There are tens of thousands of technology contractors in the U.S. that, by design or by accident, have positioned themselves as "technical service providers." However, in today's world, technical services are considered a commodity with higher competition, and lower margins. Therefore, positioning themselves as valued business partners delivering measurable business results is critical.
There are a number of ways to position your contracting company as a valued business partner. Chief amongst them is by gaining knowledge and expertise in specific business mission areas and then focusing on solutions that support those missions as a means to winning mission systems contracts.
Technology systems in the public or private sector can be categorized in three buckets. These include mission IT systems (e.g. traffic control system), mission-support IT systems (e.g. procurement system), and infrastructure or commodity IT systems (e.g. email system). Most technology contractors focus on routine commodity or infrastructure IT, which is rapidly losing its revenue and profit generation potential due to the increasing adoption of cloud computing and other standardization technologies.
Mission-support IT has value but requires the contractors to have functional expertise and related software (e.g. procurement expertise and software). The mission IT systems, however, are a new, high value opportunity. But gaining a foothold here is complex and requires distinctive expertise.
Step 5: Build Advanced Capacity and Capability
Winning mission-focused IT contracts require advanced mission expertise, skillsets and engineering facilities that tend to be beyond the reach of most technology contractors. Unless contractors have mission contracts, they can't build mission expertise and unless they have mission expertise they cannot win mission contracts!
To address this chicken and egg story, contractors might consider tapping into organizations such as Public Private Innovations, which recently built a consortium of specialized partners who can provide on-demand access to mission expertise, labs and engineering facilities at a fraction of the cost of maintaining these in house. When considering such organizations, look for the expertise needed to form prime-sub arrangements or joint ventures to pursue specific mission IT contracts. Technology contractors need to look at similar opportunities to build capacity and capability without increasing their fixed costs.
Step 6: Improve Cost and Speed of Execution
Technology contractors know cost and speed of execution matter in winning contracts. Today's CIO's want IT projects completed under budget and well before their deadlines. But how does a contractor achieve this?
Clearly, contractors need to integrate commercial off-the-shelf (COT's) technology products in the systems being developed. Today, there are thousands of start-ups and growth technology companies creating sophisticated products. Integrating these intelligently and appropriately will help improve an IT contractor's feature set, reduce the cost of development and future maintenance and increase the speed of execution. By rolling out COT's products early as part of the larger system being developed, technology contractors can create the much-needed "wow" factor and become a preferred technology supplier.
However, this requires researching and evaluating new technology products on a continuing basis, which is costly and time consuming. To address this situation, IT contractors might also consider another resource we have established, and are still developing, called GOVonomy. The idea is to provide government IT buyers and the IT contracting community with an online catalogue of new technology products that can meet the government's needs. If you want to get involved in it, join us at the GOVonomy Facebook business page.