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GAO Praises CMS Improvements to the HIPPA Eligibility Transaction System

A few weeks ago, GAO released a report endorsing CMS’ efforts to improve the HIPPA Eligibility Transaction System (HETS) and provide reliable service to users. A series of hardware and software upgrades in early 2011 dramatically increased system performance.
HETS supplies providers with Medicare beneficiary eligibility information. Timely and accurate data access is vital to the Medicare program which covered 48.4 million individuals to the tune of $565 billion in 2011.
In 2005 CMS began offering automated access to eligibility data via HETS, but suffered from a deluge of provider and beneficiary complaints in 2010. In September 2011, Senators Coburn, Burr, and Hatch requested that GAO review operation of CMS’ HETS. In a letter to GAO, the Senators referenced user complaints such as long wait times for eligibility confirmation and the inability to obtain telephone support. “Since establishing beneficiary eligibility in a timely and efficient manner is a fundamental part of basic program integrity operations, HETS is uniquely important to CMS fraud prevention efforts,” states the letter.
Prior to GAO’s investigation, CMS was attempting to make system improvements. In fact, in July 2010 they began to implement a series of major enhancements to the HETS operating environment and system, including hardware and software upgrades. However, users continued to experience lengthy response and system down times. According to program officials interviewed by GAO, CMS took additional steps to address the slow response and system availability problems in January 2011 by doubling the hardware capacity, replacing the operating system, and upgrading the system’s software. The second round of upgrades were completed in the spring of 2011.
After experiencing performance problems throughout 2010, GAO found that HETS is currently operating on a real-time basis, 24 hours a day, 7 days a week, and with few user concerns. As of June 2012, CMS reported that 244 entities were using the system and during the first 6 months of 2012, the system processed more than 380 million transactions.
Users told GAO that since CMS completed the 2011 hardware and software upgrades, they have been satisfied with HETS’ operational status. Additionally, Helpdesk calls have been reduced by nearly 50% and the percentage of transactions that received responses from HETS in less than 3 seconds increased from 60.8% in 2010 to 99.9% in the first half of 2012.
CMS doesn’t plan to stop there. With anticipated increases in transaction volume of 40% each year, the agency plans to redesign the system and migrate to a scalable database environment. In the short-term, CMS will implement proactive system monitoring tools to enhance production capacity prior to the redesign. In June 2012, the agency awarded a contract for defining and writing requirements for the redesigned system and it plans to procure a contract for maintenance of the current system until the redesign is complete in 2014. However, program officials told GAO that all improvements will be dependent on the agency’s budget.

 

 

Voting machines: Near-term procurements; mobile election future

After the 2000 U.S. presidential election debacle, when confusion swirled around Florida’s butterfly ballots, and almost 2 million votes were disqualified for reasons such as “hanging chads,” the Help America Vote Act (HAVA) was signed into law in 2002. HAVA required all states and localities to update their election processes, including replacing manual-lever voting machines and paper-based voter rosters with computerized versions.
 
HAVA also established the U.S. Elections Assistance Commission (EAC), which is an independent bipartisan body that oversees states’ adherence to HAVA mandates, and administers federal grant funding to assist states in acquiring and maintaining electronic and optical-scan voting systems. HAVA did not include standardized requirements for states to follow; instead, it was vague enough to allow states to revise their own election processes and draft new implementation plans. The EAC, on the other hand, was tasked with establishing voluntary voting system guidelines (VVSG), a voting system certification program, and accredited test laboratories to ensure basic functionality, accessibility and security are met by all electronic and optical-scan voting systems acquired by state and local governments.
 
In FY 2003, $899 million in federal HAVA grant funding was set aside for U.S. states, territories, and the District of Columbia to begin transforming their election processes and procuring voting systems. Five additional rounds of grant funding have been awarded to states since then: FY 2004 ($1.48 billion); FY 2008 ($115 million); FY 2009 ($100 million); FY 2010 ($70 million); FY 2011 ($1.29 million).
 
 
 
Due to the injection of federal funding and looming implementation deadlines, 2005 saw a spike in procurement for voting technology products and services. A smaller increase occurred in 2010, the year before federal funding was expected to drop off. In anticipation state and local governments’ procurement of voting systems picked up before federal funding dried up. The average grant award during those first two years ranged from $15 million to $25 million, with Texas ($57 million in FY 03 and $74 million FY 04) and California ($94 million in FY 03 and $169 million in FY 04) receiving the most funding. To date, $3.25 billion has been awarded to grantees, 63.1 percent of which has been spent on upgrading voting systems, and 13.6 percent on implementing voter registration systems.
 
