Report casts unfair clouds on public-sector procurement: a recent report on improving public-sector procurement practices had one problem--failing to consider how the technology sector could improve, as well.

• Author: Roque, Rob
• Position: Technology Forum

A consortium of companies and state and local governments recently completed a study that made recommendations for public-sector procurement practices. (1) Although the study, commissioned by the Center for Digital Technologies, emphasized collaboration, its underlying message was clear: Standard public-sector procurement practices are not generally friendly to cloud service providers. The study concluded with recommendations for contract improvements that could accommodate public-sector and private-sector requirements simultaneously. The recommendations were fair --except for their failure to consider how the technology sector could improve, as well.

To clarify, the report makes recommendations that are good and to the point. Some standard procurement language is potentially problematic; for example, asking the vendor to accept unlimited liability isn't standard in the technology industry. On the other hand, the report presumes that it is fine for service providers to charge premium prices for services that are as yet unproven.

The world, including the public sector, is moving toward the cloud. According to a Gartner survey highlighted in Forbes, more than 40 percent of organizations in all sectors will be using some type of cloud service by 2016. (2) The public sector is expected to adopt cloud services at approximately half that rate (23 percent) within the same timeframe, although this will likely increase as employee expectations change and the Internet of Things (3) becomes more pervasive in the public-sector workspace. (4) The limited amount of technology currently available for highly specialized public-sector functions, combined with and the sector's inability to quickly migrate from legacy applications, are seen as the main reasons the public sector has been slower to adopt alternative technologies, as compared to other industries. Another root cause the report identifies slow progress in merging the public sector's sector procurement, technology offering, and financial due diligence needs.

THE ISSUE

The public sector continues to use procurement practices that frustrate technology vendors. The three main concerns cloud solution providers express are: including functional requirements in request for proposals, using software demonstration scripts during the software evaluation process, and requiring vendors to submit proposed costs. Vendors argue that these approaches do not highlight the convenience, scalability, and opportunity that cloud solutions offer to their customers.

Because of the differences among cloud service functions, cloud providers claim that following the traditional procurement process puts them at a disadvantage. Vendors argue...