Channel tops Government

Channel tops Government

A new survey of Federal Government agencies suggests channel companies are performing better in government outsourcing deals than a great majority of vendors, telcos and service giants such as EDS, CSC and IBM Global Services.

The Canberra Report, undertaken by research group East and Partners, asked representatives of government agencies about their outsourcing priorities and asked them to rate their satisfaction with their existing suppliers.

Of the many vendors, telcos and service providers put to the customer satisfaction test, Dimension Data/Com Tech came in at the top spot, with local service provider/PC assembler Ipex coming in at number five. Comparatively, large outsourcing specialists such as EDS and IBM Global Services came in at number 13 and 19 respectively.

"We are obviously very pleased," said Michael Grayson, sales director for Dimension Data/Com Tech. "It's exciting to see your name at the top of such a list."

Graham Mann, enterprise services manager at Ipex, said it was particularly gratifying for the Ipex staff working on government contracts to be rated so well for customer satisfaction.

Mann said local IT companies such as Ipex pay a great deal of attention to government contracts because, unlike multinationals, they cannot afford to fall back on opportunities elsewhere if a deal goes wrong.

Mann believes that smaller, local service providers are able to provide greater flexibility - particularly in regards to decision making. He also points out that vendor independence is the ace up Ipex's sleeve when competing with a large multinational service provider. "Ipex has a heritage in integration - we've always focused on sourcing best-of-breed products, and in a way that has bred a culture of vendor independence," he said.

Dimension Data's Grayson agrees that vendor independence is important, but suggests that specialising in the right vendor partners and having the necessary skills in-house for those products is equally important.

Grayson identified Com Tech's people as being integral to the satisfaction of their customers. "It is very different in times like these to be able to boast that you have the same team of high-quality engineers and consultants for several years," he said. "We have very low staff turnover - the guy who developed the network is still there to maintain it 10 years later."

Paul Dowling, principle analyst for East and Partners, hailed the end of the large super-cluster outsourcing deals as the reason for higher levels of customer satisfaction among government agencies.

"There was a strong sense of frustration among many CIOs regarding their inability to engage with smaller domestic suppliers under the old regime," he said. "They recognised that the cost of doing business with government under that regime was huge, and well beyond the capabilities of many of the smaller suppliers they wanted to engage with. They recognised these suppliers had good solutions, but in the past it was difficult for them to buy those solutions."

With the old model abandoned, Dowling expects to see a substantial climb in smaller Australian domestic suppliers working in Canberra.

Mann believes the federal agencies themselves have shown signs of maturation since reviewing their approach to outsourcing technology.

"The first time any organisation outsources, their intent is to make a major saving - which is all well and good and possible," he said. "But often they are seduced by price as though it's the only factor in the decision. They are now starting to take more account of quality - finding balance between the cost of services and the quality of that service.

"The old model of big-scale pyramid contracts were extremely price-driven," said East and Partners' Dowling. "Now that those deals are out the window, the agencies are looking at the right reasons to buy or engage. It is resources like people skills that determine whether a solution works or not - and the technology is almost a given."


1. Com Tech.

2. Computer Associates.

3. NEC.

4. AAPT.

5. IPEX.

6. Advantra.

7. Cisco.

8. CSC.

9. SAP.

10. Compaq.

11. Sun Microsystems.

12. Candle Corporation.

13. EDS.

14. Dell.

15. Gateway.

16. Aspect.

17. Nortel.

18. Oracle.

19. IBM / GSA.

20. Solution 6.

22. Optus.

22. Telstra.

23. Protech Australasia.

24. Microsoft.

25. Unisys.

Source: The Canberra Report, East and Partners.

The most important factors

- Price,

- Responsiveness,

- Performance to contract,

- Commitment to relationship,

- Solution implementation.

Source: The Canberra Report, East and Partners.

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