IT leaders should help the small companies

Today Computer Weekly’s editor-in-chief Bryan Glick wrote a blog post about the implications of the Budget 2011 to business IT. Of his observations that caught may attention was about the reluctance of IT leaders around supporting small technology start-ups and small IT suppliers.

Bryan points out that the coalition wants to end the current public sector IT oligopoly and encourage more SMEs, but this is yet to be seen.

“Similarly, there remains a reticence among many IT leaders to take a risk on new technology products from emerging suppliers and start-ups. UK IT purchasing is predominantly risk averse, and when IT budgets are under scrutiny it is hard to convince the CEO to take a chance on an unproven supplier,” he adds.

Indeed, most of the IT managers I talk to tend to avoid taking risks with smaller technology suppliers – in fact, the majority will not take risks of any kind lately. Also, the post-recession drive to bring in efficiency and standardise leaves little room for the smaller firms, who are often relegated in favour of a global vendor in the famous supplier consolidation exercises, more so in the last couple of years.

However, many companies are realising that it is not always possible to drive all the innovation and ideas internally and some have started initiatives to allow local companies to bring in ideas to support the value creation process.

Late last year, I went to Edinburgh to visit insurer Standard Life, at a ‘speed dating’ event they had organised in partnership with Invest in Scotland, to help buyers from the financial services sector tap into the huge pool of expertise that can be found in small firms based locally.

I sat through some of the 15-minute pitches and could see that the buyers were most impressed with the ideas presented, and companies were – despite their nervousness – glad to have an opportunity to showcase what they are able to do to some potentially big clients. As a company that is becoming very focused on technology-driven growth, Standard Life was also pleased with how the first event went and is now looking into ways to foster relationships with those companies, as well as universities.

This is one example, but is there many more recent instances where UK users are actively looking to support smaller IT suppliers and tech start-ups, I wonder? A thriving entrepreneurial environment is one of the key pillars of economic growth, so how is the UK supposed to get back on its feet if the big buyers are not willing to help?

Are you doing your bit?

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