From Sailor to Owner

Were you, like me, one of those people who went on and on about how even a monkey could do a better job than those idiots in management? Well, now I'm the idiot in management. Starting a small business was (at least for me) equal parts exhilaration and terror. My sister once asked me what it was like, and the visual that came to mind was treading water until I somehow learned how to swim -- and at the same time juggling chainsaws. But I had no choice. I had to do it.

Since I was a little boy, watching my grandfather glide his way through numerous business ventures, I knew I wanted to own and operate my own business. I had no idea what that business would be, but it would be mine.

Well, between not quite knowing what I wanted to do, and a 20 year Naval career where I was never in one place longer than three years, I was still stumbling around trying to figure out what I was going to be when I grew up. I did finally figure out that whatever I did, it would involve technology; specifically computers.

I found out that I had a thing for computers in 1983 while watching over the shoulder of my good friend Jeff Edwards while he was writing a game that was to be named “First Strike.” He was writing code in BASIC and not only did I know nothing about BASIC, I didn't even know that it was an acronym (Beginners All-purpose Symbolic Instruction Code -- he made me memorize it later). But there were things in his code that just didn't look right. To this day I can't tell you what it was that didn't look right, but somehow I just knew.

My vision was refined further, in 1993, after doing research for a writing assignment about the uses of technology for the handicapped. I was amazed at what we were doing in terms of improving their quality of life. It was then that I decided that I would use technology to enrich the lives of as many people as I could; both personally and professionally (so what if I have a touch of Don Quixote in me).

So there I was, in the spring of 1997, newly retired from the Navy and armed with a burning desire to make the world a better place (and make a few bucks at the same time). My main problem was that I knew nothing about starting or running a business (some might say I still don't).

Fortunately for those who want to follow in my (sometimes) unsteady footsteps, you will be able to leap over some of my more notable stumbles. Veterans, particularly Service Disabled Veterans are the latest trend in Washington, DC. There has been recent legislation ( Veterans Benefits Act of 2003 ) and an Executive Order ( Executive Order 13360-Providing Opportunities for Service Disabled Veteran Businesses to Increase Their Federal Contracting and Subcontracting ) that fund training and outreach programs for service disabled veterans who want to dive into the small business arena. The legislation also sets a goal that 3% of federal contracting dollars should go to Service Disabled Veteran Owned Business (SDVOB) prime contractors and subcontractors. For the fiscal year 2004, it came to about $9 billion. That amount will grow as the federal budget grows.

Now before you start jumping for joy and booking that board meeting in the Bahamas, the 3% is a goal, not a quota. The language in the legislation says that Contracting Officers may do a sole source or restricted procurement if they feel that qualified SDVOBs (no more than one for the former and at least two for the latter) will submit qualified bids at fair market prices.

Perhaps I'm naïve in thinking that when President Bush signed into law the Veterans Benefits Act, he actually intended for federal agencies to meet or exceed the 3% goal. However, it is a long way from the White House to the local contracting offices. The numbers speak for themselves. According to the fiscal year 2004 numbers compiled by the Federal Procurement Data Center , only 0.38% of Federal dollars went to SDVOBs. Of the 68 Federal Agencies, only four reached or exceeded the 3% goal. The National Endowment for the Arts did 12.19% (one contract worth $245,659). The National Transportation Safety Board did 11.51% (one contract worth $299,623). The Railroad Retirement Board did 3.94% (15 contracts worth $240,737). The State Department did 3.26% (270 contracts worth $60,943,532). Conspicuous by their absence were: the Defense Department (0.33%), the Department of Veterans Affairs (1.38%), the Labor Department (0.87%), the Small Business Administration (0.00%), and even the Executive Office of the President (0.12%).

To be fair to the Contracting Officers, they do have a difficult job. They're tasked with getting the Best Value for the government. They're the ones who get taken out to the woodshed if they award a contract to a company that fails to fulfill their obligations.

The initial response I got when I asked why more business wasn't going to SDVOBs was “we don't know who they are.” If one were to do a search in the Central Contractor Registration (CCR) database using only SDVOB as the search criteria, you would find (as of 9/5/2005) 7,735 companies. This is important, because any company that wants to do business with the government HAS TO BE REGISTERED in CCR. And it only took me 25 seconds to find that info. Another common response is, “this is a new program and it will take time to get things right.” On the surface that might sound like a logical explanation for the slow pace of awarding more contracts to SDVOBs, until you realize that while they're taking their time to get it right, they're awarding multi-year contracts. One base year and 2-5 option years. The one that really gets under my skin is, “I've had other SDVOBs take on projects that they couldn't complete, or the end product was substandard.” It is obviously and unfortunately true that there have been SDVOBs who have bitten off more than they can chew. But to use that as validation for not awarding SDVOBs more contracts doesn't hold water since there have been no lack of examples of Fortune 500 companies having the same issues.

By now you might be wondering why anyone, not just SDVOBs would try to work with the government at all. The federal government is the nation's largest consumer of goods & services. According to the Congressional Budget Office's Economic Outlook: Fiscal Years 2003 – 2012 , the President's proposed budget for 2006 is $2.51 Trillion. For 2012 the number jumps to $3.03 Trillion. I can't speak for anyone else, but I can assure you that a small percentage of the 3% goal would make me happy. And if it is true that money can't buy happiness, then I will at least be more comfortable in my unhappiness.

So I for one am going to continue trying to navigate the murky waters of Federal Procurement until I reach the Promised Land. For those who are also headed in that direction, DAMN THE TORPEDOES! FULL SPEED AHEAD!

by  Brian George

Copyright © September 12, 2005