Federal IT Procurement Shifting Toward Cloud, Services
By Christine Kern, contributing writer
The E-Commerce Times reported that the evolution of federal procurement trends could bring a significant shift of agency IT operations to outside providers offering cloud and various shared capabilities.
“The U.S. federal government IT market is experiencing budget-, mission-, and technology-related changes that require vendors to immediately reassess their go-to-market strategies, and to position — or reposition — accordingly,” according to Gartner analyst Katell Thielemann in “Market Insight: Federal Government IT Market Primer,” which was released in July.
In the report, "Federal Information Technology Market, 2014-2019," also released in July, Deltek examined multiple factors shaping the new federal IT environment, underscoring the need for IT solutions providers to adapt to these changes.
“Contractors must continue to adjust to this reality by ensuring that they have the strategies and tactics in place to pursue growth opportunities and protect market share,” the report advises.
“The procurement environment is evolving due to many factors. Some are initiatives-based, such as strategic sourcing, the use of shared services, commercial-off-the-shelf (COTS) software, and open source initiatives,” says Thielemann.
Thielemann says changes to government IT procurement are driven by several factors, some initiatives-based, like using shared services or open source, and some budget based, like low-priced technically acceptable (LPTA) procurements. She adds that some changes are driven by “forward-thinking vendors offering new ways to procure their goods and services — for example, in a consumption-based model such as Infrastructure-as-a-Service (IaaS) and Software-as-a-Service (SaaS).”
IT solutions providers could see a shift of significant agency IT operations to outside providers offering cloud and various shared capabilities. “Government outsourcing to the cloud will benefit a wide variety of industry partners, large and small, capable of hosting government applications in their data centers, or capable of providing government with software capabilities on a service basis (i.e., SaaS) from their own data centers. Neither of these scenarios represents a loss to vendors. They simply reflect a new way of doing business," Deltek analyst Alex Rossino told the E-Commerce Times.
Both reports offer advice for IT solutions providers. The Gartner report cautions not to use a “one-size-fits-all” approach, and Deltek says to keep in mind the type of funding associated with the project.