How can UK ICT suppliers survive the coming cuts?

In the early 1980s I had to turn round the NCC Microsystems Centre when the DTI funding vanished in a typical government double-counting operation. My staff – I merely encouraged them – managed to stop the bleeding and to grow the operation, on positive cash flow, at 80% p.a. compound. About the same time I became an advisor to the High Tech Unit of Barclays Bank. I remember persuading the bank to give a stay of execution to one software house which was having to do likewise, after a major customer had gone down leaving the bills unpaid and another, whose strategic partner had pulled out of the UK.

I spent much of yesterday in meetings planning how to help local authorities and their suppliers cope with similar pressures over the year ahead. The first step will be to give confidence to local authorities and agencies that they can legitimately do short order procurements to make innovative use of IT to remove bottlenecks, improve service and free up funds for investment in shared services to make further savings – and so on.


The main challenge will be to find those willing to work together to identify and publicise existing examples of success and build on experience to date – rather than spend what is left of their budgets on invitations to tender for projects that will never happen, followed by redundancy packages for themselves. The Public Service Delivery and Communications Groups of the Information Society Alliance (EURIM) will be meeting next month to see if we can achieve the necessary critical mass of support. The early signs are that we will. 

Most of those at the top of the public sector joined in order to serve the public, not play to target and bonus games as pretend entrepreneurs. The finance directors of most suppliers have long been aware that big projects rarely make a profit, after deducting bid costs, lawyers, consultants, bonuses etc. Meanwhile many of the new intake of MPs have a background in local government and strong views on the need to make more efficient, not just more, use of ICT.