Tuesday, January 6, 2009
Introducing the Insider
The Industry Defined
HUBZones: Anyone Can Play
Beyond Reproach: The Incumbent's Bind
Breaking Wave: Human Resources BPO
Cooperative Personnel Services: Differentiating Not a Problem
Adventures in Marketing
Policy & Regs: Can We Satisfy the Appetite for Cleared Personnel?
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The Insider has been seeking insight into the impressive victory by Accenture LLP in the three-way competition for the Department of Homeland Security USVISIT program, worth up to $10 billion or more.
While it was not possible to get any of the competing primes (Lockheed Martin and CSC were the other contenders) to talk openly about it, some information is seeping out from team members. In addition, informed industry observers have begun to weigh in on the circumstances of the award and the way ahead.
Warren Suss of Suss Consulting credited Accenture with doing its homework better than the other teams. He said that enabled the firm to understand that " the government had already spent a lot of time looking at technology solutions, and what it needed had much more to do with how to manage the technology.
Sources knowledgeable about the two contenders, Lockheed Martin and CSC, said both firms believed there were issues in the proposal evaluation process, but elected not to protest so as not to jeopardize future DHD business, according to sources. In Lockheed's case, however, a startling statement by the team's leader during oral presentations to DHS may have helped consigned its offer to the loss column.
The Navy Marine Corps Intranet program, unique in scope and ambition among federal IT efforts, is also distinguishing itself through its relations with industry. The Navy and prime contractor EDS recently invited the IT industry to the second annual "NMCI Industry Symposium" in New Orleans for nearly three days last month. The purposes: engage industry thoughts on the emerging Navy IT marketplace in light of NMCI, and, acquire feedback to strengthen the program.
The tone of the symposium was upbeat, even celebratory. Except for one critical speech by an unhappy customer, Lt. General Edward Hanlon of the Marines, Navy officials trumpeted program accomplishments and repeatedly praised EDS.
Praise is due. Program office and customer data suggest the program has climbed much of the way out of a deep hole. Meanwhile, EDS has invested $2.4 billion upfront, but has written off $1.6 billion in losses. However, the Insider picked up a few comments from Navy officials suggesting that the company might be able to at least break even in the end.
On its part, EDS made clear to its teaming partners and others interested in obtaining a share of NMCI revenue that the company would be restructuring its business arrangements to share the risks and cash flow burdens with its subcontractors and vendors. One company's representatives told the Insider that the major league hardball with the EDS logo given out on the exhibition floor was "perfectly symbolic" of the firm's style with teammates, sensing a change in the air.
With more firms crowding into the federal marketplace, it's rare to see one re-launch its government business. Essentially, that's what Val Lyons, CEO of Capgemini Government Solutions, LLC, was hired to do. The Insider visited with Lyons in late June, about two months into her new position.
Lyons said that she is in a "small-scale start-up" mode, but with the advantages of a big company. Capgemini, a publicly owned company based in Paris, with 2003 revenues of approximately $6.5 billion, had earlier in 2000 acquired the consulting business of Ernst & Young. E&Y, a respected but not large federal player, produced studies more than solutions and was not a heavyweight in information technology services.
Capgemini overall has 55 thousand employees. Lyons has 43. With a robust federal market full of large competitors/partners, she described a strategy that hinges largely on leverage.
Lyons describes the business she's in as a "transformational set of services." The "solutions business" does not capture enough of what clients need to buy, she contends.
What distinguishes CapGemini Government Solutions? According to Lyons, it is access to high-quality intellectual capital, top-quality commercial best practices, a rigorous knowledge management system, and a special brand of collaborative working style. The Insider sought some support for these assertions in the balance of the interview, which also addressed the "Collaborative Business Experience," the theme of the company's new branding.
You may wonder, as the Insider did, how well financial analysts really understand the business and its peculiarities and how they do their jobs. Producing good competitive intelligence is difficult, so why shouldn't that be true for sizing up a company for investors?
To de-mystify this activity, the Insider talked with Erik Olbeter of Schwab Soundview Capital Markets, part of Charles Schwab's Washington Research Group. Based in the District, the Group both monitors the government in general and houses analysts who, like Olbeter covers individual firms. He follows CACI, Anteon, SI International, and Titan, among the nine that Schwab analysts cover in depth. He also has responsibility to monitor government-wide and DoD policy developments pertinent to the industry, as well as budgetary trends.
This article describes the main sources and methods that Olbeter uses when he looks at a company.
The January Insider profiled firms positioning for the large, but not-ready-for-prime-time, federal market for human resources business process outsourcing (HR BPO).
One of the better positioned in terms of past performance is Convergys, a $2.3 billion company based in Cincinnati. The company won an HR BPO contract in Florida about a year ago. In June the company was awarded a similar contact for the State of Texas.
Not surprisingly, Convergys has some federal market ambitions. This article reviews some key lessons learned from state experience and outlines the company's activities and intentions for addressing the federal market.
Top federal sales executives from SRA, Oracle, EDS, and Gartner shared tradecraft before a group gathered by the Northern Virginia Technology Council. They compared notes on: attributes of top sales people; their respective turnover in sales staff; what to look for in a teaming partner; selecting what to pursue; and the crux of successful sales programs.
On July 1, the SBA withdrew proposed changes that attracted withering fire from many small business interests and others in the industry. Alan Chvotkin of the PSC provides a summary of why these regulations deserved to be thrown out.
Some government clients and service providers silently applaud when they find that the scope envelope of an existing contract can be stretched, often saving time as well as the need for competition. Recent audits, Congressional investigations, and other developments have brought attention to this widespread practice. Alan Chvotkin defines the issues and gives firms a practical checklist of things they can do to protect themselves from the several downsides, some severe, of what used to look like a good thing.