Six Takeaways from the DHS Strategic Industry Conversation

Plus Five Industry Recommendations

On Wednesday, February 8, 2023, the Department of Homeland Security held their eighth DHS Strategic Industry Conversation. The Strategic Industry Conversation (SIC) is DHS’s largest annual industry event that provides an opportunity for industry to hear directly from the Department’s senior leadership on its priorities, challenges, and key areas of focus. The SIC is not an industry day event that is tied to any specific procurement actions.

While there were many nuggets of information, six themes stood out.

Programs Have Money

Many of the speakers said some version of: “I would certainly love to have more money, but I am focused on using the funding we have wisely to help make the case to stakeholders that we responsibly used what we were given and can make the business case for more money in the future.”

The focus on program execution and implementation is a great opportunity for professional services contractors. The market opportunity is persuading government clients to spend the money they have with your company.

Help Wanted – Government Talent Shortage

Nearly every speaker said something about the shortage of talent or the need for new, different talent.

Like the private sector, the government is dealing with three years of the pandemic and the seismic changes in the world of work. This dynamic is layered on top of the trend of a rapidly aging federal workforce. For those that do choose to join the government, the long lead times for talent acquisition and security vetting discourage some candidates as well as minimize the impact of new hires coinciding with budget cycles.

As funding levels change, contractors are an excellent source of talent to scale up and scale down as appropriate.

Notably, some DHS component agencies such as CBP have long resisted the authorization for additional Border Patrol Officers. CBP has often struggled to keep up with attrition and keep the people that they have trained. Historically, CBP has asked for better technology to support the people they already have.

Technology is Beginning to Catch Up with Mission Policy

DHS Chief Information Officer Eric Hysen discussed several initiatives to hire, train, and support the IT workforce including job offers to candidates for the DHS Cybersecurity Service. He also shared as part of his Operational Cohesion priority that CBP and ICE can share electric A-Files, records of any active case of a person not yet naturalized as they pass through the United States immigration and inspection process. He wants an approach to technology that is interoperable by default.

Most interestingly, he discussed Uniting for Ukraine, which provides a pathway for Ukrainian citizens and their immediate family members who are outside the United States to come to the United States and stay temporarily in a 2 year period of parole. The technology team was able to quickly establish the technology processes and transition that capability to other Central American countries in recent months. For once, the processes and technology were able to get ahead of the policy decisions instead of IT significantly lagging policy decisions.

Authorities – Procurement Tools

In addition to traditional FAR-based contracts, DHS has many alternative acquisition authorities including Other Transaction Agreements (OTAs), Commercial Solutions Opening Pilots (CSOPs), and Small Business Innovation Research (SBIR). Challenges and prize competitions can also be used.

Different tools often equal different partners. Given the importance of the DHS mission, these acquisition authorities provide many ways for non-governmental entities to help protect the homeland.

Category Management is Waning and DHS Specific Vehicles are Coming

Category management practices have been a source of much industry frustration for many years. Recent research indicates that category management practices in civilian agencies may be waning and a fireside chat at the event appeared to put that issue in plain view for all to hear.

Some DHS vehicles are in the works which sounded like DHS specific multiple award IDIQs that would have been largely unthinkable five years ago. A reference to the switch to an Air Force contract that did not see the vendors they wanted compete for task orders appeared to be a lesson learned from using GSA OASIS more broadly. DHS “may” use OASIS+ in the future, but the event expressed flexibility for contract vehicles outside the stated DHS suite of contract vehicles.

DHS is clearly watching NITAAC CIO-SP4, OASIS+, and Alliant 3. Panelists noted the trends towards “highest technically rated with a fair and reasonable price” evaluation and self-scorecards. DHS indicated a concern for a dynamic that is inequitable for small businesses.

DHS appears to be tracking contract vehicle usage in ways unknown until recently and digging deeper into why a certain contract vehicle mandatory for consideration was not used. Why are there so many waivers? Is there a gap in requirements?

DHS is Better Communicating with Industry Than Most Departments

DHS is better than most departments communicating and engaging with industry in a meaningful way. The Strategic Industry Conversation (SIC) and other industry communication mechanisms have continued under the leadership of DHS Chief Procurement Officer Paul Courtney.

DHS also has a robust acquisition business forecast. Without prompting, most Component Acquisition Executives or Heads of Contracting Activity mentioned the emphasis on the DHS Acquisition Planning Forecast System (APFS) as the department-wide tool to forecast anticipated contract actions. Many policies and resources for doing business with DHS are on the DHS public website.

Like the OMB MythBuster memos from over a decade ago, DHS plans to issue a two-page updated guidance on industry communications within a few weeks.

The event featured blocks of time for industry to meet with the DHS industry liaisons across the various component agencies and offices.

Recommendations for Industry:

1.    Help DHS make the business case for the approach necessary to reach stated goals especially with new requirements for sustainability and climate.

2.    The market opportunity is persuading government clients to spend FY23 money with your company.

3.    Many routes to market exist – choose the routes that work for you; not necessarily all of them.

4.    Use research to align the category management dynamics to the capabilities of your business. Chasing every GWAC is no longer the fear for some civilian focused businesses.

5.    Take another look at DHS if you have not done so for some time. 3,000 companies received their first DHS contract in FY22. Make sure that you understand the customer’s mission challenges before engaging them.

Ahead of the Department’s 20th anniversary next month, Secretary of Homeland Security Alejandro N. Mayorkas updated the twelve cross-functional priorities to guide DHS’s strategic focus for the coming year and beyond. Like the DHS mission mantra, if you see something, say something; the same approach is desired when interacting with DHS acquisition officials. DHS acquisition officials encouraged feedback multiple times throughout the program. Raise issues that you see in the marketplace to DHS directly or indirectly through various industry associations.

With honor and integrity, go help DHS safeguard the American people, our homeland, and our values.

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