Summary In this episode, Marcia Watson discusses the upcoming election and the potential impact on federal contracting with Gene Moran and Larry Allen. They explore the logistics and operational changes that occur during a changeover year, as well as the bidding trends and opportunities for contractors. They also discuss the importance of communication with government representatives, the role of small businesses in the contracting landscape, and the potential changes in policies and regulations related to AI. In this episode, Marcia Watson, Larry Allen, and Gene Moran discuss the potential impacts of political changes on government contracting. They cover topics such as new rules and regulations, international markets, infrastructure, and the importance of relationships and communication in the government market. The speakers emphasize the need for contractors to stay informed, adapt to changing priorities, and maintain strong relationships with government officials.
In this insightful episode of the Optimize Podcast, host Marcia Watson dives into the upcoming U.S. election and its implications for government contracting with experts Gene Moran and Larry Allen. They explore crucial changes contractors might see, including shifting federal priorities, potential new regulations, and the impact of political dynamics on bidding and contract types.
Key topics include the significance of relationship-building and communication with government representatives, evolving roles for small businesses in federal contracting, and the rise of AI and Buy America policies. With a focus on staying informed, the speakers highlight capture strategies, low-risk partnerships, and resources like spending trends and industry associations to keep contractors prepared. They emphasize adaptability and strategic planning around cash flow and continuity, especially given the uncertainty that often accompanies changeover years.
Top Takeaways:
Listen to the full episode on Optimize Podcast for a deep dive into election-driven trends affecting the contracting landscape.
I will say both parties seem quite interested in the the the mantra of buy America. And I I like to say that that's a great political tagline, but it's, impractical in its implementation in that we simply don't have the capacity or wherewithal that we once did to have everything be made in America.
Hello, and welcome to the VisibleThread Optimize podcast. I'm Marcia Watson, CEO of BTW and Company. Today, we're kinda looking at a different topic, a different general discussion of where we are right now in twenty twenty four in the US, specifically related to the upcoming election and the potential for changeover activities that are related to, a new president coming into office in January next year. So today, I have with me two experts who have been following government acquisitions for, careers, and I'll ask you each to kinda give me your bio and background on that.
But I wanted to have a conversation about this this changeover environment, what happens in federal contracting and bidding trends in an election and changeover year. So I'm looking forward to this discussion. I wanna talk specifically about logistics and operational changes, not really talking about who we're voting for and why, but really what do we have as contractors to to look forward to, to plan against, risks to mitigate, or opportunities to take when the, federal government experiences a changeover like they will this year? So first, Gene, would you like to introduce yourself, please?
Sure. Hey, Marcia. Thanks for having me here. I'm Jean Moran. I run a company called Capital Integration where I I help primarily defense and security companies, navigate the Washington space and achieve dramatic outcomes either through funding or policy influences.
And, I know we're talking about, acquisition and contracting today. I spend the the bulk of my energy with clients working on the front end of that process.
So the, the requirements generation, the budgeting, and the, appropriations that will underpin the eventual acquisition and contract.
And, it's it is an exciting time, whenever there's an election. This particular one is turning out to be, quite exciting and and, a bit unexpected.
I I will say, over a year ago, a year and a half ago, I predicted that, neither president Biden or president Trump would make it all the way through. And, we'll we'll see how this goes.
We shall see. How about you, mister mister Larry Allen? Would you provide your introduction?
Marcia, thanks. It's great to be here. It's great to, work with Gene. I'm Larry Allen. I've been in this business for thirty four years, and I currently run Allen Federal Business Partners where I work with a variety of government contractors, mostly on indefinite delivery, indefinite quantity contracting issues where I provide market research, relationship development assistance, and a heavy dose of contract compliance because my motto is about it's how much you keep in government contracting, not how much money you make.
Fantastic.
That's another discussion in short in shorty.
So we all know, like, election years, they bring significant uncertainty and change into the federal contracting landscape. Some things that I've kind of identified in in research is, you know, there might be an increase in short term contracts. We're gonna change focus to what might be the political, critical missions for the new administration.
Obviously, budgets are always questionable, every single year, but especially in a changeover year. And maybe some of the different approaches to, best value versus LPTA bidding types, the cost cutting? How do we become more affordable as we're also facing a little bit of inflation issues coming out of the current administration? So let's talk about some of those things. Like, what in general during a changeover year are just the kind of, yep, it's a changeover year. This is what we can expect. What is what is your guys' experience been in that?
You you know, I think there are things that that happen regardless of, of who the winners are that are, that sort of happen in sequence. You know, we'll go through this period of, either, excitement or, uncertainty about, okay. I did my my team didn't win.
And, you know, that's that that really doesn't, affect the, the day to day working of of acquisition and contracting, in my opinion. I I think what team wins, really only obliquely affects, the contract outcomes, and it and it may be more on the margins.
But, you know, we're going to see, a a period we we will be in a CR as this election unfolds. I I predict we will be in another CR that will extend into the new year, because regardless of the winner, it will be, somebody who's not there today.
That that means that a budget has been developed on somebody else's watch and everybody will want to, at least pretend to reevaluate that budget before they they formalize it. So that means late money coming, in the fiscal year. I'd we will be five or six months into the fiscal year again before, appropriations are signed into law. That that's my assessment.
And that means that, companies need to be prepared for this, paralysis by analysis where we will we will watch the problem, we will admire the problem, and, we will, be in in sort of slow motion until suddenly an appropriation will be passed at at the mid fiscal year, and we'll be trying to choke down all of this money, late again. We've seen it before for a variety of different reasons.
