The Growth of Federal IT Contracting

By Daniel Eisen

As I began my research for this post, I thought I would find and share interesting statistics showing such things as: the growth in revenue of IT contractors and the number of IT contractors over time, the impact to the economy and other data. But, while the data may be interesting, there’s much more to this discussion than just numbers. If you have a calendar and a watch, it’s fairly simple exercise to determine the specific time and date, for example, of the birth of a child.

Then there’s the summer that kids go away to camp and come back a head taller. In much the same way, it feels as if the IT contracting industry has gone through a growth-spurt virtually overnight. Yet, as I sat at my desk, the stack of articles completely taking over, it occurred to me that identifying some specific moment or point-in-time or event responsible for the growth of this industry was becoming difficult to pinpoint. I’m sure many people have opinions as to how all of this began, so in this post I thought I would share some of mine.

If you ask me, the explosive growth of this industry can be traced back to few specific events that happened between 1994 and 1996.  In 1994, Vice President Al Gore published an article entitled “The New Job of the Federal Executive”. In it he discusses events that have transformed the job of the federal executive. One of these events, he suggests, is “the new role of information technology in transforming a manager’s job”. Speaking about transformative powers of Information Technology, he said three very interesting things. First, that “Taylor’s theories about scientific management are no longer applicable in the information age”. Next, “information technology gives the new manager a set of tools that did not even exist a decade ago”. And finally, “the information age allows the new federal manager to communicate effectively across very large organizations. And information technology also allows this to be done without sacrificing accountability”.

Then there was the passage of the 1995 Paperwork Reduction Act (http://www.archives.gov/federal-register/laws/paperwork-reduction). It’s worth your time to take a quick look at the first section (the purpose) of the Act. Here are the two IT focused items in the opening subsection:

• Provide for the dissemination of public information on a timely basis, on equitable terms, and in a manner that promotes the utility of the information to the public and makes effective use of information technology and
• Ensure that information technology is acquired, used, and managed to improve performance of agency missions, including the reduction of information collection burdens on the public

Next, there was the Information Technology Management Reform Act of 1996. The highlight, for me, is that one of the new responsibilities of the OMB director was to “promote and be responsible for improving the acquisition, use, and disposal of information technology by the Federal Government to improve the productivity, efficiency, and effectiveness of Federal programs, including through dissemination of public information and the reduction of information collection burdens on the public”. (Here is a link to a good summary (http://govinfo.library.unt.edu/npr/library/misc/itref.html).

Finally, Executive Order 13011 (http://www.gpo.gov/fdsys/pkg/FR-1996-07-19/pdf/96-18555.pdf) signed by President Bill Clinton in 1996 outlined, among other things, the policy and responsibilities by agency heads of the “coordinated approach” that would build “on existing structures and successful practices…to provide maximum benefit across the federal government from this technology”. This order is specifically refers to both the Paperwork Reduction and Information Technology Management Reform Acts.

When I talk to family and friends about the meteoric growth of IT contracting, I always tell them these four events “opened the door by ripping it off its hinges and threw it to the side in order to walk through”. There’s more I want to say but unfortunately I’m out of space, so in my next post, I want to continue this discussion by sharing some of the highlights contained within the stack articles I’ve accumulated on federal IT contracting. They span almost two decades and discuss such things as: impact on our economy, the risks of outsourcing IT, funding concerns and suggestions, e-government outsourcing, federal acquisition progress and challenges and a powerful discussion on outsourcing and political power.

So, I invite you to come for a visit to see all that Washington D.C. has to offer. Check out the museums, take the tour of the Capital and White House, eat at our amazing restaurants, catch a show at the Kennedy Center and take a drive around the metro D.C. region  to see all of the office buildings that are home to the incredible array of IT contractors providing services to the federal government. And, as you walk by the federal office buildings don’t forget about our federal workforce using all of this new Information Technology to steadily improve both internal agency operations and services to the public.