Beyond G-Cloud – what next for government tech procurement?
PublicTechnology talks to CCS technology director Niall Quinn and a selection of suppliers about the future of IT procurement
Credit: Dennis Hill/Flickr/CC BY 2.0
Over the past decade, tech-minded government reformers have pursued two main objectives: digitisation and disaggregation.
While digitisation is the sleek and seductive storefront of transformation, disaggregation serves as the back office and the goods warehouse. The former has seen departments, guided by the Government Digital Service, build ways to deliver hundreds of citizen services online, while also digitising many of government’s own internal processes. Supporting this have been concerted efforts to reimagine the way the civil service – and the wider public sector – buys and deploys technology. The ambition is to do away with the old long-term, multibillion-pound deals that were, invariably, awarded to just a handful of global IT giants.
Having broken up these contracts – a process otherwise known as disaggregation – the goal is to replace them with numerous smaller deals and, in doing so, enable innovative SME specialists to work with government in a way that was not possible in years gone by.
In the gamut of technology careers, working in procurement will never be towards the glamorous end. But, during the transformation efforts of recent years, the Crown Commercial Service has been the yin to the GDS yang: a necessary complement needed to make a whole of two halves.
CCS took its current form in 2014 when the centralised Government Procurement Service was expanded and strengthened by the inclusion of buying management teams from individual departments. This was two years after both the creation of GDS and the launch of the first G-Cloud framework – a streamlined commercial vehicle allowing for easier purchase of cloud services.
And while the work of the procurement agency may not always capture the imagination in the same way as its Cabinet Office stablemate, CCS can put up some pretty impressive numbers to demonstrate its effectiveness: its 2017-18 annual report reveals that the organisation enabled cumulative cost savings of £601m for a total of 17,000 public sector buyers.
Niall Quinn, technology director at CCS, tells CSW: “CCS was set up to save people money; there is money saved through using our frameworks, and there’s money saved through further competition [between prospective suppliers]. Further competition is key. So, we want much more of that across all of our frameworks, because that’s real and demonstrated.”
But, he adds, CCS’s work is not just about saving money – it’s about value. “If we educate people about how to use our framework better… and educate suppliers about how to bid better as well, then you have [everything] meeting in the middle to create value – namely appropriate skills, delivered to the right problem and solving it – at the right price.”
The social contract
In light of the collapse of Carillion last year, the government announced that it planned to introduce a “social value” clause in which, to win public sector business, suppliers would need to demonstrate some form of positive impact on society.
Between March and June this year, a public consultation took place on the government’s proposals – the most eye-catching of which was a pledge to introduce a mandatory 10% weighting to social value during the bidding process for public contracts. The government’s response to feedback gained via the consultation is expected to be published shortly.
Whatever the result, Quinn says that CCS is committed to putting the guidance and mechanisms in place that will “help people make it real”.
“Policy is one thing, but we’ve all seen great policy sit there and nothing has happened. Our goal is to try and make some of the policy operational,” he says. “Beneath the consultation document we’ve produced a very large spreadsheet showing, if you were to use these criteria for social value, this is how you would evaluate it – these are the questions you would ask, and these are the types of markings you could give it. And then these are the government policies that it supports.”
A social value element will help support the SME agenda, according to the CCS technology chief.
“You could focus on localisation, and say ‘we just need a local supplier to do this’. If that’s worth 10% [of the evaluation], that’s a really big thing,” Quinn says. “Or it could be about working with suppliers who have lots of apprenticeships, who take on people who are ex-offenders, or those who are sustainable, or have a good diversity mix.”
He adds: “So, we see social value is a really, really good way of pushing the SME agenda and actually giving SMEs [a chance to say]… ‘we are here, we can do this, we are local, we employ locally, we pay taxes’ – or whatever it may be. This will be a really big thing.”
The G-Cloud agreement is now in its 10th iteration. The framework and the Digital Marketplace have been the two core pillars supporting the drive to break up the oligopoly of the big suppliers.
Over the next couple of years, Quinn and his team are aiming to create new systems which will supersede both.
The creation of a new online buying system has been in the works for some time, with plans first announced in 2015. The idea of the new system was to take the model established by the Digital Marketplace and expand it.
The end result was envisioned by CCS as an “Amazonesque” online superstore, through which public buyers could shop for a comprehensive range of goods and services, not just technology. Since then, the new system – initially known as the Crown Marketplace – has been through several changes of direction. In June last year the plan for a single, overarching platform was ditched in favour of a series of portals to serve individual agreements – including major frameworks for facilities management and supply teachers. These could then be brought together at a later date, CCS indicated.
After another rethink two months later, the marketplace was due to be constructed as a single digital buying system for five frameworks.
As of April this year the Crown Marketplace is no more. The name has been dropped, as have many of the programme’s original intentions.
Instead, CCS will lead work to create what Quinn describes as “Digital Marketplace 2”. The existing Digital Marketplace platform will serve at least the next iterations of the G-Cloud and its sister agreement the Digital Outcomes and Specialists framework, both of which will commence later this year.
“If we educate people about how to use our framework better… and educate suppliers about how to bid better as well, then you have everything meeting in the middle to create value.”
But, beyond that, the goal is to launch future agreements on its successor.
“It will not be built out of the bones of the Digital Marketplace, it will be something different and new – that has lots of common modules, like single supplier log-on, further competition: all the things you need for a [user] journey,” Quinn says.