So that that's what I mean when I say this these things will unfold in a in a knowable sequence regardless of who wins.
Understandable. Larry, your perspectives.
So I think that in terms of day in and day out government business, the regular order of business, that will continue to be done.
Where I traditionally see some of the slowdowns is in any of the product projects that get labeled with being innovative or maybe larger projects that came about because they fit in with a specific administration's agenda. And when you lose a lot of the political appointees, which is something that I actually expect to happen on between now and the election regardless of who you think is gonna win. This is just kind of when that occurs.
You start to see some of those larger, maybe more marquee projects dropped out a year.
There's certainly plenty of well trained, extremely, qualified career government people, who can take those projects forward. But a lot of times they may ratchet their activity back a little bit and wait to see what new politicals do.
I've spoken to more than one of the senior careers over the course of my time, and they've said, look, you know, we don't want to get halfway down with a new project that we're thinking about only to have the new appointee come in and say, well, no, we're gonna go down this direction.
And then they've already committed time, money, and resources to it, and they have to go back and do it again. So I think, you know, if you re if you're working on one of those larger, more marquee, maybe, more political backed projects, you'll see an impact, but the regular things will continue to get done.
I think Gene's right on in terms of his forecast for appropriations.
It's alarmingly so, but, you know, I I I think you can expect to see something in FY twenty five, similar to what we saw in FY twenty four, when you get appropriations out the door in that kind of late winter, early spring time frame.
Yeah. Which makes for a fun proposal season. That's for sure. So in in that regard, let's let's talk about that for a little bit a little bit. Communication with the government and your government representatives. If you're speaking to somebody who is in an appointed position or somebody who reports in that appointed chain of command, what are some contingencies that contractors should be considering in how they're conducting their business development, how they're having those conversations?
Marcia, I always recommend to my clients that they talk to at least four different types of people when they're talking to a government agency so that you're not keying in on any one person.
A lot of people spend time on the customer, the end user, and that's appropriate.
But if you spend all of your time talking to the end user, you're never really sure, for example, if other people in their agency wanna do the same thing that they're talking about doing. So it's good to ask around and get at least another point of contact maybe from the program manager, maybe from somebody else, in the same office. Say, hey, you know, we've been talking about doing this project. Is this really something that your office is gonna fund and move on?
Similarly, you wanna talk to people in the financial world to make sure that your project's gonna be funded.
There are limited ability for agencies to reallocate money, but in between certain funds, it can be reallocated. And again, you don't wanna go all in on a project only to find that the priority changed and that funding got cut in half. And then last but certainly not least are contracting officers. This is my plug, contracting officers are people too.
And you've definitely wanna talk to them while you're doing your business development.
Just so that you are not paying all of your hopes on one person. And particularly with the CEO, you wanna get a sense of acquisition strategy. You also never wanna take it for granted that they have an acquisition strategy, which gives you the opportunity to present one.
Gene, your perspective on that.
Yeah. When we're in periods of uncertainty as as we're about to to enter, I encourage clients to speak with their outside voice.
And by that, I mean, you you need to be clear and forceful about why your ability to deliver something on cost and on schedule is, should be the highest priority or a higher priority than than it may be, presently viewed.
If you're a manufacturer of something and, you you may be in a in a tight competitive space where there only are a few, providers, if you would be hurt by the consequences of an extended CR, you need to make sure that people in government understand that. And that, if if you are at risk or you're being forced to operate at risk, you need you need to say that forcefully because there are subtle little things that can be done as as Larry suggests to to move money around or or, you know, make some short term, adjustment so that no nobody wants to lose somebody from the industrial base over this, government uncertainty.
But, underlying that that ability to speak forcefully to, delivering on cost and on schedule is really trying to look at it through the lens of the government buyer, wherever they are in the, in the acquisition and contracting world. And as as Larry suggests, you know, there there are multiple people involved. I I like to refer to a constellation of people in your your buying, circle. It's it's multiple people, and not just in the executive branch.
There there can be industry people who may bring influence to an issue. There can be congressional people who can bring influence to an issue, to make sure that, you're at least getting a fair look, if if somebody's about to make a decision to, defer, delay, or cancel your, acquisition.
So let's talk about that. Like, what are some kind of nuance hints that you can see from the government? Like, what should contractors be looking for in terms of, as Larry addressed, like, whether or not it's funded? You know, do we think there's gonna be a changeover to this degree in the staff? What are some indicators that, you know, there might be a little bit more disruption in a certain agency or organization than there than there would be in others?
I I would speak to the, the congressional marks are often a an indicator that, to my amazement, it they routinely surprise people, in that, when money does come to the executive branch, sometimes that's the first time a company is learning that, hey, their funding has been cut significantly or was at risk of being cut. And it could have been known months prior had they been tracking the legislative marks that occur, you know, across government.
That's not so difficult to find out. These are these are publicly available documents, but most most people don't look at them.
I think cash flow is always an indicator, right, if, if the government, delays payment or defers payment or if the prime vendor that you support is, is deferring payment for whatever reason, they they may know something.
I I find with small business in particular, they are often, at the at the mercy of of a large prime, not only for the the the cash flow, but for their source of information. And, they have the ability to do their own homework and and learn some of these very learnable, things that I suggest.
Well, for those who might not know or be aware or even have considered that the small business, you know, in looking at this environment, maybe a new contractor who's just come in recently and hasn't made it through an administration changeover. What are some of the publicly available tools that they can access for that information?
