AUTUMN 2025 DIGITAL - Flipbook - Page 23
CENTRAL GOVERNMENT
While governments can’t afford to mimic the startup model entirely nor should it with the margin for error far narrower - what they can and
should do, argues Dr Jon Rimmer, Chief Experience Of昀椀cer at Mercator
Digital, is borrow key traits to improve innovation.
Right now, governments are
under a huge amount of pressure
to match the pace of innovation seen in the startup world;
whether that’s rolling out new
tech, delivering more responsive
public services, or making decisions more quickly.
But the comparison only goes
so far. Unlike startups, governments operate under intense
public scrutiny, face strict
accountability for every penny
spent, and have to work through
any political fallout if things go
wrong.
That in itself is a huge challenge, not least because innovation, by nature, involves risk and
even a degree of failure (as many
as 90% of startups fail). Add to
this the high-stakes world of government digital transformation
- where services must be secure,
scalable, and citizen-focused
- and it’s easy to understand
why governments look to big,
established systems integrators
(SIs) to handle their tech projects.
The problem, however, is that the
traditional delivery models commonly used here often carry the
weight of hierarchy and red tape,
stalling innovation.
Take the NHS Test and Trace
(NHST&T) initiative as a key
example. While much of the
underlying technology needed to
make the system work already
existed, complex structures and
layers of approval slowed progress and huge costs. Large SIs
were awarded major multi-million
pound contracts, often with minimal competition.
Despite this, and a total budget
that ended up rising to some £37
billion over two years, the project
ended up seeing a series of welldocumented setbacks. Meg Hillier
MP, Chair of the Public Accounts
Committee, said: “Despite the
unimaginable resources thrown
at this project, Test and Trace
cannot point to a measurable
difference to the progress of the
pandemic, and the promise on
which this huge expense was
justi昀椀ed - avoiding another lockdown – has been broken, twice.”
It highlights a clear challenge: a
default to large SIs and complex
hierarchical delivery models, even
in cases where smaller, more
agile innovators might have delivered faster, cheaper and more
responsively.
What needs to change
With examples like Track and
Trace still fresh in the public’s
memory, and digital transformation now central to public sector
reform, partnering with SMEs
directly or borrowing the startupstyle way of thinking could offer a
solution. Here’s why:
• SMEs often compete for
government work on merit, not
legacy relationships, which
makes them hungry to prove
themselves
• Many embrace open-source
technologies and reusable
components, aligning with
Government Digital Service
(GDS) principles around
interoperability and avoiding
vendor lock-in
• Lower overheads and leaner
teams mean they typically
offer better value for wellde昀椀ned projects
• SMEs thrive on speed,
unburdened by layers of
internal governance, which is
perfect for a digital
environment that
favours test-and-learn
approaches and agile delivery
• Often founder-led or
comprising smaller teams,
working with SMEs tends to
result in close-knit, more
personal relationships with
senior experts (such as AI and
data analytics, user research,
service design, or legacy
system integration). Here,
issues are spotted early, ideas
昀氀ow freely, and decisions get
made fast.
Despite their strengths, SMEs
still often face hurdles when
working with governments, from
complex procurement processes and large-scale delivery
expectations, to tight security
requirements. As such, the right
commercial support - frameworks
like G-Cloud or Digital Outcomes
and Specialists (DOS) - must be
considered by government teams.
The key is to design delivery
models that support learning (not
perfection) and that 昀椀t the project,
not the other way around.
It’s also wise to use SMEs
for discovery phases, quickturnaround services, or specialist
components of larger programmes. Or better yet, design
workstreams that allow them to
lead. From there, you can expand
on what’s proven to work, which
is a much easier way to secure
buy-in within the government.
And 昀椀nally, even if not working
directly with an SME, governments can take a leaf out of their
playbook by empowering their
own internal teams and giving
them the autonomy, ownership,
and clarity of purpose that a small
business thrives on.
More than a seat at the table
Thankfully, we’re already seeing
much of the above take hold
within the UK Government. Last
year, for example, it adopted a
‘test and learn’ culture to tackle
public sector challenges, including six- to twelve-month secondments of specialists from technology companies. Earlier this year,
that same approach also saw
a ‘start-up mindset’ introduced
to test AI applications and scale
successful experiments.
It’s certainly a positive step in
the right direction. But whether
governments bring in SME
expertise directly, or borrow key
traits from the way they operate,
if we want public services that
are genuinely user-centred, costeffective, and future-proof, it’s
time to give these smaller, agile
innovators even more in昀氀uence not just a seat at the table.
GOVERNMENT AND PUBLIC SECTOR JOURNAL AUTUMN 2025
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