The early months of this administration have brought policy shifts, sparking both anticipation and anxiety in federal contracting circles. For contractors, understanding the administration’s mindset and priorities, including DOGE, is critical to positioning themselves for success.
At The Chertoff Group, we advise taking a pragmatic view, looking at the potential impacts and how affected stakeholders should prepare.
How can companies adapt, build resilience and seize emerging opportunities amid evolving acquisition rules and executive directives?
Master an Evolving Acquisition Landscape
One of the most significant shifts is around federal budgeting and spending. Traditionally, budgets follow a linear process from appropriation to expenditure through agency allocation, contracting and receipt verification.
However, we’re not following that process right now. Normally, the contracting officer would judge whether to proceed at obligation—after that, the government is committed to pay. But now there’s an executive order (EO) stating that every expenditure must be approved by a general officer or equivalent.
This new scrutiny, combined with continuing resolutions (CRs) as budget tools instead of policy gaps, creates vast funding uncertainty. Traditionally, CRs provide time for a new administration to reset priorities, not cut spending.
The government is obligated to spend funds as appropriated by Congress under the Congressional Budget and Impoundment Control Act of 1974. Impoundment isn’t being discussed much, but this is a notable shift from how budgets have traditionally been executed.
Additionally, several high-level EOs and directives have landed since inauguration day, each reinforcing a broader push toward faster, more commercial-minded procurements:
Commercial Solutions Preference: An April 16 EO requires agencies to favor commercial products, streamline approvals, and use light-touch oversight for commercial-off-the-shelf (COTS) items.
Defense Acquisition Modernization: a parallel DOD directive (April 9, 2025) mandates rapid adoption of commercial technologies, expanded use of Other Transaction Authorities (OTAs), and the Software Acquisition Pathway (SWP) for software-intensive programs.
GSA Centralization: An April 15 order names the General Services Administration (GSA) as lead for all Governmentwide Acquisition Contracts (GWAC) and strategic sourcing, freeing agencies to focus on core capabilities and technical solutions.
Each directive includes concrete deadlines—often as soon as 60 or 120 days—for agencies to submit implementation plans—so staying on top of those key dates is critical.
The budgetary shifts and EOs are further compounded by other government-wide directives, many of which could impact contractors. These include:
- A focus on the “Top 10” consulting contractors (Deloitte, Accenture, Booz Allen, GDIT, Leidos, etc.) to scrutinize “high-priced” consultants
- Purchase and travel card spending authorities set to zero
- Restrictions on meetings at contractor facilities
- Firing of probationary employees and those on performance improvement plans
- Mandating federal employees’ return to office despite space constraints
- Occupied federal buildings being listed for sale
- Requirements to report weekly accomplishments
- Removing diversity, equity and inclusion (DEI) objectives from performance plans
Businesses Should Build Resilience
Given these challenges, contractors must take proactive steps to build resilience across their operations. To navigate this landscape effectively, contractors can prepare for rapid policy shifts with six core steps:
Engage Stakeholders: First, form a “war-room” team across departments to align roles, data sources and decision-making authority. Map contracts, cash flow and supply chain to highlight where delays or added approvals will cause disruption.
Identify Critical Mission: Next, conduct a focused business process analysis to determine which functions and deliverables are truly mission-essential (e.g., core software modules, hardware integrations, security operations). Create best-, likely- and worst-case scenarios to ensure mission-critical capabilities stay on track—just like Liberty-ship production.
Conduct Criticality Assessment: Then, use a streamlined business impact analysis to rank each mission function by its operational importance and maximum tolerable downtime. Compare impact analysis with your risk map to identify high-priority contracts and cash-flow dependencies requiring safeguards.
Assess Liabilities: Additionally, examine where your current processes fall short of being agile. Identify new approval-layer bottlenecks—such as required general-officer sign-offs—and opportunities to fast-track COTS items or leverage OTAs. Identify approval bottlenecks, protest risks and funding gaps from CRs or evolving directives; then quantify their impact.
Identify Resilience Gaps & Solutions: For each high-criticality area, pinpoint where agility, scenario planning or monitoring is insufficient. Create specific fixes—dual sourcing, OTAs, dashboards, playbooks—to address gaps in agility, planning or policy monitoring.
Integrate Resilience Readiness Solutions: Finally, embed these fixes into your standard operating procedures and teaming agreements. Train staff, assign owners and launch a dashboard to track EOs, Federal Register updates and reform deadlines.
Refining Your Offerings and Past Performance
With heightened emphasis on commercial solutions, contractors must rethink both what they sell and how they demonstrate credibility:
Commercial Credentials: Bolster your past performance with commercial-sector case studies and joint government-commercial projects to align with evolving source-selection criteria.
Innovative Contract Models: Use OTAs and public-private partnerships to shift acquisitions from capital expenditures to operating budgets.
Skill and Workforce Alignment: Monitor DOD’s efforts to reform acquisition career fields—new incentives may reward teams that deliver faster, cost-effective commercial solutions.
Practical Recommendations
Lead with a Customer Mindset & Focus on Efficiency: Tailor your proposals to program directors’ immediate pain points—rapid capability delivery, lifecycle cost savings, and minimal oversight burdens—so you can act when “the timing is right” by truly understanding your customer’s challenges.
Propose Innovative Contract Models: Explore services‐based engagements, public–private partnerships, or tech‐enablement approaches that shift capital burdens to operating expenses and demonstrate creative paths to capability delivery.
Invest in Thought Leadership: Read seminal works—like The Defense Reformation and The Heritage Foundation’s Project 2025—to grasp the administration’s strategic priorities and anticipate how they will shape future source-selection and acquisition reforms.
Plan for Cash-Flow Contingencies: Build financial buffers to absorb potential invoice delays under continuing resolutions or new general-officer sign-off requirements, ensuring your operations remain stable even if payments slip.
Stay Ahead of Policy Deadlines: Flag all 60- and 120-day deliverables for DOD and GSA reform plans. Subscribe to agency listservs, monitor Federal Register notices, and maintain a live dashboard to capture every new executive order, guidance memo, or source-selection update.
Remain Apolitical—and Be Helpful: Shape your messaging around solving customer challenges, not critiquing policy. Make your program manager or contracting officer look like a hero by offering clear, value-driven options that align with evolving acquisition rules.
Resilient, commercially-minded companies can turn uncertainty into opportunity—delivering next-generation capabilities faster and more affordably. As you move through this era, The Chertoff Group can offer guidance to help you proceed with confidence and clarity.
Davi Hayes is a Senior Director of Federal Strategy at The Chertoff Group. Their mission is to help companies accelerate growth.
