Demand for Service Integration and Management (SIAM) in the public sector is clearly growing. In early iterations of the G-Cloud framework, there were hardly any suppliers offering SIAM services listed, whereas a G-Cloud 10 search reveals more than 250 offering a range of SIAM solutions. Assuming that other suppliers, like ourselves, base the services they offer on an identified market need, we can safely say that the demand is out there.
This growth comes despite the GDS blog three years ago titled ‘Knocking down the Towers of SIAM’. However, read the blog carefully and you will see that the author is not criticising SIAM. He is critical of the Tower model, in which individual services are separately sourced, usually from specialist suppliers, and then the integration and co-ordination between each ‘tower’ is managed by the SIAM service. Examples of ‘towers’ are end user computing; networks; and application hosting and management. The main criticism of the model was that it can create a situation where a customer buys a number of incompatible parts and then asks a SIAM provider to integrate them and make the result work.
Despite this criticism, we know from working with many government departments that the Tower model is still used. In my experience it still has value in certain circumstances, as long as it is done well, and the customer retains independent expertise to manage services. SIAM is the key to making it work – provided that service integration and management is considered from the beginning of the project. This can be carried out either by the department themselves or by an experienced SIAM provider.
Let’s look at where the Tower model, or something like it, can be beneficial. It arose with the end of large outsourcing contracts, which gave public sector customers more visibility into the supply chains of specialist suppliers that were previously hidden by the prime contractors and whose services were usually significantly marked up by those contractors. Customers can now source these individual elements of their IT service from multiple, best of breed suppliers, provided that they manage the framework, processes and governance to integrate the individual pieces into seamless end-to-end services.
There are many advantages to this way of doing things. Smaller companies can bid directly for individual packages of work, knowing that their bid will be considered on the basis of their skills, experience and price, without the hefty mark-up previously imposed by prime contractors. This, after all, was the key aim of frameworks such as G-Cloud and Digital Outcomes and Services (DOS), which were designed to enable the public sector to benefit from the creativity and agility of SMEs while reducing procurement costs.
Departments can spread the risk of supplier lock in and dependency through using different suppliers for individual services, obtain greater transparency of each service component, and choose the best solution for their needs based on individual elements rather than a ‘black box’ solution put together by a third party. This should enable them to get better results, and ultimately provide the public with better services.
For SMEs, the change enables them to bid directly for public sector contracts appropriate to their specific skills and the size of their team. It also reduces the risk for both the customer and the supplier of having to take on contracts where they are responsible for unfamiliar third parties or are too large in proportion to their size and financial capabilities. Another advantage for SME suppliers is that they no longer need to reduce their costs to an unprofitable level to allow for the main contractor mark-up. SMEs can now bid competitively on their own terms.
The downside to the Tower model is that the different elements need to be integrated and managed to provide the overall IT service. There needs to be clear responsibility for end to end service level management and architecture. Between the Tower suppliers there needs to be mapping of interdependencies, and common, cross-tower processes need to be agreed and adhered to.
Under the Tower model the customer ideally needs to develop and implement their own in-house SIAM expertise, which demands the ability to manage multiple supplier relationships. Alternatively, they may decide outsource to an overall SIAM provider, although this can look like a reversion to the prime contractor model that the model was created to address. In our experience, this can be a good idea but can be ruined by bad execution. A simplistic analogy is cleaning your house: you can either choose to do it yourself or buy in cleaning services. If the latter, you want to be sure that the provider knows what they’re doing and won’t ruin your bespoke kitchen worktops.
In appropriate circumstances we believe the Tower model still has a useful role to play. Whether public sector organisations continue to use it, or choose a different model of service provision, the need for SIAM expertise will continue. With the migration to cloud services, which by their definition will not always natively integrate, we believe it will grow. If public sector organisations are to get the best from SMEs and create optimised IT services by combining solutions from multiple providers, they need to ensure that integration and management is addressed. Whether they choose to develop the expertise in-house or buy it in is up to them, but getting SIAM right is vital if we are to have effective public sector IT services.
Richard Blanford is managing director at Fordway