Set Your Sights on FY19 | Corporate Planning

The end of the year is quickly approaching and you are probably (hopefully) in the throes of budgeting and forecasting for FY19 and beyond. Corporate planning isn’t as easy as it appears.  At BOOST, we help clients with corporate planning and have some strategies that might be helpful to you as the end of the year approaches.

  • Corporate budgeting – Bottoms up planning for business growth and operations, holding your management and executives accountable for costs and profits and setting targets. Corporate budgeting without a view of your bid pipeline can lead to some poorly planned financial decisions that can impact your competitiveness next year.
  • Capture/Business Development Budget – Optimize your forecasts to bid smartly, especially regarding your rate structures.
  • Contracts and upcoming bids – Industry best practice is to take a thorough look at existing contracts and upcoming bids to approach budgeting/forecasting in a wholistic way.

This time of the year is a great time to focus on existing indirect rate structures, and project out future rates using revenue growth projections, types of contracts you may be bidding next year, and resources to allocate. 

Yes, you have provisional billing and indirect rates, you may have forward pricing rates, or other agreed upon rates with Govt acquisition agencies.  However, none of these preclude you from creating/re-structuring/forecasting new rates based on business strategy and forward practices.

You may have won a few IDIQs/GWACs, but are you confident that the rates that you bid under are still optimal to bid upcoming Task Orders?  For example, IDIQ rates are often ceiling rates, that you bid under certain assumptions and criteria.  Task Orders can drop suddenly, or even a year or two later.  In most industries, anything beyond 30 days is considered long term pricing, and as such, carries a price risk.

Have you reviewed all of your contracts and the associated price risk that comes with the time elapsed?  Some things to consider might be:

  • Are you considering your projected pipeline of opportunities? The size and scope of your pipeline and pwin can impact your financial status/situation/growth etc.
  • During the budgeting process, look at forecasted revenue growth and the impact on your indirect rates.
  • Are your upcoming bids likely to be SCA/Union heavy? Consider setting up separate fringe pools.
  • Is your strategy geared towards prime contracts or subcontracting? This could impact how you set up cost pools, especially OH/Fee rates.  If you’re subcontracting, you can have much lower OH rates than prime contractors.
  • How do you want your subcontracts/prime contracts (usually not a choice) to be set up? Cost plus types/FFP/T&M?  Are you prepared for capturing and allocating costs for cost type contracts? Are you prepared for DCAA Pre-award audits?
  • Are your bidding rates set up for bidding strategic bids?
  • What does your BD budget and Capture budget look like? Is it optimal for the type of bids and size of bids you’re planning to go after?
  • Do you need to consider different bid pools based on agencies, contract types?
  • Is your G&A structure set up competitively? Does it make sense to have a separate subcontracting rate?  Does it make sense to have Total cost input G&A vs. Value added?
  • Have you reviewed your existing IDIQ rates with your subs? If there are more TOs ready to drop in the next 12 months, have you reviewed indirect and direct rates at play?  How do you prepare for Task Order bids if you won an IDIQ a few years before the actual TO comes out?  The rates have all likely changed/will change, have you analyzed and prepared for those bids?

We know…there is a lot to consider.  Budgeting is way more complicated in GovCon than budgeting for office supplies and the holiday party.  BOOST gets it and we can help incorporate pricing and rates into your 2019 budget and long-term forecast.  We want to help you grow and a solid budget helps pave the way for successful growth.

Meet Avantika!

BOOST LLC is thrilled to announce that the team is growing.
Please give a warm welcome to Avantika Singh!
She will be supporting BOOST’s clients with her specialties in government cost/price volume expertise, strategic pricing expertise, price to win,  financial model development, financial analysis, federal contracting, metrics/measurement reviews, forecasting and more.

We took some time to get Avantika’s thoughts on the following:

Three pieces of advice for growing govcons: 

  • Always be ambitious
  • Business is meant to be grown
  • Don’t get comfortable in your own zone

What/Where is the best resource for growing your network? 

