April 19, 2014

Credit: Ground crews fight a fire in Lakewood, Colo. (Department of Homeland Security photo)

Homeland Defense Advisory Firm Taps into Demand for Market Intelligence

By: Sandra I. Erwin

The homeland security business is mind-boggling, for both buyers and sellers. Agencies need products but may not know where to find them. And sellers have trouble locating customers in the maze of federal, state and local agencies that are responsible for homeland defense.

“Unlike the defense market, homeland security is very disparate,” says Bradley C. Schreiber, president of Homeland Security Solutions. He is a former adviser to the Department of Homeland Security who started the company in January in an effort to capitalize on the confusion that exists in this sector.

“Many small and mid-size companies have tremendous challenges getting their technology to federal, state and local first responders, and to the critical infrastructure industry,” Schreiber says. Finding potential buyers can be like searching for a needle in a haystack. There’s the Department of Homeland Security, the governments of 50 states and five U.S. territories, and more than 3,100 counties. Each has its own first responders and law enforcement operations. DHS distributes more than a billion dollars in grants every year to state and local communities to buy equipment. “For companies that develop products for a single market segment, this is very challenging,” says Schreiber.

He and a team of experts designed a proprietary market analysis software program that helps to match buyer needs with sellers’ offerings. “Companies go to the wrong people to sell products,” he says. “It is challenging to work with DHS.” In the critical infrastructure market, there are 16 segments, 85 percent of which is controlled by the private sector.

Buyers, too, are perplexed by the diversity of products and vendors’ claims. “We see a lot of ‘junk’ out there that people are trying to develop as the next big widget, and trying to sell to customers without talking to the end users,” says Schreiber. “We look for products and try to separate the wheat from the chaff.”

The company’s clients also include investors who for years have spent money on companies but don’t really understand the efficacy of the product. Investors also want to investigate how products or services can be customized to make them more attractive to a wider audience.

One of the greatest frustrations Schreiber encounters is that, when disaster strikes and the government needs to coordinate activities with the private-sector, there is no coherent communications strategy. “We are helping set up links and dialogue between the public and private sectors, before, during and after an emergency,” he says. “That’s a gap that exists in emergency management.”

Some of Schreiber’s private-sector clients are current and former Pentagon contractors. They find that, to work in the homeland defense arena, they have to change their tactics. “The contractor community has been using an outdated model for a very long time,” he says. “The Defense Department has a specific method. DHS is different. Contractors have to look at their targets differently.” One big difference is that, in homeland security, the private sector is a “stakeholder,” he says. “The private sector is a consumer base for homeland security vendors.”

Homeland defense contractors also have to work in an environment of intense congressional oversight of DHS programs that even the Pentagon does not get. “DHS has way too much congressional oversight, more than any other federal agency,” says Schreiber. “Every committee and subcommittee claims some level of jurisdiction.”

In times of leaner budgets, there will be greater pressure on DHS to spend its funds wisely, he says. “The days of every jurisdiction buying their own trucks and equipment are coming to an end." Agencies will need to consolidate their requirements, says Schreiber. “We need to pool buying power, and do more sharing of assets.”

Congressional analysts have found inefficiency in how DHS buys equipment. This year’s DHS budget of $44.7 billion includes about $1.2 billion for science and technology. Dana A. Shea, a policy and technology analyst at the Congressional Research Service, notes in a March report that the DHS’ science and technology directorate “may not always know of technologies or products available in the private sector that could meet DHS’s general needs or specific requirements.”

To identify technologies developed in the private sector, the directorate is investing in “technology foraging,” using scientific periodicals, the Internet, and other sources to seek existing products that may be readily adaptable to meet homeland security needs.

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