News & Events

Winning the “Must-Have” Contract Vehicles: Insight from Recent Procurement Trends

By Jon Yim

Since 2011, several major contract vehicles with ceiling values over $10.0 billion have been awarded, providing awardees with access to priority funding and significant contract opportunities.  The release of the large contract vehicles such as the $22.0 billion Enterprise Acquisition Gateway for Leading-Edge Solutions (“EAGLE”) II vehicle and the $20.0 billion Chief Information Officer – Solutions and Partners 3 (“CIO-SP3”) vehicle initiates strategic evaluation on the part of senior leadership teams throughout the government contracting market, given increasing priority on coveted vehicles and priority end-markets to drive growth.  Companies seeking accelerated growth over the near-term by targeting positions on high-value vehicles may be asking similar questions around what is required to successfully capture a prime position on the next “must-have” contract.  We can glean some insight with a deeper dive into trends surrounding major follow-on contract vehicles since 2011.

Incumbency can afford a distinct advantage by allowing contractors to more completely understand customer requirements and contracting dynamics.  Therefore, incumbent contractors on predecessor vehicles have a strong opportunity to win a position on the follow-on contract, provided those contractors have demonstrated solid performance and a desire to understand customer requirements during their tenure on the predecessor vehicle.  However, while incumbency does provide contractors with an advantage, opportunity still exists for non-incumbent contractors seeking access to strategic vehicles, as demonstrated by evidence from EAGLE II and CIO-SP3.  Of the 38 contractors that secured a prime position on the unrestricted portion of EAGLE, 32% were not awarded prime positions on the unrestricted portion of EAGLE II.  Similarly, of the 27 contractors awarded prime positions on the unrestricted portion of CIO-SP2, 37% were not awarded prime positions on the unrestricted portion of CIO-SP3.  Thus, while incumbency can be a great advantage, it is not the only factor in determining follow-on awards.  Understanding customer needs and market dynamics, developing innovative processes and procedures, and a willingness to go above and beyond what is contractually required are critical factors for securing a spot on large procurement opportunities.  Understanding that there is still opportunity for non-incumbent contractors, management teams may have a higher degree of confidence pursuing vehicles such as CIO-SP3 and EAGLE II, and, as a result, may increase their potential to access strong funding streams in priority markets in order drive healthy, consistent growth going forward.