Tories to reduce Government’s commitment to large IT vendors?

The Tory Shadow Minister for Science and Innovation, Adam Afriyie gave a very interesting speech last Thursday, in which he outlined some of the Tories plans for major IT projects if/when they get into power.

Regular readers will know of my confirmed belief in the vital importance of true inter-operability, and it was a pleasure to hear Adam’s views on this....

"By using standard data formats, like XML, government can open up the procurement process to the widest possible base of suppliers. With inter-operability, large projects can be split into manageable, modular chunks. The outcome is a more flexible procurement process where it is easier to change suppliers and resolve problems as they emerge."

Then, as if he had been reading my post on How NHS NPfIT should have been procured, he announced that...

"One option we are considering is the use of multiple proof-of-concept pilot projects. If several suppliers are asked to come up with working solutions, they can then be piloted, and the most successful can be scaled up and rolled out nationally. The use of multiple early-stage pilot projects could reduce reliance on a handful of big vendors and increase the proportion of IT budgets spent with innovative young companies."

I only hope that the Civil Service allows this to happen – I remember that one of the objectives of the LA Pathfinder projects in 2001-02 was to involve smaller companies who were more innovative and faster to react than larger IT companies – unfortunately 24 of the 25 Pathfinder projects went to the major service suppliers – some of whom had no track record of LA application software development at all.

But perhaps, given the spate of government IT disasters over the past few years, these sorts of initiatives will have a chance over the next couple of years.

Adam also gave what was, in my view, a very good summary of the current government’s e-initiatives:

".... some worthy objectives, such as joined-up government and personalised public services. But their approach has been deeply flawed. While the pace of technological change was breath-taking, the response from government was not.

Internet access empowers people. It improves productivity and opens the door to self-improvement. But while the internet was empowering individuals to take control over their lives Labour was attempting to maintain the old bureaucratic machinery.

Ministers were mesmerised by the transformative potential of technology but failed to integrate it seamlessly into everyday use

Perhaps the next few years will see significant changes in the way government procures and develops new IT systems – let’s hope so.....

Capita divests IBS R&B unit to Civica

Over the summer, Civica acquired IBS's revenues & benefits unit from Capita - following the Competition Commission's decision to force Capita through a divestment – see Capita to divest IBS Revenues & Benefits unit.

I was quite surprised that Capita divested the unit to Civica as, with Civica's existing base of R&B back office and Comino workflow/DIP customers, it makes a serious competitor to Capita's own R&B business. But as I understand it, Civica were the only credible bidder with the cash to complete the deal.

In practice, I believe that Civica has done well and bought the unit at an apparently bargain price. I'm sure that the indecision brought about by the CC investigation has harmed both the IBS business and staff, but now Civica has a complete, competitive R&B offering – and a good upgrade offering to its existing R&B back office customers running Civica's very old, Pick-based, back office software.

However, I still believe that Civica will have an uphill struggle to sell its now Progress-based solution to new customers – particularly the larger users such as the new unitaries. But perhaps they will win a sympathy vote from those customers unhappy with Northgate's decision to switch off support for the old Anite Pericles product (and unwilling to move into Capita's extensive grasp).

Over the past year I've spent some time with external companies looking at the UK local authority market and considering trying to enter the R&B market by developing new back office products from scratch, but all seem put off not just by the development cost, but also by LA prospects' desire to see three live reference sites, the resulting lengthy time to market, and the possibilities of future central government changes in the way revenues are collected and benefits handed out.

Seeing no potential new entrants, we now must live with the three R&B suppliers, each of them with competent solutions, but neither of them with clearly the best solution, and each of them with at least one major drawback.......

Back to blogging

As regular readers will have recognised, I’ve not been posting to this blog during the summer, primarily due to pressure of work. But after a very busy summer, including a stint as interim Operations Director of an AIM-listed software company, work has reduced a bit, so I’ll be getting back to posting a few items each week.

Government IT projects – time for change

The debacle of the C-Nomis project (see Tony Collins blog for the background) highlights the need for fundamental changes in the way that government (primarily Central Government – local government seems to be far better) procures new IT systems.

As I have previously posted, I recommend breaking large projects down into smaller, more manageable chunks. But, perhaps more importantly, ensuring that the requirements for the project have been accurately and completely defined – prior to a specification stage that includes detailed walk-throughs with real-life end users. This is the most important phase of an IT project – yet is typically rushed or overlooked, and frequently completed without adequate reference to the managers and end-users that will be using the system.

I’m a great believer in “phased fixed price” contracts for dealing with large projects that require the development of customised software – splitting out each phase into separate contracts where the current phase is on a fairly firm basis (ideally fixed price against an agreed definition), with budgeted prices for the next phases (typically based on some broad brush assumptions of what will come out of the each phase). Such an approach allows for the requirements collection phase to be contracted separately and carried out by potential eventual developer (if you want to know how to do this in a way that allows for subsequent changes in contractor, please contact me).

