Government departments can improve competitiveness in procurement by increasing use of open source software in an increasingly commoditised IT market, according to Tariq Rashid, head of IT reform at the Cabinet Office.
Speaking at the Open Gov Summit 2013, Rashid said that government organisations are now becoming more accepting of open source software in business critical applications. However more can be done to free departments from a culture of lock-in that has prevailed in many contracts in the past by seeking out open source alternatives.
“Standardising on products or standardising on suppliers is the wrong thing to do for IT elements which are commoditised,” he said. “You lose your power as a customer, and you get yourself into a situation where you are effectively dominated by a product or supplier. You are missing out on the fierce competitive dynamics of the market at that end.”
Many elements of IT such as virtualisation, email or intranet systems no longer have substantial differentiation among suppliers, he said, and this means that the customer has more power to demand the most beneficial terms, and is free to pick and choose just as a high street shopper is able to do with any other widely available item.
The said that this increase of choice on the buyer side is buoyed by the wide range of open source software that is now available.
“Open alternatives enable new suppliers to enter the market with relatively little fuss. This allows the customer to have a choice in buying roughly equivalent items in the market,” he said. “Open source helps drive IT in that direction, and we must recognise that, because that is ultimately where we want to be buying from.”
Although there are certain systems such as ERP or HR infrastructure which are ubiquitous but not commoditised due to a lack of wide choice, Rashid pointed out, for the most part departments should be putting more consideration into what elements of their business are relying on commoditised systems. They should be particularly aware that just because a certain application is unique - such as building planning or ambulance routing application - it does not mean that the underlying hardware and software cannot be built on cheaper infrastructure.
“It is worth taking these systems and looking at the services you do operate or plan to operate, and saying ‘Can we compose this in terms of more commodity items?’
“We sometimes have to get over ‘we are special, no one else is doing an ambulance routing application that we do’. Yes, your service might be unique at a high level, but underneath that pyramid that you built it on, it can almost entirely be built on commodity IT elements.”
Rashid added that departments need to take a longer term view to the services that they procure, and avoid the temptation to agree to additional services that are offered by suppliers which are likely to lead to lock-in.
“Some of us have got into the mode of delivering IT projects, and then saying job done. But actually we need to shift our view beyond the point of purchase, beyond the point of deployment, and think what is this IT investment doing to my landscape? What is the implication of it in terms of the value it gives me a year or five years down the stream?
He added: “We have to recognise that you only have value in engaging with the market if you can sustain your choice, and sustain your customer power and competitive tension over your suppliers, not over the point of purchase but beyond.”