There is a great deal of talk in the GovCon industry these days about multi-award contracts (MACs). Why? Because the end of 2015 and all of 2016 (calendar year) are absolutely huge for the release of major GWAC and IDIQ contracts. 2016 is the one year that matters the most in the last 8. It is the peak of the 10 year MAC wave. Miss it and you will be on the sidelines until 2025.
The chart below visually tells the story. It comes courtesy of Bob Lohfeld, CEO of Lohfeld Consulting Group in his article Are you ready for the peak season of MACs and GWACs? published in Washington Technology on 12/11/2015. The data was provided by Govini, a leading GovCon research firm.
I will just summarize a couple of points. You should read the full article.
- In the 2015/2016 Wave there will be 14 major GWAC RFPs released vs. an annual average of less than 1 (one) for each of the last 8 years.
- 3 of the last 8 years had 0 released.
- The ceiling value of these 14 MACs will be $268 Billion. 40% of the total since 1998.
- The last wave (which was the first wave ever), 10 years ago, had 11 MACs with a ceiling of $190 Billion.
Are your ready?
The 2015/2016 MAC Wave is here. There are two primary areas of readiness for winning business in this wave:
- Winning the MACS as a Prime (and/or being a subcontractor who is teaming with Primes) and
- Winning the Task Orders when the wave goes operational and you are competing to win Task Orders.
Lisa Pafe, a Principal Consultant of Lohfeld Consulting Group did a very thorough webinar in December that addressed the MAC wave in general and then drilled down into both of the parts of winning. It is called Target the right IDIQs and GWACs (and win your share of task orders) and is available on demand. If you plan to participate in this market over the next 5 to 10 years, I recommend that you watch it.
Clearly, the headline grabber is the Winning of the MAC’s. That is a single, momentous event. It is strategic. At this point, you should be quite involved in these captures so I’ll skip that topic for now.
However, you make your money by winning the Task Orders and delivering them. Lisa Pafe addresses this quite well in the webinar. She advocates that everyone has a “Task Order Factory” that produces the required outcome to actually win the Task Orders. I like this metaphor. It is meaningful. A Task Order Factory can become a distinctive competitive advantage because many others lack an effective one (she surveyed people on this in the webinar). Just think, you have a well-oiled, complete factory to reliably produce a winning product and your competitor has something else that is much less.
The interesting news is that this competitive element will have much greater market impact in this 2015/2016 wave. Technology has changed in 10 years. The Task Order Factory of 2016 is very different than what people did in 2005. In that year with the first wave, basically only large organizations fully participated as Primes. They invested a great deal of money and time ($500,000 and up) to create a very custom “factory” to get deal with the volume and complexity of operations. I know because I was involved. It was the first generation – using what were brand new web-based technologies to address the needs of the first big wave of MAC’s.
Now, we are in 2016. Technology has changed in ways the average person sees and also deep below the covers. The changes are disruptive in the MAC market.
Here are some ways these changes will alter the design of the Task Order Factory in 2016 and impact the competitive situation for winning Task Orders. You should consider these in your readiness planning:
- There are affordable, off-the-shelf, complete “Task Order Factories” available to Small and Mid-Tier companies. These new systems are more effective than what large players typically have because they are designed to incorporate all elements of the full lifecycle for winning Task Orders into one system. This will be disruptive to the market.
- Note that in Lisa Pafe’s webinar she raises the unique challenge of Mid-Tier companies to gain competitive footing against larger organizations. This can change things.
- The ability to perform will challenge everyone. But, those organizations with complete, integrated “Task Order Factories” will simply have a competitive advantage over those that do not have them.
- The ability of these systems to deliver real leverage of teaming partners across the full Task Order life-cycle considerably changes the coverage and capacity of competitors.
- These new systems are flexible, so they enable competitors to optimize to the needs of specific MAC vehicles. This makes the game even more competitive at the vehicle level. Think specialized “factory lines” designed say to support a staffing-oriented IDIQ or a Construction MATOC.
- You will be more competitive if you have people skilled to run the factory. Think of the difference between the person skilled at running an automobile assembly plant vs. people managing the hand assembling of cars to order (circa 1924). Technology is changing the game and driving the need for different skill sets.
- The operational excellence to win Task Orders and the system availability and affordability extends downstream (post-award) to Contract and Program Management and upstream to Winning the MACs and to Marketing and Business Intelligence.
I know some of these things to be true today because R3 Business Solutions (the company I work for) provides a business solution that is effectively a “Task Order Factory”. It’s called R3 IDIQ Task Order Management. It is the fastest growing part of our business. We compete head-to-head with Deltek and others – meaning there is growing competition for selling these kinds of “factories”. Also, at R3 we also provide a suite of integrated GovCon solutions including Contract and Program Management (post-award) and WinCenter for RFP Capture and Proposal Management (Winning the MAC). There are lots of options for GovCon in this 2015/2016 wave.
So, in 2016, if you are participating in the MAC game – it is everything except business as usual.