222: Shape Value for the Government with Shirley Collier

13
Jul

Shirley Collier, President of Scale2Market LLC, is fueled by a passion to help businesses succeed in the federal marketplace.

We learn about Shirley’s journey and her powerful DAVIE framework (Data Analysis Value Investment Execute and Evaluate) that guides companies through the complexities of federal contracting. She explains how to leverage data, build relationships, and strategically position businesses to win lucrative government contracts. She also emphasizes the importance of innovation and staying competitive to maintain a foothold in the federal market.

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Listen to the podcast here

 

Shape Value for the Government with Shirley Collier

Good day, dear listeners, Steve Preda here with the Management Blueprint Podcast. And my guest today is Shirley Collier, President of Scale2Market LLC, which helps businesses thrive in the federal marketplace by providing strategic market positioning, a business development playbook and developing high performing business development teams. Shirley, welcome to the show.

Thank you, thank you. It’s a pleasure to be here, Steve.

Well, great to have you. And we don’t often have people talking about the Federal Marketplace, even though it’s a huge market. And I really wonder why someone chooses to create a business serving the Federal Market. I mean, I may have answered my question already, but why would someone choose to essentially work with companies who work with the government?

Well, it’s a huge market. As you’ve said, it’s a $700 billion market. So people go into that marketplace because there are huge opportunities. The contracts are large, there are multi-year contracts, and it can be very rewarding work because you’re serving the American people.

Okay. Yeah, I agree. I have a client who does that and they have a very powerful “Why” and they’re very proud of what they’re doing. So if someone is excited about that, they want to help the American people and they want to grow in the Gulfkan Market, then how can they do that? And I’m asking you because you develop the framework for exactly these type of companies so that they can grow. So can you share with our listeners how that works and what makes this framework powerful?

Yes, let me begin by saying why it’s so hard to do business in the federal sector. Most small businesses, especially, really struggle with business development. It is highly complex, very competitive, and it’s highly regulated. There are things that you can do in a commercial market that are prohibited when you’re working in the federal market. For example, when you’re selling in the commercial market, we’re taught A, B, C, always be closing. Well, the federal marketplace, that’s prohibited. You can’t actually ask for the work. You can’t say, oh, if we change our product this way, will you buy it? That’s just not the way that it works. So I’ve developed this framework called DAVIE, D-A-V-I-E, which stands for Data Analysis Value Investment, and then the E stands for Execute and Evaluate. There's six categories of actions that must be taken by contractors to grow and create value in the federal marketplace. Share on X

In this model, there is an emphasis on data-driven decision-making and disciplined thinking. Most small contractors approach the market very casually, and they usually find their first contractor to from friends and colleagues. But to grow, there has to be much more discipline. So that’s what I really focus on is how do we bring discipline and consistency to the business development process so that companies can win contracts, win profitable contracts and create market value.

Okay, so let’s dissect this. So what does it mean? I mean, I understand number one was data, and maybe the federal government also wants to make data-driven decisions. So how do you tap into this, and how do you make sure that you make your proposal so that it will be positively evaluated by a data-driven process?

So I mentioned some of the challenges of doing business with the federal market in the federal marketplace, but one of the benefits is that the federal government is required by law to telegraph what they’re going to be buying. So they are required to conduct market research to determine if there are qualified vendors out there for certain products and services. So there’s a lot of data about upcoming procurements, a lot of detail about upcoming procurements. Budgets have to be published. Procurement forecasts have to be published. Strategic plans have to be published. And then, of course, there’s all this market research. So that’s the data that we’re talking about. Accessing it, understanding it, analyzing that data, and then developing strategies based upon that data is step number one.

Okay, so you got your data figured out, then analyze and value. So what are these steps about?

