Public Sector: Banning failed suppliers

 As a result of the Fujitsu/Horizon/Post Office scandal coming to wider public attention there have been a lot of questions about why the government has not banned them from future contracts.  Some people have alleged all sorts of reasons included stating that it was not possible to ban them.

The reality is a bit more complex.  Firstly, the contract would have been awarded under the regulations in place in 1999, and to be honest I am not sure what they would allow in terms of banning suppliers.

Secondly, until now despite the clear and obvious problems that have been known for 25 years, at no point has the contract with Fujitsu  been terminated, nor as far as I am aware have damages been sought.  The principle up until now has been that the IT system was perfect, and the post masters were the ones in the wrong - a principle that was wrong from the start.  (David Allen Green has a good blog discussion of this).  So, as far as the government was concerned there was no grounds for banning Fujitsu because they had done nothing wrong (I know - not the reality).

Next, it is very likely that time had run out on both warrantees and the rights to claim damages for non-performance (and remember, until now as far as the Post Office and government were concerned there was no non-performance to challenge - they blamed the Post Masters).

So, what other avenues are there.  Well in the Public Contract Regulations 2015 there are provisions for Discretionary Exclusions of companies who fail significantly in a material element of a relevant contract - fuller details are in these PPNs here and here.

The relevant text is :"In particular, an economic operator (i.e. company) may be excluded if it has shown significant or persistent deficiencies in the performance of a substantive requirement under a prior public contract, a prior contract with a contracting entity or a prior concession contract which led to early termination of that prior contract, damages or other comparable sanctions."

But remember again, until now the contract was NOT seen to have significant of persistent deficiencies.  Difficult to believe when Computer Weekly first raised it in 2009 (and have stuck at the story to their credit).

But IF the contract were terminated and/or damages sought then Fujitsu COULD be barred from bidding for futures similar contracts at the Selection Questionnaire stage.

The new Procurement Act 2023, which starts in October 2024 looks to give the government more powers (which of course they have to choose to utilise).  Under the PA2023 the government not only has similar powers to exclude failing suppliers from the bidding process, but also the ability to debar suppliers for a period of 5 years if so authorised by a Minister of the Crown (and after representations from the supplier).  Lots of legal discussion of this - here is one.

Sounds like a step in the right direction to me, though there is some concern this is a lack of clarity , and it will be a brave Minister who is the first to invoke it. 

(Incidentally there is a growing trend for government communications about such matters to be written as party political publicity, which is both annoying and worrying.  It is the same path previously reputable newspapers went down when they became unable to separate truth and opinion. It damages our democracy).

Anyway, the key point is that Fujitsu were not made liable for their failings and consequently it is rather difficult to see how they can be punished.  They could voluntarily step away from UK government contracts for a while (though a recent conversation with a delegate suggests they are not doing so) as one consultancy did after they upset Prime Minister Theresa May through a leak.  I am decidedly against that - it is corruption to step away from contracts to curry favour with politicians.  Much better for us to properly manage our contracts, be brave enough to admit when they are not working, and use the powers the regulations are (belatedly) granting.

Supply Chain disruption

 Brilliant article in the FT about the supply chain disruptions in the ICT chip manufacturing process.

Sadly, with no easy answers - apart from national (or even regional) self-reliance is not going to work.

Which many politicians will not want to hear (in many countries).

Quite a few business leaders seem very reluctant to hear that things are (necessarily) complicated and will remain so.  In particular in my old stomping ground (the chemicals industry) people find it difficult to process that the usual economic rules do not always apply.  Just because something is profitable and in demand does not mean that competitors will come into the market.  If a profitable product ceases production (e.g. as a result of an industrial incident) it does not follow that other businesses will make it (or that the original manufacturer will build a replacement plant).  There are complexities about risk, availability, production processes, regulations etc. that all need to be understood.  But if you are a customer you are likely to think "well why aren't they doing it?".

Good procurement personnel need to know and understand these complexities (obviously not at granular detail) in order to fully understand the supply chain risks.

