Panel members point out the pitfalls--and the opportunities
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Although the U.S. economy faces an uncertain future, the federal government is likely to keep on spending big on technology, according to a panel organized and moderated by Everything Channel Industry Editor Craig Zarley at the FOSE Conference and Exposition, the government IT exposition in Washington, D.C.
Participants included representatives of Lockheed Martin Corp., Bethesda, Md.; Chantilly, Va.-based solution provider GTSI Corp.; systems integrator EDS Corp., Plano, Texas; and solution provider SRA International Inc., Fairfax, Va. The panel discussed opportunities in the federal market and discussed the implication of government IT spending in an election year. Here are some of the top trends discussed.
1. Global Opportunities
In developing countries on the African continent and around the world, federal aid programs and nation-building initiatives provide a host of opportunities for solution providers. "We're looking for the reach of companies that go beyond U.S. borders," said Paul Mrochinski, director of U.S. Government Alliances & Partners, EDS. "We've set up communities of practice where we can and have taken small-business organizations into international opportunities because of the capabilities they have."
Mac DeShazer, Lockheed Martin's senior manager and small- business liaison, said many opportunities exist through the recent creation of Africa Command (AFRICOM) to address the needs of African countries. Such opportunities include putting communications systems in place for dealing with malaria, tuberculosis and HIV. Although he said he recognizes the difficulty and risk companies take when deciding to do business in countries with limited access to quality infrastructure and sufficient power capacity, companies that go "the last mile" are often rewarded with a less tangible, but morally empowering, dividend--the satisfaction of humanitarian action. "It feels great to be able to help these countries," DeShazer said.
2. Security Staying Strong
The demand for cybersecurity remains strong in the federal market, said Mike Fox, senior vice president of marketing and sales for SRA International. "The need for information security professionals is at an all-time high," he said. "It's virtually impossible to fill all the positions needed." Threats from viruses, hackers and attacks on infrastructure require constant attention, and as trends like virtualization continue, the need for federal security solutions is expected to remain vigorous. "I agree it's a huge area," Mrochinski said, pointing to ID management as another security area that will grow along with access management. "It's something we are looking to expand from a federal government opportunity into the state and local space as well."
Next: 3. Get Environmentally Friendly
3. Get Environmentally Friendly
Green computing was a hot topic at this year's FOSE conference, and as agencies implement programs like EPEAT (a government program to help the public and private sectors evaluate, compare and select desktop computers, notebooks and monitors based on their environmental attributes), solution providers can leverage their use of more efficient and environmentally friendly technologies-and give Mother Earth a helping hand at the same time. "It's a very interesting topic and it seems to be multifaceted, from turning off lights to how [agencies] operate their computing environment," said Mohamed Elrefai, vice president of the Enterprise Solutions Group at GTSI. "The focus has been more on the products vs. the operation of those products like peak utilization vs. low-level activity."
Fox said federal agencies are looking for ways to reduce their carbon footprint and said he believes it's a movement that will only gain momentum in the years ahead. "It should definitely be taken into account," he said. "It's not driving a lot of projects yet, but we're on a major trend toward something important."
"There's been a shift in state and local with focus on end-to-end solutions," Mrochinski said. "We try to facilitate an end-to-end solution process." For government agencies, he said, it's not simply about bringing in the IT asset--you need to address the business mission.
Also complicating matters is the recent failure of large-scale complete solutions projects like the Coast Guard's Deepwater fleet debacle. "It will be going a bit slower around the mega solution contracts," Elrefai said. "With these big 'solve the world' problems, it's unrealistic to expect one company, or even one team, to do it all." Elrefai said an emphasis on team building on managed services is prudent in such a technically complex sector of the market. "When you look to partner in terms of this marketplace, no one company can be an expert across the infrastructure of a managed service," he said. "The important thing is cobbling together people who have the expertise to provide the best experience for the customer."
5. New Administration Could Mean Slowdown
Fox noted one interesting trend that solution providers and vendors will be dealing with come this fall. Because this is an election year in which no incumbent will be returning to the White House, the federal government is going to go through a major transition that could trigger a slowdown in IT spending. "Everything is going to happen between now and the end of the government fiscal year on Sept. 30," Fox said. "This is the time to bulk up.
"We could be looking at a year or maybe longer before the business starts to pick up again," he said. Even though Fox calls the D.C. area "basically a zero unemployment" location, the tumult created by the presidential election, no matter who wins, will directly affect VARs who sell to the government. This is also the first time in recent history when an executive election bridges a war, Fox noted. "Keep an eye on that, because it will have implications on our business," he warned.
6. Procurement Process Mangles Contract Awards
Talk about government protests. While the Boeing/Northrop Grumman air tanker contract is grabbing all the headlines, some of those who have lost an IT contract are making news of their own--by protesting and sometimes even winning their battles. As a result, government procurement officers are stretching out the time it takes to write contracts by dotting every "i" and crossing every "t"--fearful they will be scrutinized later. A shortage of experienced procurement officers isn't helping things. Some IT contractors are even taking advantage of the chaos, further delaying contract awards.
7. Iraq War Means Tighter Overall Budgets
With more Department of Defense money going to weapons, vehicles and the basic tools of war, IT spending is getting tighter. Federal IT solution providers fear that the continued massive outlays to support the war are contributing to a deepening recession, meaning much tighter budgets throughout the federal government in the future.