What the Government Shutdown Means for Government Contractors

During the duration of the government shutdown, there are a few things that can be done by government contractors to improve the position of their firm(s) in the Federal marketplace and realign their offerings with more essential government functions. Government contractors can use this downtime to reassess company goals and government sales strategies. As a result, government contractors will be able to create more business value for public sector customers in the next Fiscal Year 2014 while improving on their overall performance. It is important for government contractors to understand what the government shutdown means for their company, and how counteracting the problems presented by the shutdown will be critical to their success.

During a government shutdown, only governmental functions and employees deemed to be essential to government activity will continue to operate. The case is also similar for government contractors who support regular government employees. If your government contract is found to be nonessential, the employees working on that contract may also be told to cease operations by government officials. Some government contractors and firms already have clarity. Healthcare providers won't be affected as much because the Federal government continues to make payments through programs such Medicare and Medicaid. Due to the Federal Housing Administration, realtors will not be affected either, since organizations like Fannie Mae and Freddie Mac will continue to guarantee mortgages during the shutdown. While some government contractors have certainty on their contracts, many contractors are still waiting for details on which contracts will be honored during the shutdown and which will be suspended until Congress appropriates new funding.

To combat this state of uncertainty, contractors should take this time to reassess their goals and ensure that their employees are operating at optimal levels. Government contractors should track their progression towards previous goals using a designated benchmark. It will also be beneficial to realign your offerings with government needs and supply your staff with an enhanced, focused government sales strategy to take advantage of current and upcoming Federal opportunities in the next fiscal year. To ensure your workforce is performing up to the government’s standards, you may also want to consider reassigning them to necessary training courses. Government contractors should also note that it may be possible to reduce their governmental liability by re-tasking employees to an unaffected project. Performing these tasks will improve the position of the firm in the upcoming fiscal year and also enable more value for government agencies.