In the pre-covid and pre-Brexit times when things were working smoothly, Lean supply chains seemed to be the answer.  At the moment we are all considering Resilient supply chains.  But nothing is ever quite simple, and neither approach is simply good or bad.

Interesting times ahead

Hacking

With all the recent shenanigans about political hacking of e-mails and servers, and the recent introduction of the UK's rather strong surveillance law, it is possible to forget that commercial entities are also the subject of continual cyberattack.

News today is that the Kingdom of Saudia Arabia is reporting the re-emergence of a virus that caused massive problems at Saudi Aramco in 2012.  This created a large amount of damage, and the rest of the world paid more for its hard drives as a result (a spike in demand leading to a spike in prices).  For the first time that I know of a second country and oil company has been identified as suffering in that first attack, and that fits with what I have heard.

Meanwhile, ransomware is becoming more prevalent with even public authorities having to pay up to get their data back.

So, a reminder.  Back up your hard drives.  Do it now.  Go on.  Have a coffee and do a backup.  Then detach that backup from your system and do another.  You might thank me later.

Digital and Marketing Mixer 21st March 2013

The Connecting Manufacturing event at the Shay in Halifax was a big success, and we are following it up with a Digital and Marketing industries mixer at the same venue on Thursday 21st March 2013.  See the flier below.

Knowledge Transfer Networks

Bradford University School of Management

These workshops are free and are delivered by the Knowledge Transfer Network@Calderdale and are part of the Business Growth Calderdale programme, part financed by the European Union. The project has attracted £1.1 million from the Yorkshire and Humber European Regional Development Fund (ERDF) Programme 2007-2013.

The Digital and Marketing Mixer

21^st March at the Shay stadium in Halifax.

Registration for delegates will start at about 8.45am and the event will run through to 12.30pm

If you are having difficulty with strategy and marketing; sales or brand; if web and e-commerce are hanging like a weight around your neck. This is your chance to ask the daft questions, get some guidance and search for some solutions all in one neat bundle.

The ‘Digital and Marketing Mixer’ event on the 21^st March at the Shay stadium in Halifax. It will run 9.00 a.m. though until 12.30. Registration for delegates will start at about 8.45am.

It will be pretty fluid on the day but it would be helpful if you could indicate what your interest at the event might be:

·        Look for collaborations (some indication of specialist areas or skills you might be looking to link with)

·        Question an expert panel about a digital or marketing related topics (half an hour)

·        Air a problem in an advice clinic and get some concise advice (15minutes or so)!

·        Look for suppliers and customers

·        Listen to some development presentations (presentations will focus on sales, social media and PR).

There are no costs or fees for attendees as it’s fully supported by the European Regional Development Fund and by Calderdale Council under the Business Growth Calderdale initiative. It doesn’t matter if you come from outside Calderdale you can still attend.

The idea is to bring together lots of marketing, e-commerce, applications, software, PR and design businesses in one place to show the strength of the region and to create some opportunities to build partnerships and strategic alliances and get some business done.

If you want to register for the event please reply to ktnetwork@bradford.ac.uk in the first instance by email and we will get someone to contact you.

Thanks and hopefully see you soon.

I am not a Spambot

Idly writing a comment on another blog (I have 2 books, 2 presentations, one course, and a marketing document to write so of course I am commenting on other blogs!) and had to prove I am not a robot by filling in Capatcha.

Recently I have struggled to buy things online because of Internet Banking Security (I didn't notice I had caps lock on, and ended up blocking my card), and at an ePOS machine (didn't have my glasses on so didn't realise until too late that I was using the wrong one of 2 nearly identical cards).

It makes me wonder how long it will be before the Spam and Hacking bots are better at getting through Internet security than the average person. And then what are we going to do?

(The first person to say I am getting old will be correct)

The Demise of HMV

Nothing could save HMV - the future (for good or ill) is digital downloads.  All HMV, Waterstones and Blockbusters can hope to do is manage the decline down to a niche of collectors who actually like the physical objects. 
If you accept that what we want is the music/film/words, then CDs/DVDs/Books are just the media and shops selling them are doomed.

