Winning and working on a defense contract from the United States is an incredibly rewarding experience that can result in substantial financial gains. Unfortunately, obtaining one of these contracts is not easy, and there is often stiff competition for coveted budget funds. Navigating the process can be extremely tedious, expensive, and outright unsuccessful if you take the wrong approach.

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Many businesses seek a defense contract, but few know the nuances of the procedure to win one. Attempting to target a wide variety of organizations within defense will likely produce poor results, as will marketing a defined product or service or going for the hard sell. Rather, it is important to remain flexible in your approach and to forge and maintain relationships within a specific few organizations. It is also necessary to operate within the confines of the bureaucracy of defense, and to maintain DCAA (Defense Contract Auditing Agency) compliance to adhere to government regulations.

Many businesses aspire to win and work on a United States defense contract. These contracts offer the opportunity to work with the largest spender in the United States, and successful execution can result in a highly profitable relationship with the U.S. government. Defense needs are numerous and varied. In the past, the government has awarded contracts for multi-billion dollar projects such as ship construction and submarine design as well as smaller but still substantial contracts for administration services, health research, and even office chairs and flashlights.  In short, a wide variety of industries can find a niche for a defense contract. Unfortunately, obtaining one of these contracts is not easy. Aside from the necessity of keeping careful records and staying in step with the complex defense bureaucracy, there is often stiff competition for coveted budget funds. Navigating the process can be tedious, expensive, and outright unsuccessful if you approach the project with false assumptions and an aggressive sales mindset. Following is a series of steps that will differentiate your business and proposal from others and increase your chances of success.

1. Avoid the “Scattershot Approach”

Businesses seeking a defense contract would be wise to begin their search with the following piece of advice: focus. If it is important to market to a niche when dealing with consumers, it is even more important to target a specific need within defense. The belief that spending a bunch of time sending information and proposals to a wide variety of organizations within defense will result in a greater chance of having one of them bite is incorrect. Because of the framework of defense and the necessity for flexibility (which will be addressed later), focusing your efforts on just a few organizations — about two to four — will actually increase your chances of obtaining the contract substantially.

By focusing on a few organizations to start, and maintaining a consistent dialogue with individuals in those organizations, you will be better able to hone in on their specific needs. Targeting a large number of organizations will require you to stretch yourself thin in both material and face time, meaning you will be seen as less of a valuable resource. You should be able to define the needs of these organizations before you even attempt to finalize your proposal. It would also be wise to do a substantial amount of background research on your chosen organizations. Websites such as usaspending.gov allow you to see what sort of programs specific organizations have funded in the past, and can give you a good jumping off point for your own product or service proposal.

2. Endear Yourself to the Program Manager

Once you have done your research and decided which organizations you would like to approach, you are going to need to work on developing a personal relationship with them. In effect, that usually means that you will be developing a working relationship with the organization’s program manager. The program manager acts as the liaison between the funding organization and the businesses seeking a contract. That means you, in this case. It is important to realize and understand the fact that the program manager does not have final authority to authorize a contract. He has a complex bureaucracy behind him, with a functioning chain of command in place. Therefore, it is extremely detrimental to your chances of getting a defense contract if you try to give the program manager a hard sell.

First, this tactic can not work because of the aforementioned bureaucracy. Second, and more importantly, if you go for the hard sell you will come off as having one specific product that will address one specific need. This will backfire almost every time, because the odds that they have the specific need that you address in your sell are slim. Instead, in your meetings with the program manager, you need to listen. Be personable, but let him or her talk. Let them tell you the sorts of things that they are looking for. Listen to these needs, take them in, and reflect them back to the program manager. Make sure that they know that you hear them and are willing to work to address their problems.

3. Determine Your Capabilities

After you are able to define the needs of a few specific organizations, you will need to begin determining your capabilities. Note: this does not mean that you should be coming up with specific products or services yet. Rather, consider this an opportunity to appraise your resources, all of the options relating to those resources, and availability of those resources for allocation to a defense contract. Have you done anything in the past that relates to some of the needs of the organizations you are approaching? If you have a store of background data that relates past completion or rollout times for your products or services you will have a better understanding of realistic timelines for this endeavor.

This is also the time to consider the logistics of a possible contract with one of these organizations. Communication and geography are often overlooked when considering a contract with defense, yet those can make a huge difference when an organization decides where they are going to allocate their funds. You should be able to communicate your capabilities to your organizations of choice, using plenty of data to support your claims. Also, you will need to determine whether or not geography is a factor. Obviously when looking at construction projects or something of that nature geography will be a key consideration. However, even if an on-site presence is not strictly necessary, some organizations feel much more comfortable dealing with a business that is “just up the road.”

4. Make Everyone Look like a Rockstar

You have determined your capabilities. Now, it is time to communicate those to the program manager in a meaningful way. This is the time to get creative, and to actually use the bureaucracy to increase your chances of gaining the contract. The program manager, like every employee within an organization, wants to look good to their superiors at the end of the day. As a business proposing solutions to key needs within the organization, you have the opportunity to make the program manager look great to his higher-ups. When discussing approaches to the organization’s problems, keep that fact in the forefront of your conversation, and make sure to mention the ways that you will make the program manager look good specifically.

Don’t be afraid to go a few steps further here, and discuss how you can make his bosses look good as well. Try to ingratiate yourself to the workings of the system. If you are successful, the program manager will ally himself with you and you will be able to use him as an inside resource as you continue to refine your proposal. This grants you data that might otherwise be entirely inaccessible, and will give you a strong competitive advantage when the organization allocates the actual contract.