The best resource for growing the network for me has been word of mouth referrals as a consultant.  When you do good work, people trust you and recommend you, so person to person or business to business referrals have been my biggest resource.

What is your “hot take” for finding success in your industry? 

It is important to make mistakes. You don’t learn if you keep winning. Yes, it’s obviously great to win, but making mistakes and losing on a few bids gives you the best experience for long-term success.

What is the most surprising experience you’ve had working in the govcon community? 

What surprised me in this industry when I first started was how close-knit and small it really is, despite having large behemoth companies and small mom and pop shops. It seems like the same usual suspects intersect at various points, and it’s a very good community overall.  Reputation actually matters, don’t burn bridges, and collaboration is the way to go…even with competitors.

Institute Recap

GovCon Lifecycle:
Purgatory to Paradise

The second govmates institute, GovCon Lifecycle: Purgatory to Paradise met at the Northrup Grumman location in McLean, VA. In an authentic meeting-of-the-minds, industry experts discussed topics pertinent to growing the local govcon footprint.

Highlights from the institute include:

Purgatory: That Awful Time Between Submission and Award

  • BAFO’s, How to respond to government requests, FAR compliance, “Gotcha’s”“Proposals are rarely won at submission, but they are lost. If you get an EN – correct, don’t defend.”
    Barry Landew – Wolf Den
    “To mechanically lower your price during ENs make sure you revisit trends to see where you can adjust.”
    Avantika Singh

30-60 Day Transition & Ramp-Up

  • Recruiting & Operations (Transition planning, Re-badging, Quality Planning, Customer interaction) –
    “Be sure to stay in touch with your key personnel and others that you bid after you submit your bid.  Fostering this relationship will cut down on your recruiting time.”
    Mary Holmes – BOOST
  • Contracts (Sub-K’s, Negotiations) –
    “Best advice that is not only the most obvious but the most overlooked – did you read the entire contract award and do you know what you are signed up for?  Make sure everyone on the team is aware.”
    Amanda Tyson – BOOST
  • Accounting (Accounting system set-up, Billing requirements, Types of contracts)
    “Make sure you get the labor category paperwork done up front because you could lose money if they don’t meet the qualifications.”
    Giacomo Apadula –  BDO

Opportunities in Loudoun County

  • “Insider baseball on AWS is coming to Northern Virginia. There is still a ways to go, there will be another downselect based on sites.”
    Steven Hargan – Loudoun Economic Development

Now That You’ve Won – How Do You Pay for It?

  • Have your contracts folks review the financing document.  It’s a contractual document – CEOs make sure you know what you’re getting into and completely understand the terms.“Be careful and read the fine print to make sure you’re actually getting the rate you think you’re getting from your financial providers.”
    Matt Stavish

Capture & Business Development for FY2019

  • Be strategic about your capture process – make sure it’s a rolling 36-month pipeline.
  • Focus on both getting onto some of the larger IDIQs (hello Oasis!  GSA Schedule 70!) and on agencies that award independently – who buys from you? 
  • Yes, there seems to be less direct sole sourcing opportunities and more competitively bid set-aside work for 8a’s.
    Kim Pack, Wolf Den

Join govmates to be updated on future opportunities for continuing education and targeted matchmaking! 

Continuing Education

By now, our college days are long behind us (let’s not talk about how many years). Some folks have sought continuing education in the form of a master’s degree, PhD, certifications, and other credentials. Some of these factor into our “employability” and can help move our careers.

Assuming you’ve gotten the credentials/certifications requested and additional schooling that you are going to do – now what? Where do you go to find more information about your industry and stay on top of trends? What resources are available for continuing your education on the tips and tricks that successful people in your industry employ?

There are countless webinars/seminars/conferences that you can attend for federal contracting; many are relatively low cost. But how many times have you listened to a speaker provide the very highest level of information with generalities and no details? How often have you heard the same message over and over (“get to know the customer, or shape the opportunity” sound familiar?)? Why is there a dearth of actionable advice that resonates with you and your company?