So the analysis is what I just alluded to, is that there’s a lot of information out there, but it takes more than just looking at the data. You really have to dig, determine what are the ecosystems, the vendor ecosystems around opportunities, around agencies, the various programs that they have, who are the decision makers, who are the influencers. Usually, there are incumbent companies that do business with those agencies. So understanding that very complex environment is the second step, the analysis and actions, and the actions that come out of that are very specific strategies. So for example, are you going to try to prime this opportunity? Are you going to try to be a subcontractor, jump on someone else’s team? Do you form a joint venture? How do you get your foot in the door?

Okay, so you make that decision, and then you have value and invest. So what are these steps? How are these steps helping you be successful.

So the first two steps are very market focused, very externally focused. Then you have to say, so what? What does this mean to me? What is my core competencies? What are my past performances? What are my differentiators? How can I go after those opportunities? Once I learn about the opportunities, the contract vehicles, the agencies, what their strategies are, who’s in there right now, the solutions that are currently being provided, who my competitors are, how do I really understand how to get my foot in the door and do the job better than the competition. So that’s the value and validation part of the model. And then the investment. So if I understand the market, I understand myself and what I can provide, who do I need to invest in? What people, what systems, what activities, what relationships? So the investment is sort of the first action step after you do the analysis and planning.

So it sounds like a very elaborate process. So if someone wants to get into the federal market, should they expect a long sales cycle? Should they expect to be having to do a lot of work bidding for a lot of jobs in order to get started? So is it like, one year incubation process or longer? How do people even get into this market?

Well it’s very hard to penetrate the federal marketplace despite what the government might tell you. Even if you’re a small business and there’s a small business set-aside program, even if you have a socioeconomic certification, it’s still very, very hard because there are entrenched vendors and the government’s very risk-averse. So they’re not likely to change their vendors unless what you offer is significantly better than what they already have. But getting in and finding those people and convincing them, and then you have to, first of all, find out what their requirements are and how the solution that they’re currently using has deficits. So all of that is very hard to do, but there are some best practices. The government does host all of their contract awards. So I mentioned earlier that they have to telegraph through market research, the upcoming procurements. Once they’ve made a decision and awarded a contract, that’s all public also. So you can look at the contract awards and what the incumbent vendor has been providing. You’re not going to be able to get competitive information. You can FOIA the existing contract, that’s the Freedom of Information Act, but it takes a little bit of work to dig into exactly what the existing solutions and contractors are doing. That’s where having a strategic conversation with a decision maker, someone in the program office or in the contracting office, about what and how you can do things differently is critically important. But it takes a while. I advise my clients who are brand new to the marketplace. You should expect to invest $250,000 to $500,000 over a period of about two years before you see your first contract.

Wow. So, how do these companies or how these entrepreneurs make money in the meantime? They provide Consulting in the commercial sphere and then they transition gradually?

Yes, that’s what I’ve seen a lot of companies will do that. They’re an accounting firm, for example, and they do a lot of work in the commercial sector. They want to get into government accounting because maybe they have someone on staff that has some expertise in that. So they will use their commercial work to fund their entrance into the federal market.

Is it possible to do it the other way around, to get an encore contract and to use that to build out your tentacles in this market? So let’s say you’re an employee of an organization and you build a relationship and someone really trusts you and therefore even you leave that organization, let’s say it’s an accounting firm or consulting firm, then being hired by a government contract through a relationship, and then use that to build up your credentials, your experience, your staff, and then reinvest the money into trying to get other contracts.

Yes. Yes. And that is a typical pathway into government contracting, that you already work for a government contractor, and you want to start your own small business. So you spin out as a small business and usually an 8(a) certification or some other type of socioeconomic certification will help with that. There’s two things, the federal government is allowed to award no bid contracts to socioeconomically certified companies up to four and a half million. So no bid, no competition, four and a half million. That’s one pathway. Although that’s a little bit hard. It sounds easy. Even if you have a relationship, you have to convince the contracting office and the program to allow you to be a prime contractor for a set-aside contract. That’s very hard. So what a lot of small businesses do are individuals that want to start a business and go into the federal sector. They’ve been working for a government contractor. They spin out, form a company and then they contract themselves back to their old employer as a subcontractor.

