Elaine McFadden
December 7, 2015

Marketplace: good news for SMEs

Marketplace: good news for SMEs

Kevin Noonan: The Digital Marketplace may be a tough sell in the public sector

The Digital Marketplace announced today as part of the Government’s National Innovation and Science Agenda is a big win for startups and small to medium sized technology businesses, giving smaller companies better access to government’s $5 billion a year spend on ICT.

Modelled on a successful UK equivalent, the Digital Marketplace will be – not surprisingly – developed by the Commonwealth’s Digital Transformation Office and it will act to level the playing field for businesses of all sizes to engage with government projects.

“The Digital Marketplace will result in a broader base of suppliers being considered, more competition, more innovation, and more jobs,” the National Innovation and Science Agenda website spruiks.

Essentially the directory will break down large scale IT requirements into individual components, which scales down the procurement and allows for greater scope of innovation. It will also greatly simplify the procurement process, with access to a listing on the directory being relatively straight-forward.

One analyst is cautioning however that the changes to procurement models of old could be a tough cultural flog inside government departments.

Ovum’s global public sector research director Kevin Noonan has welcomed the Digital Marketplace announcement, but says there are barriers to break down inside the public service to ensure its success.

“One of the important things in the Digital Marketplace is the aim at least, to identify the great providers available within Australia, that can do certain work,” Mr. Noonan told InnovationAus.com.

“More importantly, is the requirement for agencies to break down large scale solutions into smaller components, and this was key to its success in the UK.

“Breaking projects down into smaller bits is good for government because it drives agility and it drives greater focus on delivering single outcomes that work in the short term, so that then you can build on those success for a longer term solutions.”

There is however, an age old imbedded expectation across organisations, Mr. Noonan said, that the measure of success is a big project and that IT departments build things according to very rigid specifications.

“This is a topic that’s going to be easy to talk about in theory but in practical reality, life becomes a whole lot harder,” Mr Noonan said.

“It’s the people and cultural issues within departments where there’ll be a tough flog,” he said.

InnovationAus.com first reported that the Digital Transformation Office (DTO) was considering a ‘G-Cloud’ like marketplace back in October, when the Innovation Statement had barely begun to take shape after the change in leadership.

And later that month Communications Minister Mitch Fifield gave the first clear indication that procurement was set for a shake-up under Prime Minister Malcolm Turnbull, when he told the Telstra Digital Summit that this government’s aim was to “make it easier and less costly for companies of all sizes to partner with government.”

As with any major government announcement however, the time for action is limited and Mr Noonan is keen to see the next level of thinking from the Innovation Agenda.

“It’s not good enough to just have agile IT. We now need to start thinking about agile enterprises,” he said.

“You can’t just put a thin veneer of 21st century technology sitting on top of old policy and old processes. We need to start to think about new ways of changing end to end.”

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