Less than 35 percent of all votes cast in 2000 used an electronic or optical-scan voting machine. That number increased to nearly 65 percent in 2004, and reached 89 percent in 2008. With a market like this you can imagine HAVA  mostly benefited major voting technology vendors, such as Hart InterCivic, Inc; Dominion Voting Systems (formerly Diebold Election Systems); and Election Systems & Software (ESS).
 
In 2012, you would think the story of voting technology opportunities is nearing its happy end. Think again. This story has merely turned to the next chapter, for the following reasons: First, federal HAVA funding has taken a nose dive and may never get back to FY 2004, or even FY 2009 levels. Second, those now 8-year-old voting machines, like all computers, will soon need to be upgraded or replaced. This will force cash-strapped states to pony up money they don’t have to replenish battered voting machines. Lastly, the next generation of mobile and Web-based voting systems has yet to enter the market.
 
All this in mind, over the next three years, states will attempt to ready themselves for the 2014 and 2016 election cycles by looking for affordable options that keep them HAVA-compliant in the short term. Many states and localities that purchased their voting machines outright in 2004 and 2005 may opt to lease this time around. Many more will look for maintenance and repair services to extend the life of ailing equipment to maximize their return as they wait for next-generation technology.
 
In the long term, mobile and Web-based voting systems are expected to replace everything. Though the technology may exist to vote in this November’s election from the comfort of your home or the convenience of your smartphone, there is no way to guarantee the high level of security needed to use these voting methods for a U.S. presidential election. Even though some states are experimenting with online voting by allowing military and overseas voters to submit their ballot via the Web, the technology for secure online and mobile voting is still another 10-12 years away.
 
In anticipation of these technological advancements, the EAC along with the National Institute of Standards and Technology (NIST) have created a committee to proactively rewrite the federal guidelines for the next generation of voting systems.
 
To learn more about this and other state and local procurement trends and opportunities, be sure to check out Deltek's GovWin IQ product and follow the State & Local General Government Team on Twitter at @GovWin_GenGov.
 
 
Source: U.S. Election Assistance Commission (EAC). http://www.eac.gov/

California IT procurement stakeholder outreach survey

Officials at the California Department of General Services and the California Technology Agency are distributing an electronic survey to IT vendors who do business with the state. The online survey is only available until close of business day October 22, and can be found here.
 
The survey is the result of a recent California Legislature bill to develop a transition plan to move all IT procurement from the Department of General Services to the California Technology Agency. California  Assembly Bill 1498, Section 3, requires a transition plan to be developed as part of a larger initiative by the governor to create a new Government Operations Agency. The California Technology Agency will become part of the new agency and be designated as the Department of Technology. That bill can be found here.
 
The workgroup responsible for this survey will ultimately use the results in making a decision whether or not to move IT procurement.

Nebraska MMIS procurement begins to take shape

As Deltek’s report on New Players and Future Prospects for MMIS predicted, Medicaid management information systems (MMIS) are continuing to evolve and take on more responsibilities. A recent report issued by the Nebraska Information Technology Commission (NITC) confirmed that nowhere is this more apparent than in the Cornhusker state of Nebraska.
 
In a project proposal report outlining the goals and budget for an IT project, the NITC provided a wealth of information for Nebraska’s MMIS replacement and the MMIS replacement study. As with many states across the country, Nebraska began thinking about the process of upgrading its legacy MMIS back in 2004. The state eventually conducted an alternatives analysis and decided to replace the system. At that point, a request for proposals (RFP) was released, but yielded only one bidder whose attempt to implement a new MMIS failed. After the unsuccessful procurement attempt, the state continued to operate its own legacy MMIS.
 
The 33-year-old legacy system is reasonably efficient when it comes to processing Medicaid claims in a fee-for-service environment; however, Medicaid changes over the past several years have necessitated additional functions. The legacy system is inadequate for expansion beyond the typical fee-for-service functionality to waiver services, capitated managed care, accountable case services, and varying benefit categories. Lacking the flexibility to utilize current technology in the reduction of manual processing and improvement of data integrity, Nebraska looked to the private sector for analysis and development of a replacement plan and procurement package.
 
