- Deltek’s annual study unveils AI and machine learning as top priorities for GovCon tech investment.
- 34% of surveyed GovCon leaders prioritize AI in their tech investment strategy.
- 80% of respondents currently utilize AI to optimize internal operations.
- 45% of participants plan to integrate AI technology in the future.
- 54% of GovCon businesses observed increased government revenue in 2023.
- 62% anticipate revenue growth in the coming year.
- Talent attraction and retention emerge as significant challenges, especially for small businesses.
- 46% of companies plan to expand their product and service offerings for the government market.
Main AI News:
In the latest iteration of Deltek’s annual study, government contractors underscore artificial intelligence and machine learning as paramount areas for technological investment, aimed at bolstering operational efficiency, streamlining processes, and curtailing overheads.
Conducted as part of the 2024 Clarity Government Contracting Industry Study, Deltek’s comprehensive analysis draws insights from the input of nearly 650 GovCon leaders. Notably, 34 percent of respondents identify AI among their top three focal points for tech investment.
The findings elucidate a significant trend towards AI adoption, with approximately 80 percent of participants currently leveraging AI to fine-tune internal operations. Moreover, 45 percent express intentions to harness this technology in the foreseeable future.
Kevin Plexico, Senior Vice President of Information Solutions at Deltek, underscores the pivotal role of emerging technologies, such as artificial intelligence, in aligning with organizational objectives. He remarks, “Most firms are looking to leverage emerging technology, like artificial intelligence, to achieve their business goals and adapt. We’re looking forward to seeing how increased adoption might lead to further growth and better business performance.”
The study also sheds light on positive revenue trajectories within the GovCon landscape. Fifty-four percent of surveyed contractors report an upswing in government revenue for 2023, marking an increase from the previous year’s figure of 49 percent. Additionally, 62 percent anticipate continued revenue growth in the forthcoming year.
Notably, talent acquisition and retention pose significant challenges, particularly for small businesses, with 60 percent identifying it as their foremost business hurdle. In response, companies are exploring strategies to diversify their product and service offerings, with 46 percent intending to broaden their portfolio for the government market.
Reflecting on the findings, Plexico, a recipient of the 2024 Wash100 award, emphasizes the prevailing optimism despite prevailing challenges. He notes, “This year, despite some challenges, we still found an optimistic outlook for increased government sales revenue and win rates in 2024. Government contractors are facing challenges when it comes to hiring skilled talent, increased competition for contract opportunities, as well as overall macroeconomic conditions.“
Conclusion:
Deltek’s findings underscore a strategic shift towards AI and machine learning investments in the GovCon sector, signaling a collective drive to enhance operational efficiencies and adapt to evolving market demands. Despite challenges in talent acquisition and intensified competition, the prevailing optimism regarding revenue growth suggests a resilient market poised for continued expansion and innovation.
