We recently spoke with Tod Weber, chairman and CEO of Software AG Government Solutions, about the federal government IT market and its approach to purchasing from vendors. After last year’s sequestration and subsequent budget shortfalls, many agencies began implementing a “try it before you buy it” course of action in the IT space. Weber shared tips that federal agencies can use when evaluating IT vendors, as well as an overall take on the market today. Here’s what he had to say:
ModernGov: What is the federal IT marketplace like today?
Tod Weber: It is very exciting. I think even though there has been a lot of uncertainty about the actual amount of dollars federal IT buyers have and how those dollars will be spent, the overall theme over the last year or so, is that agency CIOs have to make better use of IT and do things more productively. They are trying to accomplish many things, and there is a heavy push to look at creating best practices and ways to improve processes and become more productive. Whereas a defense contractor might not receive an order for as many weapons systems as they thought they would, the government still has to operate and look for that efficiency, so it hasn’t hurt the IT department.
MG: Has spending rebounded, or is there still a certain caution about spending?
Weber: We view the federal government as a Fortune 1 entity. They have the largest IT budget in the world, and while I wouldn’t necessarily define it as “cautious,” there is certainly a heightened sense of scrutiny placed on how they buy today. They want to avoid some of the large, massive scale projects of the past where they would commit a billion dollars and not see results for several years. There has been a shift to doing things smarter in terms of the ways they make their decisions to move forward. They aren’t afraid to move down the path, but rather are a lot smarter about how they are moving down the path now.
MG: What can vendors do to help build confidence with their potential buyers?
Weber: We approach our business with a “prove it first and prove it fast” mentality, and this goes back to the idea of validating the solution in the customer’s environment. We believe that is the right approach for any IT manager that is trying to make a decision about a potential vendor. The second piece of “proving it fast” is equally important. To us, you should be able to prove out the concept you are trying to deliver within the agency’s environment in hours, days or a week at the most. This not only proves the technology will work in the environment, but it also gives the agency the chance to get to know the people who will be supporting them. That is an important piece of any IT implementation. Are the people who are going to support the agency going to be there when you need them? What are the skill sets of the people you are bringing in? Ideally, an IT company should have an “install it and run” mentality rather than a “give me money and a year and half from now with a boatload of people, I’ll make it work.” From that standpoint, the government should look for companies that are willing to prove it fast and offer them the chance to really get to know their people.
We also look to make sure there is a real problem that the agency is trying to solve and look at this as an extension of their market survey phase. We propose a short duration stress test of the software, and we are heavily invested in this portion of the process because the nature of our software is fairly complicated; we are connecting lots of systems that don’t naturally talk to each other. We are involved with these proofs of concept for the few days that we are on the ground. We show them how to do it on their premises, which is a very important piece. You don’t want a vendor to look at the problem, go away for four weeks to develop a product and then come and just show you what they did. It is important that it be done onsite, in the environment in which it will be used, with people looking over shoulders. Then you can show them “this is how you start,” “this is how you will install,” “this is how you will configure and deploy.” We are taking away the mystery and the risk. We believe in our software; when we have assessed the problem and think it is a great fit for our technology – why wouldn’t we want to let the customer look at what we are doing?
I also see collaboration as very important during this phase. Sometimes the customer will redirect us a bit. They will ask, “Hey, can you do this?” and we show them how. That will happen a few times, and it will build confidence and credibility. An agency should make it a priority to get to know the trust and integrity of the organization with which they are dealing with and ask, “Did they do what they said they could do?” The agency also needs to have confidence that if there is a problem on Saturday night at midnight, they can call someone and the vendor will be there to help you.
MG: What should government IT buyers look for from vendors when they “try before they buy?”
Weber: First, they should treat the situation as an extension of a market survey – if it gets to be too long, it becomes more of an engagement. Second, make sure the work is done onsite, not at the vendor’s site and then brought to the agency. Third, assess the technology and the people. Fourth, evaluate the trust and integrity of the organization as a whole: Everybody in the IT industry can make a PowerPoint presentation and make claims. Can they back it up? And fifth, and very importantly, find a company that is willing to tell you that they aren’t a good fit for every IT problem in your agency. We operate that way; we don’t try to force a square peg into a round hole. Frankly, the government needs more vendors who operate like that. It will cut out a lot of misalignment of requirements and technologies that lead into massive cost overruns.