Articles
Patience Has Its Rewards:
Selling to the Department of Defense is a multi-year process
By Alan Ross
In some respects, selling goods and services to the Department of Defense (DoD) is just like selling to any large organization: You must understand your customer, his or her needs, and how your product or service fulfills those needs.
But in many other aspects, selling to the DoD is unique. Historically, introducing an unsolicited new product – even a useful product with obvious advantages – took time. That’s because the DoD acquisition cycle of identifying and validating a new requirement, programming the funds, and purchasing the equipment is quite literally a multi-year process.
As a result, any DoD sales strategy must include:
- Commitment to penetrating the military market;
- Willingness to take a long-term view; and
- The ability to accept incremental progress.
Unless you are prepared for a minimum three-year process, you should probably not start marketing to the DoD. Occasionally, a different approach will yield faster results – for example, working closely with a program manager on potential opportunities can sometimes lead to early successes. But this is usually the exception. And remember that DoD acquisition contracts may be smaller in dollars, but they can lead to additional work and profits.
The DoD acquires both systems (airplanes, radars, information technologies and the like) and components (such as circuit boards), as well as an array of services based on the integration of three separate systems:
- Requirements Generation;
- Acquisition Management; and
- Planning, Programming and Budgeting.
Simple purchases for standard components, consumable items and basic goods and service can be accomplished through the General Services Administration (GSA) schedule when applicable. More complex acquisition – for entire systems or for “second-sourcing” replacement components of existing systems – follow a separate process.
Requirements Generations
The DoD makes all purchases in response to a deficiency that has been determined by a formal process. The Initial Capabilities Document (ICD, formerly known as the Mission Needs Statement) describes the broad operational goals and capabilities required in a new system. Potential vendors must understand whether there is a formal requirement for their system – and, if so, which service program manager is responsible for that requirement.
Acquisition Management
The Acquisition Management System addresses all phases of a system’s lifecycle. Program executive officers (PEOs), program managers (PMs) and DoD acquisition professionals monitor all products and services that the DoD purchases. PEOs and PMs are responsible for maintaining and upgrading existing systems. Successful vendors know their program managers and have developed solid working relationships with them.
Planning, Programming and Budgeting
Each of the services submits a biennial Program Objectives Memorandum (POM) and Budget Estimate Submission (BES) in even-numbered years; these outline their system acquisition strategies and funding requirements. During the odd-numbered years, the services submit adjustments to their baselines, called Program Change Proposals (PCPs), and Budget Change Proposals (BCPs), which provide justification for the changes. The POM generation is largely transparent to potential vendors, but it is a competitive process in which many programs chase dwindling funds.
This is a condensed view of a long and complex process, which requires patience to be successful.
Alan Ross is president of Reston, VA – based A.L. Ross Associates (www.alra.us).
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