The same usual suspects are putting on the same educational series with the same speakers. There is a lack of transparency/real life, straightforward advice in the industry.

Why?

  • Is it because the speakers don’t know (if this is the case, why are they speaking?)
  • Their information is outdated (I’ve seen the same speech out of certain folks for YEARS)
  • They are afraid that you won’t seek their services for hire or will use their advice and not need them

What this industry needs is real, direct, transparent advice from people who have seen a lot of different things in the federal space and who aren’t afraid to share the information. Professionals that will tell you what they honestly think vs keeping it politically correct for fear of saying something controversial. Real business people who actually have solid opinions but are open to new ideas and ways (not stuck in the federal marketplace of the 2000’s).

The govmates Institute was launched with this in mind. We provide the real scoop on issues that are germane to your business. No bullshit, no pie-in-the-sky convoluted discussions without actionable ideas that you can implement immediately. Demand more out of speakers – you deserve it.

Our next govmates Institute will be on September 6th – From Purgatory to Paradise. It’s a half day dedicated to:

  • Purgatory – that awful time between proposal submission and award. What’s a GovCon to do (legally)? How to address questions, requests for redlines, and BAFOs. What can your Program Manager say (or not) to someone on source selection? What can you tell your employees?
  • 30 to 60 Day Transition – We all claim we’re ready on Day One. Yeah, right. There’s a lot that happens in that first few months and as the saying goes, you only get one chance to make a first impression. How to handle the hiring/recruiting of a new team, how to negotiate with the government, issue subcontracts to subs, get your accounting house in order, and tips for keeping the client as happy as possible, given the million balls in the air.
  • Now you’ve won – How do you pay for it? We all know we can use our banks and lines of credit. But what if you’ve maxed out your line of credit capacity? What if you don’t have enough operating history for the bankers to provide the line? What if you need upfront cash for Purchase Orders or advance hiring? We bring you some non-traditional methods to fund those first few months when you are incurring costs before actually getting paid.
  • FY19 Capture and BD Opps – great, you won. Now, what’s next? ‘Tis the season for 2019 strategic planning off-sites and budget prep. What are you going after next year and what do you need to track?

Register at: https://govmates.com/institute/

Ghosting in GovCon

Ever been ghosted? It’s not just for those navigating the dating scene. It happens in business…a lot.

Ghosting is essentially the act of having someone you are engaged with disappear on you completely. No returned phone calls, no emails, no texts. What’s worse is that the person who ghosted is still very much alive and well. Professionally, you could still see them at networking events, posting on LinkedIn, or even receive their newsletter. They just clearly don’t want to talk to you or your company, and there was no reason or rationale given.

Here are some common examples and potential reasons for why someone would ghost:

  • Active Candidate – this happens more and more these days and it drives recruiters absolutely nuts. When the market is hot, active candidates may be playing employment offers off each other and your offer wasn’t the best. You may have had a great phone screen, schedule an interview and then the candidate doesn’t show up and you never hear from them again. They may also have decided to stay with their current organization and “ghost” to pretend they never strayed. Another reason is that their spouse may have felt it wasn’t best for the family, and the candidate didn’t want to come back with “my wife/husband doesn’t think it’s a good idea”. Finally, they may just not like your company based off an interview, glass door reviews or rumors in their network and don’t want to hurt your feelings.
  • Teaming Partners – How many times has your company signed a teaming agreement and then absolutely NOTHING happened as a result? Workshare was promised, executives had visions of revenue…and then nada.

    Common reasons for ghosting here include:
    – the teaming partner deciding to no-bid (and does not want to admit they wasted everyone’s time)
    – wanting to take you off the street as a potential competitor (potentially increasing their chances of a win, but nothing for you)
    – they suffer from shiny syndrome…where every new bid seems like an amazing opportunity with the right teaming partner, only they don’t have the resources to deliver.

