When the Texas Workforce Commission (TWC) decided to revamp its Web applications to more effectively communicate with its users, minority-owned firm MMC Group—along with consulting giant Accenture—won the contract. Often, small and minority-owned firms—so-called historically underutilized businesses (HUBs)—are hard-pressed to win large government contracts. But the Mentor Protege program, created by the Texas General Services Commission, brought MMC and Accenture together in a "true partnership": The two firms mutually fund a dedicated salesperson and bid together for appropriate contracts like the TWC project.
The Mentor Protege program was created to encourage vendors to foster long-term relationships between contractors and vendors and HUBs. In interviews with TechRepublic, MMC consultant Doug Mitchell and Chris Politte, partner for Accenture's Government Group, shared their thoughts about the program and how other minority businesses can maximize their status to secure government contracts. Mitchell offered four recommendations for HUBs:
- Get certified as a small, minority-owned, or historically underutilized business.
- Get in on the "front end" of proposals.
- Stick to your core business and focus your marketing efforts.
- Deliver what you promise.
This article explores the latter two recommendations.
Second of two parts
Last week's article discussed Mitchell's advice for getting in on the "front end" of proposals and getting certified as a small or minority-owned business.
Stick to your core business and focus your marketing efforts
For small businesses, the long sales cycle is one of the greatest detriments to government contracting. For example, Mitchell said he has one contract he's been working on for two years, "and the proposal hasn't even hit the streets yet." He’s found the average sales cycle to be about 18 months.
"That’s the catch-22 of government contracting," he said. "It’s long front-end sales, but usually they are multiyear contracts. So if you spend the time on front end, you’re rewarded with a long contract."
Most small organizations don't have the kind of stamina, in terms of capital or financing, to sustain themselves in a true partnership with a larger business, Mitchell said. The problem is compounded when smaller firms don’t narrow their search for new contracts. The larger businesses, on the other hand, have the resources to pursue a myriad of opportunities, and that can wreak havoc on a small partner's assets.
The remedy Mitchell prescribes is targeted partnerships linked to targeted opportunities. Small businesses should focus on long-term contracts and on developing partnerships with companies that will result in multiple engagements. He pointed out that while MMC's client list is small, its recurrent clients are mostly Fortune 100 companies with average contract lengths of five to six years.
For small businesses, the front-end effort required for some contracts is counterproductive.
"It’s hard to re-create yourself every 90 to 120 days," he said. "You go sell two or three people, go to work, and make money for 90 or 180 days, or six months. Then, you have to go find another piece of work."
The pitch to large organizations: Find what you can offer
MMC's pitch to large companies is an offer to be their "low-cost labor supplier," Mitchell said.
"We don’t have a bunch of corporate overhead… so it’s very easy for them to let us have the majority of the people while they have the management staff," he said. "They have the computers, the infrastructure, etc., and we provide the staff."
The key to finding what your small business can offer larger players is sticking to your core business, Mitchell said. If you're a staffing company, for example, don't try to be a high-powered consulting firm. Be willing to turn down “blue sky” opportunities and stick to your niche.
Deliver what you promise
When Accenture accepted MMC as a partner, Politte said he was seeking a company that was hungry for growth and had proven itself as a skilled HUB.
"I was looking for a trusted vendor… that was looking to expand their business presence," Politte said. "Their areas of expertise are many, but the one I was most interested in was the ability to find and hire people that perform well in a computer systems integration project type of environment.”
To reward the trust of larger partners, Mitchell stresses that small firms who finally get a coveted government process always deliver what they promise. It's easier to get more government work once your firm has proven it's capable and you've made contacts. Failing to deliver results is devastating for your firm.
"Once you get that piece of business, unless you really screw up, you’re going to keep that piece of business," Mitchell said.
Are you a small or minority-owned firm who has established a "true partnership" with a larger consultancy? What challenges have you faced, and how have you overcome them? Do you agree with Mitchell's advice? Send us an e-mail or post your opinions below.