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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So you've thought a lot about your presidential choice. Watched the debates. Some people call this decision easy, others say its complex. If you give some weight in your presidential pick to the impact on your business, you'll want to read Alan Chvotkin's analysis of what to look for and do should one or the other candidate win. Even if you don't reflect your business in your vote, it's useful to know from an expert what the policy impacts might be. Chvotkin will tell you.
In any case, be sure to vote on November 2.
Acquisitions can be crucial element in a firm's growth strategy. But as discussed in Part I last month, postmerger or postacquisition integration can be difficult. More often than not, it results in erosion of shareholder value. How do successful acquirers increase the odds of adding shareholder value? Don Shay, an expert in mergers from the strategy and financial standpoints, tells you how. He's interviewed senior executives with some of the best track records in postmerger integration in the government services industry.
Shay describes what kinds of strategies make the most sense, how to communicate with employees and other key stakeholders, as well as how to manage the integration activity most successfully.
As the new federal fiscal year begins, it's useful to look at the industry from some specialized viewpoints. The Insider asked five experts to identify the critical issues and the outlook. Bob Brudno, who conducts more high-level executive searches in the industry than any other headhunter, assesses the top management talent supply. Paul Serotkin, an investment banker who specializes in small- and mid-tier acquisitions, examines trends in that arena. Warren Suss, a marketing strategy consultant to large integrators and telecommunications companies, looks at the relative positioning of these large players in the federal market. Cathy Garman, top policy expert at the Contract Services Association of America, gives you the latest on the line up of issues of concern to small businesses. Large businesses, which must increasingly partner with small firms, will find this analysis compelling, too. Finally, Steve Sorett, an attorney who specializes in privatization, outsourcing, and financial services in the federal arena, gives you a view of the end-game of the recent turnabout in policy on competitive sourcing.
Despite best efforts to move on, the Insider was drawn to yet another EDS development in the federal space. It has import for those firms that provide or team with management consulting experts, especially those claiming to be "high end" or "commercial" or "strategy" in orientation.
At the end of September, AT Kearney, the wholly owned, "independent" subsidiary that EDS acquired in 1995, announced that it was forming a "government practice." The Insider gives you the organizational context to draw your own conclusions about whether Kearney is a competitor to worry about in the foreseeable future.
What's more important than your employees? Obtaining business is also important and arguably easier—but largely because you've already succeeded in attracting staff and keeping them happy and productive.
Size matters, too. Smaller businesses often have a tough time competing with larger ones for staff. And large firms have an obvious, if indirect, stake in the quality and happiness of their small partners' employees.
For some small firms, there is a potentially strong assist to strengthening the HR foundation of the business. It's called a professional employer organization (PEO).
While a relative handful of large companies dominate the government services industry, over 20,000 small firms earn federal contract revenue. (See the January Insider at www.gsinsider.com for a structural snapshot of the industry.) They can't readily pay for full-time human resources management experts on their staff, or for tools like PeopleSoft packages.
To help such small firms, the PEO assumes many of the responsibilities and risks of being an employer. The PEO maintains an administrative relationship with PEO employees, who work at the client's worksite. Thus, the PEO shares the employer role with the client.
This article fleshes out the definition of a PEO, identifies the benefits and downsides, and gives you an idea of the cost. PEOs are not for everyone, but the Insider suggests that the PEO approach has considerably more potential in the government services industry than it has shown to date. The article helps you begin to determine if there is merit for you or your smaller-firm partners.