Yeah, okay that makes sense and what I also learned is that there’s no non-competes. So if you’re a government contractor, you cannot restrict your employees from working for other government contractors.

Right.

Or if you have a subcontractor, you can’t restrict them to partner up with your competitors even. Is this true?

Yes, exactly. So partnering, teaming in the federal sector is much, much more robust than it is in the commercial sector because the government has a social agenda in addition to a financial agenda with contracting. Many large prime contracts have a requirement that a certain amount of the contract has to be subcontracted through the prime, has to be subcontracted to small businesses in various categories, HUBZone, Women-Owned, 8(a), Service Disabled, and so forth. So large prime contractors are always looking for smaller contractors that they can partner with.

So how can someone build a sustainable business in the federal marketplace, if there are so many mechanisms that commoditize you in this business?

Well, what you have to provide cannot be a commodity. You can’t win in that game. So creating something unique that has a lot of value, that has a lot of demand. One of the areas right now that small businesses are finding a competitive advantage is in artificial intelligence. So they are developing not only expertise with artificial intelligence tools, but if they have worked either in a federal agency or for a prime contractor and have developed subject matter expertise, they really understand the mission of the agency, and now they have expertise in a particular tool. Many of them are able to develop models that they can demonstrate to agencies and get some pilot projects that really puts them on the road to success.

Can government contractors protect their intellectual properties so that their subcontractors can only provide those services through them rather than through competitors?

Yes, there are, and I’m not an attorney, so I’m going to qualify this, but protecting intellectual property is very unique in the federal sector, because you’re getting money from the government, you’re getting public funds to work, to create, especially in IT, to create some products, some work products. If you developed independently from the federal agency your own methods, software, and you bring that into the relationship, you bring that into the contract, you can protect that. What is developed under federal funds, except in some situations, the government will give a small business a period of time in which they can monetize the intellectual property in the commercial market. But after a certain amount of time, it becomes government-owned IP.

Wow. So essentially, while working as a government contractor, you are not able to develop any proprietary IP that is sustainable for a length of time.

Except under certain programs like the SBIR, Small Business Innovative Research Program. It encourages the development of intellectual property and now stays with the small business for five years, but it gives them an opportunity to take what was developed with federal funds and create a commercial product so that goes into the private sector.

But only for a limited time, so then the government can have other people provide that same service so?

To the government, but your intellectual property in the commercial market is under normal IP rules.

Oh, okay. That’s interesting. All right, so let’s switch gears here a little bit. So what are some of the traps that government contractors should seek to avoid?

One of the traps I see small businesses getting into is not really understanding procurement strategy, not understanding the federal acquisition regulations. It’s imperative that they really understand procurement regulations. There are 52 sections of the FAR, federal acquisition regulations, and no one wants to hear this. No one wants to hear this. Small businesses are like, oh, my gosh, this is just one more thing that I have to remember, but you’re operating in a regulated environment, so it’s very important that you understand those regulations and leverage them to your advantage. So that’s one thing. The second trap is believing some of the messaging that comes out of the federal government regarding procurement. The federal government gives you the impression that federal bidding, public bidding, is a level playing field, that all you have to do is respond to an RFP and as long as you submit a compliant proposal everyone has an equal chance at winning that work. And that’s untrue. Totally, totally untrue. You still have to sell to the federal government and it’s sometimes called shaping, shaping an upcoming procurement, which is all legal. It’s allowed under the federal acquisition regulations where you’re educating the government about potential solutions. And then your education about those potential solutions come out in the RFP, in the request for a proposal. But if you don’t have a conversation with a contracting officer or a program manager, you have had no contact with that agency, and you see an RFP and you think, oh, this is right up our alley, we’re going to submit a proposal, your chances of winning, even though you might be highly qualified, is almost zero. And the reason that it is, and I alluded to this earlier, the federal government is very risk averse, and their people, it’s made up of people. People do business with people they trust, and they trust people that they like. Share on X

So if they don’t know you, they’re not gonna trust you, and they’re not gonna take a chance, usually for substantive contracts. Now, the small business office will sometimes have some little small demonstration projects as an entree for small businesses to kind of get their foot in the door, but anything of substance, you’re going to have to sell your company to that agency.

