Services lure agencies

Interest in the General Services Administration's Schedule B/C integration program has exploded in recent months with an array of vendors queuing up to offer services and government buyers tapping the schedule for projects large and small.

Since opening Schedule B/C to services early last year GSA has awarded contracts to 74 companies. The purpose of the expanded schedule program is to allow companies to provide services on what traditionally has been a product-oriented vehicle.

These companies - a mix of small businesses product vendors resellers and increasingly the industry's largest systems integrators - offer agencies a wide range of services from network management to Year 2000 reprogramming. And more companies are ready to join the game. Among recent additions to the schedule are Computer Sciences Corp. Northrop Grumman Data Systems and Services and Lockheed Martin Corp. More deals are in the works. Federal Sources Inc. McLean Va. reports that it has been flooded by integrators seeking advice about how to get a schedule contract. "Services companies that never in their wildest dreams thought they would get on GSA are now hustling to get through that process " said Bob Dornan Federal Sources' senior vice president.

The industry's interest stems from the surge in GSA product sales and indications that federal agencies are interested in purchasing services through that channel as well. The Naval Information Systems Management Command (NISMC) earlier this year awarded Electronic Data Systems Corp. a blanket purchasing agreement (BPA) based upon services and pricing on EDS' GSA schedule.

NISMC also is sponsoring the Information Technologies Support Services (ITSS) procurement a BPA that requires bidders to be schedule holders. NISMC issued a draft request for quotes last month for multiple contracts that could be worth hundreds of millions of dollars. ITSS in particular has sparked vendor interest in GSA according to Dornan who said the NISMC effort may have jarred some vendors "who might have been sitting on the sidelines."

Dennis Pelehach business development manager at Booz-Allen & Hamilton Inc. which recently obtained a schedule said ITSS is a key target for the company and potentially the first large-scale services deal to go through GSA. But Pelehach sees GSA opportunities for Booz-Allen beyond ITSS. "We see this [approach] getting wide acceptance throughout the government."

Indeed the Navy is not the only agency hitting the schedule for services.

The Treasury Department's Treasury Distributed Processing Infrastructure (TDPI) deal for which Sylvest Management Systems Corp. was selected last month is a BPA that relies on the schedule for products and services. Rene LaVigne vice president of the Federal Business Division at Sylvest said his company plans to offer integration and installation among other services through the BPA.

Vendors Predict Higher Demand

John Cochran vice president of federal sales at Litton/PRC Inc. said he believes that demand for services via the schedule is increasing noting that the Army and Department of Health and Human Services also are among agencies exploring BPAs that offer a mix of products and services.

"There is very strong interest there " he said.

Cochran added that Litton/PRC sold $7 million in services on its GSA schedule in the last quarter and will do $6 million to $7 million in the present quarter which ends March 31. Litton/PRC provides a range of solutions through its schedule including client/server integration telecommunications and rapid application development.

Agencies are interested in tapping the schedule for services because it saves procurement time industry and government executives said. The schedule allows agencies to work directly with service suppliers through their pre-established schedule contracts. Instead of conducting a procurement agencies issue a purchase order with a given vendor. In the case of more ambitious projects agencies can negotiate a BPA based upon the labor rates a vendor offers on schedule.

The ability to use the GSA schedule to construct BPAs "saves procurement lead time at the front end and contract administration time at the back end " said Cmdr. Phil Graham of NISMC's contracting directorate. Graham also cited as another benefit the opportunity to obtain discounts based upon GSA schedule pricing.

Keith Holman the Internal Revenue Service's TDPI trail boss also cited time savings as an advantage of working through the schedule. He said GSA handles such tasks as contract modifications saving IRS time.

Yet another appeal of the schedule is its ability to combine products and services. NISMC's Graham said the schedule allows buyers to bundle hardware integration and maintenance for use in a given project.

Vendors are responding with product/service bundles of their own. Government Technology Services Inc. this week will announce a series of bundled product/service solutions that can be purchased through the schedule (see related story Page 68). Elizabeth Cournoyer director of technology teams at GTSI said the addition of services to its GSA schedule helped make the new offerings possible.

"We are taking advantage of that opportunity " Cournoyer said. "It's a perfect fit for us to have services available with products.