Contracting bliss

Small businesses reach nirvana on Air Force's NetCents program

Small businesses must have good karma on the Air Force's Network Centric Solutions (NetCents) information technology contract. They have received $251 million of the $430 million contract dollars spent in the first year of the $9 billion program -- a 58 percent share of the wealth.

The Air Force planned to route 20 percent of the contract's revenues to the four small-business prime contractors on NetCents and earmarked another 20 percent for small-business subcontractors on the teams of the four large-business prime contractors.

But the Air Force has far exceeded its small-business contracting goals for NetCents. The service's contracting officials say this is because small businesses are simply getting the job done.

"They are working very hard. They want to serve their customers," said Melva Strang, former NetCents program manager and current chief of the products and services branch in the Headquarters Operations and Sustainment Systems Group -- the new name for the Air Force's IT acquisition and administration shop.

"They also give competitive bids and have efficient integrated processes," Cynthia Crews, the new program manager for NetCents, said of small businesses.

Small-business prime contractors received $206.3 million and small-business subcontractors received $44.7 million for NetCents in fiscal 2005.

Multimax, an IT reseller and services firm, led the pack with 287 task orders worth $71.1 million. Telos ranked second with 134 orders at $64.9 million, the Centech Group was in third with 126 orders at $51.3 million, followed by NCI Information Systems with 70 orders worth $19 million.

"We're trying to bid as much as we can," said Mack Griffin, Multimax's deputy program manager for NetCents, explaining the company's successful strategy.

Griffin said Multimax has been fairly aggressive and agile in pursuing task orders. He said the company also had an advantage because it previously supported Air Force organizations and specializes in selling IT products, which is a component of the NetCents contract.

One of Multimax's largest IT products' deals with NetCents was a $4.3 million task order to supply Dell servers, EMC storage equipment and Argent software and support to U.S. Air Forces Europe in Germany. Another was a $2.1 million order for Cisco voice-over-IP products to Shaw Air Force Base in South Carolina, he said.

However, Multimax is also winning IT services work under the contract. The company recently received a $37.6 million order to support Air Force organizations at Wright-Patterson Air Force Base in Ohio, a base that the company has supported since 2000, Griffin said.

Ralph Buona, vice president of business development at Telos, said the services firm has followed a similar strategy of trying to score as much business as possible. "We have very significant business development and proposal writing machines," he said.

Buona said small businesses have done well on NetCents because they do a better job working with Air Force organizations. In addition, some orders are small enough that larger companies might let them pass, but they are important to small firms.

"We pay very, very close attention" to opportunities, he said.

Buona said Telos has focused more on IT services work under the contract for two major reasons. "Solutions are more challenging and are worth more money," he said.

One of Telos' largest IT services deals is a multimillion-dollar task order to install wireless networks at Air Force bases. Another is an order potentially worth $34 million to update the messaging capabilities of the Pentagon Telecommunications Center.

The high percentage of the work and revenue that Multimax, Telos and other small businesses obtained proves they can get the job done, said Neal Fox, a retired Air Force colonel and former assistant commissioner for acquisition at the General Services Administration.

"This shows the abilities of small- business IT companies to pull off large, complex IT projects and [do it] quite well," Fox said. He now heads his own government procurement consulting firm, Neal Fox Consulting.

The Air Force awarded eight indefinite-delivery, indefinite-quantity contracts last year, four to small businesses and four to large ones, under the five-year NetCents program. The four large-business contracts went to Booz Allen Hamilton, General Dynamics, Lockheed Martin and Northrop Grumman.

The Air Force is pleased with the first year of the contract, especially the number of task orders that went to small businesses, Strang said. They received 567 of the 986 orders.

Despite the number of task orders, the Air Force hoped to do a little more overall, Strang said. The service's contracting officials will boost its customer outreach efforts in support of NetCents in fiscal 2006, she said.

They will also get additional backing in the form of another memo from the Office of the Secretary of the Air Force, Chief of Warfighting Integration and Chief Information Officer. The new memo will reiterate the mandatory use of NetCents for purchasing IT services and products, except for desktop and notebook computers.


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NetCents zen

Small businesses may want to meditate on the Air Force's Network Centric Solutions information technology contract. The four small-business prime contractors and other small firms serving as subcontractors have taken more than half of the $430 million spent in the first year of the program.

Source: Air Force

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