For Federal Contracting Success, Backcasting Works As Well As ForecastingPosted: October 9, 2013
This is a guest post by Judy Bradt, CEO of Summit Insight LLC and author of Government Contracts Made Easier. For 25 years, Judy has worked with her clients on business strategies to win government contracts. Judy blogs at http://blog.summitinsight.com/.
What do you mean by backcasting, and how is it different from forecasting?
Backcasting is really a combination of research with imagination and extrapolation that gets out ahead of the funding cycle. Federal agency forecasts are based on near-term budgets, sometimes already approved and sometimes just requested. Forecasts don’t always guarantee a procurement will take place, but suggest a high likelihood if funding proceeds as planned (which gets riskier every year).
Most forecasts deal with the current fiscal year, sometimes two. But on some procurement you might only get five or six months’ notice. Even though that can sound like a lot of lead time, it’s often not enough to design a bid for more complex projects or bigger requirements, or to develop the relationships you’ll need to position yourself to win.
Often, chances are good that whatever the government is buying now, or doing now, they’ll probably be doing more of it later. Backcasting is about anticipating and positioning your company for future opportunities based on current projects.
Backcasting, combined with forecasting, can get you out ahead of the game, by looking at contracts already in place and checking the expiry dates on those contracts; you’re essentially working backwards.
Let’s say you’re interested in a big project you want to develop for your company. You know it may take a couple of years of lead time. The agency only gets funding one year at a time so it’s not in the forecast yet, but what you want to provide is aligned with the agency’s primary mission. There’s already a related or precursor contract in place. You know there will be another acquisition, but it’s so far in the future that the agency’s not saying when. You can look to see when the contract expires with the agency you want to work with, for the work you want to get the follow-on for.
If the contract is expiring in late 2015 or 2016, you can build relationships long before the requirement comes out. That’s the advantage backcasting gives you: You’re building relationships before a contract is forecasted or announced.
Know your precursors – what are the common activities/purchases that usually happen in the months and years before someone hires you?
For example, let’s say you’re in the interior design business, or own a small general construction company. After the construction of a new office building, at some point the agency will be buying furniture, artwork, and office equipment. Later, they’ll need renovations and repairs. If you want to start loading your pipeline with possibilities for interior design or renovation contracts a year or two down the road, one way to do it is to start tracking the construction projects in the regions where you want to do business. Then watch for those contracts and be ready.
The goal of your research should be to find no more than three agencies whose problems are the best fit with your past performance, i.e., the problems you’ve shown that you know how to solve.
Who is the incumbent contractor? What type of contract process or contract vehicle did they use? If the federal agency you want to do business with uses GSA schedules and you don’t have one, you’d better get one or get access to one, or another multiple award or government-wide acquisition contract (GWAC).
Once you’ve identified your three prospective agency customers, set priorities and start looking for points of contract and those five key people you need to meet in any agency. I’ll lay out other steps of the bidding process in a future post.
Backcasting is what winners do – it helps contractors identify opportunities and build relationships with the lead time it takes to be competitive. With backcasting and a smart contact development program, successful contractors are positioning themselves for the win long before the contract is published or a notice is published that there’s going to be a competition. It’s a significant competitive advantage used by all successful companies, large and small.
What specific research should federal contractors be doing?
That varies a little, depending on what products or services you sell. Every company will get some insight by starting with the Federal agency forecasts published at Acquisition Central. There, you’ll see who has money to spend.
If your company offers products or services to customers in the commercial (non-government) market, you’ll also want to research whether your target buyers are purchasing through GSA Schedule Contracts. If so, I’d recommend two other research sources. First, at US General Services Administration, look at existing GSA Schedule Contracts to see where your products and services will fit in.
Then – and this is resource many people don’t know about – you can check out the GSA Schedule Sales Query (SSQ) System, where you can see sales stats for every GSA Schedule contract holder – including those who aren’t successfully selling anything.
Then we get to the heart of backcasting: USASpending.Gov. Here’s where you can look at past contract awards to assess buying trends. You “backcast” future opportunities by looking at when the current contracts will expire. For projects that are coming up for renewal, you’ll want to find out all you can about the incumbent contractor who’s providing the service now, look into possible competitors on the recompete, consider how small business certifications might play into your choice of potential partners, and get started on researching the buyers and decision influencers in the federal agency.
For precise instructions on how to get started on this research in less than two hours, I’m happy to share my free white paper, Four Easy Lessons in Free Federal Market Research. Please complete the contact form below so I can send it to you right away.
Thanks for another informative article, Judy! Stay tuned for the next post from Judy, where she’ll lay out the steps of the bidding process. Here’s the form where you can request Judy’s white paper: