Predictions 2013: UK Public Sector SITS

It is TechMarketView’s opinion that 2013 will be a ‘Make or Break’ year. In the UK public sector, one of the greatest challenges for SITS suppliers to the market has been to determine which of the tenets of the UK Government ICT strategy, published in March 2011, will have a real impact at the coalface. There’s no doubt that the way government organisations operate must change if they are to continue to deliver effective public services in times of continuing austerity. But there has been resistance from some quarters to the direction of travel set out by the Cabinet Office and the Efficiency & Reform Group (ERG). In TechMarketView’s 2013 Predictions for the UK Public Sector SITS Market we forecast the significant changes that we think will have an impact over the coming year. Here we provide a summary:

• Make or break for leading suppliers and new entrants: The leading SITS suppliers continue to find their dealings with HM Government strained. We hear from many that they are reaching “breaking point” in their relationship with Francis Maude and the Cabinet Office. The pressure to supply ‘more for less’ is unrelenting. In 2013, the top ranked SITS suppliers to the sector will see their lead narrowed as contracts are retendered in a different form. We will see some suppliers make big decisions over whether, or to what extent, to continue to invest in the sector. Meanwhile, 2013 will also herald a year when some new entrants manage to get their ‘break’ and get their first taste of public sector business.

• ‘First movers’ will be at an advantage’: As the Cabinet Office defines ‘new’ roles for SITS companies; those companies winning the initial round of contracts will be at an advantage. By ‘new’ roles, we are talking about the roles created by the reshaping of contracts, such as service integration or cloud services. Suppliers that are winning a large chunk of Cloudstore business, and particularly those that have been accredited to higher security levels, will be at an advantage as more risk-averse Government organisations look for reference sites elsewhere in Government.

• Government organisations will move beyond ‘testing the water’: As we enter 2013, confusion will remain over which elements of the Government ICT strategy really matter to those at the coalface i.e. the ministers that are ultimately responsible for delivering public services. 2012 has been a year of pilots, proof of concepts and tinkering at the edges when it comes to new technologies associated with cloud computing, social collaboration, mobility and BYOD to name a few.  However, as austerity measures bite harder and faster, departments and agencies will need to adopt more of these new ways of working.

• Future of procurement frameworks hangs in the balance: Procurement in UK government is supposed to be getting simpler. But, arguably, a proliferation of framework agreements has resulted departments and agencies more confused than ever about how to procure ICT services. A review into frameworks is currently underway. Could this be the death knell for the framework agreement, at least in its current form? Many suppliers would be relieved to not have to spend time and money bidding for contracts with no guarantee of future revenue.

• Civil Service Reform – foundations to be set: In June 2012, Francis Maude published the Civil Service Reform plan. It is our view that if the reforms do not get off to a decent start in 2013, they are unlikely to happen at all, as the current Government will be looking to prove the worthiness of its reform plans by the time of the next General Election in 2015. Particularly interesting to SITS suppliers will be the likely speed of adoption of new delivery models, the acceptance of digital by default and the move to shared services. Larger departments in particular may continue to fight their corner and resist some of the changes. In 2013 we will see if budget cuts are enough to force the arm of government organisations in the direction of the Civil Service Reform plan.

Subscribers to PublicSectorViews can download the full UK Public Sector 2013 Predictions note here.

Posted by Georgina O'Toole at '07:29' - Tagged: publicsector   predictions