employees, their skills need to transform from military to civilian.  There are many outstanding companies offering training and educational opportunities for Veterans (e.g. CISCO, Google, NetAPP, Amazon, Solar Industry, and many more). 

In my line of work "government contracting", I try to hire Veterans because I'm a Service Disabled Veteran (SDV) who owns a Service Disabled Veteran Owned Small Business (SDVOSB) but the Department of Defense (DoD) makes it difficult.  My company tries to hire veterans but another cold hard reality is that DoD and some other Federal agencies have been telling industry (indirectly) NOT to hire veterans based on the educational and certification requirements being placed in solicitations (e.g. RFQ, RFPs) documents.  When contracting officers & Program Manager (PMs) state that certain educational requirements and mandatory certification requirements are required on day 1 of a contract for contractor personnel (although some directives may give up to a year in some cases), Veterans (e.g. Retired, Separated, Service Disabled, Wounded Warriors, etc.), are negatively impacted because Small Businesses may not immediately and cannot immediately invest in Veterans training and certification until they are hired and on the payroll. 

The cold harsh reality is that many of the companies mentioned above provide training but the Veterans completing these programs may  not have the formal education or experience in many cases to even qualify for the jobs they were doing while on active duty.  Many are trained, few can find employment and even fewer can qualify for may positions described in many solicitation documents.

Please take a look at this cold harsh reality below on the Top 10 Federal Agencies for FY2012. The DoD does not have a "Veterans First" contracting strategy nor are there any incentives available for companies supporting the DoD to hire Veterans and especially "wounded warriors" or "service disabled Veterans." Hiring Veterans could be a requirement in contracting strategies or sub-contracting plans but it seem it is easier to increase Veterans TRICARE (Healthcare) cost and reduce benefits than to hire Vets.  Between congressional actions and DoD leadership, this can be fixed if we want it fixed.  The cold harsh reality is that it takes congressional action and DoD to create Veterans, Service Disabled Veterans, and Wounded Warriors. 

Top Ten Federal Agencies (SBA)             Rank/Agency                                                          FY’12 Dollars 1. Department of Defense                                              $274,625,161,617 2. Department of Energy                                               $24,562,882,765 3. Department of Health and Human Services              $18,461,515,353 4. Department of Veterans Affairs                                $17,335,860,700 5. National Aeronautics and Space Administration      $13,418,655,917 6. Department of Homeland Security                           $12,700,335,305 7. Department of Justice                                                $5,847,014,555 8. Department of Agriculture                                        $5,332,720,225 9. Department of Commerce                                         $3,261,832,708 10. Department of State                                                 $3,166,122,178   Percent of Small Business Prime Contracts FY 2012 (SBA) 1.   Department of Agriculture                                     52.9% 2.   Department of State                                                  39.1% 3.   Department of  Commerce                                        36.8% 4.   Department of  Veteran Affairs                                35.1% 5.   Department of Homeland Security                           31.0% 6.   Department of Justice                                               29.7% 7.   Department of Health and Human Services             22.4% 8.   Department of Defense                                             20.4% 9.   National Aeronautics and Space Administration      19.3% 10. Department of Energy                                                5.1%

Veterans don't want hand-outs, they want to continue to support this "Republic" with dignity, honor, and respect.  They also deserve more than ribbons and badges for serving their country.

I do not know of any company that want to provide substandard personnel to support any government contract but the Veterans or Wounded Warriors currently doing job that are now being filled by contractors should be provide hiring preference and companies should be provided incentives for hiring Veterans and especially Wounded Warriors.  My goal is to reduce veteran unemployment and also help to educate everyone on this cold harsh reality.  I commend those Generals and Senior Executives who would advocate on behalf of Veterans (including wounded warriors); however, when Post 9/11 Veteran unemployment goes up by .5% the reality is that there is not enough being done to transition Veterans to be contributing citizens.  Actions matter more than words.  It is a cold harsh reality when Senior DoD leaders chooses to cut military personnel tuition assistance programs instead of fixing or terminating underperforming projects and programs.  

