Industry: Government Contracting, Professional and Technical Services
TMG Engagement Type: Pricing and Accounting Support
Key Results: A collaborative, expert approach to Pricing and Accounting support that took VetFed Resources, Inc. from a small business to a large enterprise averaging over 20% growth annually.
Problem
Headquartered in Alexandria, VA, VetFed Resources, Inc. (VetFed) is a leading service provider for the Department of Veterans Affairs and the Naval Medical Logistics Command. VetFed’s mission is “to serve those who have served and are serving.”
VetFed came to TMG in 2012, a few years after its founding, upon the appointment of a new Chief Operating Officer. VetFed was a small enterprise focused on expansion when they first partnered with TMG, and could not allocate the funds to hire full-time pricing or accounting resources.
VetFed knew that in order to reach the levels of expansion they envisioned, however, they would need a true management infrastructure and pricing and accounting support process to guide its proposal activity and surpass the few contracts it had at the outset. TMG entered as the ‘missing puzzle piece’ to drive these efforts and provide strategic advice and leadership necessary to help VetFed rise from a small entity to a large contractor in the Federal Government space.
Solution
The TMG team hit the ground running, and provided a variety of services to VetFed, including indirect rate development/impacting, proposal cost and price volume support, contractor proposal development, time materials and cost plus, fixed rates, and customer debriefs and discussions, among others.
TMG provided the option to have access to outsourced departments with a range of experience levels. For pricing, for example, TMG has Pricers, Pricing Analysts, Principal Consultants, and Subject Matter Experts (SME). This meant VetFed could access, with immediate availability, exactly the right resource for exactly the right amount of time – having a full department available without paying for a full department.
While accounting is the history of what a company has done, pricing is the projection for what it will be. Coordinating the translation between accounting and pricing back to a company’s operational staff, and communicating the full perspective necessary for a winning proposal response, known as Pricing Control, or a ‘Pricer,’ is an important function of a successful Federal contractor. It is also often a costly luxury. TMG was able to bring its outsourced team into VetFed to fill this critical role, at a rate that VetFed could afford without having to sacrifice the importance of the business function the Project Control step fills.
The Pricer is an essential translator between the technical plan and the financial/accounting impacts and risks to minimize the potential for “unbalanced” or “non-compliant” proposals as well as unexpected operational issues after contract award. And just as importantly, this ability increases the likelihood of higher evaluation scores and win rates. In many pricing departments, Pricers are relegated to populating models. Pricers at TMG, however, are trained experts in this critical function. TMG’s team seamlessly jumped in to:
VetFed blossomed over several years into a large business, growing chiefly through contract wins and awards. As a result of this growth, VetFed moved to different cost accounting standards, new indirect rate levels and project management requirements that TMG lead and supported. Throughout the duration of the partnership, TMG played a leading role as a scalable partner, helping VetFed to remain a lean organization with a relatively small G&A footprint.
TMG’s role evolved from getting VetFed ‘up and running’ in their small business phase to supporting them in an expanded advisory role that also involve strategic planning, proposal strategies and integrations, and the more comprehensive pricing and accounting support integral to VetFed’s growth.
Results
VetFed grew exponentially, from a small business in need of financial advice to a large enterprise requiring expanded support, advisory services, and larger-scale pricing expertise. The company averaged 20.44% annual revenue growth over 7 years, for a total of 267% revenue growth during that time. This growth is directly attributable to the dramatic increases in contract awards VetFed received over the course of its relationship with TMG, with pricing services supporting the new business wins and accounting services supporting successful operations. By outsourcing pricing and accounting to TMG, VetFed’s management was able to focus scarce time and internal resources on writing technically compelling proposals and delivering excellent operational services to their clients.
Once cash flow ‘tight,’ with business decisions largely revolving around reactions to financial motivations, VetFed became cash flow ‘comfortable,’ and was able to plan its future growth based on goals.
In several ways, VetFed is an ‘ideal’ client partnership for the TMG team, particularly as a result of the evolution of the relationship over time. TMG was able to jump in with the VetFed team early in their evolution and stayed alongside them to support their ongoing growth as their requirements and goals changed.
Pricing responses are so much more than just a financial quote, they require a strategic approach from an experienced team of professionals. The focus on the real value of pricing is a critical part of our team. The core of the success of the relationship came from the collaborative, team-oriented nature of the TMG-VetFed partnership. TMG was able to provide exactly what VetFed needed when they needed it as they continued to grow their business. In the beginning, it helped them to improve business performance and spur their growth potential and trajectory. Once the momentum began, the TMG team transitioned to more of a strategic, advisory role to continue to help VetFed rise to ever-higher goals of success.
TMG’s expertise, along with its clear, structured approach that establishes clear ‘lanes of ownership’ among team members to ensure all goals and milestones are reached in the course of a pricing proposal process, continued to be an engine propelling VetFed forward to new heights of achievement in the Federal sphere.
“TMG has been an instrumental force in our growth within the Federal contracting space. By serving as an outsourced pricing department as opposed to providing a ‘Pricer,’ they’ve allowed us to scale as we have expanded, and have the array of resources to supply us with the expertise, support, and guidance we have required, every step of the way. They are a vital part of our team, now and in the future.”
-Alfred Giambone, Chief Executive Officer, VetFed, Inc.
Industry: Government Contracting, Software Development
TMG Engagement Type: Accounting
Key Results: A value-driven partnership for the long-term that has evolved from tactical ‘do-ers’ to that of a strategic partner and trusted advisor at the CFO level.
