Small is beautiful… the public sector’s faith in SMEs will benefit wider society

With a potential £600 million of contracts up for grabs from a wide range of bodies, the launch of a new version of the Government’s G-Cloud procurement framework in June demonstrates how important SMEs are becoming to the public sector’s technology needs.

Since 2012, G-Cloud has awarded £1.4bn of cloud-based service contracts to tech SMEs and its continued growth is proof that the public-sector is benefiting from working with smaller firms that can offer the flexibility, innovation and customer service focus sometimes lacking in larger businesses.

This commitment is also having a significant trickle-down effect on the wider economy, with the technology sector able to use these contracts to grow, hire talent, export services and generate significant tax receipts for the exchequer.

For those in the tech sector there are significant opportunities to make the most of increasing appetite from public sector organisations to work with agile and customer-focused firms.

Bigger isn’t always better

G-cloud was a watershed moment for SME tech companies with a passion for helping transform the public sector.

For years it felt like ‘bigger is better’ was the default view of many government departments, local authorities and government-owned organisations looking at cloud and infrastructure services. After all, surely a larger firm must have reached that size through hard work, fantastic client service and a string of successful projects?

This however, hasn’t always been the case and several large IT projects that have failed over the years sadly evidence this.

Some public sector organisations that selected ‘approved’ bigger firms have sometimes found themselves locked in to long-term contracts where costs spiralled, deadlines slipped and front-line services were affected.

G-cloud provides organisations with the ability to identify and appraise a wide range of highly skilled and experienced SMEs. This transparency and diversity is arguably helping to drive innovation, improve customer service levels and encourage pricing that is more competitive; offering greater ROI for the public purse.

Cloud 9

For many public sector organisations, the benefits of partnering with an SME are significant:

  • By virtue of their size, smaller organisations can typically provide direct access to directors and highly experienced senior team members. This exposure provides a greater level of accountability which should ultimately lead to better service for the client and better outcomes for the tax payer.
  • A contract that could be considered large for a smaller firm, may seem of less significance to a bigger company. Perceived value can affect service levels and commitment to going above and beyond to deliver on time and on budget.
  • In many instances less onerous operational processes and shorter decision-making chains mean that SMEs can be more fleet of foot, crucial in both problem solving and innovating to provide the best solution for the organisation and the stakeholders it serves.
  • Sales, delivery and senior management teams are more likely to be aligned in smaller organisations, reducing the risk of overpromising and underdelivering, creating more realistic timelines and budgets.
  • Owner-managed SMEs are not beholden to shareholders, which means that profit can be more easily re-invested into the people, processes and products that deliver value to the public sector.

Making the most of the opportunity

The government is fully committed to digital transformation to increase efficiency and improve services for UK citizens.

Legacy technology is holding back many areas of the public sector from meeting the challenges posed by increasing demand for efficient, 24/7 delivery. However, making the changes required can pose challenges to departments and organisations that are large, complex and quite rightly risk averse.

To be successful partners, SMEs must share the public sector’s goals and public service mindset. Businesses have to demonstrate high levels of focus and commitment to the transformation process, providing best value whilst ensuring there is no threat of disruption to vital services.

SMEs also need to be responsive and agile, finding the simplest, quickest, most cost-effective route to implementing new technology. Many public sector organisations have suffered in the past from project delays, overwrought systems and costly support packages.

Finally, SMEs must take into account the people behind the organisation. It’s vital that SMEs take a truly collaborative and engaged approach, helping organisations and their employees adopt the new technology whilst working closely with them to unlock its full potential.

It’s truly a win-win-win for society as the public sector gets best value for money, citizens benefit from enhanced services and the economy is boosted through the growth of the UK’s tech SMEs.

Small is beautiful… and the government is recognising this.

Anna Assassa is CEO of technology consultancy Tisski, a rapidly growing SME that is establishing itself as an important player in delivering digital transformation projects in the public sector, frequently beating larger businesses to high-profile projects.