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George Mason UniversitySchool of Business

New Research Suggests Specialization is Key for GovCon Industry Success

Written by Administrator on .

George Mason University School of Business Assistant Professor of Marketing Brett Josephson has been studying government contracting since before he received his doctorate. In recently published research, Josephson, together with Ju-Yeon Lee, assistant professor of marketing at Iowa State University, and Babu John Mariadoss and Jean Lynn Johnson, associate professors of marketing at Washington State University, recommended that companies focus on specialization.

During a 16 year period, Josephson and coauthors researched more than 1,300 publicly traded firms that do business with the government. Whereas often diversification is recommended for companies, this research shows that when it comes to the federal government, the more specialized a company can be, the higher the return in stock prices will be.

“Concentration is the key finding of this paper,” said Josephson. “You can’t serve all agencies. It’s very expensive. You have to concentrate on one or two within the federal government, build that core knowledge. That’s when you get the biggest bang for your buck in the stock price.”

Jerry McGinn, executive director of the Center for Government Contracting, said “Brett is doing dynamite research that is directly applicable to the $500 billion government contracting industry. His work is providing great fuel for our center, and I very much look forward to continuing collaboration with Brett and other School of Business faculty during 2019.”

 

 

An article about Josephson was recently featured on Mason’s website:
In Government Contracting, Less is Often More