Short-sighted NZ government software buying

In Firms fear shift in software buying Tom Pullar-Stecker writes:

Government procurement changes make it more likely departments will buy overseas payroll and human resources software despite evidence that it is cheaper to buy locally and the problems caused by the Novopay debacle, an Auckland software firm says.

Things haven’t changed in a generation.

I first wrote about this in 1987.

Since then I’ve repeatedly heard how difficult it is for New Zealand software developers to sell to their own government’s technology purchasers.

Wellington not listening to local software firms

The most ridiculous example I remember is from the mid-1990s.

At the time an Auckland-based company making voice-recognition software had banged on Wellington’s door for years without any success. The managing director told me he simply couldn’t get a hearing while his overseas rivals were getting meetings and winning deals.

Then the company cut a distribution deal with a major international computer company. Suddenly the software started selling to New Zealand government departments. A victory of sorts, even if it had to concede a 30-40 percent margin to the international partner on each deal.

Not good enough with an NZ lable, first rate with a US badge

To add insult to injury that managing director took a call from a government technology manager who told him just how good the NZ-made software was. The managing director told me he had tried for years without success to get a hearing from that department but had been told locally-made software isn’t good enough. This was a company that had sold its products to overseas government departments.

At the time New Zealand developers faced two problems.

• A perception among government buyers overseas-made software is always better than NZ-made software.
• Government buyers would choose fully integrated products and not put their own systems together.

Now, as Pullar-Strecker points out, local developers have to contend with large-scale purchasing geared towards dealing with multinationals and huge corporations not small entrepreneurial companies.

It’s yet another reason New Zealand government may need a technology supremo to oversee all aspects of technology policy.