Jumping Ship

With agencies turning to their own IT contracts, GSA struggles to pull business back in.

The General Services Administration has high hopes for its new $50 billion governmentwide acquisition contract, Alliant, but the question is will agencies use it. With non-GSA information technology procurement contract vehicles on the rise and agencies creating internal vehicles to meet their needs, Alliant could fall far short of expectations.

Alliant's predecessors, ANSWER and Millennia, were fairly popular, but major agencies such as the Defense and Homeland Security departments have turned away from GWACs in favor of their own indefinite delivery, indefinite quantity multiple award contracts for IT procurement. Defense, in particular, has built up such an array of vehicles over the past five years that its agencies are unlikely to turn to Alliant, according to a recent report from the Chantilly, Va.-based research firm INPUT.

DHS' Enterprise Acquisition Gateway for Leading Edge Solutions, for example, is being touted as an example of exactly what agencies are looking for. Awarded last summer, EAGLE is quickly catching on at the department. INPUT predicts EAGLE could do $1 billion worth of business in the next 12 months alone.

Why do the major agencies prefer launching their own contracts instead of using existing ones? It all comes down to money and control. GSA generally charges agency customers a 0.75 percent fee to use its vehicles, and agencies can avoid contract fees by setting up their own contracts. They also prefer to use their own people and do business by their own rules.

"They like the idea of having everything close to home . . . where they have their own contract people working on it. They can tailor-make the contract for their own specific needs versus being beholden to an outside agency's contract. They have more control," says John Slye, senior analyst at INPUT.

At DHS, the desire for particular expertise necessitated an internal vehicle. EAGLE was created to mold a "cadre of contractors who are familiar with the DHS infrastructure," says Soraya Correa, director of DHS' office of procurement operations. "Our mandate, our mission, requires that we transmit and manage information between the components in DHS as well as with other federal agencies. So in order to accomplish that and accomplish that quickly, we really needed a vehicle that would focus inward on DHS."

Correa is quick to add that her agency's objectives could be achieved through GSA's vehicles as well, but having contractors in the know makes things easier.

GSA might be struggling to attract agency business, but at least one GWAC is thriving. NASA's Solutions for Enterprise-Wide Procurement, one of the few GWACs not run by GSA, remains extremely popular, proving that agencies are not entirely opposed to paying contract fees. "We've been doing this for about 15 years now, and almost from the beginning, agencies have tried to come up with their own substitute for our contracts-and yet they still use us," SEWP program manager Joanne Woytek says.

The key to SEWP's success, according to Woytek, is keeping fees low and providing technology that is not available through other contracts. NASA recently found that 60 percent of the products and services provided through SEWP are not offered through any other contracts. Twenty-one of the 38 SEWP awardees are small businesses. While these firms might not have the wherewithal to run large contracts on their own, Woytek says, they provide niche services that help keep SEWP on the cutting edge.

Low contract fees and exclusive products and services draw agencies to SEWP, but it's impeccable customer service that keeps them coming back, according to INPUT's Slye. SEWP managers and contracting officers play a role in attracting industry players as well.

Companies are considered partners rather than adversaries, Woytek says. "We have, I think, a very good reputation-if not a great reputation-among the companies out there that if they get a contract with us, we will work with them."

Companies devote significant re-sources to the GWAC initial award process, and if the vehicle doesn't bring in business, it could affect corporate decisions to make offers in the future. If agencies don't use Alliant, it could cause major problems for GSA.

"What's important when looking at a contract vehicle is, does it look like there's going to be demand," says Gary Mears, senior vice president of business development at TechTeam Government Solutions, a Chantilly, Va.-based IT contracting firm. "There's no point in being on a contract vehicle if no . . . work is going to flow through it."

GSA officials are optimistic about Alliant. Jim Ghiloni, GSA's director of GWAC programs, says IT purchasing trends are cyclical, and he is confident the trend away from GSA GWACs already is beginning to turn around.

It is the contract that will make the difference. "Simply having a vehicle when other agencies have vehicles is not enough of a differentiator," says Steve Charles, executive vice president of the McLean, Va.-based consulting firm immixGroup. "That's GSA's quandary, trying to figure out how they can add value above and beyond agencies." With $50 billion and its relevance in the IT market at stake, the burden is on GSA to turn the tide.