The cold harsh reality is that supporting Wounded Warriors at retreats, baseball games, or entertainment event is a noble gesture; however, changing existing policies (e.g. Federal Agencies should have a  Veteran First Policy for "certified" SDVOSBs, Incentives should be provided for companies that hire Service Disabled Veterans or Wounded Warriors, Government should not be raising the qualification bar higher that those expected of the personnel currently doing the work being contracted out if there are no performance issues) to enable Veterans to continue to contribute to society and GET A JOB after leaving the military is the ultimate OUTCOME expected as we give back our defenders to our society. 

The cold harsh reality is that many Veterans don’t plan proactively and the transition organizations and services available are not adequate.  As an employer, trying to hire more Veterans, I would like to have access to an online repository of Veterans and their resumes.  DoD can setup something like www.indeed.com for transitioning Veterans where employers can search and find qualified veterans based on their capabilities but will only be able to contact the Veteran if they (the Veteran) respond to the employer with their contact information.  This is simple and it works.

This e-mail is in no way meant to harm any agencies efforts but the cold harsh reality is that Veteran unemployment is going up.  As a small business owner, I spend about 5 hrs each week helping Marines re-write their resumes to make it attractive to employers in order to qualify them for employment and while I enjoy supporting ANY veteran, we should afford veterans the ability to attend transition classes at least 3 years before retirement and 2 years before separation because the transition process is not always easy.

As the President of the Defense Acquisition University Alumni Association for the National Capital Region, I’m seeing that senior military leaders and civilians are also leaving government service and realizing the challenges of getting a job in today’s environment and I hope they realize that their subordinates also need to prepare for their transition.   

 

July-13
Unemployment
Cohort (% of total)	Rate		Change	Level		Change
National	7.4%		-0.2%	11.5M		-300,000
>27 Weeks		4.2M			-100,000
All Veterans (100%)	6.4%		0.1%	702,000		15,000
Male	6.4%		0.3%	610,000		31,000
Female	6.6%		-1.0%	92,000		-15,000
Post-9/11 Veterans (24%)	7.7%		0.5%	166,000		6,000
Male	7.7%		0.9%	138,000		13,000
Female	7.7%		-1.2%	27,000		-9,000
18-24 Veterans* (4%)	17.4%		-3.1%	28,000		-6,000
Male	20.4%		-4.9%	24,000		-6,000
Female**	8.3%		-	3,000		-
25-34 Veterans (13%)	6.8%		1.2%	93,000		17,000
Male	6.6%		1.8%	74,000		20,000
Female	7.8%		-1.4%	18,000		-4,000
35-44 Veterans (19%)	6.4%		1.0%	133,000		21,000
Male	6.1%		1.4%	104,000		24,000
Female	7.8%		-0.5%	30,000		-2,000
45-54 Veterans (23%)	5.7%		-0.6%	162,000		-12,000
Male	5.4%		-0.7%	131,000		-13,000
Female	7.5%		0.1%	31,000		1,000
55+ Veterans (41%)	6.4%		0.1%	287,000		-4,000
Male	6.7%		0.3%	277,000		5,000
Female	3.0%		-2.4%	10,000		-9,000
* 9,000 enrolled in school (32% of all unemployed 18-24)

 

Semper Fidelis,

Should be government be in the cloud broker business?

NO; however, it must play a significant role now in order to gain later.

 

I’m convinced that in order for the Shared Services “aka Cloud” Broker to be effective and efficient along with providing cost savings to the consumer, the brokered service(s) must be a commodity or treated as a commodity.  Providers of current commodities do not have a vested interest in this strategy; however, if the government can define business objectives that can be supported by industry defined standards, interface specifications, and Government Service Level Agreements (w/ industry partners)  then we will see progress in cloud computing and realization of true cost savings.  I also believe that the cloud broker will be limited by the procurement and acquisition systems that the government has in place.  Most procurement and acquisition systems, in government, lack the agility to keep up with the pace of IT transformation or provide a franchisable methodology for leveraging the rapid acquisition of “scale-able” aka “pay by the drink” share IT services across government.

Case Study:  http://www.nextgov.com/cloud-computing/2013/02/defense-and-intelligence-community-pursue-conflicting-cloud-plans/61249/?oref=nextgov_today_nl#disqus_thread

The Defense Department's "joint information environment" and the intelligence arena's "intelligence community information technology environment" share the same goal of decreasing costs and increasing security by shifting work to applications accessible on any device.  The two setups, however, are being constructed separately and differently.  "To date, implementation of their respective IT and telecommunications visions has consumed significant personnel and financial resources. This has limited the ability of both to coordinate their respective efforts to ensure complementary, mutually supportive efforts,"

The government should not be in broker business; although, I understand temporarily that it has a leadership role until it is able to more clearly define its business requirements and objectives to the industry at large.  Industry will drive the innovations yet to come based on the defined business objectives, priorities, and measures articulated by government leaders.  The government cannot afford to remain focused on "blinking lights" but should be focused on business objectives and defining its requirements.

The "Chief Information Officer must evolve into the Chief Innovation Officer" who is focused on leveraging technologies “ for business value.  The broker’s role will be significant in the next few years of IT evolution.

 

If you are interested in learning more about how industry and support the business objectives of the government, contact me and we can discuss.

 

Chris Beckford

www.etranservices.com

Buying Cloud Services vs. Buying Dinner - What's the difference?

Today, a couple walked into a restaurant (SERVICE PROVIDER) for dinner, the door greeter (BUSINESS DEVELOPER) was kind and polite as he walked them to their table (FACILITY).  The waiter then presented the couple with menus (SERVICE CATALOG) so they can buy what they want (CONSUMER).  Each member of the party ordered from the menus with an expectation that the food (PRODUCT/SERVICE) will be on-time and delicious (SERVICE LEVEL AGREEMENTS) and because of the restaurants (BROKER) reputation – the food must be great (PAST PERFORMANCE).  The Agency Director ordered chicken and the CIO said “I’ll have chicken also” to the waiter (BROKER’S REPRESENTATIVE).  They both engaged in a conversation about cloud computing and supply chain logistics.  Ten minutes later, the waiter brought out chicken for the CIO and the Director.  As they began to eat (CONSUME THE PRODUCT/SERVICE), the CIO said “my chicken is outstanding” and the Agency Director replied, “My chicken taste different from what I was expecting (REQUIREMENTS) and I’m starting to feel sick.”  The waiter commented that “he did not know why there was an issue with the way the meat tasted” because you got exactly what you ordered (STATEMENT OF OBJECTIVE).  I can deduct the price of the meal (SERVICE MANAGEMENT) or I can call the poison control (INDEPENDENT AUDITOR) if you believe you have food poising.  While they were waiting, the waiter asks if they were paying by cash or check (CONTRACT VEHICLE) and for them to ensure payment is made to the restaurant via the cashier (CONTRACTING OFFICER) for the service provided. 

The fact is that the chicken came from farms, both were cooked in the same kitchen, and both served by the same waiter.  So, how could there be such a drastic difference in taste?

Some Possible answers:

- A problem with the ingredients (CARRIER, FACILITY, INFRASTRUCTURE, PLATFORM, OR SOFTWARE)

- The chickens came from different farms (PROVIDERS) - one inspected recently by the FDA and the other was not (STANDARDS)

- One was fed hormones - the other was not (SERVICE INTERMEDIATION)

- One had freezer burn - the other was fresh (AUDITS)

- One was cooked by the chef (PRIME CONTRACTOR) and the other by the apprentice (SUB-CONTRACTOR) but who cooked what!

Comment: For any number of reasons, buying products or services without an Enterprise Architecture and some level of understanding of the supply chain logistics can be risky

Small Business Set Aside for Simplified Acquisitions Takes Priority Over FSS

Companies should be aware that http://www.sba.gov/sites/default/files/files/L_Field%2001_21_12-%20attch%202.pdf small business set asides are mandatory for acquisitions valued from $3,000 to $150,000 and take priority over GSA Schedule contracts, although a contracting officer can set-aside an order for small businesses

