Federal contracting trends toward defense and efficiency in 2017
(PRWEB)
As
Federal government spending grows every year, but much of that growth comes from mandatory spending like
The threat of budget shrinkage is looking more likely by the day. The
Building on his commitment to slashing budgets, Trump has asked his team to implement 10 percent cuts on discretionary spending. These cuts, while they get praise from fiscal conservatives, are intended to fund campaign promises like tax cuts and a buildup of military power. In addition, fields like technology spending will likely get more attention as risks of new cyber-attacks on outdated systems rise.
Outright cuts of government spending are less likely than a shifting of funds toward defense and technology. However, some of Trump's ambitious campaign spending promises may take the form of tax incentives for private investment, rather than direct federal spending.
Troops over tanks: Defense acquisition in 2017
Trump has proposed an end to the defense sequester and increasing military spending. He wants to offset the increase in
For the
For the
It's not just the president-elect pushing these increases.
Some might conclude that Trump is pushing for more defense spending across the board. But experts predict that his plan to boost troop numbers might crowd out big-budget weapons development. Trump's recent pressure on big-budget weapons manufacturers to cut costs on programs like
That should worry large defense contractors like
Infrastructure: Where will the money come from?
The Trump administration's infrastructure plan is getting a lot of attention from contractors. Trump has promised massive spending on infrastructure, proclaiming a
But traditional government contractors looking for federal funding should look elsewhere. Though it's possible the spending will take place through direct government purchasing, Trump administration officials have shown a clear preference for funding their infrastructure plan through private investment. Secretary of Transportation nominee
Two of Trump's close advisors, Commerce Secretary nominee
Though nothing has been finalized, it's likely that government contractors will find the most federal contracting dollars in infrastructure projects that would not generate profit on their own. Maintenance services and other support services will be increasingly important as our infrastructure ages, and these fields are the most likely to continue to receive federal funds.
Technology procurement: spending money to save money
Cybersecurity has been in the spotlight more than usual, and that that will not change any time soon. Defending and modernizing the government's information systems is going to become increasingly important in the coming months, and technology spending is more likely to grow than it is to be cut.
Under the Trump administration, IT modernization will likely take shape in collaboration with the private sector. Trump recently appointed former
As the private sector looks forward to influencing tech policy, the Technology CEO Council (TCC) has submitted to Trump a report with recommendations on ways to make the government more efficient using technology.
The report says that implementing technology to streamline the government could save
TCC's suggestions include implementing shared services, using technology to curb improper government payments, improving government decision-making using data analytics and cognitive computing, moving toward cloud-based IT, strengthening cybersecurity, and implementing mobile technology.
Though technology's promise of efficient government services might entice the Trump administration, a trend toward eliminating waste will make individual contract awards more competitive. As category management reduces the number of multiple-award contracts and cuts duplicates, businesses will have to offer more value to win bids.
To win contracts, companies will have to do more for less
The 2017 government contracting market will be fiercely competitive. Trump's military boost combined with a proposed federal hiring freeze may open up opportunities for contractors to fill the gap in government services – but broad tax cuts will limit the revenue available to pay for them.
Trump has already indicated that he is willing to pressure individual companies into cutting costs, an instinct which may spread to a government-wide program. Government contracting experts have noted a trend away from awarding on a Lowest Price Technically Acceptable (LPTA) basis, in favor of best value contracts. Trump has instead suggested on his campaign website that the government uses more incentive-based contracts to keep programs "on time and on budget."
The push toward efficiency could benefit small business by rewarding companies that find innovative ways to fulfil the government's needs. But competition will be intense – businesses will need all the information they can get about the contracts they bid on and the competition they face in order to show that they provide the government the most value.
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Read the full story at http://www.prweb.com/releases/2017/01/prweb13997585.htm


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