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Blog | 06.23.20

Government Procurement is Becoming More Agile: What That Means for Suppliers

There’s a perception that bidding on a federal, state or local government contract entails a lengthy solicitation and contract award process, and that may still be true in some instances. However, the public sector has been moving towards more agile procurement methods for the past few years, and the COVID-19 crisis merely accelerated their adoption of fast, flexible and efficient sourcing processes. 

Though it could still take weeks to find out whether or not you have been shortlisted, and months before pricing negotiations are complete, contract terms finalized and projects are formally started; the reality is that most procurements are being fast tracked right now, including large-scale IT and systems projects. Those long lead times you were accustomed to before are probably long gone, as are many of the “waterfall” procurement methods and project structures that were often burdensome on smaller companies’ resources. In other words, as more and more agencies start to give merit to the benefits of agile IT projects and, therefore, agile procurement strategies, you should expect to see a shift to a more “iterative and incremental” design and development method for new government IT systems and services in particular.  

So, what does that mean for you as a government supplier? How will you need to adjust your “sales” strategy, or re-align your resources, in order to compete (and win) within an agile procurement environment?  

1. Step up as a subject matter expert very early in the project planning process. 

Unlike traditional “waterfall” projects, government agency leaders may be soliciting private sector entities for insights long before they issue the formal contract solicitations. As Idaho’s Chief Procurement Officer Sarah Hildebrand once noted at a state CIO conference “innovation comes from early involvement” from vendors, because “we need to understand from an industry perspective what’s out there, what’s coming.” In other words, “not only must government figure out how to creatively use new tech, but also vendors need to help them find those use cases.” Follow this advice to build credibility with government buyers as a trusted technical expert.

2. Be prepared to act fast – and be ready to show, not just talk about, your skills.

When we say you’re going to have to act fast, we’re not just talking about increasing the speed of your RFP responses. (Though agile project solicitations will come more frequently and feature much shorter turnaround times for both responses and awards.) Agencies will be moving from a marathon-style project structure to a continuous series of “sprints”. That means that, instead of looking for vendors to support a two-year project from start-to-finish, agencies will be issuing a number of competitive solicitations as they go to fulfill the specific requirements of each two-week sprint. They will also be asking agile candidates to demonstrate their capabilities versus just document them in a standard RFP proposal. Therefore, you may only have two weeks in some cases to prove your company’s technical expertise either pre-award or within the framework of a short-term contract.   

At the same time, competition is likely to become fierce, as agencies’ frequent agile acquisitions will extend their reach to new vendors. Agencies’ expansive search for technical experts and “real-world” evaluation method is expected to give them access to a much broader pool of vendors qualified to meet both price and quality standards. In other words, you’ll likely be competing against small businesses that have the exact technical expertise required but would have otherwise been deterred or disqualified if a longer-term waterfall project structure had been utilized. 

3. Be ready to support the customers’ changing requirements – or be willing to pass the baton. 

For the reasons already discussed, agile contracts are not guaranteed long-term contracts. In fact, one of the benefits of agile procurement (to the buyer) is the freedom to course correct without the red tape of traditional long-term contracts. They are no longer locked into a contract with the wrong vendor or forced to settle for a sub-par product or service. Since the agency will stop to evaluate their project’s progress at the end of every sprint, they will be in a position to easily redefine the scope of the outstanding project sprints and even re-award contracts to many different vendors if needed to achieve their short-term and long-term goals. If you want to retain the government’s business for future sprints, you must be agile enough to respond to customer feedback every couple of weeks or the customer will find someone else who is more flexible.

Beware the agile definition gap.  Not all vendors can execute on agile, despite what they might say in proposals. Not until you get the team on the ground will you really find out whether they possess those skills or not — or whether their idea of agile and yours are the same. We have found ourselves having to train the vendor on how we execute a project in agile.

   Ron Baldwin, CIO of Montana

Remember: If the customer decides to switch vendors based on newly defined technical requirements – perhaps they need a specialized solution that’s outside your wheelhouse – that is okay. It does not necessarily reflect poorly on your performance record. In fact, it could hurt you more in the long run if you claim to meet certain qualifications on an RFP response but fail to deliver. Know your strengths and know when to step back.