Three Takeaways from Deltek GovWin’s Latest Federal IT Market Report

Every year, Deltek GovWin’s Federal Market Analysis (FMA) team publishes its flagship forecast report for the federal information technology market. These reports recently forecast an abbreviated period of three years due to the fiscal uncertainties surrounding COVID-19. This year, the FMA team returns to its traditional five year forecast through fiscal 2027.

My colleague John Slye will be posting more information on the report this week. My post today zeroes in on three takeaways from the report that came from our research into the data for spending on Government-Wide Acquisition Vehicles (GWACs), on agencies achieving small business participation goals, and on trends in the Government Accountability Office’s (GAO’s) rate of sustaining contract protests.

GWAC Spending Trend

Long competitors to the General Service Administration’s schedule contracts for IT procurement, GWACs remain very popular among federal agencies. Contracts such as the National Aeronautics and Space Administration’s  Solution for Enterprise-Wide Procurement (SEWP) are now in their fifth iteration, with plans proceeding for a sixth iteration soon. Other popular GWACs include the National Institute of Health Information Technology Acquisition and Assessment Center’s (NITAAC’s) Chief Information Officer Commodities/Solutions (CIO-CS) and GSA’s own Alliant 2 Large and Small Business vehicles, among several others.

The Office of Management and Budget designated many of these GWACs as “Best-in-Class” (BIC) during the adoption of the category management methodology a few years back. Now, FMA has found that federal spending on BIC GWACs increased 27% from FY 2020 to 2022. This is important because it shows that agencies are responding to OMB’s category management guidance by putting more contract dollars through BIC contract vehicles.

Small Business Participation Rates

The latest available data from the Small Business Administration (through FY 2021) shows the number of small businesses active in the federal IT marketplace is declining. This is ironic because federal agencies continue to hit small business participation goals, yet the number of participants winning small business dollars has been declining. Such a trend does not bode well for the health of the U.S. economy or for the availability of the innovation small businesses bring to the IT table.

Here is the data by socioeconomic small business class:

FMA’s IT Forecast also takes a deeper dive into the data by breaking it down to the agency level.

GAO Bid-Protest Rates

Protests are a fact of life in federal IT contracting. The latest data from the GAO shows that while the number of protests filed by industry has declined every year for the last five fiscal years the effectiveness of those protests for bringing some relief, translated as a favorable result for the protestor, remains above 50%. Results this successful encourage many vendors to believe it is still worth the time and money to file protests.

Taken together, these three observations reflect the dynamism of the federal IT marketplace. Data such as this is, however, only a small sample of what is included in Deltek’s new Federal IT Market, FY 2023-2027 report. Dozens of other topics are covered as are deep dives into the IT trends at more than 25 federal agencies.