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Backing Our Industry

Backing Our Industry

What message does it send to local small to medium enterprises (SMEs) when a second-tier UK company wins a major government contract in the Australian market that those local SMEs would kill for? That was the outcome when the Department of Public Works and Services (NSW) announced the successful consortium to build its e-procurement e-marketplace recently.

Again: how much hope can local players realistically have of getting Australian government purchasing muscle onside to help build their business when a recent Australian National Audit Office's (ANAO's) audit of IBM Global Services Australia's (IBM GSA's) performance within its Department of Veterans' Affairs (DVA) IT outsourcing contract shows SMEs scored just 2.5 per cent of the contract's value? How much salt does it add to the wounds to find that although it was asked, IBM GSA didn't even bother reporting on levels of SMEs' participation in the DVA contract?

Governments can play a useful role in fostering IT innovation and driving development of indigenous companies - the massive purchasing power they have to play with makes it so. The question is how far should they go in pulling the strings, having recognised the potential importance of the information industries to our nation's prosperity? Is it enough to get the regulatory settings right and leave the rest to industry, or can government intervene to give local industries a leg-up? Should the government use its massive purchasing power to assist Australian SMEs or buy goods and services from multinationals in the interest of the Budget bottom line?

Interestingly, journalist David Braue's report on Industry Development, included in these pages, arrived on my desk the day The Australian was reporting Indian technology companies were pushing to increase their share of Australian government sector work. The newspaper opined that the move was likely to put even more pressure on Australia's IT sector, where thousands of home-grown IT professionals are struggling to find work.

Clearly government has an important role in fostering innovation and driving adoption of smart business practices. Yet CIOs keen to play their part in promoting that role know that those goals can conflict with other priorities, like mitigating risk, achieving maximum ROI and ensuring partners and suppliers are stable and the contracts they have with them easily managed. It's a delicate balancing act, but one all government CIOs must engage in, to the best of their ability.

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More about Australian National Audit OfficeAustralian National Audit OfficeGSA GroupIBM AustraliaIBM GSANational Audit Office

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