The first step in the new process was the release of another RFP for an MMIS replacement study in 2010. The state received proposals and quickly selected Public Consulting Group (PCG) to complete the outlined contract deliverables. Now, two years later, PCG will deliver the final alternatives analysis to the state.
 
Following the initial consulting engagement, Nebraska will work with PCG to develop a procurement package, including a detailed scope of work. The result of the aforementioned alternatives analysis will determine if the state will choose a vendor to implement and maintain an MMIS, which from reading the project proposal, is clearly the favored option, as it provides the most competitive vendor response to the future RFP
 
With an estimated budget of $113.6 million for the replacement MMIS, the NITC anticipates spending nearly $90 million on contractual services alone. A specific scope of work has yet to be outlined; however, any vendor who can satisfy the state with a flexible, scalable system will be well positioned as the procurement progresses.
 
The following outlined benefits of a new MMIS must be met for a vendor to be successful:
 
·         More flexible system structure to support the implementation of federal standards, which will allow Nebraska to continue to receive 75/25 federal match for operations
·         Ability to receive 90/10 federal match for enhancements
·         Ability to incorporate new payment and delivery models to achieve cost savings
·         Increased reporting and analytical capabilities to adequately manage program
·         Improved ability to identify fraud, waste, and abuse of services, as well as potential cost-saving opportunities and quantify results
·         Increased user configuration and control along with reduced system modification turnaround time
 
The availability of this level of detail and information prior to RFP development allows vendors to position themselves early for the release of a scope of work based on the abovementioned principles. As always, Deltek will continue to monitor the MMIS replacement project for additional information from the alternatives analysis.
 
Be sure to follow Deltek’s Health Care and Social Services Team on Twitter @GovWin_HHS or connect with us through LinkedIn.

 

Wanted: Sexy Data Scientists

One of the biggest inhibitors for Big Data is the lack of professional data scientists. These quant jocks are in high demand for their ability to extract sought-after information from large datasets and present them in a way that decision-makers can readily understand, see the value, and act upon.
The profession is the sexiest career of the 21st century, according to The Harvard Business Review. While I’m not so sure about the sexy part, they will certainly be in high demand. Data scientists devise theories, design experiments, and test hypotheses to extract relevant information from data, such as identifying patterns that can be used to predict behavior, using technology tools. They are part scientist, part researcher, and part computer programmer.  Data scientists usual work together with subject matter experts, to understand the domain under investigation and to ensure that their hypotheses and design are relevant.
It is actually hard to know just how sexy these folks are because there are so few of them and therein lies the problem. The availability of data scientists is not likely to keep pace with federal demand. According to a 2011 study by the McKinsey Global Institute, the U.S. could face a shortage of up to 190,000 data scientists by 2018.   Data science is a new profession and there are few practitioners.  It originated in academia in computer science and management science and began migrated from academia into industry just a few years ago when Wall Street firms required quant jocks.  However, they have thrived in the halls of government research and development labs, centers, and institutes for years, in places like DOE Labs and NASA. No doubt, some of those were contracted from industry, but the best probably have long experience as government employees. 
As part of the White House Big Data Initiative, announced in late March 2012, the National Science Foundation (NSF) is “encouraging research universities to develop interdisciplinary graduate programs to prepare the next generation of data scientists and engineers.” They are also providing “a $2 million award for a research training group to support training for undergraduates to use graphical and visualization techniques for complex data.”  These training initiatives, as well as re-training initiatives, will mitigate the shortage, but they won’t provide the talent that will be needed in the short-term.  
As the Big Data competition heats up, it will be interesting to see vendors scramble for data scientist talent. And, no doubt, vendors will make it lucrative for the best to retire from government service and step into the consulting profession or the contracting pool. But attracting away the best and bright government data scientists might actually slow growth in the market even more as they are also sometimes the agency subject matter experts as well.
Contractors are likely to find that some of their best internal people with subject matter knowledge and IT know-how might be able to make the leap with some added training in statistics and analytics. Universities are also ideal places from which to recruit talent. As visualization tools improve making the data scientists’ job easier, more people will be able to transfer some of their existing skills to make the transition into the field.
With federal budgets tightening and the threat of sequestration, government contractors are looking for ways to make themselves more attractive.  Moving to growth niches is one way and the Big Data niche will be sexy for years to come.

