As one longstanding government executive recently noted to a well-known tech vendor, it's not easy to navigate the state government market, and if this services provider wanted to engage, it would need to invest in the long haul.
“How interested are you in the state government market?” the official asked. The vendor, who had just presented a solution that could help the state address an enterprise issue, gave an accurate and telling reply: “We are as interested in the state government market as the state government market is interested in us.”
Herein lies the divide between a marketplace – filled with ideas and solutions – and governments of all sizes that struggle to take advantage of those innovative offerings. Government processes that were put in place by legislatures reacting to the latest headlines of deals gone bad and understaffed procurement agencies trying to keep up with market trends while juggling multiple RFPs from numerous agencies can create a perception that the state and local market is almost impenetrable.
Vendors, on the other hand, do not take the time to understand the motivations of all stakeholders involved in a state government procurement. Instead, vendors operate as they do with commercial clients, relying on feature sets and ROI talking points to influence their potential buy.
Yet innovation is a theme that sits front of mind for every state CIO and every governor. The National Association of State CIOs' (NASCIO) 2014 survey noted that for more than two-thirds of CIOs, innovation is a critical part of their role. But, governments don't have a track record when it comes to innovation. Unlike the private sector, which must invest in innovation to maintain market relevancy, governments do not have an “innovation” line item in their budgets.
And to rely solely on the “big” providers – the ones with the resources to invest heavily in the state and local government market – is to ignore a wave of new solutions that smaller- and medium-sized companies can offer.
The same NASCIO survey also states that CIOs are increasingly brokers of services – they must coordinate the activities of multiple disparate entities, many of them commercial organizations with their own drivers and objectives. This brings us back to the original problem – bridging the divide between innovation offered in the marketplace and adoption of that innovation within the walls of government.
So what does one do? The answer does not rest with one party alone. Vendors and government buyers must work together to develop new forums designed to share perspectives on how each others' world operates. The outcomes these forums produce should focus on process improvement within the procurement processes, a deeper understanding of what the market offers, and a clearer view of the buyers’ and sellers’ motivations and challenges. Adoption the following principles in sales strategies and procurement processes would help all parties:
A recent initiative led by the Center for Digital Government, the research arm of Government Technology's parent company, e.Republic Inc., brought state governments and the market together to develop a best practices approach to purchasing cloud and as-a-service offerings. Some states are finding creative ways to allow more dialog with potential providers during live procurements In a market characterized by 50 different states, each with its own unique manner of purchasing, this level of collaboration is invaluable to buyers and sellers.