federal market outlook

8/3/2019 Federal Market Outlook

1/13

Outlook for the Federal

Technology Market

Kevin M Plexico

Vice President, Federal Information Services

Deltek, Inc.


2/13

Federal Discretionary andContract Spending Trend

*Note: 2011 and 2012 Contract Spending are Deltek estimates

Source: Presidents Budget FY 2012, House Appropriations Committee, Deltek

2 2012 Deltek, Inc. All Rights Reserved


3/13

Final Federal Appropriations for 2012

1/17/2012 2012 Deltek, Inc. All Rights Reserved3

Enacted ($B) vs. 2011($B) vs. 2011 (%)

Agriculture 20.2 19.8 (0.4) -2%

Commerce, Justice, Science 53.3 52.7 (0.6) -1%

Defense 513.0 518.1 5.1 1%

Energy & Water 31.7 32.0 0.3 1%

Financial Services 21.7 21.5 (0.2) -1%

Homeland Security 41.6 39.6 (2.0) -5%

Interior & Environment 29.6 29.2 (0.4) -1%

Labor/HHS/Education 157.4 156.3 (1.1) -1%

Legislative Branch 4.5 4.3 (0.2) -5%

Militry Const./Vet Affrs 73.1 71.7 (1.4) -2%

State/Foreign Operations 48.1 42.1 (6.0) -12%

Transportation/HUD 55.4 55.6 0.2 0%

Base Discretionary Funding 1,049.6 1,042.9 (6.7) -1%

Other Discretionary Funding

Disaster Funding 8.1

Overseas Contingency Operations 158.0 115.0 (43.0) -27%

Total Discretionary Funding 1,207.6 1,166.0 (41.6) -3%

Appropriations 20112012

Source: House Appropriations Committee, Deltek


4/13

Agency Dependence on Contractors


Source: Presidents Budget, FY 2012


5/13

Historically, IT spending patterns trackedclosely with discretionary spending.

Deltek Estimate

Discretionary and IT BudgetRelationship

5

Source: OMB, Deltek

2012 Deltek, Inc. All Rights Reserved


6/13

Consolidation Leverage cloud Improve performance

Energy R&D InvestmentsEnergy conservation &

infrastructuremodernization

Utilize electronic healthrecords to reduce costs

Expand governmenthealth care programs

Expansion of cyberoperations

Consolidation ofnetworks to improvecyber security

Strategic Growth Opportunities forFederal Contractors

6

BudgetStreamlining

CyberSecurity

Healthcare

Energy /Conservation



7/13

Key Administration IT Priorities

7

Establishing policy, implementing continuousmonitoring, increasing workforce

Consolidating andoptimizing data centers

and reducinginfrastructure costs

Increasing cloudcomputing adoption and

reducing infrastructurecosts



8/13

Growing Importance ofTask Order Based Contracts

Source: USASpending.gov, Deltek

8 Copyright 2012 Deltek, Inc.


9/13

Major Contract Vehicles Todayand Tomorrow

9

HHS

TodayCIOSP2SEWP IVCITS (CDC)

TomorrowCIOSP3

SEWP IVCIMS (CDC)

VA

TodaySchedule 70SEWP IVVETS

TomorrowT4

SEWP IVCEC

Army

TodayS3FIRSTITES

TomorrowEAGLE

ITES3R23G

DHS

TodayEAGLEFirst Source

TomorrowEAGLE 2

First Source 2



10/13

Federal Contract Spending byIndustry in Maryland

10

Source: FPDS, Deltek



11/13

Federal IT Spending in the State


Contract OfficeLocation

Maryland Other

Placeof

P

erformance Maryland $13.5B $19.2B

Other $9.2B

$42 billion (or roughly half of the Federal IT budget) spent

in or contracted in Maryland



12/13

Federal IT Spending byDepartment in Maryland




13/13

Conclusions

13

Budget environment leading to much more competitive landscape

Growth most likely to come from market share vs. market growth Protecting incumbency is paramount

Companies need to position for growing areas either through

acquisition or organic growth

Positioning on Contract Vehicles increasingly important

Leveraging integrator relationships critical for small firms


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