How Will the Election Results Impact Technology Companies?

by Steve Charles, Co-founder and Executive Vice President

To understand the impact of last night’s election on federal technology contractors, you’ve got to glance at the big political picture. What might be most remarkable on that count is what did not happen. The situation after inauguration day will be very close to the one we have now ⎯ President Obama in office, a strongly left-leaning Senate and a strongly right-leaning House.

Yet, the very sameness might propel both sides together to break the stasis. Both sides say they want to avoid the sequestration scheduled for January. Both sides say they want a budget deal. If they’re successful, it would mean, in the long term, more stability in projecting agency spending plans. That stability would in turn give your federal customers more room to create cogent technology roadmaps. That gives marketers a more open chance to drive long-term sales.

Focusing on our job at hand, successfully marketing and selling technology to the federal government, here’s what I see as the three most likely currents for the near term:

1. Look for continuance of policies favoring cloud computing, continuous network monitoring and other cyber security measures, and systems to control improper payments, particularly in the medical and health areas.

2. With the Affordable Care Act having protection from repeal, a major apparatus will develop to carry out its mandates over the next 24 months, most of which start in 2014. That will pull along major technology purchases in both administrative and analytical domains. States will be creating health insurance exchanges that will need to replicate federal functionality, so there’s a good chance for selling similar solutions at dual levels within the public sector.

3. Management initiatives, chiefly the TechStat and PortfolioStat review sessions will get a shot in the arm. So stay aware of how those are going for your customers. You can’t sell to a canceled or on-ice project! And the tendency toward government employees doing close-to-inherently-governmental functions will continue, giving sales strength to product manufacturers relative to systems integrators.

Of course, we’ll learn more once the election hangover subsides, and we’ll post more insights as the details emerge. Make sure you’ve signed up to follow this blog to keep up with the latest impacts on the federal IT vendor community.