Public sector pushes for impartial IT advice

Hazel Ward

Although the public sector is often seen as the poor IT relation compared to the private sector, it does lead the field in...

Hazel Ward

Although the public sector is often seen as the poor IT relation compared to the private sector, it does lead the field in one respect. It is spearheading the drive to ensure the impartiality of IT advice provided by management consultancies, an industry figure has said.

Robert Morgan, chief executive of IT outsourcing adviser Morgan Chambers, said that, in the search for impartial IT consultancy advice, the rules and regulations governing the tender of contracts mean the public sector is forced to scrutinise more carefully the independent status of any potential consultancy partners, particularly those that have entered a joint venture with an IT supplier.

Morgan's comments came in the wake of moves by the Management Consultancies Association (MCA), the trade body representing UK consultancy firms, to tighten the rules and regulations governing the impartiality of advice given by consultancy firms allied with IT suppliers.

With the increasing number of deals between management consultancies and IT suppliers, business figures have expressed concerns that such partnerships could create a conflict of interests, which could jeopardise the integrity of management consultancy firms.

Deals such as Cap Gemini's acquisition of Ernst & Young's consultancy arm in May last year, and Hewlett-Packard's bid for the IT consultancy arm of PricewaterhouseCoopers in September, have raised questions about consultants recommending the products of an associated supplier to the exclusion of all others.

Morgan said the issue of consultancy independence was proving a thorny one for public sector agencies, which, because of the regulations governing supplier independence, had a stricter selection criteria to meet than private sector users. "We get about six calls a month from local government, from health authorities and from central government saying they find it extremely difficult to find a management consultancy that is not tied to a service provider," he said.

The alliance between consultancies and IT suppliers threw up a potentially major conflict of interests which was often not perceived by users, Morgan said. "Users should be asking hard questions about the independence of consultants to ensure that the advice coming through is not slanted towards an associated IT supplier. The question they should be asking is: 'Are you totally independent and, if so, can you actually demonstrate that?'" he added.

But Morgan said the rules governing the tender of contracts ensured public sector bodies were more thorough in their investigation of potential partners than their private sector counterparts. "Unlike the private sector, the public sector has to work with rules and regulations concerning impartiality which means it really has to do its homework about potential partners. In this respect, by having rules and regulations that dictate independence, the public sector is really leading the way," he added.

Morgan said he believed industry bodies should be calling on the private sector to take an approach to rules and regulations which is as serious as the Government.

Bob Griffith, national secretary at the Society of Information Technology Management (Socitm), said the issue of finding independent advice had proved to be a problem for a number of years. "It has been a complaint made over the last couple of years which is one of the reasons why Socitm set up its own consultancy arm," he said.

Griffith said the problem lay in the fact that consultants' knowledge of products was often limited to products they were familiar with. "I do not believe there is a hidden agenda to recommend a partner's solution formally but the trouble is that consultancies tend to recommend the product they know from a company they are familiar with. It is unlikely they would know anything about a competitor's product," he said, adding that some consultants tended to offer a "standard solution" rather than considering what the client really needed.

He believed Socitm's initiative to set up its own consultancy three years ago meant local government was ahead of central government. "It is not easy to set up something like that but we have become the leading supplier [of consultancy services] to the local authority marketplace," he said.

Socitm's consultancy business now employs 60 consultants, most of whom are from an IT management background, Griffith said.

Read more on IT legislation and regulation