Detailing The Potential Impact of Sequestration at DISA

The role DISA plays at DoD is mission-critical, making it more likely than not that sequestration cuts will fall more heavily on other Defense agencies than at DISA. Also, the agency receives much of its program funding via two sources, the DoD RDT&E budget and the Defense-Wide Working Capital Fund. How sequestration potentially places these funding sources under pressure is examined.
Here at FIA we have received a lot of inquiries about the potential impact of sequestration on IT spending at the Department of Defense. DoD IT is obviously about more than programs at the Defense Information Systems Agency (DISA), but DISA programs are central to the DoD’s enterprise IT and cloud computing strategies. Because of the importance of DISA’s role, it seemed like a good idea to take a closer look at the potential impact of sequestration on the agency. In doing so I hope to relieve some of the anxiety that industry is feeling about sequestration and clarify what the issues are that leaders at DISA may be struggling with when it comes to deciding where the sequestration axe should fall.
Sequestration and DISA’s Funding Sources
Let’s begin with where DISA gets its funding and how sequestration may affect those revenue streams. DISA receives an annual direct appropriation to cover its basic operating and personnel costs, but this is not as important to the funding of its IT programs as are the Defense-Wide Working Capital Fund (DWWCF) and the Research, Development, Test, and Evaluation (RDT&E) portion of the DoD’s annual budget request. Only $550M (1%) of the DWWCF ($55B in FY 2013), is subject to sequestration, so the impact of sequestration at DISA would be minimal from a percentage standpoint. Why is this important? Simple. The DWWCF is a fee-based revolving fund reflecting the revenue that DoD agencies like DISA, DLA, and DFAS bring in based on the services they provide to DoD customers. In DISA’s case, it projects $6B in revenue in FY 2013 from the services it provides, including critical operations like its transport network services, cloud services, computing services, and enterprise acquisition services. Many of the critical DoD IT programs and services that are commonly associated with DISA are thus expected to experience limited pain from sequestration.
DISA’s portion of the RDT&E budget is a whole different matter. Sequestration cuts $2B (11%) from the total FY 2013 DoD RDT&E requested budget of $18.1B. This is if an FY 2013 budget is passed. The DoD RDT&E budget funds 19 separate DoD centers and agencies, including DISA, so DISA would not be required to bear the burden of a $2B cut alone. In fact, DISA’s requested RDT&E funding for FY 2013 is $256M, or 12.8% of the $2B sequester amount. The “if an FY 2013 budget is passed” part of the statement above is important here because if an FY 2013 budget is not passed then sequestration cuts would be based on funding at the FY 2012 level because of the Continuing Resolution that is in place until March 2013.
In DISA’s case, FY 2012 RDT&E funding was $293.5M, including OCO funding. Based on the FY 2013 DoD budget request, DISA expected its RDT&E funding to decrease by $38M. In today’s twisted federal fiscal world, this means that it is actually more favorable for DISA if sequestration cuts are based on the FY 2012 actual RDT&E funding level of $293.5M rather than on the FY 2013 requested RDT&E funding level of $256M. Thanks to Congress’ inability to pass a budget, DISA actually has $38M more in RDT&E funding headroom to bear the brunt of sequestration cuts.
What is Vulnerable to Sequestration at DISA
Having established that DISA was already expecting a cut to its RDT&E funding before sequestration and knowing that any cuts which occur will be based on the higher funding level of the FY 2012 actual budget, what programs are most vulnerable to cuts that sequestration may force at DISA? I cannot go into all of the programs here, but the table below lists the top 10 (by funding) RDT&E funded programs/offices at DISA, based on FY 2012 funding levels.

These programs represent a total of $278M in RDT&E spending at DISA in FY 2012. The question industry needs to ask itself is as follows: based on what you know of strategic priorities at DISA and DoD, which of these programs could DISA afford to cut if sequestration became a reality? Perhaps you can see the magnitude of the difficulty that leaders at DISA will have if they are asked to cut hundreds of millions of dollars from programs. DISA leaders will be required to weigh which programs are considered critical and which are not.
The wild card in all of this is we do not yet know how much DISA will be asked to cut, if indeed the agency is required to cut at all. It could be that the $2B in RDT&E cuts demanded by sequestration fall more heavily on Defense agencies other than DISA. My best guess is that DISA will feel some cuts if sequestration becomes a reality, but these cuts will be minimal in comparison to cuts levied on other Defense agencies. I have this hunch because the DoD has already admitted its “network dependency” and it has already announced a new Asia-Pacific focused strategic shift that is absolutely dependent on the network infrastructure and services provided by DISA.
Active Contracts Related to the Programs Above
A bonus piece of information I am throwing in below are these tables of contracts that are related to some of the programs above. I’m certain there are others that I have not been able to identify. On 28 September 2012, Richard Ginman, Director of Defense Procurement and Acquisition Policy (DPAP) stated “The DoD does not anticipate having to terminate or significantly modify any contracts on or about January 2, 2012, as a result of sequestration.” In other words, these contracts should be unaffected. However, in case this situation changes, these tables will add to understanding of what is at stake for some vendors.

