It's generally known that government IT projects are some of the riskiest projects out there. They are often enormous projects, with complicated specifications and requirements. At the same time, the nation has a greater need for efficient systems than ever before. Civilian and military agencies have a lot to manage, with projects ranging from defense systems for battlefield wireless networks to systems that support the recent changes in health care.
"Cloud computing" is one hot area of research and development, and a new GSA contract will have 11 different vendors providing cloud computing and storage to a number of different government agencies. Such interagency cooperation may require new ways of defining contracts, especially for projects that require delivering a wide array of services, from storage to software licensing. This is in keeping with President Obama's creation of a new task force on interagency contracting cooperation.
Meanwhile, government contracting specialists and industry analysists are experiencing a shift in perspective. Our current contracting models simply don't work for IT projects. Software cannot be produced the same way as, say, the F-22 Raptor, or a new levee for New Orleans. Our enemies and our project requirements are constantly evolving; massive contracts with set requirements are an anathema to our ability to respond.
On top of this, massive IT projects lend themselves to poor contracting procedure, a subject we've covered in our article series "Contracting Principles the DoD Forgot," about the DoD's withholding contractor payments due to poor contract management. When you combine this new penchant among legislators and members of the Executive branch to hold back payments, with little recourse and devastating consequences for small businesses, the implications are enormous. If we do not change how IT contracts are developed and written, it will be a wonder if we have any IT vendors willing to assume the risk of contracting with the federal government at all.
Two recent articles discuss some remedies: "Bite-size procurements can minimize big-time problems" at Federal Computer Week, and "Gov't IT Contracting Reform Needed" at PCWorld. Both suggest a smaller, bite-sized, incremental approach.
What this means for federal procurement regulations is up in the air right now, but it's clear that federal acquisition regulations would need to change to better accommodate this incremental approach. Contractors need to be familiar with the FAR now, but IT vendors in particular need to keep an eye on the regulations for the foreseeable future as the President's Interagency Task Force keeps working.
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