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Re:Tech Giants Face Off Against 18F by Spooky23 on Monday July 04, 2016 @08:34AM (#12030314)
I've been in leadership positions in self-sustaining, non-Federal IT service delivery orgs.

Government uses contractors for lots of reasons -- many of which are more about shifting risk/accountability.

Operating in a unionized environment is challenging because of the inability to fire, but that's more a leadership issue than a cost issue. For most of the infrastructure services we built, during the growth phase, we'd be 25% FTE cost (including benefits), 25% contractor cost, and 50% hardware and software, with the mix depending on the service. Software projects had more contractor cost, and some specific, high skill infrastructure areas had more contractor cost.

The key to a sustainable service is distinguishing build/grow from operate. When the service is in a operate/steady state phase, the government employee staff should be running it 100%, and bringing in SME contractors as needed. That's how you operate effectively.

As you do this stuff, you build a cadre of smart employees who develop the ability to build more and be flexible. You never run out of projects. By owning the services and processes, you save money unless you're totally inept.

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