Outgoing Federal CIO Warns of 'IT Cartel' In DC 198
CWmike writes "In a wide-ranging discussion Friday with President Barack Obama's top science advisors, Federal CIO Vivek Kundra warned of the dangers of open data access and was sharply critical of government IT contracting, telling the committee: '...We almost have an IT cartel within federal IT' made up of very few companies that benefit from government spending 'because they understand the procurement process better than anyone else.' He added: 'It's not because they provide better technology.'"
Par for Course (Score:5, Informative)
Welcome to all government procurement of any sort. We have rules to prefer small businesses over big companies. So who gets this business? Not all the existing small businesses in town who know their product, can answer questions, keep stock on hand, are a generally helpful. They can't handle the bureaucratic overhead of government procurement.
Instead we have to buy from companies created for the sole purpose of being middle men to the government, whose only benefit is their understanding of the procurement process. Bonus points if they are owned by a woman or minority. They don't keep anything in stock, and add another 2-5 days to the shipping process compared to buying direct from the manufacturer. They are even more expensive than the local shops. They don't know what their products are used for and can only regurgitate what catalog in front of them says. But since they do so little they can turn over tons of revenue with only a few employees and thus remain a "small company".
HSPD-12 badges (Score:4, Informative)
So, the infamous 'HSPD-12 badge', aka, the 'CAC card' ...
Supposedly they run $200 each. We all got bitched at for it ... have I *ever* used it to slot into a computer? Nope, because our network runs OSes that don't support the CAC functionality, and a lot of the folks on our machines aren't federal employees and remote users, so we'd have to have them run a background check (which we already do), then come in (from out of the country), finger print 'em, wait a month, then have them come back for a badge.
And then we'd have to issue them CAC readers and force them to use Windows or some OS that can use the CAC readers (MacOS? nope).
And if you loose the badge? Well, good luck on that one. Took me months to get a replacement. All the while, I couldn't enter any secured rooms, so I had to get issues a 'temporary' key card, and a 'temporary' badge ... which were EXACTLY like what we had before, only not at $200 a pop.
And the temp badges? They have HUGE text on them for the things that matter -- expiration date (the HSPD12 badges run for 5 years, no matter the length of your contract), affiliation (just says 'Contractor' in tiny type), and has an indication of your security access more than just foreign national / US cltizen / civil servant (I'm guessing because then they'd have to issue new people badges 3-4 times as their various background checks get done).
So ... more expensive, no new functionality that actually gets used ... and less secure, in that it's possible to enter the facility with an expired badge because the text is so tiny the guards can't read it, and they don't tie badge expiration to your contract, so a person with 1 year on their contract still gets issued a 5 year badge.
Not just an IT problem (Score:5, Informative)
General Dynamics, Raytheon, Boeing, Halliburton, etc provide a critical service: they understand government regulation. If you've ever seen a printed out copy of the Federal Acquisition Regulations, you'd be surprised that gravitational collapse isn't happening.
For most businesses, it's not worth taking a government contract until they're asking you to provide a COTS solution, where you know what you're selling, and the government pays you, and that's the end of it. The government is getting exactly what the commercial market gets. Firm Fixed Price contract, no surprises.
As soon as the government wants it customized in any way, and they're willing to pay you to customize it, that rabbit hole goes all the way down. Every stipulation of the contract must be assessed for compliance, and every assessment requires some kind of test, and every test has a schedule towards passage of the test, and every last one of these things costs time and resources, which means money, which the government is going to pay you, because the government wants its double cheeseburger in a way that no-one else wants it.
If you're an action oriented kind of entrepreneur, this will drive you insane. So you don't do it yourself. You go in as a subcontractor to one of the big Gov-BS-Handlers. You do the work, they firewall you from the BS, 50% for you, 250% for them (after change orders and spec changes and reviews and program management overhead) and everyone is happy with the $500 hammer (non-sparking, minimal toxic release, aircraft rated, 8 pound, loading bracket hinge, for the hitting of, one count)
Re:And this applies exclusively to IT. (Score:5, Informative)
But his larger point of knowing how to use the system and apply for the contracts...is what keeps the major few companies as being the only IT companies doing business with the feds.
The hoops you have to jump through are many. The larger contract houses have staff devoted to NOTHING but writing proposals. The small guy, cannot compete with this.
And even when there are contracts dedicated to SM's....the only way that truly works, is, the larger contract houses, *back* the small business and join to them...basically using them as a front to get the bids on the small business contracts.
They generally find a small company, it must be female or minority owned about 99% of the time, to get federal consideration.....then, the big guys basically do most of the proposal work, and the so call PRIME contractor that wins...gets a good kick of money in, but they really aren't in control of anything.
Happens all the time.
You'd need to rewrite the oversite rules...somehow...to try to prevent this. To make the application process simpler....but I don't see that happening any time soon. But, ever since they've been trying to make mandates that the Federal govt workers be more oversite and managers, rather than hands-on tech, you're gonna see more and more of this.
That and the situation that really kills the small companies off....is the hesitance of the feds to hire individual contractors as 1099's directly....they'd rather hire a large IT company which then wires the 'contractors' as W2 employees....giving you essentially the worst of both worlds.
You don't get the bill rate you should get as a true contractor, but you do get the lack of stability of a contractor. This bastardization of the contracting paradigm has really hurt things....