Duncan Jones advises government on managing IT suppliers

The debate around how the UK government can get better  value from its IT suppliers saw recent announcements about maximum size of contracts, more frequent competition, and more metaphorical kicking of the big suppliers from Francis Maude, the Cabinet Office Minister, and Bill Crothers, government CPO.

We share many of their views about past performance, but we have also worried about whether public humiliation is the best way to get the most out of suppliers who will be needed by government for many years to come. It can’t all be done by SMEs in a converted shed in Shoreditch.

Now someone who understands IT a whole lot better than me has entered the debate. Duncan Jones of Forrester, the IT analyst firm, has written a really interesting article for Computerworld. Jones is a real IT expert, including a strong knowledge of procurement and supply chain tech actually – I’ve met him at a few conferences and been impressed. In his piece he says this:

“Mr. Maude and his team have a laudable and important goal but their approach is misguided, in my opinion. Short term contracts, indiscriminate competition and avoiding sole source category strategies will deliver neither the best technology nor the best price...”

Jones then explains why. He gives four reasons – whilst a couple might be counter-intuitive, do read the full article and you may well be convinced:

  • Too much competition deters the best suppliers from bidding.
  • It also removes the supplier’s main incentive to do a good job.
  • For software, competition pushes prices up, not down.
  • If you think software is expensive you should see the cost of people.

They are all good points and very pertinent. Where he perhaps goes slightly off-track, we might argue, is in some of his conclusions.

“Politicians should empower their public sector procurement teams to use industry best practices for technology sourcing and stop forcing them to use open tender approaches when they aren’t appropriate for the category or project being sourced. They should also focus their transformation initiatives on delivering better project outcomes, and obsess less on minimizing costs”.

Of course, public procurement is constrained by EU and national rules and regulations, so whatever the procurement strategy, it has to fit into that framework (even in the new world of the G-Cloud Store and such like). So it is not as simple as saying empower people to “use industry best practices”, unfortunately.  But his arguments are generally well made, and his final point - that it is project outcomes that matter, rather than minimizing costs, is absolutely spot on.  Value should be the key word.

 

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