Problem
Founded in 2009, Research Innovations, Inc. (RII) develops cutting-edge software for the government and military. RII first came to The McKelvey Group (TMG) when it was less than one year old and in intense growth mode. The company was focused on getting up and running, establishing its business and service offerings, and landing its first clients. The management team consisted of a total of one person, who was focused on the offerings and clients. Wanting to remain agile and grow quickly, RII was in search of an outsourced accounting partner to handle the back office.
Solution
The TMG team sprang into action to actively assist and support RII’s expansive growth. It set up the company’s books and accounting system, created the indirect rate structure for government contracting, and established the billing process for federal work. TMG supported RII’s first government audits and created the cost volume for the first major proposal submission. RII won that work and it remained a core contract for the company for many years. The TMG team delivered comprehensive accounting support where and when it was needed, from invoicing and cash management to the advisory level and planning for the future.
Over time, as RII continued to grow and expand from a single owner to a fully-staffed management team and operations group, TMG remained a constant partner and advisor. When the time was right, TMG helped transition to provide support through a new RII Vice-President of Finance. TMG provided the Vice-President of Finance the ground-level accounting required for the day-to-day operations of the company, the institutional knowledge earned through the years of support to assist with planning, and access to a dedicated outsourced CFO for advisory services. Along with the growth in personnel and operations, TMG supported RII’s accounting software transition from QuickBooks to the more robust Deltek Costpoint.
The TMG model of right-sized support has served RII well as it has grown. Our ability to scale part-time resources across experience levels has allowed RII to invest more heavily in operations and business development while still having a fully-functioning accounting department from the beginning. As RII continues to grow and build out its own internal accounting staff, TMG remains the trusted partner to provide reach-back core accounting support as well as ongoing CFO-level advisory services.
Results
Over the many years since the outset of TMG’s relationship with Research Innovations, TMG’s role has evolved from tactical ‘do-ers’ to that of a strategic partner and trusted advisor at the CFO level. The core of the success of the partnership to-date has stemmed chiefly from TMG’s flexibility to scale up or down, bringing on resources as-needed to address peaks and valleys as the company has grown, to meet Research Innovations’ changing needs over time.
“The McKelvey Group has been an invaluable source of expertise and leadership since our earliest beginnings. In addition to being a constant amidst our changing needs, The McKelvey Group has always given us larger industry insight and ways we can constantly improve and innovate from within as opposed to doing what we have always done. This has been instrumental in the enormous growth and success we have achieved in our years of partnership together.”
Research Innovations CEO, Jack Harrington
Industry: Software-as-a-Service (SaaS)
Engagement Type: Accounting support and advisory services.
Client Performance: Transformation from a new enterprise to a well-managed and profitable company, achieved through an array of value-added accounting/finance services and advisory support.
About Votenet: Votenet Solutions, Inc. DBA eBallot, (Votenet) is a leading online voting platform that allows its users to run secure elections and achieve instant, trustworthy voting results. Votenet serves a wide variety of clients worldwide, from membership associations to corporations, universities, unions, professional societies, and others.
From Dot Com Conglomerate to Independent Entity in Growth Mode
Votenet first became a client of The McKelvey Group (TMG) in 2007. At the time Votenet was in need of CFO-level accounting support and assistance with the establishment of daily operational functions. Votenet’s leadership team was evolving as the company emerged from a larger conglomerate of organizations originally purchased by the owner during the .com boom of the 1990s. The larger group of companies dissolved, and several of the initial companies were sold. Votenet was left as an independent entity to succeed and grow on its own. Now smaller, they no longer needed the more complex financial management structure that was in place. A new management team was appointed, and with no dedicated in-house accounting team at the time, Votenet searched for an outsourced partner. They selected TMG to leverage its expertise to review the company books, and offer high-level insight into pricing of products, compensation structures, and other related functions necessary for the company to set itself on the path to growth.
Implementation of a Dedicated Outsourced Team and Strategic Advisory Services
TMG provided Votenet with a dedicated team to specifically address its challenges and future goals. This team hit the ground running to assist Votenet with key operational tasks, including bookkeeping, invoicing, and payroll processing. In their advisory role, TMG helped steer the company from costly, time and resource-consuming research and development efforts to focus on growing its online voting business and achieving a cash-positive position.
As Votenet’s online voting business grew and evolved, the company shifted to bring on an in-house full-time accounting resource, moving from the team support offered by TMG to a single staff member. Later, as the workload grew, Votenet’s leadership team realized the immense value it could generate from the power of a team, and decided to bring TMG back on-board.
When the relationship resumed between TMG and Votenet, TMG provided continued accounting support, and took on an expanded role to deliver CFO support, financial analysis, and data mining services.
Measurable Benefits, Lasting ROI – Benefits of an Outsourced Partner
In addition to the value of the team that TMG brings, Votenet continues to generate measurable return-on-investment from the depth TMG provides in both the accounting and finance sides of the business.
As its partnership with TMG continues to evolve, Votenet is primed to achieve even greater growth and success in the years ahead.
“For more than a decade, TMG has been by our side as a trusted partner and expert. The growth-enabling advisory expertise, comprehensive accounting support, and knowledge their team delivered were critical drivers of our quick success. With accounting no longer a daily concern, our leadership team can focus on our company growth goals, and fully leave the accounting to TMG!”
-Steven Castellano, Vice President, Votenet DBA eBallot