Okay. So this is very interesting, the shaping process. No one told me that before that it was legal, and maybe there’s no reason to be illegal about it anyway, but I had a client years ago who built a very substantive business by shaping projects. It was a civil engineering company, it works in municipalities, and they really used us in Europe, and they knew what the EU fundings are coming, and what can be done, and they generated a lot of ideas for local governments, and they would hire them, and they had a very, very robust business in a certain part of the country. So my question is, what is the process for becoming a shaper, other than being likable, so that people will like you and grow to trust you. But is there a process for this?

Yes. It’s important that you read all of the public information about the agency, their strategic plan, what they’re trying to accomplish, what their mission is, their programs and those sorts of things. And then you offer solutions. The federal government depends heavily on the vendor community for innovation, for ideas, for solutions. So the FAR actually encourages what they call pre-solicitation communications. It’s not only the formal market research that agencies do, the contracting office will usually manage that process, but contracting offices and program managers are encouraged to have one-on-one communications with vendors to get ideas, to be educated about what the possibilities are in the marketplace long before market research is conducted and certainly long before the RFP drops.

Wow. So, is this the secret to getting established as a government contractor is to generate those ideas and sell those ideas and shape?

Yes.

So is this something you can help people with?

Yes, that’s one of the things that I do in this playbook that I developed. So my initial deliverable to my clients is a three-year data-driven customized business development playbook. So it’s an analysis of the marketplace, all that data that we’ve been talking about. So it’s an analysis of the marketplace, strategies, how are we going to approach this, and what do we say? What do we say to these agencies about why they should do business with us as opposed to the incumbent or a competitor?

Okay. That’s fascinating. So if you want to get into government contracting, then figure out or go to Shirley and talk to her and help her build your plan on the business development playbook. How you’re going to do that, how you’re going to generate the right ideas that fulfill the mission, which will be different enough and unique enough and powerful enough to help shape future RFPs so that you can build and you can win the RFP that you created or co-created, then establish your footprint and become an established payer. Is this a one-off thing that you just have to do it once and then you can use the inertia of the government to just keep providing great service and then you become an incumbent or you have to regularly do that?

Well, the incumbents definitely have a strategic advantage. So once you’re in and you become a trusted advisor, and you referred to that earlier, they become to depend upon you. You know them, you know their operations, their decision-making criteria, culture, all those sorts of things. You're better able to become a trusted advisor. Share on X It’s much riskier for them to kick you out and to get someone else in there. So incumbents definitely have a strategic advantage. However, the fallacy of that is that if you become too complacent and you’re not being innovative, you do risk being supplanted by a competitor.

So it’s kind of like in a commercial market, disrupt or be disrupted kind of thing. Sometimes you have to disrupt it in order to stay competitive. Well, that’s a fantastic, fascinating discussion. I didn’t expect us to have such an interesting discussion around government contracting. I’m excited about this and maybe if I was a few years younger, I might invest the years into this or might do it anyway. I don’t know. So if someone would like to learn more about the DAVIE process, about how you can help or what your information content is out there, where can they find you and where can they learn more?

Scale2Market.com with the number two in the middle. You can also reach out to me on LinkedIn.

Okay, well, definitely don’t miss out on connecting with Shirley Collier, President of Scale2Market. Thanks, Shirley, for coming on the show. And if you enjoyed this, please like and comment on YouTube, on our show or on LinkedIn and keep coming back because as you can see every week, we have a fascinating entrepreneur sharing all their secrets with us. So thank you Shirley for coming and thank you for listening.

It’s been my pleasure, Steve. Bye bye.

 

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