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March 31, 2021 By cs

The price of success vs. the cost of failure

“Uneasy is the head that wears the crown.”

Shakespeare most likely did not appreciate the timeless relevance when he wrote that line for his play Henry IV, Part 2.

When applied to business, the clairvoyance cannot be overstated.

Successful companies achieved their standing by being competitive in their respective markets. A recognized measure of business success is having the company become a part of the Dow Jones Industrial Average.  In 2021, there are no original companies left on the index, and many of these original companies haven’t been part of it for many years now.

There are several reasons for that. Some unfortunately failed to adopt disruptive technologies that would have maintained, and perhaps strengthened, their leadership position.  One of the lessons to be learned here is that companies can get left behind if they fail to innovate, leaving themselves vulnerable to more agile competitors who keep a pulse on disruptive technologies.  This is an everyday reality in the tech industry. Companies must innovate or succumb to the competition.

The defense industry is now facing a disruptive technology moment and looking directly at Silicon Valley for inspiration.  Within the Defense Department, the digital revolution is in full swing, with multiple new programs signifying a push for widespread adoption of commercial processes by defense contractors. The department is signaling that it is ready to push the envelope with commercial best practices and will no longer tolerate the “never enough time and money to do it right, but enough time and money to do it over” acquisition process.

Keep reading this article at: https://www.nationaldefensemagazine.org/articles/2021/2/24/the-price-of-success-vs-the-cost-of-failure

Filed Under: Government Contracting News Tagged With: acquisition policy, agile, contractor performance, defense contractors, digital talent, disruptive, DoD, industrial base, innovation

March 29, 2021 By cs

Small number of states dominate DoD spending

A huge portion of U.S. defense spending is going to contractors and military personnel based in just a handful of states, according to data recently released by the Pentagon.

Defense Department contract obligations and payroll spending in the 50 states and the District of Columbia totaled $550.9 billion in fiscal year 2019. Of those outlays, 73 percent was spent on contracts for products and services, while the remaining 27 percent paid the salaries of department personnel, according to the Office of Local Defense Community Cooperation’s latest report on defense spending by state.

“California, Virginia and Texas topped the list of recipients for overall defense spending,” said a press release accompanying the study. They received $181.3 billion, about one-third of the total allotted to all 50 states plus D.C.

The top five, which also included Florida and Maryland, received about 43 percent of the total, while the top 10 received approximately 59 percent, according to the data.

The top 10 states were: California, $66.2 billion; Virginia, $60.3 billion; Texas, $54.8 billion; Florida, $29.8 billion; Maryland, $26.1 billion; Connecticut, $19.7 billion; Pennsylvania, $18.1 billion; Washington, $17.8 billion; Alabama, $16 billion; and Massachusetts, $15.8 billion.

That adds up to a whopping $324.7 billion.

Keep reading this article at: https://www.nationaldefensemagazine.org/articles/2021/2/25/small-number-of-states-dominate-defense-spending

To read the Office of Local Defense Community Cooperation’s full report go to: https://oldcc.gov/sites/default/files/defense-spending-rpts/OLDCC_DSBS_FY2019_FINAL_WEB.pdf

Filed Under: Government Contracting News Tagged With: defense contractors, defense contracts, DoD, government contracts, government spending, OLDCC, spending

January 15, 2021 By cs

DoD bringing companies into the fold for sensitive info

After a years long pilot, the Defense Department is establishing a permanent program that will let some trusted companies in on critical military information to help build needed systems.

“As the world sees a return to great power competition, DoD must strengthen its engagement with the defense industrial base in order to respond to the national security challenges facing the United States in a more responsive and cost efficient manner,” a Dec. 15 memo signed by Pentagon acquisition chief Ellen Lord states.

The memo goes on to state that, increasingly, technologies and information are squirreled away in special access programs.

Those are programs that exceed regular classified information and entail highly sensitive operations and black projects.

Keep reading this article at: https://federalnewsnetwork.com/dod-reporters-notebook-jared-serbu/2021/01/dod-stands-up-permanent-program-to-give-vendors-access-to-top-tier-secrets/

Download the Dec. 15, 2020 DoD memo on the subject of “Special Access Program Contractor Portfolio Program Establishment” at: https://fas.org/irp/doddir/dod/sap-contractor.pdf

Filed Under: Government Contracting News Tagged With: access, defense contractors, Defense Industrial Base, DoD, industrial base, national security, trust

September 16, 2020 By cs

Pentagon, Defense contractors are out of step on tech innovation, GAO finds

The Pentagon wanted to fund ambitious research into future tech breakthroughs but contractors spend most of their money on safer bets, GAO has found.

Two years after the Pentagon set out to spend billions on 10 breakthrough research and engineering efforts, defense contractors instead are putting most of their money in less ambitious research projects.

The development gap between the military and its suppliers troubled investigators at the Government Accountability Office, or GAO, who determined in a report released last Thursday that the Defense Department isn’t keeping good watch over those private efforts and doesn’t know how much of it would fit into the military’s tech goals.

The Pentagon’s undersecretary for research and engineering in 2018 laid out several big idea research areas that would be most relevant to maintaining an edge on China or Russia.  Many are in the very early stages of maturation; the biggest breakthroughs are expected in the second half of the coming decade.

Keep reading this article at: https://www.defenseone.com/technology/2020/09/pentagon-defense-contractors-are-out-step-tech-innovation-gao-finds/168237/

Filed Under: Government Contracting News Tagged With: Air Force, breakthrough, China, defense contractors, DoD, GAO, innovation, Pentagon, research, Russia

July 27, 2020 By cs

Government contractors and financing a post-coronavirus ‘reboot’ of the economy

When the shutdown ends, contractors will be busy.

When the economy does begin to recover from our nationwide lockdown, one  certainty is that it will not be as simple as “turning the lights back on.”

Companies may have a long road back to full strength as they go through the process of restoring their workforces, rebuilding supply chains and planning for growth in a new, unfamiliar economy.

One certainty, however, is that government contractors will be in high demand as agencies face a backlog of project work as well as new initiatives grown out of coronavirus recovery plans. Taking the right steps now will be essential to aligning these resources with expected need.

So why will government contractors face a surge in demand when COVID-19 restrictions lift? One reason is that many projects that were underway in the spring, particularly construction projects, will once again come back online after being placed on hold due to social distancing guidelines. Construction on roads, bridges and highways is expected to peak as state and federal agencies race to catch up on work planned and postponed for the spring and summer periods.

Keep reading this article at: https://federalnewsnetwork.com/commentary/2020/07/government-contractors-and-financing-a-post-coronavirus-reboot-of-the-economy/

The Contracting Education Academy at Georgia Tech has established a webpage where all contract-related developments related to the coronavirus (COVID-19) are summarized.  Find the page at: https://contractingacademy.gatech.edu/coronavirus-information-for-contracting-officers-and-contractors/

Filed Under: Government Contracting News Tagged With: CARES Act, coronavirus, COVID-19, defense contractors, Defense Industrial Base, DoD, economic recovery, economy, financing, industrial base, industry, pandemic, shutdown, social distancing

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