  • Prospects – To the ire of sales folks and BD teams everywhere, prospects will spend hours of the team’s time in meetings, phone calls, proposals, and follow up, only to completely vanish. What makes a hot lead go completely stone cold? Loss of funding, their needs changed, or they really were just shopping rates and went with a lower cost option, but don’t want to tell you in case they need you if the lower cost option doesn’t work. We’ve also seen where an eager beaver goes to the trouble of finding a proposed solution for whatever ails the company, only to not have the resources or approval to move forward.

So, what can you do to reduce ghosting? Stay on top of active candidates and make sure you respond to any inquires quickly. Treat your candidates, and your employees as valued and your reputation will be a huge asset. Not everyone cares about if you have a foosball table in the break room.

They want to know, “do you do what you say you will and are people treated with respect?” That’s what matters.

Think through teaming partnerships and don’t be too quick to sign any paperwork (other than an NDA). Look into your perspective teaming partners’ background and ask questions in the industry. Some of the large System Integrators are well known for locking people up in exclusive teaming agreements, with nothing to show for the teammate.

Look at how you are prospecting. Drill down on questions in the initial interactions that will save you from endless, useless follow up. Critical Questions – do you have the budget established and authorized and how much is it? Who is making the final decision? When is the company looking to make a decision and move forward?

Finally, know that it’s an incredibly small world, despite how large the industry is. Reputations for ghosting do come out and people DO talk. Listen to the grapevine before thinking you’ve landed an amazing candidate/teaming partner/prospect. Sometimes they disappear…like a ghost.

The Halfway Mark

As June comes to a close, most federal contractors are halfway through their fiscal years. It is a good time to reassess the company’s first-half performance and what changes need to be made for the second half of the year. Here are some areas to consider:

  • Moola – have you made any? Are you in debt? What’s the profitability of the company? I’ve said time and time again; Top Line is for Ego, Bottom Line is Business – essentially, you can push all the revenue you want into your company, but if you aren’t profitable, it does notcount.  Don’t sacrifice your bottom line.

  • Multiplier – by now, most have submitted their incurred costs submissions for 2017. You should know exactly how well you did on your wrap rate and where you may have fallen short. Look at your forward pricing/wrap rates for 2018 and adjust now. Do not wait until there is a nasty surprise at the end of the year. Equally important, make sure your proposals are being bid at rates you can sustain and be profitable on.

  • Pipeline – Got one? Dive into it and know what’s really going on and what you’ve just glossed over in pipeline review meetings that drone on and on.  If you don’t know what you are bidding on this proposal season, then you’ve got a problem.

  • Performance – How’s the team doing? Is there anyone that you have been giving too much latitude to or is dragging down performance? Have you documented and dealt with the problem? These folks tend to drag down the morale of the high performers.  Stop avoiding the confrontation and handle it. Don’t let the rest of the team suffer.
  • Look ahead – Opportunities for networking, events and sponsorships are planned months in advance. Do you want your name on the latest and greatest event boards? Do you want to be recognized at yearly award events? Reach out to your biz buds to see what they’re working on and how you can support one another as you continue in the year. Don’t be left in the dust because you didn’t reach out soon enough.

This time of year tends to be slower due to a lack of planned events and increased family vacations which means you have a unique opportunity to reassess your company’s performance. See where you need to make midyear improvements and start planning your next steps. If you’re looking for support within the areas of Strategic Pricing, HR, Recruiting, Accounting or Contracts- reach out to BOOST at [email protected]. Let’s blow the next part of the year out of the water.

Recruiting During Proposal Season

Soon proposal season will be upon us…along with writer’s block, visions of past performances dancing in your head, cost volumes, long nights and lots of coffee. But, the most enjoyable of all is resumes, sourcing, contingent offer letters and recruiting.

Government contracting recruiting is not like commercial recruiting.  The talent pool is small, the salaries are low, the lists of qualifications are long and the skill sets are specific. Proposal recruiting is its own version of fun with key personnel, vague requirements and candidates who get cranky when they hear you are recruiting for a proposal.

