An update on our ICT procurement transformation work
Our Chief Strategy Officer, Dr Anthony Vlasic gives an update on how we’re transforming ICT procurement across government.
In late 2017, the government released an ICT Procurement Reform Taskforce report. The report set an ambitious agenda with 10 recommendations for transforming ICT procurement in government. The DTA has been leading the implementation of this work.
In this blog we reflect on the progress we have made over the past 12 months. There have been some great achievements and a number of lessons learned. That is not to say we are done. We have realised along this journey that we don’t just need to change some processes, but we also need to change the way the government thinks and talks about ICT procurement.
It’s not ICT procurement, it’s digital sourcing
We have been deliberately changing our language, because ICT procurement no longer fits the work we do. Instead, we’ve been referring to our work as digital sourcing.
While many products, services and projects have ICT components, the market is moving away from being just about procuring ICT equipment. Instead, the focus is on ICT as an enabler of successful digital transformation.
Similarly, procurement is no longer all that government does. We have a tendency to think about procurement as the buying process. That is, once a problem has been defined — and a solution devised — we think about how to best buy that solution. But buying needs to be more than that. It needs to evolve from just a procurement process to playing a role in defining the problems being solved through buying. That is what we refer to as sourcing.
Thinking about the work we do as digital sourcing supports us in transforming the buying process for both suppliers and agencies, particularly as we work through the recommendations of the taskforce report.
Establishing a solid foundation
In developing our response to the taskforce report, we knew it was important to establish a lasting foundation to build from. We did this by developing a long-term framework as a solid base, and trialing ideas to drive the reform activity.
One of the biggest achievements so far has been releasing a new Digital Sourcing Framework for government, one of the key recommendations of the report. The framework sets out principles, and will include policies and guidance that outline how to buy digital products and services. We set up cross-functional teams to develop the framework, which resulted in three new policies to complement the Capped Term and Value policy, currently in consultation:
In the past 12 months we have also delivered a number of initiatives across the 10 recommendations, including:
Completing three whole-of-government supplier agreements to lower cost, increase flexibility and reduce risk for the Australian government.
Upgrading the Digital Marketplace so that it is now one of the government’s top 5 largest multi-supplier ICT panels by volume, with almost three quarters of all contracts going to small and medium-sized enterprises.
Launching the hardware and software marketplaces to rationalise the digital panel sourcing process.
Commencing simplification of the standard IT contract template suite to make it easier to do business.
Completing the Secure Cloud Strategy, while developing several other strategies such as the Digital Transformation Strategy.
Our lessons learned have been just as important, including:
Be clear about the principles. The ICT Procurement Taskforce report has a number of principles to guide the path forward. We utilise these to help set our direction and priorities.
One size does not fit all. It is important to understand how and why buyers purchase in order to influence that process.
Consult a diverse set of perspectives. We introduced an exemplar process that seeks input in a time-boxed manner. It has been very effective at gaining a wide set of views to develop the content.
Widespread change is required to ensure enduring impact. It is not as easy as just pulling one lever to have an impact, it requires multiple changes across the value chain.
The future is about being ‘open for business’
With the first year now complete, we have moved our attention to making government more ‘open for business’. That is, increasing opportunities to a broader set of suppliers. As we move forward with policies, our own products and services will come into line with this principle, such as with the recently launched Hardware Marketplace.
A related activity is our review of sourcing capability. This will outline the mechanisms in greatest need of uplift. By upskilling APS sourcing professionals, we can ensure government improves as buyers of digital products and services.
After only a year, we have a line of sight to how we can deliver real transformational change. The real test — and how we will know that these tools and strategies have all come together — is if we succeed in changing the conversation from ICT procurement to digital sourcing.
Dr Anthony Vlasic is the DTA’s Chief Strategy Officer.