The Federal End of Year Scramble: What Can Be Done to Change It?

Everyone in the federal IT space knows how crazed the time of year at the end of the fiscal cycle can be. With government departments working to spend out their budgets before the close of the year in September, deals are rapidly made and VARs spring into action.

This well-known end of year scramble can have its consequences, though.

Jamie Wodetzki, co-founder of contract management and document assembly company Exari Systems, said this rush can lead to risky or even problematic contracts for the IT field, wasting time and resources on overall lower quality projects.

’This is not actually a new phenomenon,’ Wodetzki told CRN. ’…There are periodic disasters or projects that go horribly wrong that create outrage because it’s the taxpayers’ money that’s being wasted. … The problem (is created when) you spend like crazy at the end of the budget cycle. You’re inevitably doing things in such a rush that you don’t apply the same level of scrutiny.’

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Wodetzki told CRN VARs can get themselves into a tight spot too, when they agree to a contract with a limited amount of time to conduct research and thoroughness regarding how much completing a task will cost. So, if a federal partner takes on a contract for $1 million but learns down the line it will cost more, there’s no going back for the business.

’The problem is once they sign the contract, they’ve essentially locked themselves in…,’ Wodetzki explained. ’It’s done in such a hurry, by the time you realize it,… it’s too late.’

CRN reached out to several VARs in the federal space to get their perspective on the ’mad dash’ that comes every fall to see what they would change about the procedure; many expressed their concerns with the mania and offered opinions on what they would change.

Ed Blumenthal, CEO of S.O.M.A. Computer in Philadelphia, a federal IT contractor, said his company can serve as many contracts as 100 a day in September, and even though the dash can be intense, he said he’s never thought about changing the system or improving upon it.

’We don’t have the time to talk with each customer,’ Blumenthal said. ’The orders come in so fast that we’re doing all we can just to keep up with civil processing. … We just make sure we get them all done.’

Brian Edwards, chief technology officer of the Arlington, Virginia-based Phacil, said a lack of requirements to size orders can hurt his business, and makes contracting all the more difficult, especially during the end of the year scramble.

’Unless the government actually tells you some things about the actual task, it’s difficult to actually size the work unless you call and get ahold of owners or the incumbents working with them,’ Edwards said. ’…The September, or fourth quarter, rush is problematic to get all of that done, but the delays and having to force companies to rebid and redo work they already did is costly.’

NEXT: More Federal VARs Speak to the End of Year Crunch

Neil Cohen, director of business development for Defense Group in Vienna, Virigina, said from his perspective, contracting could be improved, especially just by lowering the high cost for requests for proposal, or RFPs.

’I was recently asked in the defense industry why are fewer and fewer people responding to RFPs, and small businesses in particular are no longer responding to federal RFPs,’ Cohen said. ’My response is the RFPs we’re responding to are extremely time consuming. It’s costly and it can cost from thousands to tens of thousands of dollars.’

An East Coast based VAR, who wished to remain anonymous and who deals directly with the government, said he has been disappointed with contract handling in the past. He told CRN more transparency around contract dealings would make him more comfortable and he additionally believes a ’vast majority’ of contracts have been pre-determined before they are put out for the RFP process.

’There’s very little transparency…,’ he said. ’I’ve noticed that when awards are done very quickly, it means the agency had predetermined who they were going to choose and this RFP was a (facade) to make it appear that it was a competition.’

Exari developers created a product now sold to partners which works to better contract lifecycle management strategies to improve the quality and efficiency of last-minute September federal contracts by automating drafting and ensuring key language is accurate and standardized. Wodetzki said he has gone through this process for years and is now offering this product to try to change the current state of affairs.

’Our main perspective on this is we provide contract management software that we can provide to both government agencies and we provide to private companies, including vendors, …(to put in) a more controlled process,’ he said. ’You can enforce some control in what people do through the software.’