Actually doomed is the wrong word.  It suggests something that is going to happen, when it already has.

Myself, I used to love shops - but I don't need or use them now apart from to find things to download.  It's part of what killed the Word, you know... my favourite magazine apart from the Economist, which incidentally I now read exclusively in an electronic version.  The paper copy goes into the bin each weekend, because it arrives after I have already read much of the newpaper.

This change may be a good thing or a bad thing, but it is here and no doubt people will continue to talk about it until our generation(s) shuffle off this mortal coil.  But the younger generations will struggle to understand why we are nostalgic.  Why worry about something being replaced by something that gives you what you want quicker (and cheaper, with more choice)?

Interesting article about this from their marketing agency here, which lead me to think about the book How the Mighty Fall by Jim Collins.

In business you need to worry about this sort of thing if you intend to still be in business in say 20 years.  Will we need taxis if we have self-driving cars?  (yes, until the drink driving rules change, but after that?)  Will we need lorry drivers?

I think my core businesses of trainer and consultant are safe for my working life time (30 years at most), but I would not like to bet that they will be in 50 years.  How about your job?

Are there really opportunities for SMES in the public sector?

I've written before about the unresolved conflict at the heart of goverment procurement policy - the need to save money and the desire to inolve more SMEs.   It was always likely that for all the rhetoric, money would speak loudest, and government departments would look for savings by aggregating requirements rather than look to the longer term game of stimulating competition.

A couple of other blogs today have provided examples - my friends at Government Opportunities are pointing out that one of the Government's own working groups (on ICT) is saying that things are going backwards - see here.

Meanwhile over at Bdaily, they report on the North East Chambers of Commerce calling for the National Procurement Framework for construction to be scrapped because it would disadvantage North East firms without national reach - see here.

These issues get to the heart of the public sector dilemma - if Britain were a private company it would be able to focus on getting the best quality at the lowest price.  Public Sector procurement always has a broader dimension.  Realistically it always it will.  You can call for all decisions to be made purely on a commercial basis, but the Bombardier issue shows that people (and the media) are not happy with that approach.  And what Politician is going to willingly give up the lever of using public funds to create jobs (and votes) for their constitency?

It is always going to be a difficult balance, and we should expect Politicians of all flavours to tailor their proposals to their audience - even if it leads to inconsistency.  I expect cash savings to dominate for at least another year or two, and then as the clamour for action rises, the policy to be revamped to favour the broader agenda - just in time for the next election.

Backup

Just over a week ago my laptop started giving me warning messages saying that a fatal drive crash was imminent.  I talked to Dell who started walking me through diagnostics, and then quickly stopped listening to the diagnostics and started arranging for a new hard disk drive.   It arrived on Monday, and now (late on Friday afternoon) I think I am about done with installing software and restoring it to where it was.  Oh, and extending my warranty just in case.

I was able to carry on working on other computers, and because as soon as I got the error messages I backed everything up to an external drive.  Which I copy to another external drive, and store each in different buildings - though if the whole town blows up I am in trouble.

I know it is a cliche, but really - if you haven't backed up recently, do it now.  That is now!  The interuption to your business could be fatal.
One thing I use that helps is Dropbox - see here.  This is a free web based utility that makes it easy to sync files between computers, and your phone.  It also acts as a backup for your documents, so you don't lose them if your HDD crashes.  There is a paid for service, and it used to be that I could get more free space if I invited you to join, but really this is a public service announcement not an advert.

Back up now.  Just in case.

PAWA Consulting Facebook Page

PAWA Consulting Ltd. now has a Facebook page - see here.

Currently there are no plans to use this extensively, but rapidly changing information about courses may be posted there as well as at this site.

Timeline of the future

As the great Yogi Berra said “it’s very difficult to make predictions – especially about the future”. However that does not mean that we should not try to. It can help to shape our business strategy, protect us from shock changes, and besides it can be great fun.

