In this Fed Gov Today segment, Mike Derrios, former Deputy Assistant Secretary for Acquisition at the State Department and now founder of Derrios Advisory Group, talks with host Francis Rose about what the federal acquisition community can expect when the government reopens after the longest shutdown in U.S. history. Derrios outlines the practical challenges, cultural changes, and opportunities that will shape contracting and procurement in the weeks and months following a shutdown.
He begins by describing what he calls a “deluge of activity” awaiting both government and industry. When agencies return to normal operations, contracting officers and specialists will need to sort through delayed invoices, restart suspended projects, and reengage with vendors who may have lost staff during the extended downtime. Small businesses, in particular, could face significant hurdles. Many may have lost key team members who moved on to other work or accepted independent contracts during the closure. Derrios says that rebuilding teams and reassessing readiness will be a major focus for these vendors as they try to get back to full strength. On the government side, he notes that acquisition offices themselves are operating with smaller staffs than in years past. Attrition in the 1102 contracting series has been rising, and some employees may use the disruption as an opportunity to retire or take new positions outside government. The result, he says, is that both sides of the contracting relationship will be under strain at exactly the moment when demand for speed and efficiency is highest.
Derrios and Rose then turn to the topic of the Federal Acquisition Regulation (FAR) overhaul—one of the most significant updates to acquisition policy in years. Derrios believes the reform has the potential to fundamentally change how agencies do business, giving contracting officers more flexibility to innovate and use discretion rather than being bound by rigid, prescriptive rules. For years, he explains, many acquisition professionals have wanted to operate in what he calls “the gray space,” where they can apply judgment and creativity to craft smarter contracts. The new FAR language encourages exactly that kind of thinking, but Derrios cautions that change will take time. Leaders, he says, must help their teams feel comfortable exercising this newfound latitude. That means communicating clearly that it’s okay to try new approaches, learn from experience, and make adjustments along the way.
He stresses that this cultural shift will be one of the hardest parts of implementation. Contracting professionals who have spent their careers following strict rules may be hesitant to embrace flexibility, even when policy now allows it. Senior acquisition leaders, he says, need to model confidence in the new system and encourage their teams to experiment within the bounds of the regulations. 
The deviations and rule changes are already in place, so contracting officers have permission to act—they just need reassurance that their leaders support them in doing so.
The conversation then turns to broader trends shaping federal acquisition, especially contract consolidation and the “One Gov” initiative. Derrios sees consolidation as a positive development that allows agencies to focus on their strategic mission work while letting GSA and other centralized organizations handle common goods and services. When the government can aggregate demand and approach industry with a unified voice, it can leverage its full buying power and achieve better pricing and outcomes. However, he cautions that this approach requires robust acquisition planning and coordination between agencies and GSA. Understanding shared needs across government takes time and skilled people, and the success of consolidation will depend on having the workforce to do that planning effectively.
Derrios also discusses how the skills required in acquisition are evolving. It’s not enough, he says, for contracting professionals to understand rules and paperwork—they need to think strategically about programs, technology, and mission outcomes. He calls this the difference between “big A acquisition” and simple procurement. The future workforce must be able to develop acquisition strategies that align with broader agency goals rather than focusing only on individual task orders or contracts.
Technology plays a central role in this evolution. Derrios argues that artificial intelligence is already a “strategic lever” for agencies that are willing to use it wisely. He acknowledges that AI makes some leaders uncomfortable, especially when it comes to data security and governance, but believes the potential benefits are enormous. AI tools can streamline procurement processes, identify patterns in spending, and help agencies make more informed decisions. To take advantage of these opportunities, contracting officers must begin to think like technologists, not just buyers. For decades, acquisition professionals have had to understand IT systems to manage reporting and compliance; now, they must go further and see technology as a core part of their work.
Throughout the interview, Derrios maintains a realistic but optimistic tone. He acknowledges that the path forward after a shutdown will be messy and demanding, but he believes the acquisition community is resilient and adaptable. If agencies empower their contracting teams, embrace the flexibility provided by the FAR overhaul, and integrate technology more effectively, they can emerge stronger than before. The key, he says, is leadership that builds confidence, fosters collaboration, and gives professionals room to innovate.
Derrios emphasizes that this post-shutdown period represents a rare opportunity to reset how federal acquisition operates. With new rules, new tools, and a renewed focus on outcomes, both government and industry have a chance to build a more agile, efficient, and mission-driven contracting environment. If the workforce can seize that opportunity, he concludes, the government will not just recover—it will lead the way in smarter, faster, and more strategic acquisition.