US Government Procurement: Long Live Silos
September 12, 2024
This essay is the work of a dumb dinobaby. No smart software required.
I read “Defense AI Models A Risk to Life Alleges Spurned Tech Firm.” Frankly , the headline made little sense to me so I worked through what is a story about a contractor who believes it was shafted by a large consulting firm. In my experience, the situation is neither unusual nor particularly newsworthy. The write up does a reasonable job of presenting a story which could have been titled “Naive Start Up Smoked by Big Consulting Firm.” A small high technology contractor with smart software hooks up with a project in the Department of Defense. The high tech outfit is not able to meet the requirements to get the job. The little AI high tech outfit scouts around and brings a big consulting firm to get the deal done. After some bureaucratic cycles, the small high tech outfit is benched. If you are not familiar with how US government contracting works, the write up provides some insight.
The work product of AI projects will be digital silos. That is the key message of this procurement story. I don’t feel sorry for the smaller company. It did not prepare itself to deal with the big time government contractor. Outfits are big for a reason. They exploit opportunities and rarely emulate Mother Theresa-type behavior. Thanks, MSFT Copilot. Good enough illustration although the robots look stupid.
For me, the article is a stellar example of how information or or AI silos are created within the US government. Smart software is hot right now. Each agency, each department, and each unit wants to deploy an AI enabled service. Then that AI infused service becomes (one hopes) an afterburner for more money with which one can add headcount and more AI technology. AI is a rare opportunity to become recognized as a high-performance operator.
As a result, each AI service is constructed within a silo. Think about a structure designed to hold that specific service. The design is purpose built to keep rats and other vermin from benefiting from the goodies within the AI silo. Despite the talk about breaking down information silos, silos in a high profile, high potential technical are like artificial intelligence are the principal product of each agency, each department, and each unit. The payoff could be a promotion which might result in a cushy job in the commercial AI sector or a golden ring; that is, the senior executive service.
I understand the frustration of the small, high tech AI outfit. It knows it has been played by the big consulting firm and the procurement process. But, hey, there is a reason the big consulting firm generates billions of dollars in government contracts. The smaller outfit failed to lock down its role, retain the key to the know how it developed, and allowed its “must have cachè” to slip away.
Welcome, AI company, to the world of the big time Beltway Bandit. Were you expecting the big time consulting firm to do what you wanted? Did you enter the deal with a lack of knowledge, management sophistication, and a couple of false assumptions? And what about the notion of “algorithmic warfare”? Yeah, autonomous weapons systems are the future. Furthermore, when autonomous systems are deployed, the only way they can be neutralized is to use more capable autonomous weapons. Does this sound like a reply of the logic of Cold War thinking and everyone’s favorite bedtime read On Thermonuclear War still available on Amazon and as of September 6, 2024, on the Internet Archive at this link.
Several observations are warranted:
- Small outfits need to be informed about how big consulting companies with billions in government contracts work the system before exchanging substantive information
- The US government procurement processes are slow to change, and the Federal Acquisition Regulations and related government documents provide the rules of the road. Learn them before getting too excited about a request for a proposal or Federal Register announcement
- In a fight with a big time government contractor make sure you bring money, not a chip on your shoulder, to the meeting with attorneys. The entity with the most money typically wins because legal fees are more likely to kill a smaller firm than any judicial or tribunal ruling.
Net net: Silos are inherent in the work process of any government even those run by different rules. But what about the small AI firm’s loss of the contract? Happens so often, I view it as a normal part of the success workflow. Winners and losers are inevitable. Be smarter to avoid losing.
Stephen E Arnold, September 12, 2024
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