In GovCon right now, it’s tough to get a bead on the clear direction, at the contract level. Since Executive Order 14275 directed an overhaul of that rulebook (the FAR), agencies have been adopting it at different speeds. Over the last year, each of the 50+ parts of the FAR have been “overhauled”. At one point, an overhauled part came out about every week. While is it true that the regulations were overdue for an overhaul, the change is not as much of a problem as the speed, the volatility, and uncertainty around which agencies are authorizing which rule as of today…
Recently, a client called with a problem. There was confusion over which regulation to use in their situation. This was a decision where the “right” answer depended on who you asked, and when you asked. I paused, not because I didn’t understand the rules, but because I wasn’t sure which version of the rules applied…and whether they had changed since this question came up. Which direction to recommend was dependent on which rule set applied (are we in the red kayak or the blue one?)
The laws have not changed much, but many of the rules around them have (or feel like they have). Either way, this has created a volatile environment for both the buyers and the sellers. Agencies are adopting pieces of the new version at different speeds. Each federal department writes a deviation to the FAR and accepts each of the overhauled FAR parts, one by one. This leads to the current situation: some agencies have adopted nearly all the deviations. Some have only adopted a few. We refresh our screens often…
In our day to day of training and coaching, we are seeing a new pattern develop across government agencies: there isn’t one ruleset anymore. There are three: those agencies using the current regulations, those agencies using the “overhauled” regulations, and those agencies operating with a hybrid of both as they adopt the FAR Parts one by one.
For example, this can mean that the same agency can use one set of rules to compete a contract and a different set of rules to prioritize competing that same contract among small businesses. Since Contracting Officers compete most requirements, not having a clear path to compete among small businesses can be frustrating, confusing, and even conflicting. When those rules don’t line up, there isn’t a clear path forward. That slows down the process as the Contracting Officer has to find a new path. In practice, this makes the work of soliciting, competing, awarding and administering contracts more difficult, or at least more time consuming. At a minimum, the work tends to be confusing because what can and cannot be done feels less fixed, more like it’s etched in wet sand.
Those of us in GovCon are operating a “messy middle” where it is difficult to know for sure where we are between the old GovCon and implementing the new GovCon. This is made more fluid by the fact that so far all these changes have been by Executive Order, meaning that they can be undone by Executive Order too. What makes this particularly challenging is that the agencies adopting the overhauled parts can be updated every day. The volatility of the regulations creates a sense of whack a mole around the rules. For those who operate in the traditionally stable world of government contracting, having a moving set of rules is unnerving.
Overall impact
The federal government agencies, as a whole, represent one of the largest single buyers in the economy. When the largest customer in the economy is inconsistent, everyone downstream feels it. Both government and contractors are having to navigate new rules, new procedures, and sense of uncharted territory in a market that was traditionally very stable. Uncertainty in rules creates hesitation in decisions and that slows one of the largest buyers in the economy. Like we need more uncertainty…
Change is not unheard of in Government Contracting. The role of the Contracting Officer is to figure out how to buy a product or service to meet a mission need, despite the regulation. Now the new challenge isn’t just learning new rules, it’s knowing which version of the rules we’re dealing apply to which situation. Some Contracting Officers are actually moving more slowly because they are leery of stepping on landmines that were not there before. They are spending more time interpreting rules than doing work. For us, that means we now spend most of our time helping our clients tell signal from noise in all the changes.
Businesses are hesitant to lean into potential contracts because the risk is murkier than before. In addition, the contract vehicles they used to rely on to be able to sell to their government customer are often not available anymore, or not available in the same way. This creates different sales channels for similar work
As for how this affects our company day to day, the good news is that our role at Skyway Acquisition has not changed: we help people meet their agencies mission despite the challenging of the regulations…and we’re still doing that every day.
So, what to do with this challenge?
- Focus on what is not changing
There are still 3 Deciders. The Customer has a need, the Economic Decider has the funding, and the Contracting Officer then figures out how to execute that need with those funds. If there is no requirement, and no funding, the FAR overhaul does not matter because there is no contract to execute. The 3rd Decider (the Contracting Officer) is the one feeling the most volatility right now…so focus on maintaining comms with the other two to make sure there is a requirement and funds to support it. Otherwise, we’re risk chasing ghosts. For more on the 3 Deciders check out episode 540 of the Contracting Officer Podcast at https://contractingofficerpodcast.com/podcasts/540-the-3-deciders-revisited/.
- Embrace the TPOT
The TPOT is shorthand for the Thinking Part of the Job (the J is silent). See LinkedIn article from last year here: https://www.linkedin.com/pulse/thinking-part-job-kevin-jans-axvse/ and Contracting Officer Podcast episode on the TPOT here: https://contractingofficerpodcast.com/podcasts/553-the-thinking-part-of-the-job/.
The TPOT is starting to boil over (forgive the pun) as the regulations continue to be changed, rewritten, reworded, and then implemented part by part. While the long term benefit of the FAR Overhaul may be speed, the short term cost is likely the opposite. Finding the new way through the regs is not something we in GovCon have had to do over and over. The stability of GovCon allowed us to stack the knowledge wins. Now, given the feeling of the FAR being etched in wet sand, it’s harder to stack those wins. Embracing the value of the TPOT is how to navigate, especially when we can’t stack wins.
- Embrace the role
While the rules of GovCon are changing, the role of the Contracting Officer is not. In the end, the role of the Contracting Officer is to get from requirement to delivery of product or service to meet that requirement, regardless of the regulations. The role is to figure out HOW to execute the mission through contracts. That has not changed. If we keep our focus on that, we’re better able to meet the mission, despite the volatility.
