Judy Bradt is CEO of Summit Insight LLC and author of the new book, Government Contracts Made Easier. For 25 years, she has worked with her clients on business strategies to win government contracts. Judy blogs at http://blog.summitinsight.com/.
I asked Judy to tell us more about her seven steps to success in government contracts, which we’ll do as a series of posts.
Bill: What are the seven steps to success in government contracting?
Judy: The seven steps are: strategy, focus, process, competition, teaming, relationships and marketing.
Bill: Which step or steps do you find most business owners missing?
Judy: Strategy is the thing many people forget – they never think clearly about whether federal business is good business for their business. Focus is the thing people do least well, and is the most costly to skip.
Bill: Can we go into more detail about each step, why it’s important and what actions people should be taking?
Judy: Sure, we’ll start with strategy.
Success in Government Contracts – Step #1 – Crafting Strong Strategy
It’s all too easy to get lured by enthusiastic marketing events. I often hear presenters say, “Gee, small businesses should run after federal contracts,” and, “Look at all of these set aside programs!” This language seems exciting, engaging and magical to smaller companies seeking opportunities. You’ll notice that Federal agencies and Procurement Technical Assistance Centers (PTACs) are also enthusiastic, but temper their counsel with a strong emphasis on where to get the facts and stats and how to develop strong and patient processes, and they urge company owners to review the information carefully and make wise decisions that make good business sense.
Yes, the federal government buys almost every product and service on earth. Still the question every business owner must ask is, “Does the world’s biggest client represent good business for my business, and is my company ready to tackle the investment of time and money that success will take?”
For example, recent studies for the American Express OPEN for Government Contracts Victory in Procurement (VIP) for Small Business Program report that in a study of 740 companies new to the federal market, there was an average expenditure of over $130,000 annually, and between 18-24 months of effort on the way to that first contract. Those kinds of statistics are sobering, and they should be.
Before a company launches into a pursuit of federal opportunities, they’d be wise to look at the big picture – does your company have the resources to support a successful pursuit? Many small companies that are eager to pursue federal contracts discover that they don’t have enough money and business development time to devote to finding, and landing, the business, which they have to do in order to win the contract. A business owner that is 100% billable simply doesn’t have the business development time to spare.
This isn’t a great market for most start-ups. Those who succeed find that track record—past performance—is absolutely critical to attracting the interest of prospects and teaming partners alike. Working capital and business development resources are just two other key factors to keep in mind.
The tasks you want to check off in the strategy stage are:
- Be in this market for winning reasons
- Commit to realistic goals — a minimum of two years
- Draft a quarter-by-quarter work plan tied to those goals
- Get management support for the resources you need for the job
- Set interim goals and milestones for regular reviews
Bill: A very important first step – thanks, Judy! What’s next?
Judy: Next is focus.
Success in Government Contracts – Step #2 – Setting Sharp Focus
I once worked with a service-disabled Navy veteran in Orlando who had spent over a year and $65,000 going to events. After 12 months of time he had nothing to show for those efforts, and he asked for my help. We discover he was spreading his time and effort so far and wide that none of the people he was talking to cared whether he was alive. He was reaching out to five states, making a single contact and hoping someone would call him back.
We regrouped, concentrated his effort on four top prospects in his geographical territory and within six months he landed two contracts worth half a million dollars. That got him on the steep part of the success curve and he has millions of dollars in new federal contracts to show for his new efforts in focus.
Geographical focus is one example. Another comes from an understanding of your “sweet spot” – the problem you solve for your best clients – and pinpointing which potential federal buyers have that same problem.
(You can read more about Judy’s client on her blog at: http://blog.summitinsight.com/blogs/veterans-day-success-story-sdvob-winning-government-contracts.)
The tasks you want to check off in the focus stage are:
- Define sweet spot/core competency
- Find government buyers’ hot spot: who buys that?
- Narrow the field: Where does your sweet meet their hot?
- Review the forecasts: What will they spend that you could win?
- Draft your priority list: What can you afford to go after?
Check out my blog for a lesson that will help you research federal buying forecasts of your prospective clients.
Bill: What a powerful story – thanks, Judy! Can you give us a hint at what’s coming in the next post?
Judy: We’ll cover the third step to success in government contracts, which is “nailing the process.”