The simplified acquisition and subcontracting thresholds are among several acquisition ceilings that will increase on Oct. 1, 2010.  The Federal Acquisition Councils issued a final rule today detailing several changes, including increasing the simplified acquisition threshold to $150,000 from $100,000.
The simplified acquisition threshold governs when agencies can buy products or services more quickly, more economically and with a focus on small businesses.
In another significant change, prime vendors will have to submit subcontracting plan on all contracts worth more than $650,000 instead of $500,000.
The FAR Councils state that the final rule doesn't change from the proposed rule issued in February.
Other changes in the final rule include:

• The FedBizOpps pre-award and post-award notices remain at $25,000 because of trade agreements.
• Commercial items test program ceiling is raised from to $6.5 million from $5.5 million.
• The cost or pricing data threshold is raised to $700,000 from $650,000.
• The Miller Act threshold is raised by this rule to $150,000 from $100,000. The Miller Act requires payment and performance bonds when agencies acquire construction services at rates higher than the threshold.

Companies should be aware that http://www.sba.gov/sites/default/files/files/L_Field%2001_21_12-%20attch%202.pdf small business set asides are mandatory for acquisitions valued from $3,000 to $150,000 and take priority over GSA Schedule contracts, although a contracting officer can set-aside an order for small businesses..

Insights from Steven VanRoekel, the United States CIO

I had the privilege of attending the January 13, 2012 “Fireside Chat: Insight from Steven VanRoekel” and it was an outstanding discussion.  Darren Ash (NRC’s CIO) interviewed Steve in what could be described as one of the most straight-forward conversations I’ve seen in a while with a senior executive.
 

Below are my notes from the event (they are not word for word but captured so that I could frame the conversation based on my mental model)

 

Consumer Electronic Show - What did you see that would impact government?
- 3d visualization, telework, warfighting, connecting people to people, ***Spectrum Challenge - policy need changing, impact on mobility, & spectrum needs to be optimized

 Announcement of the Mobility Roadmap @ Consumer Electronic Show - impact on government
- Think about how to economically acquire (via streamline acquisition) and use mobile devices
- Government should foster applications and not necessarily build applications - Nitin at FAA is a great example

 How will be mobility strategy impact agencies that are ahead of the mobility strategy?
- In 12 months the government should be addressing the applications for mobility
- Apps need to be device agnostic
- Collaboration between agencies is the objective

What can industry do to help government? - Participate in the national dialogue - support AFFIRM & IAC/ACT forums.
- April 2012 - CIO will be kicking off industry activity and getting feedback for the mobility roadmap - gov need help flushing out implementation
- Standards are important- need help to establish standards and drive open standards development (e.g. api)
- Authentication on desktop, mobile devices and BYOD using standard access means needs to be standardized

 What was the White House announcement for today? - Program to streamline government interaction with industry ( have an outside in looking perspective)
- Call on Congress to act (1 new agency and the SBA administrator will be on the cabinet also) to support a consolidation of commerce agencies
- A call center (1800-FED-INFO) for information rather than 20 agencies
- Meta-tagging information is important as a way of doing business
- Focus on the growth of small business

 Talk about the 2 day Federal CIO Offsite - Focus on the perspective on the CIO council & its priorities - Offsite was focused on 2012 and what needs to be accomplished
- Cloud, cyber security, mobile, application development, shared first strategy across government

 Discussion on the 25 Point Plan - The plan has too many #1 priorities; however, each agency is at a different stage of maturity
- Focus on government should be on "continuous improvement"
- Priorities should be focused on the mission of the agency - this is where prioritization starts
- Acquisition strategy and competition should be focused on the strategic objectives of the government and not necessarily price

What's the #1 thing that surprise you as the FED CIO? - technology plays a role in every budget issue and consideration - personal attendance at each budget discussion
- difference between politics and government - focus on making America great

How can industry help the Federal CIO? - Help the government shift to being a platform provider
- Critical areas are: cyber, FedRAMP, mobility, enabling the shared first strategy

 Any key messages for the audience? - Agile development relies on industry and industry should push the government to the next level
- Pressure congress on technology issues

- Q&A Session - Government CIO should form strategic relationship with key vendors that understand their performance requirement and objectives
- Focus on analytics to justify changes in the government and support actionable strategies
- Transparency is critical to letting business leaders understand what IT do for them
- Focus on Semantic web capabilities when developing website - don't use the org chart - focus on data and meta relationships