Ed Bradley and Tim Ingham believe the recent furore over council G-Cloud spending could help open up more contracts for small and medium enterprises.
Peering through the G-Cloud
As a company that is new to the public sector it has been interesting to witness the storm that has blown up in terms of the use of cloud services.
Certainly some of the key revelations from the Freedom of Information request that was the catalyst for the discussions are enough to get anyone’s attention.
The FOI request revealed the buying habits of 27 county councils in England and it made stark reading for the government’s G-Cloud framework not least with the revelation that only 1% of 2012-13’s £440m local government spend on IT services had come through it.
With G-Cloud set up with the intention of providing fast and low cost procurement of IT cloud services and in this age of austerity it wasn’t surprising that media coverage of the figures resulted in cries of ‘waste’ along with assertions that local government was simply not grasping the cloud opportunity or the severity of the need for saving time and money wherever possible.
The local government response – via Socitm – sought to clarify that it was perfectly happy to use G-Cloud should it present the best option for procurement and that not using the G-Cloud did not mean local government was avoiding cloud services altogether.
But does using G-Cloud provide any guarantees over quality and efficiency that local government is missing out on by not using it? As the validity of architecture, technology, products and services aren’t examined to any great detail, you have to say that such guarantees are not there by definition. Rather, G-Cloud exists to open up the Government marketplace to SMEs – avoiding lengthy OJEU processes and cost of sales for unsuccessful bids – while enabling government departments to award contracts more quickly and efficiently.
Using G-Cloud may not necessarily offer assurances of better quality over non-G-Cloud suppliers. Hoewver, the most transparent reason for local government being slow to G-Cloud is that it is something new and can seem riskier than sticking to familiar Tier 1 suppliers.
However, as Virtualstock (VS) has discovered in the private sector, the large multi-national IT suppliers can hide behind their brand security and leave behind projects that have gone over budget and over time and ended up simply not fit for purpose. Smaller suppliers have made a habit of picking up contracts over larger players from the ashes of such IT disasters.
Interesting to note here that the Public Administration Select Committee (PASC) Inquiry into Good Governance: the effective use of IT in 2011 said that central government’s over-reliance on large contractors for IT (as well as a lack of in-house skills) had created a ‘recipe for rip-offs’.
So this is a familiar story to VS and other private sector SME IT suppliers that have picked up or won contracts from larger companies.
However, the private sector is naturally more ready to accept something that provides a competitive edge and recognises that with first mover advantage comes some risk. Conversely, government organisations are quite rightly often risk-averse and concerned with ensuring public funds are spent effectively with an audit trail to prove it. But in many cases this fear of risk is standing in the way of technological advancement in the public sector. True, software-as-a-service (SAAS) partners will understand working with companies who are operating under tight margins and highly competitive environments and will be able to reduce impact on existing systems and processes and be flexible about delivering solutions. So involving SAAS suppliers can be an opportunity to affect service delivery and achieve some cultural exposure to a new way of working at a reduced level of risk.
Much has also been made of the potentially outdated mindsets in public sector and that they may be a big ship to turn around in terms of new solutions, suppliers and procurement. But this can be true of many private sector organisations too and service offerings that are non-invasive and in new high ROI areas such as analytics and inventory status across multiple systems add measurable value with minimum impact and are a perfect fit for even the most risk-adverse of cultures.
The government maze
One final point to touch on is whether suppliers themselves are doing enough to engage with the public sector. Simply sitting on G-Cloud and waiting for the phone to ring is naïve and, as the FOI report clearly demonstrates, a sure way to waste the opportunity presented by the sector.
However, the problem with engaging with government departments is their sheer size and the maze of contact points. Many G-Cloud suppliers are driven on short-term cycles between first engagement and closure of the deal and trying to service a major government department can consume large amounts of resources and time and can be unproductive and costly. Suppliers can attend certain forums to raise their profile but there is a danger that young, small organisations can be swamped by the demands of dealing with government. And even when you breakthrough there are communities of vested interests such as tier 1 suppliers, Information Assurance and enterprise architects who can and will resist change.
Clearly there is work to be done in terms of selling the message of G-Cloud and improving entry points for new SMEs with much to offer the public sector. The hope must be that this latest furore will provoke action on both sides and the public sector market can be fully opened up for the innovative and progressive SME community that this country is rightly proud of.
Ed Bradley and Tim Ingham are co-founders of G-Cloud supplier Virtualstock