The Administration’s new Executive Order “Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base,” is poised to bring sweeping changes to the way the Department of Defense (DoD) buys goods and services with changes that directly benefit small business government contractors.
The Executive Order is designed to streamline acquisition processes, eliminate outdated bureaucracy, and prioritize small, agile, and innovative businesses. See the Fact Sheet: President Donald J. Trump Modernizes Defense Acquisitions and Spurs Innovation in the Defense Industrial Base.
For years, small businesses have struggled to compete in the defense contracting space, held back by a system riddled with slow processes, excessive red tape, and rigid procurement methods. This Executive Order is designed to reverse that trend and open the door for small businesses to play a much greater role in delivering value to the government.
A New Era of Opportunity for Small Business Government Contractors
The Executive Order places speed, flexibility, and innovation at the center of DoD procurement. That’s where small businesses naturally excel and now, the system is finally adapting to recognize and reward that agility.
Here’s what small business contractors can look forward to:
- Greater access to streamlined acquisition methods, such as Other Transactions Authority (OTA) and commercial solution procurements. These alternative pathways reduce the administrative burden and make it easier for small companies to secure contracts without needing extensive prior federal experience.
- More solicitations focused on commercial technologies, giving small firms the ability to offer ready-to-implement solutions without conforming to rigid federal acquisition procedures.
- An acquisition workforce that is now encouraged to take calculated risks and seek out innovative suppliers, meaning small businesses are no longer an afterthought, but a priority.
Bureaucracy Out, Innovation In
The Executive Order calls for a government-wide effort to eliminate outdated internal regulations and duplicative steps that have long slowed down contract awards. For small businesses, this means less time and fewer resources spent navigating a complicated acquisition process, and more time spent delivering results and building relationships with contracting officers.
For small contractors, this means:
- Less time navigating slow and complex procurement cycles
- More opportunities to compete on a level playing field
- Increased focus on commercial-ready solutions that solve real-world defense challenges
By removing barriers and decentralizing decision-making, the government is giving small businesses a faster and more direct path to contract opportunities, especially in areas where larger contractors have struggled to adapt.
Major Program Reviews Create New Openings
The Executive Order also mandates a full review of all Major Defense Acquisition Programs (MDAPs). Programs that are more than 15% over budget or behind schedule could be canceled, freeing up budget dollars and demand for alternative vendors and new solutions.
This could result in a new wave of smaller, modular contract opportunities, which are perfect for small businesses that can deliver faster and more affordably.
Small businesses should prepare for a wave of re-compete and replacement opportunities, particularly in areas such as cybersecurity, software modernization, AI, logistics, and systems integration.
Workforce Reform = More Small Business Engagement
Another game-changing aspect of the Executive Order is the reform of performance evaluations for DoD acquisition personnel. Now, contracting officers will be rated in part on their ability to engage commercial and small business solutions.
Contracting officers and program managers will now be evaluated on their ability to:
- Utilize streamlined procurement methods
- Prioritize commercial and innovative solutions
- Take calculated risks to drive innovation
This creates a direct incentive for DoD buyers to seek out small, qualified firms thereby giving you an edge if you’re registered, visible, and ready to perform.
New Ideas, Fast Execution, and Commercial Expertise
Small businesses are central to the mission of the DoD. If you’re a small government contractor, now is the time to position your business as a solution provider prepared to respond quickly to opportunities as the acquisition system modernizes.
This culture shift is great news for small businesses with cutting-edge technology or services, as contracting personnel will now be incentivized to seek out innovative small business partners.
With reduced regulatory barriers, faster acquisition timelines, and a contracting workforce now encouraged to seek innovative commercial partners, small businesses are positioned to thrive in the new defense procurement environment.