There is a a full suite of things that are publicly accessible. You can find all the legislative issues that Dean referred to on, house and senate websites.
That's actually fairly easy to find. If I can find it and make use of it, then chances are your listeners can as well.
There's also all kinds of information on spending trends. You have usaspending dot gov that talks about it and a lot of people look at that. But I would also encourage you if you wanna do a little deeper dive to look at, stuff like the federal procurement data system that tells you a little bit more about who, what, and where of the buying that's going on, or not. Tells you, one of the things as you get out of that system is the burn rate on specific contracts.
So that can give be one indication as to whether or not, you're burned out or you've got a little time to go. You know, that's one thing that but to get back to one of your earlier questions, Marsha, I think one other thing that companies can always look at, if they start hearing from their government contacts that they're going into continuity of operations planning meetings, COOP meetings, every agency has to go through this, if there's a threat say of a shutdown or if there's a threat of a disruption in the market, which is not to say that it's actually going to happen, but by law they're required to go through these continuity steps at certain times.
And that is at best only a distraction from what, would be doing people would be doing in the order of their normal business. At worst, it could lead to some very substantial changes.
I I would add, to to Larry's excellent list that, the there are a variety of associations out there who serve multiple purposes. They they don't just put on trade shows. Many of them offer, quite substantive, sort of redistribution of, of reports and summaries of of reports and and detailed understanding that stems from their great relationships with the government across, you know, multiple agencies in some cases. But they also have, these associations have connectivity with, the larger companies who have, you know, a a full time Washington presence and have research, tools available to them and and, you know, are able to devote the time and energy to that sort of thing, it can be easy to overlook that some of those tools are, already being paid for as part of a subscription of membership, and, and you you may just not be using them. So, sometimes asking, hey. Am I on the right mailing list, or do I do I have access to the correct, database that is a natural part of a of a membership?
There there are hundreds and thousands of of associations, some some much better and better recognized than others, but, don't overlook those.
Yeah. Absolutely.
So then when we talk about small business in general, we know that there's usually changes associated with those administrative changeovers and how they're looking at federal small business contracting. Sometimes the goals change. Sometimes we get more emphasis for one set aside type than another. For those contractors and those, socioeconomic designations, what are some things that they should be considering as part of this changeover activity?
Marsha, I think one of the things that's happening now is you're seeing so many of the small business rules being rewritten and and readdressed in terms of government contracting.
And I really think that for the most part, that's an effort that's gonna continue regardless of what happens at the polls this coming November.
It's things like the mentor protege program, things like pass throughs, certifications, what do you need to be to be eligible?
And that's changing. And the idea is that it's all gonna be tightened up a little bit with some transparency to make sure that the businesses are who they say they are.
But if you're a business that's in that world, if you've got a special socioeconomic designation, if you're part of the mentor protege program, you really need to be paying attention to some of these things that are going on, right now, because they could really reshape your market, for good or for ill. And, you have an opportunity in most cases to make sure that your views are known and you should take every advantage of those opportunities, to make, to let people know what you're thinking, so that people don't make decisions that provide more speed bumps in your government market that you probably don't need.
Absolutely. Dean, from your side?
Yeah. You you know, I would, just draw a distinction between the law and the policy here. So the the law the law says twenty three percent for small business set asides of the various categories, but it's policy that subdivides that. And, I like to say that policy can be bent like a horseshoe.
And so, just as easily as we can, make make an adjustment to put emphasis in one direction or another, there can be exceptions and carve outs, and it and it happens all the time.
The other thing I would, look at or encourage small businesses to look at, some hold themselves back from breaking through that free and open barrier, whatever it might be for the for the individual NAICS code. I've had multiple clients, fearlessly break through that, and do quite well, competing for even bigger opportunities.
So, you know, let's not forget what what these set asides are really all about. It's it's an acknowledgement that access to capital is not the same in our country across those socioeconomic categories. And it's intended to try to, help those companies, have a a fairer opportunity, at least as they're, starting out as small businesses. But don't feel like you have to, suppress your trajectory to stay in that category.
It's okay to break through. And, sometimes we we lose sight of that.
Yeah. That that makes for an interesting dynamic with some of the small businesses that that they are able to get out of that, small business designation, at least in that NAICS code, but then it puts them against that full and open market. In the context, again, of of this change over time frame, what are some capture strategies that that teams should be looking at when they think that an opportunity might head a different direction? I'm going more more tactical.
Larry?
Yeah. I I would let Larry lead on that. I because I I I don't I don't focus as much on capture.
That's that's why I think Yeah.
No problem.
Well, I think capture strategies for smaller businesses need to take into account a couple of factors. One is that, particularly when we're having a changeover in top people, your risk averse government customer may become all that much more risk averse.
So emphasizing why you are the low risk experienced source, your reliability, the who you surround yourself in terms of team members, their reliability and experience, that really, should go some way towards, alleviating any of the concerns that people might have, about doing business with you. Of course, if you're a newer market entry, partnering with people who are experienced, who you can leverage that benefit from, is is important. And it's important anytime, but I think it's particularly important now. And also understand that some of it has to do with what it is you're trying to capture.
Are you trying to capture business that is on a new project that has, some higher visibility, or is this, a follow on to something that's already being done? Because the higher visibility it is, the more, maybe it's size there is to the project, the more, media attention there is around it. The the more you're going to want to have to make sure that everybody knows what your capabilities are and that, you can handle the project that could come your way.
Absolutely. Gene, anything from that perspective?
