Top 10 Things Federal Employees Should Know About the Problem With IT Spending

Government spends an estimated $80 plus billion dollars on information technology every year. And yet, here we are, interacting with services and systems that are antiquated, costly and next to impossible to maintain. I have been a fed, a contractor and worked for companies that had nothing to do with the government. There is no simple solution to government IT spending and failures. This list is just a starting point.

Procurement isn’t the problem, it’s just part of the problem.
Budget and governance are the two biggest blockers to effective spending for information technology projects. Identifying this problem as a “procurement” problem is one of the biggest issues that I see in creating a more modern government. We need to push harder on the “procurement is broken” comment. How is it broken? Which part of the process? How is it impacting your success? I won’t deny that it is arduous and backward at times, but that might be more a symptom of a cultural problem and a downstream impact from an inflexible budgeting process and a 100% waterfall governance system.

There will never be a “level playing field.”
There is constant talk of getting new players into the government space, improving the ability for small businesses to enter and “leveling the playing field.” This ideology has stumped me a few times. Is it difficult to sell a new product into government? YES! Is it difficult to enter the government space if you don’t have a ton of resources? YES!
However, the rules that attempt to fix this have been perverted to the point where we have small businesses with zero experience in almost anything, winning $20 million dollar contracts and being expected to deliver. We should want less government niche contractors and more quality technology providers.

Competition is fake.

This argument gets me every time. Invite a business development specialist or VP or CEO of a company that has done business with the government for a conversation about procurement. They will tell you that unfair advantages exist everywhere.

C.R.E.A.M. Contractors Rule Everything Around Me.

There is a current contractor working on the system you are re-competing. There is a contractor in your governance office. There is a contractor working in your data center, which you shouldn’t even have. They are everywhere and they all know someone working on or something about your program. It is next to impossible to give that knowledge to everyone interested in bidding. And honestly, you shouldn’t strive to. Want to make a real attempt at competition? Use a problem statement. Host a challenge (with or without challenge authority). Engage with industry. And award contracts to companies that solve problems, not ones that write a great proposal.

For a company, submitting a bid costs way more than you think.
I will expand on this more in the coming weeks, but an average cost to bid is $50k — $250k. For a single bid. And its ok, because that cost is transferred to the government (insert sarcasm here).

Industry struggles just as much as government with purchasing and executing on custom development contracts.
I keep hearing people talk about the government working more like a great tech company. But, government isn’t a tech company. Government is a service provider. More in line with American Airlines or Exxon Mobil or any other service you use that is supported by a backbone of technology. Need proof that the issues exist elsewhere too? Check out this article on the Avon SAP failure.
https://www.forbes.com/sites/benkepes/2013/12/17/avons-failed-sap-implementation-a-perfect-example-of-enterprise-it-revolution/#5e09e6ba31a6
Most of the reports you are asking for don’t add value.
If you ask for a weekly, monthly and quarterly report with all the same data you better have a plan for using it. All too frequently I interact with programs that “really need those reports,” but when I ask them for what, they can’t tell me. Here is a great rule to follow: if the report will not help you change something about the delivery in a contract or improve government transparency, you probably don’t need it.

If your contract isn’t set up to support iterative development or deployment, those reports won’t help you because you wont be able to change the work your contractors are doing.

Not communicating with industry is worse than having open conversations.
Everyone is afraid of a protest. Program, procurement, legal etc. Some agencies have backed themselves into a corner with protests to the point that no matter what they do, it will get protested. If you want to avoid a protest, do market research and have constructive conversations with industry. Make sure you ask for something that is reasonable and in line with how companies price their products and services for private companies. When it is over, make sure they know how you made your decision. This is an ecosystem. We need each other to be successful.

$100 million for any one contract is too much.
WHAT ARE YOU BUYING!? Think about this: there are new companies that get funded and deliver services, sometimes to more people than your agency does, for a quarter of that amount of money. There is nothing that you are are buying that should cost this much.

A static website shouldn’t cost $5 million.
A static website should cost somewhere between $10k and $250k. Stop awarding inflated contracts. If you aren’t sure what something should cost, call an industry friend or query the internet. The information is out there!
Side bar on this one: not every website needs its own help desk. 26 help desks for a single agency make for a really crappy user experience.

Your timeline should never be an excuse for a poor procurement.
Needing to spend your money by the end of the fiscal year, or include 20 plus people in the decision-making process is not an excuse for wasting millions of dollars on a bad contract. Step back. Do it right. Make the contract smaller. Get it out the door faster. Complete a retrospective and improve the processes that hindered you from doing this in the first place.

Always be shipping and ALWAYS BE IMPROVING.

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