Five Ways to Steal a Half-Billion-Dollar AccountBy Ericka Chickowski | Posted 2009-10-06 Email Print
Channel Insider gets the inside scoop on how mega-services player CSC snatched a five-year contract with airport security arm TSA from the incumbent arms of Unisys.
Last week, Falls Church, Va.-based CSC officially snatched the Transportation Security Administration (TSA) Information Technology Infrastructure Program (ITIP) services contract from incumbent Unisys by closing on a five-year deal potentially worth $493 million.
So how’d CSC do it? That’s the burning question asked by many a channel provider gone a bit green over someone else landing such a whopper. Channel Insider investigates.
An Unhappy Customer
After burning through more than $1 billion in seven years of service with the TSA, Unisys was not making the grade among key stakeholders within the agency.
A report by the Department of Homeland Security’s Office of the Inspector General released in 2006 exposed cost overruns led by potentially fraudulent billing practices, the regular execution of unauthorized contract work, a failure to provide promised deliverables and an overall dissatisfaction among agency Federal Service Directors (FSDs).
"Many FSDs were dissatisfied with Unisys equipment and services," the report reads. "In our survey, we asked all 158 FSDs nationwide to rate Unisys’ equipment and services. The FSDs’ response rate shows their concern and frustration with [offered] goods and services." Though TSA spokespeople did not go into details as to why it chose to put the ITIP contract up for rebid upon the announcement of CSC’s win, the OIG left the writing on the wall with this report. Clearly, Unisys blew its opportunity.
A Compelling Story
A 50-year institution in the technology services field, CSC has long been a player in government IT contracting. So it hardly comes as a surprise that it was picked over a bevy of competitors vying for agency dollars.
When it comes down to it, says Pat Schambach, vice president and general manager of the Homeland Security and Law Enforcement (HS&LE) Division for CSC's North American public sector group, the real winning edge came by way of CSC’s ability to understandably and convincingly put its capabilities and its plans down on paper.
"When you think about the evaluation team on the government side and they have these proposals in front of them, all they see is what's black and white on the piece of paper," Schambach says. "What we really work on is trying to resonate with them [and show that] we understand and in some ways walk in the shoes that they're walking in."
According to Schambach, critical aspects of the CSC proposal included detailed descriptions of what CSC perceived as the TSA’s IT challenges, its proposition for helping them through those challenges and also the plans for getting TSA through the unique demands of transitioning from one vendor to another.
Additionally, the company was able to communicate the resources available to meet these planned goals and the organization’s past successes with civilian and military agencies such as the Army and the Federal Aviation Administration.
Persistence and Patience
Schambach gets asked all of the time by VARs, consultants and other channel service providers about the secrets to breaking into big government contracts.
"Particularly for new companies trying to break into government work—and I think even for successful, long-term companies who have always worked in the commercial sector—working in the government arena is a different kind of animal," he says.
He explains that many channel providers go into government bidding with their eyes closed, not realizing the persistence and patience necessary to land government work.
"They don’t always appreciate what the government process is like and that the sales cycle time tends to be a lot longer on the government side," he says. "There are drivers that push major acquisitions to the right on a timeline, things get delayed and businesses trying to break into government work are frustrated along the way."
One of the major requirements of the TSA for its ITIP contract agreement and many other agency agreements like it is that the primary solution provider offer ample opportunities for small businesses to subcontract.
According to Schambach, CSC has long had a tradition of leveraging the expertise of smaller solution providers to give customers the most holistic offerings possible.
"They bring things to the game that maybe could fill gaps for us," Schambach says.
In addition, the company also partners with all of the larger vendors within the IT landscape that lend a solution provider credibility.
A Foot in the Door
Oh, did we also mention that Schambach is a former CIO for the TSA? When Channel Insider spoke to him about the link, he played it down, explaining that many other large players going after this bid also had some all-star former bureaucrats within their ranks.
"That gives me an individual advantage and to some degree CSC, but all of the major companies are known for what we call 'strategic hiring,’ trying to find people who have the insight into what the agency is really looking for," Schambach says. "TSA went through this competitive process, and they rated us on our technical and management approach, our past performance qualifications, our small business plan to incorporate small businesses and our costs."
Yes, but it certainly didn’t hurt to have that extra foot in the door—not to mention a clear vision of what the building looks like once inside the threshold.