For government contracting companies, keeping pace with industry trends and best practices is crucial. How do other companies in your sector operate? What strategies lead to success? How can you ensure project success, compliance, and business growth? Fortunately, a recently unveiled report can provide the answers. (GovCon Wire September 12, 2023)
For seven consecutive years, Unanet and CohnReznick LLP have collaborated to gather insights from GovCon organizations across the industry. The result is the GAUGE Report, and the 2023 edition is now available for free download. (ibid)
Understanding the GAUGE Report
The GAUGE Report serves as an annual industry roadmap, offering benchmarks, trends, and insights tailored to GovCon companies and executives. This comprehensive guide provides a window into the current market landscape, best practices, and forecasting techniques. (ibid)
Each year, Unanet conducts surveys involving GovCon organizations of various sizes and missions. In the 2023 edition, responses from over 1,100 GovCon executives and management were analyzed to uncover prevailing trends and best practices. The report’s name is derived from an acronym representing key focus areas for government contractors: Government contract compliance, Accounting, Utilization, Growth, and Efficiencies. (ibid)
Leveraging Benchmarking and Best Practices
The GAUGE Report serves as a valuable yardstick for GovCon businesses. It allows companies to establish relevant benchmarks for evaluating their performance and progress. By comparing their practices against peers, organizations gain insights into how they measure up and where improvements may be needed. (ibid)
The report also provides an overarching view of the current GovCon market and business environment. This perspective enables companies to align their strategies with industry trends effectively. (ibid)
The Key Takeaway: Leading Through Forecasting
The central theme of the 2023 GAUGE Report is the pivotal role of accurate forecasting and planning for GovCon firms’ success. It underscores the importance of precise forecasting, resource efficiency, service/product diversity, and contract versatility. (ibid)
For small and medium-sized GovCon companies, strengthening long-term planning by investing in infrastructure, understanding their pipeline, embracing technology, and seeking expert guidance is essential. The report also highlights the significance of indirect rate and return on investment forecasting. It addresses challenges in timekeeping and billing for SMBs compared to larger revenue companies and advocates for the adoption of a formal capture process for federal proposals. (ibid)
Key Insights from the GAUGE Report
Here are some noteworthy findings from each of the GAUGE Report’s topic areas:
Government Contract Compliance
- 51% of respondents reported stable government oversight, while 46% noted an increase in oversight in the past five years.
- Indirect rates were identified as a common audit challenge for government contractors.
- Business systems, particularly accounting systems, played a crucial role in winning solicitations. (ibid)
- The most common days sales outstanding (DSO) range among respondents was 31 to 45 days.
- Smaller GovCon firms had shorter invoice cycles.
- Mergers and acquisitions remained active, with 36% of respondents prioritizing M&A in 2023. (ibid)
- 61% of GovCon executives reported mature resource management disciplines.
- Centralized project management offices (PMOs) gained popularity, reflecting the trend toward standardizing project management practices.
- Projects were typically delivered on time and on budget. (ibid)
- Personal relationships and market intel tools were the preferred avenues for discovering new opportunities.
- Firms with a formalized capture/gate process had a competitive advantage in pursuing suitable opportunities. (ibid)
- 41% of GovCons changed their indirect rate structure in the past 12 months.
- Fluctuating indirect costs emerged as a challenge for many firms. (ibid)
Using the GAUGE Report Findings
Understanding the latest trends in your industry is valuable, but what’s next? To capitalize on this knowledge and enhance your business:
- Download and Review: Access the full 2023 GAUGE Report to gain in-depth insights that can serve as a roadmap to success. The report offers a wealth of data to inform your strategies. (ibid)
- Benchmark and Apply: Use the GAUGE Report for benchmarking against industry standards and applying best practices. This knowledge empowers your GovCon business to excel in various areas. (ibid)
Would you like to use insights from the GAUGE Report, to gain a competitive edge and achieve higher performance? Give us a call.