DISA Programs Minimally Vulnerable
The programs listed in the table below are funded through the DWWCF. These DISA programs should experience little pain from sequestration given that 99% of the DWWCF is exempt from sequestration. Funding figures were not provided due to the relatively small amounts of potential cuts. Readers will note, however, that these services for the core of DISA’s network, computing, telecommunications, and acquisition service offerings.

Sequestration in Perspective
Summing up, the important thing that industry needs to keep in mind when it comes to sequestration at DISA is that the potential impact is likely to be limited. Ironically, the CR puts DISA in a stronger position to withstand cuts to its RDT&E funding, if they materialize. Equally important is the fact that many of DISA’s most important programs are funded via the DWWCF, 99% of which is not subject to sequestration. Finally, the role DISA plays at DoD is mission-critical, making it more likely than not that sequestration cuts will fall more heavily on other Defense agencies than at DISA.

 

How Sequestration Might Impact the Navy

It seems that the topic of the impending budget sequestration come January has nearly eclipsed all other topics of industry discussion around Washington – save next month’s elections. The normal drama at the of a federal fiscal year (FY) has most often centered around whether or not Congress will manage to pass a continuing resolution (CR) so that federal agencies have a funding to begin the next fiscal year. But this year, a CR extending until mid-March 2013 passed with little controversy or even notice, in part due to an aversion to political controversy during a major elections cycle. What has taken its place in the discussion is sequestration: Will it be averted or is it likely to happen . . . and what will be the impact if it does?
The level of interest and the volume of inquiries we are receiving around the potential impact of sequestration on IT spending – especially at the Department of Defense – have dwarfed all other topics these days.  So my colleagues and I have been looking for whatever data and clues we can find to shed light on the topic, clarify the main issues that DoD leadership is dealing with and, hopefully, focus attention on what’s real. Here I will focus on the Department of the Navy. 
The Navy Budget Environment and Sequestration
Similar to other defense areas, the Navy funds much of its IT programs through its Navy Working Capital Fund (NWCF) and its Research, Development, Test, and Evaluation (RDT&E) budget. The NWCF is 100% exempt from sequestration, so programs funded through NWCF may avoid sequestration-related cuts, at least directly. The RDT&E side is another story because these funds are subject to sequestration.
For FY 2013 Navy requested just under $16.8 billion for its Research Development Test & Evaluation (RDT&E) activities, funding primarily, but not exclusively, C4 systems and weapons platforms. The current sequestration plan cuts $1.7B (10%) from the Navy RDT&E budget, if that FY 2013 budget gets passed. But under the current CR, Navy RDT&E funding is assumed to be set at the FY 2012 level, which was $17.7B, including Overseas Contingency Operations (OCO). So the FY 2013 RDT&E request represented a decrease in funding of about $1 billion.
The Budget Control Act (BCA) that brought us the sequestration plan was passed in 2011, when FY ’13 budgets were in their planning and development stage. Even at that point the general expectation was that current budgets were unsustainable and would need to be trimmed and this bore out in much of the final FY ’13 budget. Navy was already planning to reduce its RDT&E spending before sequestration would be implemented.
What is Vulnerable to Sequestration at Navy
Given that, under the current CR, any sequestration cuts which occur will be based on the higher funding level of the FY 2012 actual budget, what NAVY programs are most vulnerable to cuts under sequestration? Below is a table that lists the top ten highest RDT&E-funded programs/offices at the Navy, based on FY 2012 funding levels. These ten programs total $361.3 million in spending. Just for comparison, the Joint Strike Fighter is funded at around $659 million in Navy’s RDT&E budget.
Ten Highest RDT&E-funded Programs/Offices at the Navy