You know, I I would just offer that I I know, you know, as we're recording this and and really as we publish, we're we will be in advance of the the election, but but there could be some considerable changes in the, the senior executives and the the senior, government officials, in in any of the agencies, depending on who wins. You know, former president Trump has made clear that his intent to to, you know, look more carefully at at what some of the, long term, government, positions are all about.
I think with, if if it were vice president Harris who wins, there there's maybe some desire to keep, a level of continuity, and and there are some very high performers, in in any government administration that they might try to, try to keep keep in place or or, continue on in a new administration. But in that interim, when when, decision makers are are uncertain about their own situation and and they might be evaluating what what's their next career move, that can have this, this this feeling of a sort of a weight on the whole process that to just kinda, as as Larry used the term, causes people to gear down a little bit and and, that it manifests itself as a gearing down to something to watch for.
So let's talk continued that conversation a little bit. So looking at kind of President Trump's first term in office, obviously, Harris looking at possibly a continuation of some of the Biden initiatives, but, you know, she's gonna wanna put her own spin on it. Look looking at critical missions inside the US, what can one expect in terms of, you know, do we think president Trump is gonna come back and try to reinstate some activities or things that have kind of come down as as in the last four years? You know, what do we kind of think is gonna be the the, you know, changing of the status quo back to or away from, prior activities in in either of these administrations with that incumbent history being, you know, a thing.
I will say both parties, seem, quite interested in the the the mantra of buy America.
And I I like to say that that's a great political tagline that certainly excites voters, but it's, impractical in its implementation in that we simply don't have the capacity or wherewithal that we once did to have everything be made in America. And that's why there are so many exceptions and and carve outs. So, we may see some big swings made by a president Trump or a president Harris to say this is how it will be. We've seen congress try to do that by, legislating, in in, certain industries.
And, often, it's it's proven to be, just just impractical.
And so there have to be exceptions made.
So I say that companies, regardless of their size, who have knowledge of specific industries or elements of industries, have an equal opportunity to step forward and and communicate.
I'll say in the, Trump administration, we saw the use of executive orders to, make declarative statements and, sort of work around the legislative process, that any president has certain executive powers to to do those kinds of things until the Supreme Court says you can't do that. But, he was fairly ready to use, executive orders that were not super complex, and, they weren't, you know, in the case since president Biden's AI executive order, that's sixteen pages long that I think it's the longest one on record.
President Trump was was fairly decisive in his use of those. And I I would think he will try to do it again because it's a a quick way to get to a a, a desired position.
Yep. I would concur with that. I think another thing that we could expect to see out of a second Trump administration would be ratcheting down, some of the regulations that impact government procurement.
During the first Trump administration, we saw them work overall, not just in terms of acquisition, but overall in the regulatory framework, two regulations out for every one new regulation in. And I think we can expect to see that that type of thing again. I think also anytime you have a Republican administration come in, you wanna you can expect to have a look at a seventy six, which is the OMB circular on what serves as an inherently government function and whether or not industry should be given the opportunity to perform some of those. So that could very well be on the, agenda.
For vice president Harris, I think I would expect to see a continuation of their regulatory agenda in terms of, pro union labor, things, work agreements, project labor agreements, things like that. In addition, continuing the work that has already begun on sustainable acquisition, they're rewriting the entire chapter of sustainable acquisition and the federal acquisition regulations.
But then they're also at the meantime talking about greenhouse gas emissions, and other things that are environmental in nature. Things that don't really have a net core part of government acquisition, but government acquisition is being used as the train to achieve some of those ends.
Yeah. And I think in in terms of, you know, FAR compliance and those sorts of things, we certainly see those influences coming in with new FAR clauses or adaptions of FAR clauses from, you know, right of first refusal is something that kinda switches back and forth that I've seen or, you know, obviously the the AI is going to be another, thing that needs to be regulated.
So let's touch on that because we can't have a podcast without talking about AI.
Just in general, because I've always said, and I don't wanna be on this topic long, I've always said that the risk for the proposal industry and business development industry right now with artificial intelligence, I have two philosophies on this. One, when you have artificial intelligence suggesting your response and then artificial intelligence evaluating your response, that kind of takes a lot of the, you know, technical human elements out of it. Is the government looking at that in one way? And then in the larger, just how AI has become so prevalent in in our conversations. And in in another podcast, we even talked about the the load of data that is required for an AR response and the environmental impacts of being able to run AI servers and those sorts of things. Do either of you have any, insights or perceptions into what kind of those perspectives are inside either of these administrations?
I I have some concerns about how we will approach this.
I recently sat on a, an Axios editorial board that was about, the the intended path of regulation for AI. And the the consensus in the room among twenty five experts was that the government would likely go down a similar path that they did with regulation of cybersecurity, which is to say it will take forever, and they will put the burden on small business, to, pay for, whatever sort of compliance is required.
I will say I was a lone voice at that table that said you you cannot do this to small business again, expecting them to, you know, pay for the the security, concerns that are these are national security issues and there should be some government support for that.
I personally thought that, you know, bringing the likes of Elon Musk and, Bill Gates, and and other luminaries to the table with, senator Schumer and other senior congressional leaders, that's exactly the wrong way to approach this. There there are some AI leaders at the very, highest levels of big tech. But in terms of, regulatory, implementation, this this will be years, if not decades of, policy, reconfiguration. This this will, look like, tax legislation in my opinion. There there will be so many, nooks and crannies to it as we go along.
And and we've definitely seen that already starting to happen with agencies, each doing, their own AI approach, their own AI reviews.
