Public sector focus: without a concrete GTM strategy, G-Cloud opportunity remains nebulous

The G-Cloud framework is the mechanism the UK government has set up to procure Cloud services. In mid-2019 the launch of G-Cloud 11 was announced, which enables 4,200 potential suppliers – 90% of which are small businesses – to bid for contracts worth £1.95 billion.

But is G-Cloud all it’s cracked up to be? Or is it a case of cloud-and-mirrors simply aimed at meeting the government’s own targets for engaging with SMEs? (Which state that by 2022 one-third of government business will be with SMEs.)

The government argues that since 2012, more than £4.79 billion of cloud and digital services have been procured through G-Cloud, and almost 45% of that spend (£1.8 billion since 2012) went to SMEs.

However, a study published this month by Tussell says that only 480 out of 3,474 suppliers (14%) on G-Cloud earnt any revenue through the framework. The report noted that large suppliers still got the lion’s share of the available budget, with software consultancy Equal Experts leading the charge at £137 million, followed by Capgemini (£136 million), Deloitte (£103 million), PA Consulting (£92 million) and UKCloud (£86 million).

Many suppliers – with smaller suppliers the most likely to be guilty of this – believe that simply being listed on G-Cloud is enough. It isn’t. Firms still have to make themselves relevant, explain clearly what they do, promote their offerings and identify opportunities.

Crown Commercial Service (CCS) said that Tussell’s figures were inaccurate as a further 965 suppliers were in the process of transacting during the period analysed, so a more accurate number is 72.5% of suppliers earnt no revenue. It also argued that 44% of total spend related to smaller businesses equating to £2.35 billion, with larger businesses winning £2.75 billion.

There may continue to be arguments over the figures, but a few things are clear:

G-Cloud has been successful in terms of offering a mechanism for smaller companies to sell to government

Being on G-Cloud is not enough – it’s just a procurement framework – firms have to have, and enact, a strategy to sell on G-Cloud.

Bigger businesses succeed because they have the sales and marketing resources and brand awareness that smaller firms lack. This means if smaller firms are going to go to the bother (cost, time etc) of joining the framework they need to also factor in the effort required to make a success out of it.

Selling to government customers is not the same as selling to commercial customers. If you’re not prepared for things like security accreditations and complex billing processes you are not going to get very much past the start line

Selling to government bodies is a long process – be prepared for lengthy timescales. Don’t be surprised if it takes a year (or more).

Partnering can be a great strategy – you don’t need to be on G-Cloud to sell on G-Cloud, because you can partner with someone who is and who knows how to sell on there. Incumbent suppliers are actually looking for innovative SMEs to work with and are mindful that the government is targeting 33% of spend going to SMEs. So adopting a channel strategy to G-Cloud may be more sustainable than trying to go it alone.

For those that are already on G-Cloud 11, SynergySix offers advice and support to help them increase their success, as part of our GTM consulting.

SynergySix Principal Kevin Bailey says: “This analysis highlights the danger of the ‘build it and they will come mindset’ that organisations of all sizes frequently fall into. The reality is that G-Cloud is no different to Salesforce, Google, Apple or Amazon, which all have application marketplaces. They enable you to establish a capability to be seen when someone wishes to procure a product, but the marketplace does nothing to highlight why you should be considered over another comparable offering. Choosing whether you wish to compete with the 4,200 suppliers on G-Cloud, or partner with an established G-Cloud provider, needs to align with your fiscal and longer term plans related to your business disciplines for marketing, sales, product, people, operations and financials. The value of G-Cloud comes as part of an overall GTM strategy, not in isolation”.