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In-depth: Steps to effective business in the public sector

What do government CIOs expect from their suppliers, and what does the channel need to do better when it comes to dealing with key technology buyers?

These were some of the questions raised at a recent round-table hosted by networking vendor Netgear, which looked into the relationship between local government IT organisations and their suppliers, and tried to assess the landscape as it now stands eight months after the government's comprehensive spending review.

The Royal Borough of Kingston is currently trying to cut its budget by 33 per cent, with all but five per cent being taken out this financial year, and lead ICT business partner David Grasty is at the forefront of this drive.

Among other cost-cutting measures being taken, Kingston is on the verge of merging its IT department with that of its neighbouring London borough, Sutton, and is exploring a shared cloud project with other south-west London councils, including Richmond, Merton and Wandsworth.

Since the formation of the coalition government last year, the public sector landscape has changed radically and Grasty says it is vital that the channel takes a more active role in understanding this.

In Kingston, for example, many top-performing schools are thinking of transitioning to academy status, but according to Grasty, academies will not be covered by blanket procurement agreements and will have to negotiate their terms and conditions separately, which could leave a sour taste in the customer's mouth.

"Memories of who has let you down are long, and schools are always very wary of the private sector," concedes Stephen Harley of Dell, HP and Microsoft partner ACS. "If you do something like that you will make a quick buck, but at what cost in the long-term?"

"We find huge benefits in educating ourselves about how the public sector works, because it means we're not blindly going in," adds Harley.

Might this wariness indicate a wider fear of private sector organisations muscling into the public sector? MicroScope posed this question to members of our LinkedIn network and received some interesting responses.

Channel credit veteran and independent consultant Eddie Pacey argues that if anything, the opposite is true.

"I feel the channel fears the public sector; while cuts in public spending are forcing those with budgets to optimise return, public sector ICT buyers are far savvier than they used to be," says Pacey.

"Those that view the public sector as a market yielding high profit with less demand are in for a rude awakening. Supply chains are cluttered with people offering very much the same thing. To break into the public sector if you are not already there requires considerable guile, expertise, and infinite patience," he says.

One firm making hay in the current climate is Manchester-based Cisco partner ANS, which recently announced a major deal with North Staffordshire NHS.

The firm's managing director, Paul Sweeney, backs up Pacey's view. "There's not necessarily a worry about the private sector, but a more general worry about outsourcing," he tells MicroScope.

"Typically this brings public sector buyers into the realms of Fujitsu or Capita, and they worry if they really want to get involved in that," says Sweeney.

For ANS, cloud is becoming a huge differentiator in the market, but Sweeney says he is finding the public sector resistant to the concept in many cases.

"There are challenges in terms of how they adopt cloud and managed services, right now they are comfortable with on-premise; there's a desire to get into shared services but nobody has the authority to make it happen," says Sweeney.

"Now I can give them cloud or infrastructure-as-a-service or build a shared datacentre, but the politics of it are phenomenal and it's a minefield trying to tread through it.

"I don't know if it's safety in numbers but nobody wants to take a decision by themselves; there's so much scrutiny on what's being spent that people are just checking and double checking and getting as many signatures on the order as they can.

"The channel will have to demonstrate and show off shared models in the private sector before taking it into the public sector," he concludes.

Sweeney's worries about internal public sector politics are shared by Doug Maclean, consulting manager at SOCITM, who says: "Few councils have anybody approaching the role of CIO, and in some cases we're struggling to identify an effective CTO. All this means that networks grow topsy-turvy, and services similarly."

Harley at ACS agrees, saying: "It's often unclear to us who is making the strategic decisions. This means that the decisions that are made aren't necessarily best value."

Ultimately, according to Netgear VAR sales director Jonathan Hallatt, this means that many projects are being signed off in kind of a kneejerk reaction; councils know something must be done, but are not sure what is best for them. David Grasty adds: "The speed with which we have to work is getting faster; two year conversations must now take no more than six months."

Maclean at SOCITM says: "We tend to get involved in helping councils with IT strategies and what we pick up from them we wouldn't call a strategy by any stretch of the imagination. The [procurement] frameworks, especially, are very obstructive."

The upshot of this is that in many cases the big suppliers are able to dominate the market without really adapting to the needs of their customers. Such a case has been seen recently in Bristol, where Computacenter came under fire over an open source installation.

Although Stephen Harley says that since the spending review came in the more enlightened council CIOs are looking to challenge old means of procurement, which has been good for companies like ACS, it still appears that there is a tendency to stick with what you know.

Writing on the MicroScope LinkedIn network, Bechtle UK operations manager Darren Potter says: "Some [councils] continue to stick to well-trodden paths either through fear that they will be brought to account for going outside approved supply channels or simply prefer the easy life continuing to use suppliers that won't raise eyebrows.

"However, for the brave souls who are willing to step outside I personally see a distinct lack of loyalty and unwillingness to build relationships. Currently price is the only language spoken. Adding value, quality of solution, knowledge, support, and service are very low priorities and I can't see a change in this attitude for quite some time."

Despite the ever-present threat posed by government cuts there are still ample rewards for the channel when dealing with the public sector. For some time now we have all been very clear on the fact that the right ICT installation is a huge cost-saver, and this isn't going to change any time soon. Obviously, it must be the keystone around which your sales pitch is built.

Suppliers must also be thorough in their efforts to identify the right people to talk to and to appreciate, or even listen to, their concerns over their own futures.

Resellers keen to get involved in the sector should also remember that if they are going to lead on cloud, they will need to be able to demonstrate strong case studies to convince public sector buyers to take the plunge into our world.


This was first published in June 2011

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