A "good enough" IT solution

What is the connection between “good enough”, “fit for purpose”, “agile”,  commercially available off-the-shelf software (COTS) open source software, “out of the box”, and engaging the SME sector? The answer is that they are part of the same trend: the public sector moving away from proprietary, over-engineered, software licensing models for ‘all you can eat' bundled solutions. As such, this trend has major implications for the public sector vendor community and equally for the way services are procured and delivered by enterprise.

There are many reasons why this is likely to be an unstoppable trend. The key driver is the fact that the average enterprise customer is now much more tech savvy than they were ten or even five years ago. In those days the apocryphal tale was that some companies would not turn up at a meeting unless they were assured that there was a purchase order on the table.

We are also beginning to see a regime change at the CIO level and a greater understanding of the business use of technology across the enterprise. Many of the most influential CIOs in public sector, now in their early 50s, have grown up with companies such as Microsoft, Oracle, and SAP – and the enterprise license model. As they begin to retire, we have a new cadre of CIOs emerging who are not wedded to the enterprise license model and are coming into their roles just as cloud, consumerisation, and ubiquitous connectivity are riding a “coach and horses” through the IT industry. Their vendor choice now includes massive new entrants such as Apple, Google, Amazon Web Services, Salesforce, VMWare, and a myriad of smaller vendors. Equally, they are coming into their roles as the world economy is going through the floor; they have to operate in an environment where spending is not so much constrained as asphyxiated.

The final nail in the coffin is that government and the public have run out of patience with large, botched IT projects and are more interested in an approach that offers economies of scope as opposed to often-unrealised economies of scale.

Good examples of “good enough”

“Good enough” is not about dumbing down solutions or finding the lowest common denominator but finding a solution to a public sector challenge that is fit for purpose, scalable to enterprise level, secure (enough), and cost effective. There are many enterprises using smaller companies with innovative products and we would point to Ovum's On the Radar commentary on companies such as Beezy, Be Informed, IEG4, Screampoint, and Jadu. The often-quoted example of a “good enough” solution is the almost wholesale adoption of Google Maps as a citizen-facing geographical information system (GIS) in government. In the very recent past many enterprises spent large sums of money on either developing an in-house solution or purchasing proprietary GIS software but Google Maps has proven good enough for all but specialist needs.

The cloud game changer

There were many who felt that cloud was overhyped because they saw it as a binary argument and quite rightly suggested that not everything should, or would, be cloud-based. The real disrupting influence of cloud is the affinity of the technology to the ability to facilitate pay-per-use models of delivery. If you combine that with SME adoption of cloud as a SaaS delivery platform you can see how it supports the trend of “good enough” and pay per use.

Get ready for market disruption

There are new entrants to the public sector market, and many are pure-play cloud operations. Apple, AWS, Google, Salesforce, and VMWare are all targeting the rich seam of government contracts and benefit from having little or no public sector IT baggage through failure. They suit the environment of “good enough” because they see themselves as commodity IT. In Google and AWS's case there would seem to be a clear strategy of not developing public sector specific value propositions but to offer the same “good enough” commodity service they offer to all their clients – based on unit pricing and being fit for purpose. Many politicians like the associated “cool” of working with these companies and they are beginning to pick off enterprise-scale contracts rather than the small-scale engagements usually associated with them.

System integrators and their partner ecosystem

This trend towards “good enough” has ramifications not only for software companies but across the vendor community. Most of the major system integrators (SI) are used to trying to read the runes of public procurement policy and adapt their consortia to match it. They have made great strides in recent years to engage with SMEs partly through enlightened self-interest to capture the best and most competitive IP and partly through a three line whip from government.  When dealing with a major procurement, SIs spend a lot of time trying to work out who and what is in, and who and what is out, in terms of their clients' thinking. If they believe that they need to change the emphasis of their technology pitch away from the usual suspects we can foresee an interesting reforming of alliances. Equally, some of the major software operations which have relied on a partner channel will have to adapt their products and develop direct selling operations.

Joe Dignan is chief analyst addressing the European public sector and a member of Ovum's Industry Technologies team, which produces research and analysis on the use of technology in the education, government, health sciences, financial services, energy and sustainability, and telecoms industries.