*FY 2012 level funding is assumed at this time because of CR.
These programs range from combat systems to back-office enterprise systems. The big question is . . . which of these can Navy afford to cut?
Implications
If sequestration in its current form comes to pass the Navy will need to weigh cutting RDT&E funded C4 programs versus network and computing programs and it is uncertain how much latitude they will have, in real terms, to shift funds to shore-up critical needs or if across-the-board percentage cuts will be enforced. Navy’s RDT&E funding was decreasing before sequestration was in place, but that does not mean that such an event will not be disruptive to programs, plans and schedules. The sequestration impact at Navy would be greater if based on FY 2013 budget than if based on FY 2012 CR funding level.
The combination punch of sequestration and the normal funding restrictions of a CR – same programs funded at the same levels – could prove to be the most disruptive because the CR prevents the Navy and DoD as a whole from moving forward with planned adjustments under the new defense strategy. The cuts, contingencies and delays caused by the current budget environment will likely have implication well beyond FY 2013.

 

Deltek releases free report: State & Local Competitive Procurement Analysis, Q3 2012

Earlier this year, Deltek reported on 2011’s nationwide state and local government procurement numbers to identify regional, government-level, and offering/commodity trends in solicitation releases. We’re building on that report and kicking off an analysis series for solicitations released by states and localities each quarter, starting with Q3 2012.
 
Using the GovWin IQ database to capture all solicitations released from June through September 2012 per region, we found the South accounted for nearly 34 percent of procurement activity. Solicitations released in the East totaled 25.5 percent, with the West and Midwest tackling fewer projects, at 21.3 percent and 19.4 percent, respectively. These numbers fall in line with 2012 all-funds budget numbers. The South tops budget figures at more than $517 billion. The East totals more than $428 billion, followed by the West ($401.6 billion) and Midwest ($324 billion).
 
As a reminder, Deltek utilizes the National Association of State Procurement Officials’ (NASPO) regional segmentation for analysis.
 
 
When we segment procurement data by government unit, state departments represent a majority of solicitation releases (34.6 percent), with cities at 29.2 percent, and counties encompassing 15.3 percent of releases. Public universities also released a solid chunk of solicitations during the summer months (11.5 percent). As is typical, special districts and independent school districts released the fewest number of solicitations, at 5.5 percent and 3.9 percent, respectively. Though state-level solicitations are most common, when combining cities and counties, local government procurement is dominant.
 
 
Further drilling down our data to the state level, not surprisingly, Texas (10.6 percent), California (8 percent) and New York (7.6 percent) encompass the bulk of solicitation releases. These three states also comprise the highest budgets, though Texas is third at $78 billion, with California ($210 billion) and New York ($133 billion) far exceeding the rest of state budgets.
 
This is just the tip of our analysis. A free, detailed visual report offering a deeper dive into Q3 2012 procurement can be found here. The report includes data on specific service requests (information technology, professional services, architecture, engineering and construction, etc.) per state as well as regional figures per commodity. 
 
Keep an eye on the Deltek B2G Breaking Views blog and our GovWinIQ suite of products for the latest analysis on state and local bid activity. Also, remember to follow Deltek's General Government team on Twitter @GovWin_GenGov and @GovWinKRidley, or connect with us through LinkedIn!

Procuring justice/public safety and homeland security technology: Is it more localized?

Justice/public safety and homeland security (JPS/HS) technology is commonly categorized as “local” IT since most procurements take place at the city or county level. Analysis gathered over the past three years confirms this statement, with 82 percent of the top five most-procured JPS/HS technologies coming out of localities.
 
The top five most procured JPS/HS technologies include 911 software, radio communications equipment, computer-aided dispatch (CAD) and records management systems (RMS), automated fingerprint identification systems (AFIS) and surveillance systems. Surveillance encompasses the majority of procured JPS/HS technology as it is more commonplace throughout multiple government entities and not strictly used by police and law enforcement.
 
As mentioned, JPS/HS technology procurement is traditionally more local, with the exception of AFIS. State-level procurements for AFIS are slightly higher (55 percent) than local-level procurements (45 percent). The reason for this is because AFIS is primarily used by state departments to integrate current criminal justice information systems from all law enforcement agencies within a state.
 
Procurement of the remaining top four JPS/HS technologies is predominantly at the local level. For CAD/RMS, local procurements totaled 79 percent, whereas state-level procurements topped at 21 percent. Surveillance technology totaled 72 percent local, and 29 percent statewide. Eighty percent of 911 technology procurement was localized, and only 20 percent was statewide. Lastly, local radio communications procurement totaled 70 percent, with statewide landing at 30 percent.
 
