By Emelie Rutherford
Amid concerns in the Pentagon and Congress about sustaining smaller defense companies, a congressional panel is recommending the Defense Department (DoD) increase its outreach to such firms.
The House Armed Services Committee’s (HASC) Defense Acquisition Reform Panel approved a final report on March 23, ending the special panel’s year-long existence.
The report–which is full of recommendations for changing how the military buys goods and services, and is expected to influence forthcoming legislation–recommends the Pentagon work with other federal agencies to "proactively notify relevant firms, especially small businesses, of contract solicitations."
This recommendation calls for the Pentagon to work with the Commerce Department, Small Business Administration, General Services Administration, and private sector to alert companies about such solicitations for contracts. Firms now largely learn about Pentagon contracting opportunities through the http://www.FedBizOpps.gov Web site.
The "simple posting of a solicitation notice on a Web site does not represent a concerted effort to push information about potential contracts to relevant firms," the HASC’s acquisition-reform panel’s report states.
"A small investment in additional outreach to industry could demonstrate a large return in increased competition, lower prices, and innovation," it adds.
Alan Chvotkin, the executive vice president and counsel at the Professional Services Council (PSC), the trade association for the federal government’s professional and technical services industry, said this recommendation is "significant because what they’re saying is that right now the system only rewards people who are part of the system."
"So if you’re not a government contractor today, and you don’t know that FedBizOpps is the focal point for all information, then you’d never know about the opportunities that arise," he said in an interview.
"The Pentagon tends to buy from the same people over and over and over again," Chvotkin said. "They (would be) right to do some outreach to see if they can expand that pool of resources."
The Pentagon potentially could fulfill this call to better notify small firms about defense contracts without actual legislation or regulations, and instead through social networking and advertising, he said.
Fred Downey, the vice president of national security at the Aerospace Industries Association (AIA) trade organization, similarly said there are common-sense ways the Pentagon could increase outreach to smaller defense shops, such as improving public-relations efforts leading up to industry days.
Downey, in an interview, said the HASC’s acquisition-reform panel has touched on a key issue regarding Pentagon communication with smaller factions of the defense industry.
"Most of these small businesses are actually suppliers, and the thrust of both policy and economy has put an awful lot of stress on these smaller suppliers," he said. "And they’re critical to the (original equipment manufacturers) OEMs, and they’re critical to the government."
AIA called last year, in a report on the defense industrial base, for the Pentagon to strengthen the dialogue between senior DoD and defense industry officials.
"The Pentagon can no longer rely on a policy of…simply allowing market forces to shape the industrial base," Downey said. "That may have been possible in an era where you had multiple companies at many levels in the base, but that’s not the case anymore. And (the current environment is) not one that efficiently recognizes the new and innovative companies that are potential benefits."
The HASC’s acquisition reform panel devotes a whole section of its five-part report to "getting the most from the industrial base." Other recommendations in this section relate to firms with questionable employment practices, the duties of the Defense Contract Audit Agency, the factors the Pentagon considers for entering into multiyear procurement contracts, and the export-control system.
The panel’s recommendation regarding outreach to smaller defense firms comes as Pentagon and congressional leaders have voiced concerns about ensuring the DoD learns about the products made by companies other than the defense giants.
"The issue (of)…how do we get small, innovative companies to sustain themselves in this business is a critical issue," Chairman of the Joint Chiefs of Staff Adm. Michael Mullen told the House Appropriations Defense subcommittee (HAC-D) on March 24. "And my experience is, the big contractors eat them alive."
His comments came during a discussion about small defense contractors and improving the performance of acquisition programs.
Mullen called for "continued review and pressure inside this acquisition reform structure" to help the Pentagon get technology that he said is "out there" and "will help us a great deal."
HAC-D Chairman Norm Dicks (D-Wash.) has talked to Pentagon officials about expending the DoD’s Small Business Innovation Research effort, in order to help small firms looking for defense contracts. Those talks were spurred by a new House proposal to end earmarks in appropriations bill for for-profit companies, a move many key senators have opposed.