Myers Briggs personality profiles suggest that only 20% of are mainly focussed on the future – 40% are focussed on what we learn from the past, and 40% on the here and now. That is pretty much what you would expect from human beings who evolved in the Savannah - too much dreaming of what might be is not much help in escaping lions, and in fact it might get you eaten.

The same applies in business – not learning from the past, and not focussing on the immediate threats are fatal for businesses. However there is always a need for at least a few people in a business to keep scanning the horizons, and thinking about how things change.

The old metaphor about boiling a frog is appropriate for our attitude to change. Today the internet is pervasive in our society – and most of us forget that a matter of a decade ago it barely existed. Most of us have mobile phones, and we have forgotten what we did before them. Films from the 1990s can feel strangely dated when the central problem could be easily solved in the characters had mobile phones, let alone Facebook, Twitter and LinkedIn.

This makes it difficult for us to think about some of the major changes that can happen to our industry. The rise of 3D printers, which seems like a science fiction technology but is being used in aerospace, changes a lot of our ideas about manufacturing (see The Economist). The internet is of course changing other industries, and in some cases making them redundant – I can’t believe there is a major future in printing yellow pages telephone directories or CD pressing plants.

So what industries will remain unchanged?

Well haulage and distribution will still be essential to move some goods around – despite 3D printers, we are still likely to need to move chemicals and similar raw materials. However it may change significantly within a generation to include much better IT based planning and even more significantly robot driven lorries (it is on the way, trust me).

Television, if we continue to call it that, will probably merge with the web, and be shown on the sort of printed electronics paper thin screens that I have mentioned before.

My industry, consulting and training, will no doubt be changed by intelligent systems and training on demand media. I think though that will always be people who prefer to engage with (flawed) individuals rather than a (perfect) computer database.

Health is changing massively – our life expectancy rises by about 3 months every year. Think about that. The consequences are massive – and not just for pensions. This is a societal change that we don’t notice happening even though it is happening rapidly. Partly this is because medicine is advancing so fast – people live who would have died a decade ago, and people are born who would not have existed 30 years ago (including my children).

Prof. Bryan Cox in his Wonders of the Universe TV programme has reminded us that planet earth will one day be destroyed by the sun. Luckily that will be in about 6 billion years, so no need for us to worry just yet.

Trying to think on that timescale can be fun – when you think that human beings have only been around for less than a hundred thousand years. Will people in the year 3011 even be recognisable to us as people? A website providing a timeline of the future can be a way of stimulating thinking, and broadening our horizons (click here) – as can thinking about the Clock of the Long Now (see the picture for the prototype). I don’t agree with all of their projections (some I think will happen much quicker, others not at all) but that is not the point. It won’t tell you what will happen to your industry next month, or even next year, but it does help us stop thinking that the future will be just like the past.

Your Flat screen is fat

I recently attended an event organised by Chemicals NorthWest on Printable electronics. You may not have heard much about this emerging technology, but it is going to change a lot of the world around us. The sector covers quite a broad range of activities, but the key factor is (as you might expect) electronic components that can be printed on surfaces in a similar way to printing newspapers on paper. Or perhaps slightly closer, printed wallpaper.
There are a myriad of related issues and concepts, such as organic polymer batteries, light sources and the like, but essentially when this technology comes through we can expect to have our televisions as wallpaper in our living rooms – or potentially on the windows. And our energy produced by thin films of photocells on our roof or any other surface (flat or not)