Whether recruiting for a proposal or a funded job req, the usual question is whether you recruit with in-house recruiters or if you utilize an outsourced recruiting firm (or individual recruiting consultant). There are several pros/cons to consider when outsourcing:

Pros of Outsourced Recruiting

  • You can use recruiting support only when needed, which can keep costs down
  • Recruiting firms offer the benefit of an expanded network
  • The resources of a qualified recruiter result in finding candidates faster, also important in proposal recruiting
  • Recruiting firms can keep the client confidential in postings, which is especially beneficial in the intelligence community or when recruiting for proposals

Cons of Outsourced Recruiting

  • For proposal recruiting, you are expending costs that you may not recover
  • You still need to add the cost into the indirect rates
  • Outsourcing can add additional time to the process (i.e., bringing a recruiter up to speed, learning your culture, etc.)
  • Better upsell of your company when you directly deliver the message

There is no right/wrong answer when it comes to determining how you will conduct your recruiting.  Both insourced and outsourced offer benefits and advantages.  Outsourcing costs more, but allows you to focus more efforts on different areas (proposal writing, business development, etc.).  If you have the staff available, insourcing can save costs and give you more control over the recruiting process.

BOOST and Apertus Partners are conducting a workshop through the Loudoun County Chamber of Commerce GovCon Initiative on May 31st at 8:30 on Recruiting in the Intelligence Community.  Come join the discussion on recruiting challenges, case studies of successful internal recruiting from a local GovCon, the price of recruiting and recruiting diverse candidates in the Intel space. Ross O’Rourke from IC-1 Solutions will present on his company’s experience with internal recruiting in the intelligence community and Dat Nguyen, a BOOST recruiter, will speak on his experience with diversity recruiting in the intel space.

Register here.

April Showers

We find ourselves suddenly in April and the beginning of 2Q18.  How did that happen?  We’ve closed the books on 1Q18 and have 3 more quarters to meet our goals.  How did you do?  Are you prepared for ramping up?  Here’s a checklist to get you thinking:

  • Proposal season – it’s almost here.   Is your team ready to tackle a few monsters?  Have you lined up teaming partners?  Have you started storyboarding your technical solution?  Now’s the time to start locking resources, teammates and solutions down. Don’t forget to include recruiting for potential slots as well to get ahead!

 

  • Pipeline Report – How real is the pipeline report?  Have you started glossing over “must wins” on a spreadsheet in your efforts to make the meeting go faster?  Who has dug into the opportunities and have you set them up to be successful wins?  Trust but verify CEOs… BD and Capture folks are inclined to load a spreadsheet with people they spoke with before, but that’s not an opportunity.  Be very clear on what makes it to the list and why it’s there.

 

  • Revenue – What did you have as a 1Q18 win that slid?  Are you going to be able to recover that revenue in 2Q-4Q?  Time to review the revenue assumptions for the year and figure out where you can make it up while there is still time.

 

  • Cash – by now, you should have recovered from your December cash spend/holding back bills and should have paid off any LOC used to make it through January’s payroll.  Are you in a good position?

 

  • Multiplier and profit – are you going to make money this year?  How many “must wins” are in your indirect rate budget that you are using for bidding?  Ensure that you are turning a profit and not undercutting your rates unnecessarily.

 

  • Hiring Talent – when was the last time you checked in on your potential hires?  You know, the folks that you’d love to work with but can’t hire until the contract hits or cash flow frees up.  A quick coffee to touch base can keep their interest.

 

  • Infrastructure – A little spring cleaning is always a good thing.  How’s the team running?  Do they need more resources or can you get away with less?  Have you documented everything your folks do, should they win the lottery and leave?  No one is indispensable… make sure you’ve covered how your organization runs.

The above should serve as a quick checklist of things to follow up on and analyze.  If you don’t know the answers to the above, you should take steps to find out…now.  There is time to not only recover but gain this year if you have your act together.