The move away from the Crown Marketplace name and strategy – which Quinn characterises as a “classic waterfall programme” – comes in recognition of the fact that the public sector has more complex and diverse needs than can be served by a simple online catalogue.
“Is what we need Amazonesque? I think we need a GoCompare, or a MoneySupermarket,” Quinn says. “If our buyers want to buy cloud services, we need a platform that can ask them: what’s important to you – price? Length of term? Flexibility? – and then take those responses and give you 10 suppliers in that space… then you need a bit of problem definition, so you can type your needs in and that goes out to those 10 suppliers and they get back to you. It is more of a comparison website as a front-end, rather than it being a point-and-click Amazon-type scenario.”
But in some cases, the system will be able to intuit the ideal product for the user in question, according to Quinn.
He says: “[The platform] will know: you’re in a school in south-west London, you are an overworked admin assistant who wants to buy a new photocopier – here is the one everybody buys in your location.”
Alongside the new buying platform will be a selection of new, more specialised commercial agreements.
G-Cloud is split into three broad lots, addressing cloud hosting, cloud software, and cloud support.
CCS has begun conducting market-engagement exercises for a framework dedicated purely to cloud hosting and related services. This deal will, in turn, likely be split into three sections, covering hyperscale hosting – the kind of large, generic environments provided by Microsoft, Google, or Amazon Web Services – smaller hosting arrangements and, in a third lot, related services.
The aim is to launch that agreement next year. It will likely feature about 1,000 suppliers at the most – compared with the 3,505 firms that secured a spot on G-Cloud 10.
The areas of machine learning, artificial intelligence, analytics and robotic process automation will also be broken out into a smaller dedicated framework outside G-Cloud. This vehicle is set to contain no more than a few hundred specialist providers.
SME suppliers seem firmly appreciative of G-Cloud and the Digital Marketplace and the success they have had in enabling smaller firms to work with government, while harbouring concerns about what might come next.
Chris Farthing, managing director of tech and procurement consultancy Advice Cloud, says that the lower barrier to entry for G-Cloud was beneficial for SMEs.
“The direct-award process made it much easier to do business with government,” he adds. “There is transparency: everyone can see everyone else’s process and services, so it felt less like backroom deals were being done. The spend figures are a very useful tool for prospecting.”
The Advice Cloud chief says the Digital Marketplace “has played a major part in supporting the SME agenda”, and urges CCS – now it is responsible for running the platform – to put forward plans for how this can be built on.
Another key question for the procurement agency, he says, is: “what is CCS doing in the digital space to make it easier for buyers to access their frameworks?”
Dave Mann is managing director at digital transformation specialist dxw, and previously spent 14 years as a civil servant. He was a founding employee of GDS and, prior to that, worked for its antecedents Directgov and the Cabinet Office e-Government Unit.
“Digital Outcomes and Specialists and G-Cloud are nirvana in comparison to what came before,” he tells CSW. “I was in central government for a long time; I procured lots of things and knew how to do procurement… but it was a lot of effort, even if you knew what you were buying and had some clear path of the sort of outcome you were looking for.”
For all this progress, Mann points to the recent “worrying trend” of government departments using the Digital Marketplace to procure so-called bench arrangements. This is where buyers publish notices that do not specify a single outcome or project, but rather seek suppliers that can, at short notice, provide teams to support as-yet-undetermined goals or programmes. In such arrangements, only vague terms are given upfront, with objectives, needs, and compensation to be agreed via individual statements of work once a contract has been awarded.
In addition to being anathema to the concept of agile procurement that is geared to outcomes and solutions, these contracts necessarily disadvantage small firms, according to Mann. His own firm, for example, has a total of about 50 employees – making it impractical to leave five or 10 of these unoccupied and waiting to be summoned by a government customer.
“The nature of these bench arrangements is that you’re going to end up with big suppliers who can throw teams together at short notice,” Mann says. “Spinning up a team in two to four weeks is unfeasible for small businesses.”
For both the cloud hosting and analytics and AI frameworks, services will, for a time, remain on both G-Cloud and the new agreements. But, ultimately, the goal is for the smaller, specialised deals to serve these areas exclusively.
The new frameworks are also likely to implement some different commercial features to G-Cloud, according to Quinn. These may include further competition stages to allow buyers to narrow the field, rather than the current catch-all bidding process.
“We may also bring in longer terms,” Quinn says. “So, rather than two years, plus one, plus one – if you’re putting records into the cloud, you don’t want to have to repeat that [procurement] all the time – it might be more appropriate to have a five-year term.”
“We also want to try and normalise pricing, as much as possible,” he continues. “All the cloud providers have different attributes inside their pricing… we want to make sure that, when people are comparing prices, they know that this price has certain features, and this price doesn’t. Some of the older Ts and Cs that government has are also not appropriate for the cloud.”
But he stresses the importance of recognising and retaining G-Cloud’s many virtues. “G-Cloud is great, and we must never lose sight of why it is successful. It is successful because it is easy for suppliers to register, it is easy for customers to use, it is online, it is a catalogue, and it is flexible... We know there are some challenges with it – in that it can be gamed a bit. Because it has grown so large, our view is that we should take some of the stuff and make it into more appropriate chunks.”
Which seems to be another way of saying “disaggregation”. A decade of CCS breaking things into smaller chunks may not have made the word, or the concept, any more scintillating. But, if government is to continue to transform, disaggregation will surely remain crucial.
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