 
The number of opportunities for each given technology has increased from 2010 to 2011, but the ratios of state to local opportunities remains roughly the same. Most procurement activity thus far has taken place between January 2011 and January 2012, but these statistics could change depending on what states and localities have planned for the remainder of 2012. The only exception to this is AFIS opportunities, which had more procurements take place in 2010 than in 2011. It is interesting to note that all AFIS procurements that occurred in 2011 were statewide purchases, which reaffirms the fact that AFIS is one of the only JPS/HS technologies primarily procured at the state level.
 
Analyst’s Take
 
JPS/HS procurements are traditionally localized due to their ever-present need in local law enforcement agencies, coupled with a lower cost to purchase at the county/city level. It is much more expensive for a state to upgrade or replace an entire system compared to localities replacing their individual systems themselves. 
 
When technology becomes outdated, statewide upgrades have to take place across all jurisdictions simultaneously. At the local level, upgrades can take place intermittently within distinct departments at a much lower cost. Also, local projects tend to occur more often than statewide projects since fewer legislative issues and debates stand in the way. While funding a major countywide initiative may consume a bulk of a locality’s budget, and possibly be one of the only major projects pursued in a year, it is more likely to be approved due to the locality’s high need.
 
Additionally, the implementation of statewide mandates, such as the current FCC narrowbanding mandate, requires local departments to upgrade current software within a specific timeframe, thus creating more localized purchasing opportunities. The narrowbanding deadline of January 2013 may have direct correlation to the number of radio communications opportunities rising 22 percent between 2010 and 2011.
 
*All data has been taken from the Deltek GovWin database.

 

A Well-Orchestrated Pipeline Management Process Sets the Foundation for Contract Wins

In an era of contracting federal budgets, lengthening procurement timelines, heightened competition, and increasing client price sensitivity, federal contractors now more than ever need a well-honed pipeline management process to compete in today’s federal space. For those of us who have been in the contracting game for several decades, it’s easy to recognize that never before have we seen so many forces in play to make it difficult for even the most seasoned federal contractor to compete and gain business in the current environment.
Product and service differentiation no longer provide the only necessary leverage for winning contracts. Contractors must seek to improve upon operational processes to remain competitive. Fewer mega-awards, increasing task order use, modular contracting, and focus on small business contracting, just to name a few, test the temerity of contractors’ business development processes and make it more important than ever that they fine tune their pipeline practices.   Business development problems will only be made worse in the current environment, so identifying any kinks in the process can improve competitiveness and reduce costs.
Deltek’s recent research into the opportunity and pipeline processes of federal contractors sheds light on current business development challenges, pipeline management practices, and methods for monitoring pipeline health.   The chart below shows the major business development challenges cited by Deltek’s 244 survey respondents: 

 

By far the biggest business development challenge for survey respondents is the unpredictability of procurement/sales cycles. Coupled with the second ranked challenge of insufficient resources, contractors must have an agile and solid management system in place to provide stability in the pipeline process in order to remain competitive. Additionally, mid-sized contractors need to focus on developing teaming and sub/prime decisions earlier in their pipeline process. Scrambling to find a team or assemble a team late in the game will cause mid-sized companies to lose ground in the pipeline process, as well as their competitive positioning.
The chart below shows respondents’ desired changes to their current pipeline process: 

 

Most respondents would like to see their company’s business development and capture capabilities strengthened, especially mid-sized and large contractors. Additionally, mid-sized contractors would like to see more consistent implementation of pipeline processes. Training, solid processes, and executive level support can help contractors alleviate these pain points and strengthen the BD process and insure more consistent implementation of the pipeline practice across the company. 
Most respondents believe there is a correlation between effective pipeline management and corporate financial performance, such as increased revenue, profit, and/or stock price. Contractor business development and pipeline processes are the foundation for generating business. A well orchestrated and managed pipeline process, along with seasoned and well trained staff, can create a competitive advantage and a reliable vehicle for generating contract wins. A consistent, structured pipeline management process can help contractors navigate and weather the challenging federal market environment.
About Deltek’s Survey:
In July 2012, Deltek conducted a web survey of 244 of business unit heads, CEOs, COOs, business development leaders, capture managers and proposal managers from 138 companies that provide information technology or professional services to the federal government, with annual revenues of $25 million or more.

 

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