ICT capabilities in strong demand within government despite pandemic

While many businesses have suffered through 2020/21 because of the pandemic, the ICT industry is going through a growth phase – which shows no sign of letting up.

As a result of an increasingly more complex digital environment and the growth of dispersed workforces, digital transformation and cloud technology have had a profound impact on all businesses.

Digital transformation, whether by a government mandate or pressure to remain agile and competitive, has become a strategic imperative for the Australian Government and represents an excellent opportunity for ICT businesses to scale in line with demand.

The opportunity to grow your ICT businesses is further enhanced by a lack of foreign workforce (due to overseas travel restrictions) available to take on in-house roles and the high demand from Government and private businesses to adapt to a remote working environment during a significant skills shortage. For ICT businesses, the world is your oyster right now.

For SME businesses, which may have previously struggled to compete against larger organisations for contracts, there is a unique opportunity to grow your business to meet demand.

The Government has simplified its process for ICT sellers to tender for contracts for digital products and services with the creation and capability expansion of the Digital Transformation Agency (DTA). The DTA provides strategic leadership on whole-of-government and shared ICT and digital services, including sourcing and capability development. It also oversees ICT and digital investments, assurance policy and framework, and the whole-of-government digital portfolio.

Until recently, small businesses were less inclined to tender for projects because of the Government’s onerous payment terms, which impacted cash flow. But since the end of 2019 Federal Government introduced a policy where businesses billing for less than $1 million were entitled to claim interest if they were not paid within five days. It strongly encouraged the states to follow suit.

The NSW Government has introduced faster payment terms for eligible small business suppliers – undertaking to pay them within five days (instead of 20).

In Victoria, the State Government’s payment terms are ten business days.

In Queensland, payment terms are 20 business days for small businesses, with interest payable on late payments.

In WA, the payment terms are 20 days for invoices under $1 million, including works and construction contracts.

The Government has also made it much easier to tender with federal and state-based pre-approval processes modified for smaller businesses. The Digital Marketplace facilitates government agencies and digital experts doing business together. It comprises a procurement panel which is compatible with Commonwealth Procurement Rules and promotes opportunities through a seller catalogue of government opportunities. To date, it has contracted $3.53 billion worth of projects, with 70 per cent of them being awarded to SMEs.

In March 2021, The Digital Transformation Agency was the leading government buyer with 35 opportunities, with software engineering and development the most sought after category by far. Other ICT specialities required include: Agile delivery and governance, support and operations, cybersecurity, strategy and policy, user research and design, change and transformation and ICT systems delivery, among other skills.

In short, business is booming for ICT right now.

For many small businesses, now is the perfect time to consider scaling your business to meet demand, whether through organic growth or mergers or acquisitions with complementary companies..

A business adviser can work with ICT businesses to understand strengths, growth strategy, sales and marketing, and the M&A process to facilitate seamless growth to meet the ever-growing demand for ICT services. Mackay Goodwin’s business advisory arm has several ICT specialists able to work with your business and take advantage of the growing need for tech expertise across Government and private sectors.

To arrange an obligation-free appointment, contact Michael Bogue on (02) 9220 7107.