All too often, major government IT contracts are awarded to big service suppliers rather than splitting off the development stages (that frequently generate lower revenues than the roll-out and related infrastructure stages) to specialist software developers, and leaving the other stages to the service suppliers. The culture of specialist software development businesses is different to that of the major service suppliers, a culture which is more likely to deliver a better software solution (whilst service suppliers would be better at the other stages of a large new IT project).

As the C-Nomis project proved, a lack of focus on the core requirements, system design and expected benefits, has resulted in a system that met neither the business objectives, nor the project budget and timescale. I suspect that it’s been a great business success for the service supplier who has benefited from the budget increase from £234M to £513M – no doubt far outweighing any bad PR from this obvious failure.

How many more project failures will there have to be before we see Government recognising the need for splitting up large projects into smaller, more manageable chunks, ideally allocated to different specialists for the different types of contract?

Capita to divest IBS Revenues & Benefits unit

The Competition Commission has published its final report on Capita’s acquisition of IBS and, unsurprisingly, it has announced that it is requiring Capita to divest the IBS Revenues & Benefits unit.

The report points to the several problems with the partial divestment of the R&B unit (Capita would be allowed to keep the Social Housing unit if it can achieve the partial divestment of the R&B unit), but has apparently obtained assurances from Capita that it will pick up any additional customer costs such as additional licensing costs and/or separation of an integrated IBS database into separate R&B and SH databases.

I would imagine that existing joint R&B/SH customers of IBS will not be too pleased about losing their single contractor, single point of contact and integrated database, but if Capita had been allowed to keep the IBS R&B unit, in the long run, perhaps Capita would have moved the customers off the IBS R&B product any rate, so the customers would have lost many of these benefits without the forced partial divestment.

There seems little doubt that the value of the R&B unit to purchasers will be reduced by the partial divestment, rather than a full divestment of the whole IBS business including the SH unit, but I suspect that Capita will much prefer such a partial divestment. Although the value realised will be less, and the partial divestment will be more time consuming and messy, given the likely smaller price tag, there are likely to be more potential purchasers – and, given the unknowns, I suspect that it will be some time before the divested unit becomes a forceful competitor again in the R&B market.

There is the risk that if a partial divestment is not achieved, the CC will require Capita to go down the full divestment route – a route that I’m sure Capita will wish to avoid at all reasonable costs. Although Capita has announced that it is “in early discussions with interested parties”, no doubt the due diligence and purchasing process will take several months, but it will be very interesting to see who the succesful purchaser of the IBS unit turns out to be .....

FOI to apply to suppliers?

UKauthorityITy.com has pointed out that there is an impending extension of Freedom of Information powers to cover suppliers (see here for the article).

However, I believe that software and associated service suppliers will not be affected – any extension is likely to be limited to BPO contractors – and not software suppliers operating on either a conventional licensing or SaaS approach.

It will be interesting to see where any extension stops as far as IT services and managed services are concerned. Where a managed service is limited to supplying a working computer system for use by public sector employees and/or their contractors, then I believe that any FOI extension will not affect this sort of service any more than current contracts/legislation require.

Where a service supplier provides a fully-outsourced IT service, any extension is likely to be less well defined. My personal view is that FOI should not apply to such contracts, but from the comments flying around at the moment, I believe that there is pressure to bring these types of contracts into the FOI arena. This will no doubt provide lots of work for the legal profession over the coming months/years....

Google Waves hello to Microsoft

Possibly to try to counter Microsoft’s launch of its new search engine Bing, Google last week pre-announced its new Google Wave product - a “new-age communication and collaboration tool” that seems to combine e-mail, instant messaging, and bulletin board functionality, with strong support for multi-media, into a single product.

I’ve only seen the developer preview at last week’s Google I/O 2009 conference (see here for the 80-minute video of the presentation), and whilst it was clearly still buggy in its development form, and will not be on general release before the end of this year, it seems to be a serious future competitor to the Microsoft tools that currently dominate corporate communications.

Particularly impressive to me were the collaboration aspects of Google Wave – potentially very effective for project teams to communicate ideas and make decisions – together with the ability to replay the messages/discussions in order to see how the discussion went from initiation through to current time. Given the potential benefits for improved collaboration, I can see that small technology operations (like software houses) – particularly those using a high level of remote working, be they home-working or distributed offices – will be the early adopters; the question is, will the major corporates follow?

However, whilst such tools would be great for in-house use, I struggle to see how one might manage the security implications of opening up such ‘waves’ to users external to one’s own organisation – or even across departments in large corporates or organisations.

I also wonder about the level of server computing power (and network capacity) necessary to support just internal heavy usage – let alone the power/bandwidth necessary for public utilisation.

Google is planning for Google Wave to be open source, and through its pre-launch in San Francisco last week, is trying to encourage the developer community to embrace the product, and use the API’s to produce bolt-ons (‘gadgets’ and ‘robots’). The plan appears to promote open networks, with anyone being able to become a Wave operator, with ‘Wave’ running on a distributed network model operating on a peer-to-peer basis.

Whilst I suspect that Google Wave will need to change before its open launch - to address both potential security and performance issues - its innovative functionality will undoubtedly drive significant changes in the way we all use e-mail and instant messaging in the future. I’m intrigued to see how Microsoft will respond....