Harry Metcalfe

How government’s SME relationship should smell

Since I started dxw a few years ago, surprisingly little has changed in the way that we contract with Government. Now that the Government Digital Service has thoroughly arrived on the scene, I thought it might be a good time to write something about how I think contracting for digital ought to work. Or perhaps more accurately, how it should smell.

I’ve never worked as a civil servant, and I’m not a legal expert. The only experience I have of procurement is that of a small supplier to Government trying to get things done. So, this post is neither comprehensive, nor a solution. More a statement of principle.

There are many problems with the contracts under which Government currently works with SMEs (at least, all the ones I’ve seen). They’re too long. They’re not really being used for the purpose they were designed for.

But, on a much more practical level, they’re so long and abstruse that no one reads them. I really mean that: neither the client, nor the supplier, nor, I often suspect, the procurement staff. They are universally regarded as an unavoidable bit of bureaucracy on the route to starting a project. They are almost never challenged, because they have existed throughout the aeons, having been handed down from on high.

These contracts contain lots of detail that — theoretically —  defines the working relationship between government and it suppliers. And I suspect that they do exactly that when Government takes on big projects with big suppliers. But those processes are totally inappropriate for a working relationship with an SME — and the smaller the SME, the less sensible they become. For a company like dxw, they’re absurd.

We very rarely deal with change requests, serving written notices, purchase order amendments, management information, audit requirements, getting permission for staff changes, or any of the myriad other things that these contracts tend to require. Because when we’re working on a project, there are generally two or three people at dxw working with two or three civil servants. And the biggest project we’ve ever had was worth about £30k.

When you’re talking about that number of people, and that value of contract, most of the working arrangements in these contracts become ridiculous. Because they’re designed for much bigger teams, working on much bigger things.

When the teams are small, these arrangements are worse than a waste of time. If we were to follow the letter of these contracts, we’d spend more time on management than on delivering useful things. We’d have to charge lots more money to cover all that time, and the client would get next to no value out of that extra spend.

So, we don’t. And the client doesn’t ask us to. And we all play out the charade, going through the motions of a procurement process that everyone knows is overcomplicated, and that no one intends to think about after the project starts.

Strangely enough, this is ok, in practice. Because in practice, these projects involve a small number of people who are like-minded, and who share a common understanding of a project and its goals for success. The contracts we all agree to aren’t ignored out of malice. No one is being duplicitous. It’s just that they’re obviously unnecessary, and everyone gets by just fine without thinking about them.

Most of our clients no longer even require us to write a formal proposal. Instead, we write a short letter explaining what we’re going to do, by when, and what it will cost. This works best for everyone, because it’s short, readable and useful. But it still sits within a framework contract and a procurement process that aren’t fit for purpose. That are designed to shape a complex working relationship that doesn’t exist, and to facilitate litigation that will never happen.

Because of the efforts of right-thinking clients who just want to get the job done, and who understand the relationship, we’ve ended up with day-to-day working practices which are quite good. But they’re not formally recognised, or enshrined in any process. And that’s a missed opportunity: because the civil servants who need to commission a digital project for the first time, or who work within a more traditional government department, will turn to the process for guidance. As they should. And the process is maddeningly, hopelessly wrong.

So, I think there should be a new process. Since I only know about digital and SMEs, I’ll say that that’s what the process should be for. But these ideas probably apply more widely. I think we need a new framework contract and process which:

• Values brevity and simplicity above comprehensiveness, ignoring unlikely scenarios in favour of increasing usefulness and readability
• Has a primary, core purpose of leaving all the parties better informed about the project, what they’re supposed to do and what’s expected of them, and what success looks like
• Is written for the benefit of the staff actually delivering the project (SME and government), and not for lawyers, procurement staff, or as a tool for litigation
• Is written using language and styling that makes it likely that those people will actually read and absorb it

At its root, the process needs to recognise that in digital projects (and probably other ones too) success far more often emanates from the close and effective personal relationships of people acting in good faith than it does in detailed specification of process, requirements or outcomes.

Those bullet points accurately describe what almost every project we’ve ever worked on has ended up smelling like, despite the procurement process and legalese.

