The ambition by the government to shake-up its IT order book and open up business to a wider number of firms has helped Capita become the largest software and services supplier in the public sector.
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Capita has overtaken Hewlett-Packard as the largest supplier according to the latest review of the IT software and services (SITS) market from analysts TechMarketView.
Capita enjoyed a 11% increase in public sector revenues to £1.59bn, overtaking HP which suffered a similar percentage drop, helped not only by the Cabinet Office looking to move away from relying so heavily on some of the larger suppliers but also because the business process outsourcing that it specialises in has avoided a lot of the government cut backs.
Following on from Capita's pole position in the top 20 UK public sector SITS suppliers, HP, Capgemini, Fujitsu and BT are all holding their positions in the top five, according to TechMarketView's UK Public Sector SITS Supplier Landscape 2014-15 report.
The analyst firm also indicated that some of the suppliers that were outside the top 20 were enjoying strong growth, providing more opportunities for the channel to get access to public sector spending.
"Mid-sized infrastructure services providers like Dell and Computacenter are taking advantage of the UK public sector’s desire to spread the spoils. Dell’s UK public sector SITS revenues were up 8% (to £120m) while Computacenter’s rose by 7% to £49m," the report stated.
But TechMarketView also highlighted some of the problems that some of the SME suppliers were facing as they tried to compete against larger more established rivals.
"As these ‘newer entrants’ make their mark, the larger SITS suppliers are trying to reassert themselves. Notably they are playing the “working with larger suppliers can bring significant benefits” card. And it is a strong card to play in some situations. After all, you will be hard-pushed to find an SME willing to help out at the ‘drop of a hat’ in an emergency situation and think about the commercials later," the report said.
"Indeed, the Cabinet Office seems to be accepting that a mixed supplier economy is the right answer. But for any supplier – large or small – to be accepted as a “strategic partner”, it must be unwavering in its support for the UK Government’s strategy and determination to transform. Some suppliers are finding that an easier ask than others," it added.