Grading on a Very Steep Curve

How do you make a C (at best) an A or A+? Use the math prescribed in the U.S. Small Business Administration Small Business Procurement Scorecard, that’s how.

This is my annual swipe at the results of the scoring that assesses the Government’s performance in meeting its small business goals. Let’s start with the word goals. A goal is something you intend to achieve, and by its own admission, in FY2023, the Federal Government awarded $110.6 B in SBA set-asides to small business concerns, yet they show $178.6 B on the scorecard. Wonder why that is?

Let’s start with the fact that $68 B was not set-aside, but awarded to small business concerns. Then remove the $7.0 B or more that was awarded as a subcontract by Department of Energy M&O prime contractors (but counted as prime dollars), and then there is the selective double-credit for local area set-asides. Even with this, if you tally the obligation transactions in FPDS, the math still doesn’t work. That’s because you didn’t account for the double and triple-dipping across socioeconomic designations. Only in Small Business Procurement Scorecard math does 1+1=6. That’s right, one dollar is counted as many as three times, one for small business, one for 8(a), and one for Woman-owned. Or was that one dollar for small business, one for Service Disabled Veteran Owned, and one for HUBZone? It gets so confusing sometimes. And for everyone vying for their SBA 8(a) certification, the Small Business Data Hub shows $24 B obligated to 8(a) companies, which includes dollars not awarded because they were 8(a). That’s a little more than 2% of all dollars SBA says were awarded as set-aside. FPDS show’s $10.2 B in set-aside and sole-source awards to 8(a) companies. That’s less than 1% of all dollars to small businesses via set-asides.

By the way, did you happen to notice who is NOT listed on the report?

Not every agency follows the FAR, home of the Small Business Act for specific federal agencies, and of the authority requiring agencies to have an OSDBU/OSBP program This means not every federal agency is obliged to require small business subcontracting goals of ‘Other than Small Businesses’ or set-aside their own contracts. But most of them do.

The point is, don’t get caught up in the celebrations and think all is awesome, because it’s not. Yes, agencies did accomplish something, and it should be measured accurately, and not dressed up to make it look like it is more (much, much more) than it really is. This also means companies, small businesses in particular, should not focus on these results. Instead, focus on what you do, how well you do it, and how relevant it is to a specific agency objective, cross-agency priority, or governmentwide goal. And spend as much time pursuing conversations with Customers, as you do Buyers.

Peace, Health, and Success,

Go-To-Guy Timberlake