Congress kind of got into the AI game and acquisition a little bit late, but now it's furiously playing catch up with, bills that they introduced in the spring and summer this past year.
So I would expect to see some forward movement on those. But I think the the word patchwork is one that we will hear a lot more.
If, vice president Harris wins, the election, I think we'll continue to see her administration use the AI framework laid out in the admin the Biden administration's AI executive order.
Conversely, president Trump has said already that he will not abide by that. And he think that thinks that that AI executive order is overly prescriptive in terms of, not supporting innovation and and broad thinking.
Not sure what that would be replaced with, but, you know, certainly, there are two different minds there from each candidate.
Yeah. Absolutely. And I I think for for everybody, there's probably, you know, many different opinions on this subject. But I will I've always said until it's regulated, use with caution. You know, I I I think personally that there there runs the potential of bids being disqualified for their use of AI because how do you know? How do you know where this idea came from? You know?
I think that and we've talked about this and again, it's not necessarily privy to this conversation, but in those terms of how acquisitions are going to be written, and and tying not just to AI, but different political influences, pricing strategies, staffing strategies, down to the nitty gritty. And this is probably another Larry question.
When you're looking at opportunities and the broader scope, what kinds of those far regulation impacts can come companies expect to see if if some of those, clauses change?
Well, I think we can expect to see, the continuation of new rules and regulations that place new burdens on contractors, really frankly under either administration. You'll probably see a little bit more of that under a Harris administration, but there are already so many proposed and interim rules in the pipeline, that, you know, they're all gonna have to make their way through the process.
Many of them, are gonna end up being implemented regardless of who sits in the White House, or at the Office of Management and Budget. So, you know, we're talking about things like pay equity and and transparency. We're talking about where you get your semiconductors from. We're talking about some of these things that are intended to, on first look, impact only large businesses that are maybe doing a lot of high end defense work.
That doesn't just affect those companies. It affects all kinds of companies. You know, we saw this happen with rules on telecommunications, use. And the broadest impact of that is not on telecommunications companies.
It's on every other type of contractor regardless of size. So I think we'll, continue to see that. I my hope would be that we get to a point where, people take a look at some of these regulations and say, look, we don't need to have all of these particularly for commercial item acquisition.
I've been, in government procurement long enough to remember when we actually did that. And it wasn't a partisan issue either. It was very bipartisan.
And hopefully we can get back to that point because if you take DOD and DHS at face value and say, we want new businesses, we want innovation, we want nontraditional contractors, You're not going to get that by continuing to expand the FAR.
Absolutely. Dean, anything to add?
No. I I I think I've I've spoken my piece on AI.
Got that one covered. Let's move on. So let's go broad now. Right? We've talked small business.
We've talked to implications of of big things happening in the US, but let's go global. Visible Threat is an Irish company and and they do have working, clients in the EU. So what do we think from U. S.
Federal government contracting perspectives on an international market?
Any major changes to like overseas operations?
You know, any of those initiatives underway?
I I for, you know, from a national security perspective, I I see us, as a country struggling a bit to determine where do we want to fit into this, global landscape.
It seems to be changing at least from the perspective of the electorate.
I think our our citizens are are less inclined to want to, be, you know, fully engaged. I I dislike the term world's policeman, but that's a it's a simple way for people to look at it that, we need to we need to be everywhere. I would say, though, that a a reason that we we do need to have a global presence is to maintain a flow of commerce and to have these, economic ties that that really, fuel the world and and supply the world.
Many Americans would be shocked to learn how much of their goods that they consume on a daily basis, arrive by ship from a a foreign port. And it it's not all from China. You know, China certainly has has a lot, but but, we have a lot of European partners. So we were talking about, in the competitive landscape where there there might be a push to buy American.
For for a lot of capabilities, we need to, what's being called Friend Shore, capability and and use that, capacity of our allies.
So, you know, the degree to which we can stay connected, with our our economic system and and with our methods of commercial transport, I I I think it's vital and it it underpins any contract that that we're talking about here.
Yeah. I I would agree with that and add to it in saying that one of the issues that's really being, been coming to the fore in defense, which I dabble in from time to time, is, rare earth minerals and, the components that are critical to going into not only weapons systems, but to commercial technologies that people make part of their everyday lives.
And, you know, one of the things that this country needs to do in an area where our allies could potentially help is looking for ways so that we lessen our dependence on sourcing from one or two countries, that may or may not be inclined to continue to supply, the things that we need.
And we also should be looking, not just at our friends, but at ourselves. What do we have here that we can do and understanding how, what the trade offs are between having a sound environmental policy, but also being able to provide, more for our own national defense. You know, those are some discussions that I hope would take place during anybody's next administration.
But I absolutely think that, it's not gonna change overnight.
We're going to need to continue to rely on our friends and others to provide us with critical, equipment and services, for the any for any type of reasonable future. So we have to understand that. And as Jean said, be engaged in the global market.
So I wanna change topics a little bit.
I appreciate this conversation so far because it's just it's giving a lot of different things for contractors to think about. Like, we don't already have enough.
You know? And and allowing, I think, looking at c suites and and different organizations. And I'll tell you my personal anecdote. And it is, a minor contribution to this very intelligence discussion with the two of you.
