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 5. Confidence and Competition are High for Government Contractors According to
    Clarity Study


CONFIDENCE AND COMPETITION ARE HIGH FOR GOVERNMENT CONTRACTORS ACCORDING TO 2022
DELTEK CLARITY STUDY

Posted by Deltek on May 25, 2022

Deltek News   Industry Analysis   Project Management  



The results from this year's Deltek Clarity Government Contracting Industry
Survey are in and they show that government contractors rose to the challenges
brought on by the pandemic. As respondents looked back at 2021, many revealed
that their businesses outperformed financial expectations and managed better
than expected. 48% reported higher sales and 47% reported an increase in the
number of government contracts won over the past year. However, many also
expressed significant challenges do remain.  

The pandemic led to opportunities for some government contractors, yet others
found themselves looking for alternative revenue streams from the government, as
it was hard to stand out in a crowded industry. New funding opportunities,
shrinking GSA contracts, the labor shortage, and supply chain disruptions were
identified as key factors in driving more intense competition. In fact, one in
three respondents perceived increased competition as a critical challenge.   

 
 


GET THE LATEST INDUSTRY TRENDS & BENCHMARKS



13TH ANNUAL DELTEK CLARITY GOVERNMENT CONTRACTING INDUSTRY REPORT


Download Now

 
 



THE INDUSTRY’S LEADING GOVERNMENT CONTRACTING STUDY 

For 13 years, Deltek has conducted an industry survey of government contractors
to identify key performance indicators, market conditions, industry challenges,
and the performance outlook for businesses. This year’s survey had over 650
respondents from government contractors who work in professional services,
defense, information technology (IT), transportation, energy and oil,
healthcare, engineering, and research. These findings can be found in the Deltek
Clarity Government Contracting Industry Report that provides exclusive industry
insights and benchmark data of high performers. This annual report highlights
notable challenges and solutions your peers are facing across six functional
areas including Business Development, Project and Risk Management, Finance and
Financial Management, Manufacturing, Contract Management and Procurement, Human
Capital Management and Information Technology. 

 
 64% of survey respondents expect their company’s revenue from government
contracts to increase this year.
 


TECHNOLOGY AND TALENT RISE AS KEY AREAS OF INVESTMENT 

This year’s study found that tense competition over funding and talent,
underpinned by digital transformation as a key area of investment, set the scene
as government contractors looked at ways to move their businesses forward.
Companies of all sizes plan to prioritize investing in cybersecurity, talent
acquisition, business automation, and project and resource management tools to
empower a modern workforce and gain an edge when competing for new contracts.  

In the federal market, 17% listed talent acquisition and onboarding technology
as their top priority, followed closely by cybersecurity technology at 16%.
Cybersecurity emerged as a concern beyond IT functions, which was cited as a key
compliance requirement for the entire organization. 40% of all survey
respondents ranked cybersecurity as a top three technology priority in 2022,
which signals a likelihood of investment in this area.  

Labor shortages were felt across every business function with government
contractors of all sizes struggling to attract and retain top talent. 53% of
respondents cited attracting quality talent as one of the most pressing human
capital challenges in 2021. Companies are willing to invest in finding top
talent with 49% of companies ranking increasing incentives among existing
employees for referrals as the primary strategy. It’s a job seeker’s market and
companies continue to look at employee retention programs to address the current
shortage in the talent pool.  

Technology and talent investments that support critical functions are expected
to be a key part of companies’ overall strategy in 2022. 


GOVERNMENT CONTRACTOR CONFIDENCE INCREASES 

The Government Contractor Confidence Index (GCCI) measures overall confidence
that government contractors can grow their public sector sales over the next 12
months. It is measured on a scale of zero to 200, with zero indicating the
lowest confidence level, 100 reflecting neutral confidence, and 200 indicating
the highest confidence.  

This year’s GCCI is 141.7, a 1.1 percent-point increase compared to last year’s
score 140.1. This number reflects a cautious optimism in the face of global
challenges including ongoing conflicts overseas, the “Great Resignation,” a
potential US recession, and lingering effects of the pandemic.  


THE TOP THREE PRIORITIES FOR GOVERNMENT CONTRACTORS IN 2022 

In this year’s study, three priorities rose to the top as government contractors
decided what would impact on their business the most:  

 1. Teaming to identify and capture the opportunities in the market 
 2. Putting their digital transformation ambitions into action  
 3. Looking for efficiencies and systems to help control costs 

As the General Services Administration (GSA) continues to consolidate
government-wide contracts, businesses are looking at their capture planning
strategies to seize shrinking prime opportunities. Small (35%), medium (32%) and
large (23%) businesses all ranked teaming initiatives as their top priority.   

Beyond teaming, government contractors are looking at investment in business
development and government compliant business and financial systems to help get
ahead of the competition and to ensure that their projects are performing at
optimal levels and are on track.   

For government contractors, dealing with complexity has become the norm. Many
contractors are focused on developing nimble business operations, in diversified
markets, to build resilience as they plan for the future.  

To learn more about these and other report findings, join Kevin Plexico,
Deltek’s Senior Vice President of Information Solutions and Dan Firrincili,
Senior Manager of Product Marketing, for a closer look at the insights and
trends from this year's Clarity study in this complimentary on-demand webinar.

 
 


JOIN OUR GOVERNMENT CONTRACTING EXPERTS


HEAR MORE ABOUT THE FINDINGS FROM THIS YEAR'S CLARITY STUDY


On-Demand Webinar

 
 

To keep up with Deltek Clarity and other industry news subscribe to Deltek's
Government Contracting newsletter focused on insights, technology and best
practices to succeed in government contracting.




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