Contracts executives craft the terms by which companies both win and execute jobs. They develop contracting policies that mitigate risk and balance regulatory requirements with customer demands and resource realities. Without them, there would be no business.
How do contracts executives see this role, and how do they envision it moving forward? The current landscape of change, challenge, and opportunity frames many answers to these questions.
Mission Critical Job
Mastering the fine details of FFP, CPFF, T&M, and IDIQ; advising on legal complexities; and making sure proposals and agreements include the appropriate terms and conditions are only the beginning of a contracts executive’s task list in today’s federal contracting world.
A typical day might also include:
- Government relations—testifying before Congress on proposed rules and regulations
- Customer relations—meeting with clients as part of overall efforts to maintain and grow the relationship
- Risk management—implementing policy and procedures to ensure compliance with applicable regulations
- Quality assurance—making sure project teams are able to fulfill essential tasks
According to Carl Salzano, senior vice president for acquisition services at Booz Allen Hamilton, “Leaders must ensure strategies are in place to effectively deal with the imposition of increasingly burdensome regulatory requirements and oversight, lead risk management and contingency planning, and develop approaches to optimize all aspects of deal formation.”
“You do not want to give the client any reason to not exercise the next option or terminate the contract early,” said Lora Drewer, senior vice president and corporate director for contracts and procurement for CACI International.
A number of factors in today’s GovCon environment are making this task more and more challenging.
Constraints Up the Ante
Even before the GSA’s spending issues earlier this year, GovCon firms were feeling the pressure to prove their value and run an impeccably compliant shop. President Obama’s March 2009 memo ordering the Office of Management and Budget to lead an in-depth review of government contracting efforts was the first of many measures impacting the scope, structure, and oversight of government contracts.
Self-reporting rules and clauses tied to stimulus projects, monthly requirements to update the FAPIIS database—the increase in contracting’s complexity is reflected in all aspects of executives’ duties.
The current climate of heightened scrutiny and constrained government acquisition resources has turned the GovCon landscape into a real-world Hunger Games, with scarce resources and brutal struggles to survive ruling the day. Bid preparation times have shortened from nearly a year to 90 days. Meanwhile, bid protests both stretch out procurement timelines on the other end and increase the cost of participating in federal procurements—and recent GAO figures report an 18 percent increase in bid protests, taking these to the highest level since 1995.
“Clients are asking us to adapt to new budget realities, as well as challenging and changing mission requirements, faster and more creatively than at any time in the past,” Salzano said.
In this environment, according to Rajesh Natarajan, executive director of global customer solutions with AT&T Government Solutions, “contracts executives are called upon to assist with setting strategies that maximize the use of existing contract vehicles, rather than strategies to win business under new contract vehicles.”
When new business pitches do happen, it’s often a multi-party affair the contracts executive needs to orchestrate. “The contracts executive must demonstrate flexibility in working with other firms to structure contracts creatively to allow teams of companies to pursue business opportunities,” Natarajan said.
To help proposal staff stay sane and effective during the inevitable RFP crunch, he advised that “contracts executives can be advocates for focused bid teams, developing business opportunities in advance of the bid process. A contracts executive must help to shape corporate strategy to thrive in an environment with shorter bid timetables.”
“Businesses must proactively manage the entire acquisitions lifecycle—from capture to delivery—to excel in the current marketplace,” Salzano said.
Meeting more reporting requirements with fewer resources. Fulfilling the demands of regulators and customers. Contracts management requires a careful balance of all this and more. “Today’s contracts executives must understand many different contractual and legal standards and possess intimate knowledge of overlaps and contradictions between those requirements,” said Scott Pospichel, director of contract management for Accenture’s U.S. Federal Client Service Group.
Contradictions also exist in government’s drive to simultaneously cut costs while fostering innovation. Cutting-edge solutions generally demand a highly skilled workforce and often entail never-been-tried solutions that are difficult to scope. Yet an overworked, understaffed government acquisition community is moving toward contracting strategies that are easily evaluated and implemented. Such a commodity pricing approach can negatively affect the staff quality a contractor can offer and the results that can be achieved.
The trick, according to Drewer, is expectation management. Make sure clients understand what can be reasonably accomplished under such a mechanism. Concurrently, make sure one’s colleagues on the project team execute upon these contract demands as flawlessly as possible.
“Contracts executives need to work closely with their technical counterparts to ensure that requirements are understood, deliverables are timely and accurate, and the client is completely satisfied with performance,” Drewer said. “This is how you keep the business you have and maintain a past performance record that is going to help you continue winning business in the future.”
Communication, Creativity Are Key
Navigating through increased oversight and scrutiny demands sharp communication skills, according to Drewer. This ranges from connecting with government counterparts to ensure mutual understanding in an atmosphere of trust to effectively relaying an ever-evolving array of relevant regulations to fellow executives and employees. “You need to be a team player,” said Mark Connel, vice president and executive director for contracts, procurement, and subcontracts at SRA International.
Drewer also cites creativity as essential for dealing with situations that would have been unheard of even 10 years ago—for instance, equipping and managing an increasingly mobile workforce. To be successful, contracts executives need to think outside of the box.
For Connel, the goal is “continuous process improvement that responds to the changing environment.” One ingredient that makes achieving it easier: the knowledge that you’ve been there, done that, and survived before. “We’ve seen similar situations in the past—situations where the market has faced increasing competitive pressures,” he said. “Experience is worth its weight in gold.” GCE
Keeping Talent Up to the Task
Contracts executives frequently cited hiring, maintaining, and managing a contracts workforce among their top challenges. What’s more, as many senior contracts professionals reach retirement age, their successors are in many ways entering a brave new recruitment and training world.
Said Natarajan: “As a new generation of contracts personnel enters the workforce, the contracts executive must be adept at using multiple approaches to retain personnel through employee development, accommodating different work styles and work/life balance.”
Companies must be prepared for talent changes on the client side as well. “As federal agencies confront a changing workforce—due to attrition, retirement, or downsizing—the industry must build and maintain relationships with newly hired or newly trained acquisition teams,” Pospichel said. “This may cause delays in pre- and post-award actions as new people learn a complicated contracting environment.”