For dxw, procurement will be “fixed” when the process we follow is designed to facilitate and enhance that relationship. I hope we get there soon.

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System Error: fixing the flaws in Government IT

A few months ago, I was interviewed by researchers from the Institute for Government, as part of their work on the report that arrived, embargoed, in my email yesterday.

I’ve now had a chance to read it. I’ve heard a number of opinions on the project over the last few months — I have to say, mostly not very complimentary ones — so I was glad to see what they finally decided.

On the whole, I think it’s quite good, as far as it goes. It’s definitely saying the right kinds of things about the sort of change that’s needed: notably, choosing commodity options when they’re available, and using agile processes to innovate and develop bespoke solutions when they’re necessary. Good stuff. The report includes a now very-well-rehearsed explanation of the problems with government’s traditional approaches which is spot on, and some good recommendations for Government – it will be interesting to see how they respond.

On a minor point (at least, for me) it is very technology focussed and doesn’t much discuss the wider social context that technology needs to serve.

More importantly, I would have liked to see more detail, in general. There’s a lot of discussion of open standards, buying commodity services, and coordinating activity between departments. But it feels a bit like the report skips over the fact that these things are really hard.

Agreeing standards is hard, as is implementing them correctly. Standards for the web have taken >10 years to develop and mature, and in many respects are still not very well embedded: Microsoft have really only just got there with IE9, and that remains to be seen. And this is in an industry where the incentives to make everything work are huge. I’m really not at all sure that the incentives to use open standards for the NHS spine and people’s tax records are even nearly as strong, where suppliers may be reluctant to facilitate the involvement of others.

Commodity services can of course deliver immense value, and the success of Amazon’s Web Services is a testament to their usefulness. But even the private sector is only just getting there. Computing resources are now effectively commoditised, as is — perhaps — the purchase of hardware… and that’s… it. There’s no commodity market for VOIP services that I’m aware of. There’s no commodity market for payroll, workflow management or document storage. For all of these things, we’re still in a world of competing products which are mostly not interoperable. The report actually highlights Microsoft Word as an example of a commodity application, which made me choke on my coffee: it’s quite the opposite. In fact, it’s a dominant product in what is all but a monopoly, and — as anyone who’s tried to use OpenOffice in anger will know — it’s a long way from being interoperable with anything.

Sensibly coordinating activity between departments has been advocated as good for so long that it’s practically axiomatic, and we still aren’t anywhere near it.

Perhaps more importantly still, the report really doesn’t address procurement nearly carefully enough. It does present some interesting suggestions about how to squeeze agile projects though existing OJEU and OGC processes. But I think procurement is at the root of the whole problem, and needs wholesale reform. The main reason that Government’s incumbent suppliers are so dominant is that the barrier to entry for new businesses is immense. And procurement constitutes a very large portion of that problem.

The report even advocates the use of framework agreements as a cost-cutting measure, when — in fact — the use of framework agreements is one of the prime culprits for the lack of any agile suppliers in the market able to compete for the large projects that are currently solely delivered by the Usual Suspects.

In summary – I think this is a good start. The direction of travel is spot on, and I hope it is warmly received and acted upon by government. But it does skim over some terribly difficult problems which we’ll have to confront if we want this to work.

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Forensic Science Procurement

I just listened to this week’s File on 4 (available till the 15th), which was about the “marketisation” of the forensic science services used by the Police.

It began fairly predictably as critique of the privatisation of the Forensic Science Service, which led to the system we now have — where multiple companies bid for contracts to provide forensic services to the Police. The usual criticisms were trotted out: that markets are amoral, and that everything was rosy before the capitalists came along. But the program fairly swiftly moved on to more interesting and familiar territory: procurement.

It was the same sorry old story. Heavy-weight tendering processes. The granting of long contracts for huge sums. Contracts managed by staff with little specific expertise in forensics. Commoditisation of services where expert analysis is key to success. Bureaucratic intermediation between the staff who need things and the contractors who get things done. Sound familiar?

It seems that many of the problems that beset IT procurement affect forensics as well. I can’t say I’m surprised — the problems are, after all, endemic — but somehow it’s a lot scarier to hear these things said about forensic science.

I wonder how many people have been imprisoned as a result of barmy procurement rules?

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