Did you know? BOOST does strategic planning to help with all of the above! You could benefit from the variety of resources we have in our BOOST backpack including the area’s top matchmaking resource, govmates.  Send an email to [email protected] and let’s set you on the right path for the rest of 2018.

Will You Be My Valentine?

Alongside the thought of a two-year budget passed, we giddily start thinking about the possibilities here in the GovCon world.  What if we actually received the full year’s funding?  What if our customer was able to award that contract that’s been held up?  What about a new start here or there?  It’s almost like Christmas thinking of the potential new work that could be accomplished in the upcoming years.

Keeping that in mind, what better day than Valentine’s to talk about finding the right teammate/suitor to work with on upcoming bids?  What does real GovCon love look like?  It includes fair workshare, without a constant battle back and forth or being worried that your teammate will steal positions.  It looks like an honest dialogue about capabilities, customer relationships, and capture strategies.  It includes a romantic wrap rate that you both can live with and hire successfully under (never mind having a profit!).  A true partner in GovCon means never having to say you’re sorry for communicating with the customer…as you have open discussions.  It means you ask your partner to join you on RFPs that help build both of your businesses, without worrying about risking relationships.  You can have other relationships with other GovCons that have different skill sets or past performance, but you know that your favorite is always a go-to in bidding strategy.

As your relationships and companies mature, you may consider forming a JV to stretch those revenue dollars just a little more.  Or you could be in a Mentor-Protégé program, but not one that is an afterthought or a “check in the box.”  You want to be top of your partner’s mind so that they are helping you grow your business…kinda the whole intent of the program, right?

Do you have a GovCon love? BOOST has a few! (We’re the only back-office shop with a teaming platform.) If not or if you need someone new in your life, consider govmates.  We’re a FREE online teaming platform that provides teaming opportunities.  We are matchmakers who believe in taking a formulaic and methodical approach in teaming – based on past performance and capabilities.  We do the intros, you determine if it’s love at first sight.

If you have any teaming needs (as a prime), shoot me an email at [email protected] or [email protected] and I’ll be happy to help.  If you haven’t already registered your company, do so at www.govmates.com

Happy Valentines Day GovCon world.  Make the next two years count.

Life’s too short to work with jerks

Much like everything in the GovCon industry, successful partnerships are based on relationships.  Overused expression, but it’s true.  What are the qualities you should look for in a partner? What makes you want to team with someone (whether directly on an opportunity or in the B2B world)?

TRUST

Most important is trust. Do you trust the person that you are considering working with?  Do you trust that they have the authority to keep things tight on their end (how many times have you worked with a junior BD person who negotiates workshare, only to have contracts screw you later)? Can they correct issues when they arise?  Do they have your back?  Are you worried about bringing them into outside meetings?  If you find yourself only providing half the story to them, or not cc’ing them directly with the client or prospect, something’s not right.  Either you aren’t acting above board (and why not?) or you instinctively don’t trust them.  Figure that out.

HONESTY

Different than trust in that you must ask yourself if the person is upfront with you.  Can they really do everything that the SOW says?  Or are they honest about their company’s shortfalls?  Do they turn down opportunities that aren’t a good fit for them?  Are they going to go rouge and directly contact the end client without communicating with you ahead of time?

COMMUNICATION

This is the heart of practically any human issue.  Can you effectively communicate?  Your styles may be different, but do you understand what the other is saying completely?  Do they go dark on you?  Do you understand their language?

LIKEABILITY

Unless you are a glutton for punishment (who are we kidding, you are a little if you are in GovCon!), part of what makes relationships work is the fact that you just plain like them.  Why spend your time, resources or even mental energy on someone you don’t like?  Life is too short to work with jerks.  And as a business owner, you didn’t get into business to deal with people you don’t like.  Just the opposite.

What’s interesting is that the above is applicable towards finding new friends, new romantic partners, new relationships.  Why treat your business relationships any differently?
Cycle out the relationships that don’t work and focus your energy on expanding the ones that do.

If you’re looking to forge new, successful partnership this year, reach out! I’m happy to recommend a few of the greats! [email protected]