One of the nice things about this is that it is an area where British companies are in with a good chance of establishing a strong position. This is a disruptive technology, so all the companies trying to develop it are pretty much starting from the same position. Ultimately the devices might be assembled in the far east, which is a shame for UK manufacturing, but the real money could be in the design and manufacture of raw materials and components, and the use of design of the end product. In these areas UK businesses are well placed.
Although I was aware of the technology, I was not aware of how advanced it is until this conference. We were shown a Sony OLED TV – which had better colours than most HD TVs, and was at most half the thickness of an IPod. And this dates from about 3 years ago.
The world will look more like Minority Reports than many of us expected, and it will be with us far sooner than I expected. This is expected to be a market worth hundreds of Billions by the end of the decade.
Of course, at the moment it is all quite staggeringly expensive – but that can change over time. And with it will come an even more futuristic world than we can imagine. Of course, when it does arrive we will take it for granted in about six months.
The opportunities for British business are significant. Dr. Chris Drew of Soris compared the state of this industry to that of pharmaceuticals in the 1950s – fast paced, very high specifications, very technical, great potential, still largely undeveloped. The UK was able to take advantage of that – let’s hope we can do the same again.

Business of Social Media

At the SME Conference North West on Thursday, we had a very interesting presentation from Chi Chi Ekweozor of realfresh.tv in Manchester about the increasing use of social media in business. At the end of that I asked the audience, mainly smes, how many of them used various social media. Bearing in mind that it is a bit difficult to be accurate counting hands when you are standing at a podium chairing a conference, I think the split was roughly;
- had a website - 90%
- had a blog 40%
- used Twitter 30% (that is just a few fewer hands than for a blog).

I found that very interesting. Like many people of my generation I find Twitter somewhat alien, and struggle to find a business purpose apart from customer service. A Blog I can understand more as a sort of informal newsletter. What this showed me is that Twitter use is already higher than I imagined, and there is a possibility that it is already more imbedded in business than is clear to the late majority/laggards of the business world.

Certainly it makes me think again about the use of Twitter. And I think you should too.

I am wondering about Twitter as an interactive tool. Would it have been useful to have had a Twitter feed at the conference? Could we have got feedback on what was going well, what was overstaying its welcome? (nothing I think, but how to be sure). Could I have taken questions that way? What about use in training courses?

Twittering Meetings

I was talking to a colleague who described a recent meeting between two rather traditional multi-national organisations. On the face of it there was an imbalance in the meeting between the host company who had 6 people in the meeting, and the visitor who only had 4. You would expect therefore that, allowing for individual skill and experience levels, that the hosts would be in the stronger position – being in their own offices and having greater resources available.

In fact the opposite applied. The reason? The visitors were live twitter feeding the meeting back to their colleagues in offices across Europe. So while the hosts were drawing on the 6 people in the room, the visitors were able to draw the experience and knowledge of about 20 people all across Europe.

Now, there are a number of issues raised by this. One is a certain level of politeness, because while the hosts were talking the visitors were busy tapping away on Blackberries sharing information with other people (and no doubt doing other things). This could certainly be seen as rude. But then again I am of a certain generation, and I am told that to people in their 20s this is actually perfectly normal. There is also a question of whether the visitors were paying due attention to the discussion going on around them while they fiddled with their technology.

Another issue is about security, and whether confidential information about a high level meeting was accessible to third parties if they were in some way able to access the feed. An important issue, but one that is increasingly common anyway as use of ICT becomes ever more prevalent.

Certainly the consequence of the meeting was that the visitors were able to draw on evidence not actually available to the people in the room, and were able to have suggestions and ideas tested live by a wide community of people who would be effected by the decisions. In previous times, the decisions would have been made in the room, carved in tablets of stone (or at least memos), and then distributed to the masses. Now the people involved could have an input and course correct the meeting as it happened, without having to take time out from their daily activities. As a result, not only will the decisions made be more robust and tested, they are also more likely to be implemented because the people delivering them have been involved in their construction. Action started the moment the meeting wrapped up, rather than sometime after the minutes were written, circulated and then forced through by the project leader.

Now this is in a staid, traditional industry – not media, ICT or creative industries. As my colleague said, one party was in the 1980s, one party was in the 21st century. There are issues to be worked out, but I think we are going to see a lot more of this style of working. Of course one of the drawbacks is that only the people in the room were able to go on the post meeting celebratory bar crawl….