I started my career at at one of the top ten, you know, large federal government contractors, during the operations overseas, enduring freedom at Iraqi, yo, now I lost it, during the the Iraq wars so in that time period this particular organization did a lot of work with med med comm military health you know and all of those things for the warfighter, for the warrior. And as those operations were drawing down, this large federal contractor was surprised to see their work going to small, disadvantaged veteran owned businesses, service disabled veteran owned businesses. Sorry. And it seemed to be like, boy, that was gonna be kinda obvious, but I was new to contracting and and, you know, didn't really wanna speak up on the matter.
But looking at things of of that nature, of, you know, changes in the environment that require adjustments from the federal government, what should businesses look at from a pipeline perspective, Looking at recompetes coming up. How can they understand kind of what might be in jeopardy? How they kind of as we started the conversation might have to turn their selling into a different avenue? They might have a different audience at the recompete.
They might have a different KO or contracting officer. What what should businesses have an eye out for right now for pipeline development? Larry, I'll take it to you.
Sure. So for pipeline development, I think it's gonna be super critical to look and see where the changing priorities are if in fact we have changing priorities.
And again, president Harris's administration would probably continue some of the things and priorities being done by the Biden administration. But don't forget, we are going to have, I think, a battle royal over the next three months on, FY twenty five appropriations. And it's not going to always break down towards the traditional sides.
We've got a lot of deficit ops who, are primarily about reducing the deficit, even though they might traditionally be pro defense spending, for example. So, you're gonna have to watch that process. And as Jean said, it's gonna be a process that's long and strung out, and indeed it is. You know, one of the things that I'm concerned about in this, is, the delays in getting the defense authorization bill done. There doesn't seem to be any sense of urgency in the Senate to get that done.
And that should be starting to make contractors a little bit nervous. I wouldn't hit the alarm bell yet, but I I definitely think you ought to go down a level, you know, so you're at least at that little yellow area, of caution, that you're paying attention to it. Because those could affect recompetes. Those could absolutely affect, projects that you think you're gonna be doing.
Yeah. If you are also, depending on your socioeconomic designation, the Department of Veterans Affairs is gonna continue to be a good place to do business. I think the Department of Homeland Security is gonna continue to be a good place to do business. So the pipelines that you have inside of those agencies, should continue to do well.
I always also recommend my clients that, they have one or two acquisition approaches to recommend, even if it's a recompete, you pointed out Marsha, you could have a new KO and you certainly could. Different KOs like, have their own favorite acquisition methods.
Never assume that they've got one, planned and present one or two that, are in their best interest to consider, but also allow you to, compete.
Yeah. I I I would add, you know, I teach public policy at Florida State University. And and, one of the things that we we convey is this this concept of the the salience of an issue, like, you know, how how important is it in relative terms, but but that there are always, multiple sides to an issue. And in in this time of an election season, and and I I would say looking at the president Trump administration, things were typically presented as black or white, yes or no. There's two sides to it. There there are always more than two sides to any any public policy issue, and that creates opportunity.
In seminars that I run with, with clients and and just people in my network, one of the exercises we do is we look at the the front page of the Wall Street Journal on any given day and see how you can connect any story to your business, because there there is a way to make a connection there. And, you know, I I said I I work in the defense and national security space.
I'd I'd echo, Larry's comment that, with defense and homeland security, those opportunities are ever present.
I've I've been in it in in the the dark days of sequestration, and, and there was opportunity then. But, you know, the the global players that we're talking about have a vote in how our government will ultimately divide the the money. And so those those opportunities to, you know, protect the nation and protect the, infrastructure, will will be ever present. I I would urge the audience to use your imagination when looking at what could the impact of something be on my business. Often, we're just we're so focused on, you know, meet meeting the next deadline, meeting, you know, cash flow, you know, which is a legitimate concern, or or, you know, making the next opportunity that might be in the next quarter.
Somebody in the company has to be thinking big. I I help companies with the that that strategic approach. How do you how do you influence things in the next twelve to eighteen months that you can truly influence and just disregard some of those things that you can't, so that you you're you're thinking about the big picture. If somebody's not connecting those dots for your company, you're you're likely missing opportunities.
I I think that's an excellent point. One of the things that I've been writing about lately is, that no company should take anything for granted right now. No defense contractor in particular.
You've got to watch the process, even though you may not always wanna see how the sausage is made, it's how it's made and what goes into it is going to have an impact on your business.
Not only do you wanna look at it, you wanna be have an opportunity to weigh in on it while it's being considered.
Absolutely. I think both of those are great points because, you know, a lot of the what I witnessed and and coming from a proposal department, right, I've never been a crucial cog in the c suite. However, I did always have a bit of a voice of this is what we need to be looking out for.
And I really think that, you know, companies and and what I witness in in my my small business itself and the consulting that we provide, small businesses are inundated. They're swamped. They're overloaded. The c suite just doesn't have time.
You know, what are the stop and thinks that that we need to remind our executive leadership inside of, these businesses of from from your back office to your customer facing, like pulling on that string a little bit further. C suite, open your eyes. We need to look at x, y, and z. Are there things that that you guys see in your consultant relationships that small or that businesses are just not able to focus on that they really should switch their focus to at this point?
Marcia, I think you nailed one of them, and that is that, smaller businesses in particular that are going well and growing, congratulations. That's not easy always.
They typically will add resources to what I call the front of their house. That is sales and marketing people. And so sales and marketing people are all very important, but so too are the back office operations.
You need different infrastructure if you're a now a five hundred million or fifty million dollars company from when you were a ten million dollar company.
In my experience, companies, company executives usually will staff up and grow the front of their house, but not backfill the infrastructure for the back of their house. And that's when you lead you know, you can get yourself into some trouble not understanding what the rules are that you're needing to comply by, the reports that you have to file, the contract terms that, you're obliged to follow. And when you start getting to those higher dollar volumes of business, you get on people's radar screens from the compliance community.
