We're Hiring - Expanding a Small Business Workforce Minus the Growing Pains

Posted by Deltek on March 31, 2021

Expanding a Small Business Workforce Minus Growing Pains

Scaling up to meet contract demands is a tale as old as time for small government businesses. The story generally begins with a reason to celebrate – your small, but mighty, team has secured a government opportunity, perhaps with Department of Defense (DoD) or the General Services Administration (GSA), as either a prime or subcontractor. Then, a bit of dread sets in. [Gulp] Now you actually have to execute on the plan you painstakingly prepared to win the award. Queue the “reality realization,” music.

It is not unusual for a government firm to go from five full-time employees to more than 150 full-time employees in the span of 12 or 18 months. And, while those in the commercial start-up sector regularly caution against adding tons of headcount in anticipation of the work to come – see the famous example of Instagram having 13 full-time employees when it was acquired for $1 billion by Facebook in 2012 – the complexity and nuance required to execute on most government contracts fuels the growth. The trick is to approach it strategically and methodically to ensure your workforce has the capacity to produce the highest quality goods/services necessary for project success.

Evaluate and Align

Chances are, part of your proposal to win a government contract included a prediction on how you would add to your team to address the awarding agency’s project requirements. For the sake of time, let’s say this evaluation process took place, and you know how many employees you need to hire in phases one, two and three of contract execution. What sort of organizational structure will these new hires be walking into? Before you begin soliciting resumes, it is important that you define the new hierarchy within the firm. It’s also important to stand up a human resources department that can handle the volume and velocity of talent as you get deeper into a lifecycle of the contract.

Equally vital is the current abilities and alignment of internal systems for everything from finances and human resources, to information technology (IT) and operations. Assuming a system is in place for each of these functions, how well do they “talk” to each other? Is there an unencumbered flow of information from one system to another? If data entry for the same piece of information, such as price per part or cost per hour, is required for multiple systems, a government business will immediately be upside down in terms of productivity and efficiency. Automation within aligned systems is vital for individual productivity and keeping projects on time and in budget.

Battle for Talent

The Deltek Clarity Government Contracting Industry Study has reported on a pretty pervasive challenge within the market over the past several years – the war for talent is real, and it’s not going anywhere anytime soon. The availability of good candidates, attracting better qualified talent and matching qualified talent to open positions have consistently been named as top challenges for human resources and human capital management leaders. Preliminary results from this year’s Government Contracting Industry Study reinforce these previous findings despite the challenges everyone experienced due to the COVID-19 pandemic. The number of open positions continues to increase, largely due to organizational growth, with the average turnaround time to fill positions vacillating between 30 days to more than two months.

Having a pre-defined, long-term compensation strategy in place as early as possible will save you from many headaches down the line. For example, beyond the basic compensation package that all candidates receive, what do you plan to offer a senior manager or someone at the associate level? Is the compensation distributed evenly across all departments so that a senior manager in IT experiences the same benefits as their counterpart in finance? Regularly researching how competitive these packages are in the marketplace is also important to ensure your offer has a better chance of being accepted.

Set Up for Success

Getting talent through the door is one thing, ensuring their success is its own unique challenge. Are they versed in the systems you have in place? Will they be able to hit the ground running from day one? It is important to know the licenses and resources each new hire will need to operate effectively within your organization. Having a pre-determined set of system rights based on position and security level will help to equip new hires with the basics, which can later be tailored as work on the contract evolves.

Tracking time and expense for current employees and each new hire is a necessity for contract compliance. Automation of the time and expense process, including time entry, leave requests, approvals and expense authorizations, establishes a clear audit trail and it allows your workforce to be more productive by taking certain housekeeping tasks off of their plate. It also provides visibility into labor costs, project timelines and expenditures at the management and execution levels.

Perhaps part of your contract execution plan is to consolidate your multiple disparate systems and migrate to a more central hub, like the enterprise resource planning solution Deltek Costpoint. Understanding the limitations of the current network of solutions you have in place is as important as seeking a more robust replacement. As the needs of the contract grow more complex, so will the accountability and compliance demanded by the contract agency. Seeking candidates who also have experience in the intended direction of your business can put you steps ahead in the later phases of contract delivery.

Scaling Up the Smart Way

Leveling up your workforce in service of a government contract can be daunting. Preparation and planning can take away many of the growing pains so a firm can scale the smart way. The webinar Growing Your Small Business reviews the challenges government firms may encounter as they evolve to fulfill a contract, and how Costpoint draws everything together to help businesses execute more effectively.