Margarita Howard Discusses HX5’s Challenges and Strategic Adaptations

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Government contracting demands meticulous strategic planning and adaptability to various challenges. HX5 is a government contractor specializing in providing technical, engineering, and program management support to federal agencies.

The company’s role as a contractor involves meeting stringent regulatory and security standards and ensuring compliance with federal requirements. This expertise allows HX5 to support complex, mission-critical projects while navigating the complexities inherent in government contracting. Margarita Howard, who serves as sole owner, CEO, and president, provides valuable perspectives on the hurdles faced by the company and the methods it has employed to thrive.

The importance of meticulous recordkeeping and compliance cannot be overstated. “As a government contractor being paid with tax-payer dollars, it is the government’s job to audit every single area of what we do for them, from the labor department evaluating our human resources policies to the financials that we bill to the government for services being provided,” Howard says.

Margarita Howard’s HX5 Ensures Compliance Through Proactive Security and Regulatory Measures

This level of scrutiny extends beyond financial matters. “Additionally, our security department goes through an annual security audit as well, making sure that we’re doing the proper security training and providing everything needed for the people that are cleared,” Howard adds. The constant state of preparedness for audits is, as she puts it, “just part of the business of being a government contractor.”

HX5 has invested in building a team of advisers specializing in government industry policies and regulations to manage these regulatory demands. This proactive approach helps the company navigate the complexities of defense contracting regulations and maintain compliance with applicable laws and standards.

The government contracting sector is highly competitive, and HX5 has faced challenges from larger companies with more resources and competitors employing questionable business practices. Margarita Howard explains, “Our hardest lesson has absolutely been the realization that  there are certain competitors who don’t play by the same ethical rules that we do, and accordingly, are not above using underhanded tactics in an attempt to try to take the work away from you, or to take advantage of you, especially as a small business owner.”

This realization has led HX5 to adopt a more cautious approach in business dealings. Meticulous vetting is necessary when forming partnerships or entering into competitions. “It’s critical that a company does its best to ensure it knows who it’s teaming with, and when possible, to know who you’re competing against, in order that you’re always prepared as best as you can be,” Howard points out.

Hiring Challenges, Funding Uncertainties, and Budget Fluctuations

In an industry that often requires highly specialized skills and security clearances, finding and retaining qualified personnel presents a significant challenge. Margarita Howard refers to particularly hard-to-fill positions as “purple unicorns,” acknowledging the scarcity of individuals with the required combination of technical skills, security clearances, and specific experience.

HX5 has developed a painstaking approach to recruitment and retention to address this. “We prefer to hire experienced individuals, so we look for people that have worked with, or supported, NASA or the Department of Defense, as this experience is always very helpful,” Howard says.

She continues, “So in all of our respective fields, contracting, accounting, finance, HR, even business development, we look for people that have experience because it’s not easy to learn, and the more experience they have, the more helpful they’re going to be to us in what we do.” Additionally, the company invests in professional development and continuing education for its employees to maintain its competitive edge.

Government contracts are subject to annual budget approvals and potential funding changes, creating uncertainty for contractors. These concerns are particularly acute as the fiscal year ends on Sept. 30, often requiring companies to prepare for possible changes or last-minute requirements.

Given the nature of HX5’s operations, the primary concern lies not with last-minute budget cuts but with the possibility of furloughs during budget approvals. Critical operations, particularly those overseas or in 24/7 environments, are typically less impacted by budget stalemates. The firm has developed methods to identify business sectors more vulnerable to furloughs and address these risks, allowing them to prepare in advance. This experience enables them to anticipate when concerns about budget approvals arise, ensuring they know which programs to prioritize and which personnel to engage.

Staying current with rapidly evolving technologies is crucial, which is why HX5 is making efforts to integrate artificial intelligence into its operations: “We try to stay ahead of those changing technologies, such as AI, which is rapidly evolving every day. We are very much involved in it already,” Margarita Howard says.

The company’s commitment to remaining competitive in a fast-changing technological field is why HX5 has engaged consultants for specialized training and is developing internal AI tools.

As a women-owned business in a traditionally male-dominated field, HX5 has faced other issues. “Being a woman-owned business in this industry does create an additional challenge to prove yourself as an effective and successful leader,” says Margarita Howard.

Despite these obstacles, Howard notes progress in the industry: “It’s rewarding to see that women are making significant strides in the government contracting industry, over the years, breaking barriers and more often assuming leadership roles in this industry and within government agencies that we work with.”

As HX5 reaches its 20th anniversary, the enterprise continues to adapt its strategies to meet evolving environments. “We try to continuously assess our performance, refine our strategies, and invest in professional development education so our employees are able to always stay ahead in performance,” says Margarita Howard.