And, you know, this is my plug. Compliance is pennies on the dollar. So if you're expanding the front of your house, you should be looking at expanding the back as well.
Absolutely. Dean, any perspective?
Yeah. I I would offer that, you know, when you you talked about, this, you know, the c suite leader, you know, look look up. Being busy is not the goal. Yeah.
And and you can be busy all the time. You can you can just do everything and and be, noodling over options or, checking somebody's work or double checking somebody else's work that's already been checked. That's not a good use of a leader's time. I I say that's the opposite of what leadership is if you're if you're touching these things all the time.
I think what Larry's describing is was really how our company's preparing to scale, and there are different ways to do it.
Some, it's it's with, how they access capital or investors.
Others, it's how they, they maybe partner and and buy into a capability or a, or a market.
I would I would also encourage not to just get bogged down in the org chart.
Moving boxes around on an on an org chart is really easy to do, and it can be very satisfying. It's one of those things that just it feels good when you when you come up with a new a new plan. This is how we're going to organize. But it can inform how you're staffing the scaling you're talking about. And and I think Larry is hitting hitting on the key point here that, you you have to move the entire organization, not just the, the outward facing part of it, that that brings in the revenue. If you can't if you can't execute on those new opportunities, you're not long for this world.
Absolutely. And that's advice for every day. But I think in a changeover as well, I know, from the last administration changes as president Trump came in, there was a full turnover of where folks were looking.
You know, civilian agencies took a hit. Operations moved, you know, towards border security and those sorts of things. You know? And it did take a lot of readapting for companies to understand, like, oh, where I thought I could go, I can't get there anymore, at least not for the next few years.
So let's talk about that. Some of the implications in the civilian agencies as we change over these administrations.
Well, I I think if you're looking at the civilian agencies, there are a couple of agencies that will, continue to do well generally.
Maybe not every part of the agency, like, there will be winners and losers inside the Department of Homeland Security, for example. That's an agency that has very decentralized, business models and offices.
So you'll see things like customs and border protection probably continue to do well, TSA, Air Force, who know, or Coast Guard rather, who knows that a little bit more difficult to forecast.
But, the other agency in the civilian world that's gonna continue to do well is the VA.
There's no political stomach for either side of the political spectrum to, scrimp on veterans.
This has been a key oversight issue over the last several years. And again, it's not necessarily a partisan one. It it can be one, in fact, where each party tries to outdo the other to see just how much can be done, for veterans. So I would expect the Department of Veterans Affairs to do well.
In a Trump administration, some of the civilian agencies, might not do as well if you're talking about commerce and education, EPA, agencies such as that. But but even there, keep in mind that while the executive branch has a lot of control, what happens in the congressional elections this November are gonna terminal out as well. You know, this year and last year, we've seen the Senate in particular negotiate in with a among Republicans and Democrats for a formula essentially. I'll give you this for defense if you give me this for civilian agencies.
I would expect to see a certain amount of that continue, particularly if we continue to have split party control, in each chamber.
So you have to watch those elections too and understand what they mean for your business.
It it what they mean for your business could be the same or different for what they mean for you in your personal life, depending on where you are, but you have to look at both.
Yeah. I I was leaning toward the, the congressional response as well in that, sometimes in periods of uncertainty, agencies, veterans is a is a perfect example.
They they will wait to be told what to do. And who tells them what to do? It's it's not always president. It's often congress, either either in, in words or in terms of the dollars that are that are sent their way.
Hearings are a great way to get an early indication of what what are the positions.
So regardless of who, controls each chamber, and and I could make a case either way for both the house and the senate to flip.
I I think I think there's enough uncertainty in the air, in the in just the, the political environment that either chamber could flip. It's possible that we could see this go all one way or we could have another period of of divided government. But those, whoever is in charge will control the, committee staffs and decisions about who are those, professional, staff members.
I hate that term. They're I mean, they're all professionals, but there's a term called PSM. They they oversee, individual agencies and understanding, you know, what motivates them, what what gets talked about by their bosses in hearings. And, again, those transcripts are publicly available. Summaries of those transcripts can be can be had at at a very low price, through a a variety of subscriptions. The AI tools have gotten better and better. It's very easy to understand this in in a much more sophisticated way, but often, again, we we lack imagination or we think that that's just a black box that we can't access, but it's filled with information that could inform, somebody's thought leadership within their own company.
Yeah, certainly.
And then I wanna talk a little bit about infrastructure in terms of, you know, US based construction activities, military growth, any of those things that, you know, have kind of been neglected over the last few years, that that might need or adjust in in in this changing political environment? I'm thinking back to, you know, brack closures back in the day. Is there anything like that that is gonna be an impact?
I'm thinking of the, the year long effort at having an infrastructure week next week in president Trump's, reign.
I mean, we were promised an infrastructure week for months, and it it never came about.
President Biden took a big swing. I think he thought he had limited opportunity and and so took a big swing on infrastructure.
It includes a lot of things that don't deal with infrastructure, but it's it's only now just unfolding in terms of the the flow of funds to some of those opportunities.
I personally don't see a BRAC, in our future. And I I say that because communities have become so resilient in terms of how they defend against BRAC.
I live in Florida.
