In case you hadn’t noticed, Fort Meade has been a hotbed of activity the last few years. The Base Closure and Realignment Commission (BRAC), the expansion of various intelligence communities and huge construction projects have offered billions of dollars of contract opportunities to large and small businesses.
However, many small businesses have expressed frustration at their inability to win contracts, particularly as subcontractors. At a recent BRAC Business Initiative (BBI) brown bag lunch, a colleague of mine, John Heinz, and I gave a presentation discussing how small businesses can better position themselves to be more attractive to prime contractors. The presentation was based on conversations with prime contractors, many of whom expressed frustration regarding small businesses that missed the mark in terms of being viable subcontract candidates. Following are highlights of that presentation.
Before considering any contract bid, businesses must understand their core competencies, know the target opportunity, be clear about how they fit into the picture, objectively determine whether there is a competitive advantage to satisfy customer needs, and evaluate the capabilities of sales and support staff.
Prior to discussing these points, two broad warnings should be noted. First, a business in a “disadvantaged” category is not guaranteed business. Contracts are won based on firms that best meet the needs of the contractor. Further, using disadvantaged status as the lead capability can be a major turn-off for a contractor.
Second, avoid the temptation to be all things to all people. One of the best ways to get disqualified from a contract bid is to answer the question “What can you do?” by asking, “What do you need?” No one can do everything well, and positioning one’s firm as capable of doing anything implies nothing is done well. Be clear and honest about whom you are, and just as important, be clear and honest about whom you are not.
Understanding a business’s core competencies means clearly identifying the unique selling proposition (USP). What makes your business special? What do you bring to the table? What is your value added? What is your track record of performance? Does the business have the size and scale required by the prime? How will you win the bid?
Be specific in this assessment, and avoid glittering generalities that lead to an affliction that the “godfather of soul” James Brown once called “talking loud and saying nothing.”
Examples of a USP are: saving time, reducing costs, increasing profits, possessing unique capabilities and having prior experience with the client. This last point is critical in that prime contractors, like most of us, prefer doing business with people and organizations they know. A USP that is superior to the competition is the best way to get the attention of prime contractors and, possibly, that first contract.
Distinguishing one’s business from the competition is not just a function of the capabilities of the business. Businesses succeed or fail based on the performance of people, and an important part of that performance is the impressions people make in networking and bid situations. Consequently, it is imperative to understand as much as possible about the contractor, including its core businesses, markets, important contracts and relationships and key personnel.
Additional homework includes finding project announcements, reading news releases and industry magazines, discovering events contractors have attended and generally poring through the web site to discover some factoid that might provide a leg up in the networking and bid process.
Many decisions are made based on first impressions. The first two or three minutes of an initial meeting are critical, so one must be mindful of the image presented. The first impression that usually occurs is visual. Therefore, one should dress for success. While this may seem obvious, I have seen business owners attend business meetings attired as if they had just returned from digging the Panama Canal. Again, the key is to positively distinguish oneself from the competition.
The next image is usually verbal. There are two major aspects of verbal communication: what you say, and how you say it. Businesspeople should have a short (ideally, two to three sentences) “elevator speech” that identifies the value added of their business. The goal of the elevator speech is to stimulate the interest of the listener, not to give a chapter and verse company description. An effective elevator speech addresses the needs of the client, so it is imperative to be clear regarding the client and the opportunity.
Importantly, you are not marketing to a company, but focusing on a specific opportunity; you are not selling, but offering solutions to a problem. A lack of attention to detail can blow a company out of the water: mispronouncing names, irrelevant name dropping and an inability to answer questions are examples of mountains that can quickly become volcanoes.
That said, one may have an opportunity to recover from a negative situation. For example, an inability to answer questions can be counterbalanced by a promise to provide an answer within 24 hours. Many people are unaware that less than 20% of the way a listener receives a message is based on what is said. The most important determinant is how something is said, specifically, tone and body language. An evaluation and understanding of communication style is recommended to be more effective in communicating.
There are several other criteria for successful contract bids, but space does not allow their inclusion in this column. However, it can be noted that one has a greater likelihood of winning contracts if there has been a prior, productive relationship with the client; the company possesses unique capabilities desired by the client; and/or there are clear competitive advantages in terms of cost and productivity.
It is, then, incumbent upon the small business to research and identify appropriate contract targets, develop and improve capabilities and build relationships. There are and will be significant contract opportunities available to small businesses, but consistent with a tired, yet applicable cliché, failing to prepare is preparing to fail.
Michael A. Mobley is managing partner of Obsidian Management LLC in Ellicott City. He also teaches a course on entrepreneurship at Howard Community College. He may be reached at 410-418-4453 or obsidianmgmt@aol.com.
