A change in metrics. The agency just announced the results of its 2014 Small Business Federal Procurement Scorecard that measures how well federal agencies reach their small business and socio-economic prime contracting and subcontracting goals. The results were good. In 2014, the federal government awarded nearly 25 percent of prime contracts, or $91.7 billion, to small businesses, beating its assigned target of 23 percent. This is an interesting metric, but not that surprising – the economy has been growing and government spending, particularly in defense, has increased. Shouldn’t we know how many small businesses in total are getting these contracts and (more importantly) the number of small businesses doing business with the government that never did so before? In other words, how much easier is it to do business with the government this year than last year? I have too many clients that are too intimidated to sell to the government. How is the SBA addressing this challenge? That’s the metric that would more better justify its relevance.
More leaders from the private sector. SBA Administrator Maria Contreras-Sweet is good. Very good. She’s tireless, positive, smart and supportive of the small business community. She’s been relentlessly touring the country and meeting with small businesses to better understand their problems and needs. She has both private and public sector experience. She is applying her strong background in banking to help improve the offerings of her agency. Her counterparts on both the House and Senate small business committees appear to support her. But she can’t do it all. And unfortunately most of those in mid-level and senior positions at the SBA don’t have her kind of background. More people like Ms. Contreras-Sweet must be leading the agency regionally – people with significant private sector experience.
Increased partnerships with the private sector. Through Ms. Contreras-Sweet’s leadership the SBA has increased its activities in the small business community. In just the past few months, the agency has expanded its services to the hard of hearing, been an active participant in National Small Business Week, awarded research grants to universities and other organizations to support small business innovation, created new programs to help women, veterans and Millennial business owners, established new mentoring and emerging leaders programs and jumped in to help Baltimore small businesses hurt by the city’s unrest with additional resources and loans. This is good. But more can be done. The SBA should continue to expand its partnerships with the private sector, from online lenders to crowdfunding sites to large corporations who also offer grants and financing to small businesses. The government can learn a lot from companies (some are my company’s clients) like CAN Capital, KickStarter, Staples, Square, PayPal and Chase’s Mission Main Street and leverage on their resources and community to expand the SBA’s reach. They’re all after the same market so why not work closer together?
An enhanced advocacy and service role. The SBA’s flagship 7(a) Loan Program reached another lending record in fiscal year 2014 with the approval of 52,044 7(a) loans for $19.19 billion, an increase of 12 percent in the number of loans and 7.4 percent in the dollar amount over fiscal year 2013. The agency saw loans and guarantees increase to minority groups, exporters and those seeking surety bonds. Guaranteeing loans in a growing economy with plenty of capital availability is expected. But it only impacts a small percentage of business owners. And to be really relevant to companies like mine, the SBA needs to be more than just about loans. The SBA, to really prove its value, must turn itself into the customer service agency for small businesses, whether they need financing or not. For example, I still have to call the IRS when I have a tax issue or the U.S. Immigration and Customs Enforcement agency if I have a visa problem. My clients still have to navigate their way through the complex world of government contracting with little help from the SBA other than getting assistance with surety bond (assuming that they can make it to the point of needing a surety bond). The SBA should be the one place we all go to when we have any question about doing business with the government. And its employees should be trained to guide us through the complications of working with Washington. That’s a tall order, I know. But it will keep the SBA relevant.
Say what you will about big government (and I’ll probably be in agreement) but if the SBA didn’t exist neither would thousands of small businesses that depend on the agency to get the affordable financing theyneed to survive and expand. That’s good. But there’s so much more the agency could be doing.
Gene Marks owns the Marks Group, a Bala Cynwyd PA consulting firm that helps clients with customer relationship management.