Business goals

DISA sends message to big business: meet small business goals or risk losing speed

There is always a lot of talk about the importance of small businesses to federal contracts. Every jurisdiction likes to tell us how small businesses are “the engine of the economy”.

Yet the government-wide small business contracting target has been 23% since 1997, despite federal procurement spending reaching $ 594 billion in fiscal 2019. While agencies have done a good job of meeting and exceeding the 23% target over the past five plus years, small businesses continue to face enormous challenges as prime contractors and contractors. Take a look at the 8 (a) STARS II Insanity and several other programs that have derailed in recent years.

So when an agency does something that not only puts small businesses at the forefront of a major market, but adds clauses to hold large businesses accountable, it’s worth noting.

This is the case with the Defense Information Systems Agency’s Engineering, Technology and Systems Innovation (SETI) contract.

For its efforts, DISA received the Greenery Award 2020 from the Ministry of Defense for demonstrating new approaches to balance the development of efficient procurement methods and the use of small business. The Pentagon created the Verdure Award in 2015 as one of five official recognition programs designed to promote the success of small business programs.

“The bottom-up overhaul of SETI four years ago seems to have set us up for success today. The principles of the SETI program and the innovative acquisition tactics that we have developed and deployed throughout the instantiation of the program have been validated by our peers across the department as being the best, ”said Christopher Riley, the manager. of the SETI program for DISA, in a call to reporters on October 9. “When we first built the SETI building, what we were trying to do had never been done before. This was going to either be a use case of what not to do or set the new standard to spur innovation in large-scale acquisitions in the department.

Riley said SETI is now the new standard bearer on how to work with small businesses in the future.

There are several reasons why Riley and others at DISA think SETI is what the future of small business contracts might look like.

DISA has taken specific steps to create the 10-year contract which has a cap of $ 7.5 billion with input from small businesses. SETI includes two contractual suites – one for small businesses and one unrestricted. DISA awarded 15 companies a spot in the unrestricted version in July 2019 and the small business side just came out of protest delays earlier this summer and has 25 winners.

Carlen Capenos, director of DISA’s Office of Small Business Programs, said that through targeted feedback during the project and final solicitation phases, the agency removed barriers that may have limited small businesses that allegedly bid. .

Carlen Capenos is director of the Office of Small Business Programs at DISA.

“Two specific examples were the authorization requirement. In general, anything we do in DISA requires authorization from the prime contractor’s facility site at the time of proposal. This is a huge hurdle not only for small businesses, but also for the joint ventures themselves. We took that barrier away and said we would sponsor this award to a company or joint venture that didn’t have it. It was something that we don’t normally do and we had the opportunity to let in more businesses and joint ventures, ”said Capenos. “The other thing we did was remove the cost accounting certification requirement. Again, we normally need it at bid time, but in this case we said you don’t need it at bid time, you would need it before costing the contracts. We would sponsor this certification process for you.

Another obstacle that DISA is trying to overcome is the tendency for defense services or agencies to automatically use the unrestricted version of SETI.

Christopher Gray, chief of the DISA contracting office at the Defense Information Technology Contracting Office – National Capital Region, said contracting officers should first consider leaving the order to task against the small business part of the contract before using the unrestricted version. And if a military service or defense agency decides to use the contract without restriction, small business firms can still bid on the work order.

“We also made a deliberate statement that did not require small businesses to address all elements of the Statement of Work (SOW). We know that small businesses, especially innovative ones, have niche capabilities and we wanted to go to those really innovative small businesses that have niche capabilities and not trigger them all just because they couldn’t. perform in one or two specific task areas, ”he said.

Riley added that DISA is also keen to bring in non-traditional SETI entrepreneurs, which is another hurdle they’ve removed.

“One of the things that was a typical barrier to entry for small businesses was that you had to have past performance references related to the Department of Defense. We allowed past performance references from outside the DoD, which has allowed them to bring historic capabilities to the table when they propose, ”he said.

It appears that DISA has been successful in reaching many of these non-traditional businesses.

Capenos said about half of all award winners had to be entered into DISA’s contract drafting system, meaning they had never done business with the agency before.

Riley added that out of more than 100 offerors, about 80% had no previous experience with DISA.

Now, all of that effort and upfront work will be in vain if DISA customers and large businesses return to their old habits of not following SETI’s rules for small business task orders or securing sub-opportunities. contracting.

Capenos said DISA plans to hold prime contractors accountable for their actions in supporting small businesses.

“We have a subcontracting requirement in all contracts, whether awarded to a large or small business, and they have to report them quarterly. Not only do they have to report them to contracting officers, but they will also report them to our office so that we can help monitor and measure the dollars and work performed by small businesses, ”she said. “Not only will we measure and monitor it, but businesses large and small will be noted in their Subcontractor Performance Assessment (CPAR) report. “

In addition – and this is perhaps the best part of SETI – DISA has built into the contract an exit ramp after five years where it can decide not to exercise the option of contractors who do not meet the requirements of their small business. business.

While DISA has it all right and has done a lot of the initial work to set SETI up for success as a small business and innovative contract, the proof is still in the pudding over the next five years.

If DISA keeps its word, empowers buyers and big companies, and genuinely supports small businesses, then SETI will be the flagship of future deals, and one that other agencies should certainly look to as a role model.