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Industry Perspective: Keeping IT (Procurement) Simple

The most successful IT procurements follow a simple formula: Identify a business need, define success and how you’ll measure it, then carefully communicate and reward that success.

by Jon Dittmer, Vice President & General Manager, Defense Sector at ARRAY / April 3, 2014

Government IT procurement is more of a challenge than ever before. Agencies are forced by economic conditions and fewer resources to leverage IT for everything from survival to innovation, and the challenge comes from two things: the increased complexity of the requirements and the lack of commensurate IT procurement experience.

A good example of this trend is the legislation introduced recently by Rep. James Lankford (R-Okla.) and Rep. Mike Honda (D-Calif.) -- bipartisan entrepreneur-in-residence legislation that aims to make it easier for entrepreneurs to work with government, and inspire more innovation and better use of technology.  

I assert that procurement tools aplenty exist to enable the procurement process to tame the IT monster.  The issue, however, is a severe shortage of trained or experience IT procurement professionals to break down the requirements of today’s IT monster into manageable, bite-size pieces. In that vein, let me break this discussion down into more manageable pieces.
Many government executives and IT professionals are often heard complaining about the IT monster — there’s either too much, not enough, or its running or ruining life as we know it. On the other hand, most of those same executives are very interested in what they think IT can do for them in solving their business challenges. Think about it: Haven’t we all heard some form of the following statements?
  • IT has become too complex; my contracts shop doesn’t know how to write IT contracts based upon today’s technology!
  • I know we got into this mess (i.e., large number of older/out-of-date/unsupportable systems) by letting each business unit do their own thing; how do we get all of it under control as we try to modernize?
  • Our developer is adequate, but we’re concerned about the quality of their work and the lack of innovation — I’m not sure what to do.
Of course, the challenge we face, thanks to Mr. Moore (of Moore’s Law, who recognized in 1965 how it would grow), is that technology has outpaced our ability to manage it properly. Therefore, we find organizations of all shapes and sizes facing one or many of the following subset of common IT project characteristics:
  • Under-utilized IT capacity and capability
  • Unsupported products and technology
  • Delayed or cancelled IT projects
  • Mismatched expectations for IT projects
  • Poor system performance 
  • Poor user acceptance
  • Under-achievement of business value
  • Declining system health (e.g., reliability)
In these instances, you might need more than the “Geek Squad” to save the day, but most of the remedy lies in the solicitations and contracts we write when we procure the hardware, software and services to feed the IT monster.  
Here’s a simple example based upon concepts of standardization and consolidation.  As City XYZ grew, it invested in separate systems for Human Capital Management, Financial Management and Contract Management. Because they probably seemed like the best decisions at the time, they were made, and each system now runs on different hardware and operating systems. Given the current situation, how should City XYZ’s CIO procure support for these systems? 
Simply put, there are three ways to go: the easy way, the wrong way and the right way.
In this case, the easy and wrong ways are the same —  to continue to compartmentalize the support for these systems allowing them to be unique. The right (or better) way to proceed is to procure support to standardize and consolidate these systems under a single project or contract. There are many reasons why, including: Your support staff model becomes simpler and personnel more proficient (one architecture versus three); you’re using a higher quantity of like hardware and software products, which may enable higher discounts; and resources can now be shared between systems to further reduce costs and improve performance/utilization. Not as simple as the “easy” way, but not beyond the realm of what any contracts shop can produce.
Thankfully, you don’t need to be an expert in IT procurement to produce similar results. After 30 years in this business, I’ve found that a handful of fundamental procurement tenets will help to tame the IT monster. Try these on for size and see what you think:
  • Don’t reinvent the wheel. Why hire somebody to make something when there’s an 80 percent solution available off-the-shelf.
  • Nobody supports Product X better than the original equipment manufacturer (OEM) of Product X. If a product has OEM support available, most of the time it’s the right way to go.
  • Don’t buy technology for technology sake. I know, you saw it at some trade show and can’t get it out of your mind. The smarter move is to contract for the business capability the technology is meant to provide to you and hold the professional system integrator with proven past performance responsible for delivering. 
  • Accountability is key. Make IT decisions for business reasons and hold your IT contractor accountable for delivering that business value.
  • Standardization is key. It’s easier to contract for one order to support 9 standard systems than it is to contract for 9 orders for 9 non-standard systems.
  • Consolidation is almost without limit. There is almost no limit to the size of an IT enterprise, so when it makes sense, consolidate similar capabilities, technologies and values under incrementally larger and larger contracts. Then provide incentives for industry to accomplish what your organic staff couldn’t.
  • Finally, remember (despite my last bullet) there is a limit!  Define your procurement objectives to incrementally face and tackle areas of risk representing obstacles to your success. Ensure increments are valuable, severable and measurable.
With any challenge IT professionals in government face, it’s best not to venture down an IT path without a definition of success.  The most successful IT procurements follow a simple formula: Identify a business need, define success and how you’ll measure it, then carefully communicate and reward that success. Happy hunting!

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