Posted by: peterhact | April 30, 2010

Australian Government, Have you listened to us at all??

I have been surprised initially by the announcement by the Australian Federal Government to create a position called the “Advocate to IT SMB” – their main task has been to enable the SMB resellers a better chance of gaining market share in the Federal Government arena.

What I was hoping that this would lead to was an overhaul of the Federal Government’s procurement guidelines, which in their current form are an archaic list of suggestions on how to request a Tender, Expression of Interest or Request for proposal.

The current guidelines have done away with the Value for Money proposal – instead, it seems as if the focus is now on price only, which leads to an unachievable solution, as companies are force to drop their price to remain competitive, often to the detriment of the winning bidder and, eventually, the department making the request.

What I had hoped was that this system of weighing the several options would be reinstated, and change the focus of price.

The factors I thought would be of interest were:

Delivery time – Weighted at 25% of the overall value

Innovation – Weighted at 15% of the Overall Value

Diversity – Weighted at 10% of the Overall Value

Price – weighted at 50% of the overall value.

This would allow the SMB market to compete in the tender responses with an equal fighting chance against large enterprise companies.

It appears that this idea has gone by the wayside, in favor of the appointment of an ex EDS executive, potentially, they can see the SMB reseller’s perspective, but only if they have had any experience in this environment.

To date, the information put to the public via IT News has not been overly inspiring, the suggestion that the SMB companies would be best to consult to the multinationals and globals left a sour taste in my mouth – SMB has a lot to offer the Market, diluting their involvement will only lead to the death of the SMB player in government, and Innovation will die with it.

Small Companies have the agility to change and adapt to the market far faster than their large competitors.

SMB has a place in the market. Perhaps there is room for the global companies to speak to SMB, but I would think that they would be learning from these companies, not getting them in as consultants.

If the various SMB resellers get smart and form consortia like they did in the ’90s, the companies that will be left behind are the enterprise players, as the innovation, diversity and agility will create super companies – they will roll over the slow to react larger companies – it is hard to be competitive when you need to ask for directions from your head office, and if the deal becomes too complex, and takes a path that isn’t known to your technical teams in the bid responses, down a direction that is common knowledge to the members of the consortia, after all, they suggest and use it every day, then we will see a total change in the market, and the resulting shakeup will possibly see the end for some companies as their solutions are exposed as being stop gap.

Pricing won’t be a factor, as the reach of these super companies will extend to the Manufacturers, and special pricing won’t be the shield it once was…

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Responses

  1. Hi Peter – good to meet you in Canberra.

    Just a quick response on your blog I did spend 4 years at EDS but I have also run my own business and worked with small businesses for at least 10 years. 4 in The Netherlands and 6 in Australia.

    I agree with you that Australian ICT firms offer great value for money and there is a lot of innovation and creativity in the local industry as well. My mission if to find ways to encourage Government to utilise Australian firms without increasing their risk or overheads.

    This will require a set of actions jointly supported by the ICT industry and the Government agencies.

    regards,

    Don Easter
    IT Advocate


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