In a market characterised by rapid and significant change, it’s important suppliers understand the new environment for their clients, and how this will impact their future requirements.
Intermedium’s research shows there was a slowdown in the value of Federal Government ICT contracts during 2007-08 of around 18%.
The coincidence of a number of factors (change of Government, Gershon and other reviews, general budget cuts) has significantly impacted almost all sectors of the market.
Agencies are undergoing massive change as they adapt to this new environment. It is clear for example, if the Gershon recommendations are implemented, resulting changes will herald a new government ICT marketplace. Suppliers, in particular, need to understand early what this means to their future business, and start positioning themselves.
Leverage the investment in your government sales staff
In a contracting market, most suppliers will need to do more with less to grow revenue without adding to their cost base.
It’s important client-facing staff have a detailed understanding of all aspects of the market. They must be able to speak knowledgeably with clients about a wide range of issues impacting their clients:
Gershon Report recommendations
- Cuts to BAU funding
- Reductions in contract staff
- Whole-of-government governance arrangements
- Cooperative procurement
- Strategic management of key suppliers and codes of practice
- More business focus to ICT
- New standards and procedure
- Increased monitoring and evaluation of ICT project
- Co-ordinated procurement contracting and volume sourcing arrangements
- New Commonwealth Procurement Guidelines
- Changing role of CIOs
- Additional 2% efficiency dividend
- Machinery of Government changes following the election
Consolidate client relationships
Relationship is currency in a lean market. As agencies face reduced budgets and significant policy changes, it will be your ability to respond to their changing needs that will drive success.
- What’s likely to be going through the mind of the CIO in your key client agencies?
- How should you approach dialogue during this time?
- What does the agency expect from a trusted supplier in this environment?
- Have you revised your value proposition to take account of the changing environment?
- Will there be changes to the tender process?