They're every major, military population center has sort of an anti BRAC, council associated with it. It it it resides within the economic development commissions, resides in governor's offices. They they're they're now highly effective at responding and creating all kinds of negative headlines for for a BRAC. It doesn't mean that we don't need it because we we are carrying a lot of excess, infrastructure capacity. In some cases, it dates back to, you know, World War two era. We don't the ability to recapitalize those, those large bases, and they're they're just a drag on the on the, the the process.
Larry, any take on that?
I think we have seen in the past, two or three years in Congress, and with this administration, frankly, it started with president Trump when he was still in office.
A lot of work, a lot of money being dedicated to infrastructure overall. And some of that goes to the Department of Defense. Some of it goes other parts of the economy.
I'm not sure what type of appetite there would be to do anything major on the type of scale that we've recently seen.
You know, Gene points out that a lot of that that's already been started has yet to be unfolded.
And there may be a desire between a lot of people on the hill to see how that unfolds and and how it goes before they do anything large again.
Having said that, I think if you have a certain outcome for the November elections, one party traditionally funds and focuses more on infrastructure than the other. You could certainly see an infrastructure bill coming down, in twenty five or twenty six.
That again would probably not focus just or even mainly on DOD.
But as Jean points out, DOD does need to be part of it because, you know, they've got to have some facilities that, if they were facility civilian facilities in charge of, but being run by the General Services Administration, they'd probably have been shut down by now.
Absolutely. Well, we're coming up on time and we've been steering this conversation in different directions, and I love the fact that it kind of ends on community.
So let If either of you had a topic that we wanted that you wanted to discuss and we haven't, but, let's try to get into some of that conversation. Just people to people, general relationships as we're all going through this election together. I think it's bringing a lot of stress and and just anxiety because it could literally go any way. It could, you know, we could flip the houses of Congress. We could bring them back into as a single party.
In these kind of anxious, curious times that that we all have for each other, What do you guys advise in in the weakest sense of the term? Just maintain perspective, maintain, you know, just a community, a camaraderie. You know, how do you guys have feelings on that?
I'd like to talk about, our ability to communicate.
I co co wrote a book with Alan Weiss called Million Dollar Influence, and it's all about using some of the most obvious tools that we have available in communicating our, desired outcome with whatever the whoever the audience is, whether it's congress, whether it's in the executive branch and and any level of the executive branch.
Too often, we come into meetings unprepared for taking command of the meeting or to be able to take command of the meeting to drive toward an outcome to help orient and reframe that that audience immediately to to why what it is that you're trying to do makes so much sense. I use what I call the eight minute rule of messaging.
That's that's being able to not not not convey an elevator pitch, but to be able to tightly control what it is that you're you're trying to accomplish. There's an issue, the background, the discussion, and a specific recommendation. When you can link that in a in a short period of time, you you immediately frame it for the audience. You allow time for questions and you're likely going to be able to give them time back. You won't need the amount the allotted time that that you were offered, which means you get to come back and you and you get seen in a a way that's credible.
We're you know, this time of transition, it it's like any other time in that there is always opportunity.
And those that are best prepared to take advantage of the opportunity always have positive relationships, and always get to come back and and do it again and and keep winning. And it it just compounds over time.
Absolutely. Larry, I see the head nod.
Exactly. I think you see I think Jean's exactly right. Relationships matter in government business.
The most successful businesses are the ones that understand both the relationship and process parts of this market.
And so in terms of people who are transitioning in and out, as a contractor, you wanna make sure that you're maintaining as many relationships as possible and that you're open to creating new relationships with people who might be coming in, who have the ability to shape your business one way or the other, whether those people are gonna be on Capitol Hill or in the executive branch, you have to take the time and invest in developing those relationships.
You also have to know the process. Both are important, but, we've talked already today about how the process might change. So, let's not forget the the relationship side of this. The other thing I would say to, people is I've been in this business for a while.
I like to say when I had hair, but nobody believes me. But, government procurement trends come and go, markets fluctuate, things get better, things get not so good, but go the government market is here to stay.
It's not the same government market from, year to year and especially not five years from to five years. So you have to pay attention and be on top of those changes.
But the government market will be here. There will be opportunities if you're prepared to pursue them.
Oh, I I think that's it. It's it's the human element. It's paying attention.
It's self advocacy, all of those things, self preservation sometimes, but being aware of your surroundings and what potential implications that might allow for you, but also just being aware of yourself.
Where where is your company sitting right now? What is your long term strategic plan? Yes. It's kind of like investments, right?
Just roll. Let it ride. Let it ride. See where we can go. But you have to be able to navigate, those those ebbs and flows, the wins and the losses and all of those things.
And understand that that does change in a in a different under different administrations and in different political landscapes, cultural ones as well. And I think there's probably gonna be some implications there as well.
Gene, any last closing thoughts?
You know, it's an exciting time. I'm I'm thrilled at the, the potential because I I know that, good things are out there. I I I look forward to continuing to help clients as they they try to navigate what what looks to be just, unnavigable terrain. It it is it is quite learnable, and you just you do just have to jump in. If you need a guide, get a guide.
Absolutely. How about you, Larry?
I'll take a cue from the music man. Professor Harold Hill, you've gotta know your territory.
Absolutely. So true. And networking. Because I wouldn't have met either of you without my personal network, so I'm certainly grateful for that. So excited to have had you here on this episode with me. But to wrap it up and to close it up and summarize by closely monitoring the political landscape, understanding agency priorities, proactively managing risks, Contractors can increase their chances of success in this challenging environment of an election changeover. You just have to be paying attention.
So thank you for joining us on the Optimize podcast. Thank you very much to both of you as well. Have a great day.