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Glass Roadblock Hurts Women-Owned IT Firms

The ability of women-owned tech firms to win government contracts and grow is being limited by restrictive federal procurement policies. . / Credit: Road closed image via Shutterstock

Small technology companies are vital to U.S. economic growth and technology leadership. They account for 40 percent of U.S. IT jobs, 98 percent of the nation’s IT firms and contribute billions of dollars to the nation’s economy each year, according to CompTIA, an IT advocacy organization. But the ability of women-owned firms in this sector to win government contracts and grow is being limited by restrictive federal procurement policies.

Wendy Frank, the founder of Accell Security, a Birdsboro, Penn., IT firm that offers security services to managed service providers and value-added resellers, ran head-on into this glass roadblock when she sought to branch out by pursuing government contracts under the federal Women-Owned Small Business (WOSB) program, even though her firm was highly qualified for the program.

This program authorizes 5 percent of federal prime and subprime contracts to be set aside for WOSBs.

[How Women Can Get Government Contracts]

"We could not participate in the government's Women-Owned Small Business program unless there was another female competitor," Frank said. "Procurement officers required that at least two women-owned small businesses compete for the contracts, even in the IT field, where women-owned businesses are underrepresented."

That  "two or more" business requirement does not apply to other related federal set-aside programs such as section 8(a) Business Development Participants, HUBZone small businesses and Service-Disabled Veteran-Owned small businesses, according to CompTIA.

The ability to meet this requirement is hindered by the fact that women-owned businesses are underrepresented in the industry, the organization said, which often precludes competing WOSB contract bids. Women make up only 28 percent of core IT positions and women-owned businesses account for only 11 percent of information technology firms in the U.S., exclusive of sole proprietorships and nonpayroll firms.

This inequity has been recognized by lawmakers and legislation that would repeal the two or more requirement; the legislation has been voted out of committee for the House (HR 4203) and is pending in the Senate (S. 2172), but has not yet been voted out of committee.

In conjunction with National Small Business Week, CompTIA joined with nine other technology groups to spotlight some of the issues affecting the abilities of small businesses to grow. Jointly, the organizations issued a letter to the Senate small business leadership in support of legislation in that house aimed at expanding government contracting opportunities for more women-owned small businesses.

"We support passage of S. 2172, which would allow a contracting officer to award a sole source contract to a WOSB under the same conditions as applicable to HUBZone small business," the letter said. "It is only fair and reasonable that the WOSB program be brought into parity with other federal contracting programs."

Reach BusinessNewsDaily senior writer Ned Smith at nsmith@techmedianetwork.com. Follow him on Twitter @nedbsmith.

Ned Smith

Ned was senior writer at Sweeney Vesty, an international consulting firm, and was Vice President of communications for iQuest Analytics. Before that, he has been a web editor and managed the Internet and intranet sites for Citizens Communications. He began his journalism career as a police reporter with the Roanoke (Va.) Times, and was managing editor of American Way magazine and senior editor of Us. He was a Captain in the U.S. Air Force and has a masters in journalism from the University of Arizona.