By Mike Carter, Technical Director at Ixis
Recent news that the government’s latest digital procurement framework, Digital Outcomes and Specialists (DOS) 2, has attracted 60% more suppliers than its predecessor is good news for organisations in the public sector looking for more outsourcing choice. The new platform, which was launched by the Crown Commercial Service and Government Digital Service at the end of February, is designed to help the public sector buy IT services from a wider range of suppliers through one digital storefront.
Launched in 2014, the Digital Marketplace – which is the umbrella term for both DOS and its sister framework, the G-cloud – is transforming the way the public sector commissions digital and cloud services, by making it simpler, clearer and faster for them to buy what they need. All public sector organisations, including agencies and arm’s length bodies, can use the Digital Marketplace to find and buy cloud-based services, specialists who can work on digital projects and physical data centre space. Crucially, the DOS framework in particular is designed to support specific ‘outcomes’, enabling the buyer to define what it is they are trying to achieve, build or create and assemble a team around this.
Although the government’s intention of widening choice for government bodies and extending contracts to SMEs is a good one, does it really go far enough? And is the DOS framework at risk of delivering unintended outcomes for the suppliers and buyers involved?
Delivering better services
The latest figures show that on launching the platform there are more than 2,000 suppliers on Digital Outcomes and Specialists 2, and around 4,000 on the Digital Marketplace in total. The framework already has over 800 more suppliers signed up than Digital Outcomes and Specialists 1, the framework it has replaced, and 94% of these suppliers are micro, small or medium sized enterprises (SMEs).
The objective of buying and selling through the Digital Outcomes and Specialists framework is that it will reduce the time and cost traditionally associated with procurement. It will allow buyers and suppliers to talk to each other so they can decide whether there is a good fit, and give more suppliers the opportunity to support digital transformation across the whole of the public sector.
Historically, most of government IT has been handled by a small number of well-known systems integrator (SI) and IT services firms. Now public sector organisations, including agencies and arm’s length bodies, can use the Marketplace to find a wider range of people, technology and firms for digital projects.
The changes are therefore part of a wider efforts by the Crown Commercial Service to help the public sector buy what it needs to deliver great digital services. Certainly, the Digital Marketplace has made great steps in opening up the public sector market to smaller suppliers.
For example, it has developed a good practice guide to managing supplier applications, which includes standardised communications plans and email templates as well as best practice for being open, fair and transparent when inviting suppliers to work with government. The success of the DOS’ sister framework, the G-Cloud, which is traditionally reserved for wider service projects, has also helped in this area and the expansion of the Digital Marketplace with Digital Outcomes and Specialists (DOS) 2 represents another positive step in increasing supplier competition.
The Risk of Digital Commoditisation
Despite these promising signs, the Digital Outcomes and Specialists framework has previously received criticism from suppliers who argue that a list of digital services priced transparently on a web store for the public sector to browse and purchase risks devaluing the skills necessary to deliver the outcomes being sought. Digital isn’t a commodity service because in many instances what’s needed in the public sector is advanced skills and capabilities to work on complex projects, rather than off the shelf specialists or services.
Delivering digital transformation for the public sector requires many different skill sets and external suppliers have an important role to play in providing government departments and teams with the specialisms needed to deliver a service, programme or project. However, where the scope and deliverables are defined by the buyer there is a danger that project teams could be working in silos and external agencies are denied the resources required to deliver the desired outcomes.
As well as a potential fears of digital commoditisation, there are also concerns that a framework that invites the buyer to define both required services as well as outcomes could result in projects being listed as broad, or even vague opportunities where the overall budget total is such that the ‘outcome’ is something that will ultimately exclude SME’s, leaving the door open again to large SIs. This is clearly the exact opposite to what the Digital Outcomes and Specialists framework is intended to do and risks creating challenges for potential suppliers.
Partners rather than suppliers
Ultimately, we find that public sector agencies who are looking for digital expertise are looking for partners rather than suppliers. While there is still a valid reason for defining outcomes and requesting specific services, organisations and external businesses should strive to work as joint partners rather suppliers and buyers. Partnerships foster a greater understanding of outcomes in a way that avoids services being commoditised or overall projects being too vague.
While the new DOS platform is off to a good start, it’s important, therefore, that digital work does not get commoditised and partnerships between organisations and external agencies are allowed to flourish.