5. Maintain Flexibility

Now it is time to put together your proposal. Using the information that you have gathered from the program manager and your personal research, you should be able to directly address your chosen organization’s needs. This does not mean that you should introduce defined parameters for your product or service however. To a defense organization, parameters are immediately interpreted as constraints. While some customers outside of defense like the idea of knowing exactly what they are getting, most defense organizations like to know that they have a custom solution with the flexibility to change. Because defense is rooted in the political and economic climate, needs shift constantly. You should be aware of this fact, and should not be intimidated by the knowledge that any specific needs the defense organization identifies now may change drastically by the time your solution is proposed or instituted.

Let defense dictate the parameters of your deliverable. If you can maintain and communicate your capacity for flexibility you will increase your value to the defense organization dramatically. On the same note, recognize that RFP’s can be deceiving, in that they do not necessarily indicate an opening for a new product or service. They may already be filled, or even written with a specific business in mind. However, they can and should be used as a guideline when looking at the types of proposal you should make to your chosen organization.

6. Use a Short Pitch

The time has come for your proposal meeting. You have identified a need and developed an excellent working relationship with the program manager. Now, you will need to decide how to communicate your solution to decision makers within the organization. Many businesses make the mistake of going into the meeting with immense binders filled with detailed information, background research, and a structured plan for addressing every aspect of a company’s problem. This is a poor choice, because it does not communicate your capacity for flexibility and can come off as an attempt to throw resources at a problem until it is solved. Defense organizations prefer a pitch that quickly and efficiently communicates your approach. Be concise.

Identify the following in your pitch, and try not to overwhelm the organization with extraneous information:
• The organization’s pain point
• Your proposed deliverable
• How your deliverable alleviates the organization’s problem
• Benefits and support you and your solution can offer the organization

7. Nail DCAA Compliance

Assuming everything goes well, you will be in prime position to take on the contract. However, you will also need to make sure that you operate within the delicate confines of the defense bureaucracy from this point on. Part of that means maintaining DCAA compliance. Essentially, the Defense Contract Audit Agency (DCAA) oversees all Department of Defense contracts. Their audits monitor operations, ensuring that all costs are accurately assigned and accounted for. The end goal is the reduction of federal waste and security of equal treatment for all contractors.

While the prospect of such a comprehensive audit can be daunting, it does not need to be difficult or put undue pressure on your company. One of the easiest and most effective ways to prepare for a DCAA audit is the standardization of company accounting systems and the employment of a comprehensive system for tracking employee time. Quality DCAA compliant software can automate this process, making the audit even simpler. Ultimately, you will need to choose a system that works for you, but choosing the right tool for the job will eliminate frustrating bureaucratic roadblocks and will hasten your time to delivery.

Final Thoughts

Clearly, catering to a defense organization differs in several significant ways from more conventional market strategies. Fortunately it is possible to use the structure of the defense system to strategize and produce targeted, value laden products for their specific needs. It is also important to realize that the relationships you build and maintain with defense organizations can have hidden value in the form of future recommendations and consistent business. Defense contracting is not a passive process. It requires active engagement over the life cycle of your proposal and execution of your deliverable. Nevertheless, successful completion of such a lofty project will result in a strong relationship that will greatly enhance the profitability of your business.
About the Authors:
Laura Faulkner, PhD., is a Strategist at FalconDay Consulting & Research. She formerly served as Program Manager and Principal Investigator of multiple Department of Defense and industry projects at the Applied Research Laboratories, The University of Texas at Austin. She has extensive experience with software systems design and fielding for the U.S. Army, Navy, and Air Force, in the information warfare and modeling and simulation domains, including digital communications, intelligence operations, and sonar analysis. Dr. Faulkner earned a PhD. and Masters in Psychology, and undergraduate degrees in Anthropology and Sociology.

Bill Balcezak is General Manager for Journyx, a company that automates payroll, billing and cost accounting while easing management of employee time and expenses. Bill has 25+ years of experience in successfully managing heavily integrated, large-scale, critical software deployments for industry leading clients. His specialty is organizing, orchestrating and delivering successful service scenarios, by isolating and focusing on the critical aspects of technology adoption and using proven methodologies for deployment. He is a graduate of the Massachusetts Institute of Technology with a Master of Science Degree in Mechanical Engineering.

Earlier today Deltek announced that Tom Mazich will oversee enterprise software sales and consulting services for Deltek’s GovCon business unit that delivers comprehensive solutions that power the complete business lifecycle of government contractors.

As the Executive Vice President and General Manager of Deltek’s GovCon business unit, Mazich will oversee sales for Deltek’s Costpoint, GCS Premier, Deltek First and Enterprise Project Management product suites, and he will also be responsible for managing Deltek’s consulting services business in support of application sales. Mr. Mazich will report directly to Kevin Parker, Deltek’s President and CEO.

Tom Mazich has over 30 years of experience in the software and services industries and is a recognized leader building and managing high performing teams that sell and implement IT solutions and services into the public sector and commercial markets. Most recently, Mazich was President at Mabec, an IT services business that he co-founded in 2008. During his tenure at Mabec, he played a key role building the company, winning key contracts, and running its day-to-day operations.

Prior to Mabec, Tom held positions at SAS Institute including Vice President and General Manager, Government Operations and President of SAS Federal. Mazich also held management positions at other notable software and technology companies, including Symantec Corporation, Comdisco Continuity Services, and Inference Corporation.

Inc. Magazine has named Reston VA based InScope International a Top 20 Small Business Workplace finalist. For a complete list click here: Top 20 Small Business Workplaces

Perhaps the seriousness of their mission of ‘Advancing the Global Good’ gives each member of the InScope team a sense of purpose. Or perhaps it’s because my brother-in-law, Gary Struzik, is their Chief Financial Officer. (Sorry, had to give him a plug!)

Advancing the Global Good