Failures in public IT projects still regularly make headlines. The media reports on collapsing projects and critical public systems that are delayed or suffer from severe quality issues.
It is alarming that many new IT procurements continue to be tendered using the same request-for-proposal (RFP) models and managed in the same way as previous projects that have already failed. Especially in turbulent economic times, the public sector cannot afford failed digital investments.
However, this is not the full story of public IT procurement. I have followed the industry's development closely for over ten years. Public sector’s IT projects have improved tremendously over these years: authorities' digital expertise has grown, and hundreds of successful, often large-scale projects have been completed. These successes rarely make it to the newspapers. After all, it’s hard to create sensational headlines about a project that was completed on time and resulted in a functional system that public officials or citizens are happy to use.
Luckily, procurement law is not a barrier to agile and successful public projects. Success is neither random nor a secret science. In our experience, the same factors consistently contribute to thriving projects.
We have gathered together our insights from successful public projects. What are the three most important aspects of a successful project’s procurement phase? And what are the three key factors in managing and organizing a successful public project? In this article, we will share what we have learned!
The three most important factors in the procurement phase
1. The project contract is flexible
Contracts don’t usually spark deep passion in people (except for lawyers – for them, a box of contract documents is like a ball pit). However, in a public IT project, contracts and RFP documents are so crucial that they deserve close attention. The contract is a binding document that the client will have to live with for years, as procurement law does not allow significant changes later.
Traditionally, lecturers in law schools have declared that a delivery contract should define the IT system's requirements, schedules, and work volumes in detail. However, modern procurement lawyers understand that this approach is incompatible with agile software development. Instead of locking in the final outcome, it is better to buy a skilled team. When professionals create unique software and work on a one-of-a-kind project, not everything can be known in advance.
In public procurement, the contract and RFP documents should remain flexible so that the team and the client can address issues and make decisions along the way. A contract should not tie the team's hands – it is worrying if an eager legal department decides on behalf of software professionals what they should do in the project. Lack of flexibility also frustrates the client, who ultimately owns the digital service being developed.
2. A strong trust is built between the client and the team – no forced marriage
Sami Kuronen talks to the couples on Temptation Island about trust and a shared future, but the same lessons could just as well be applied to IT project management seminars. In the end, software projects are built on trust.
Ideally, the client is able to assess the collaboration and the supplier’s expertise already during the bidding phase. In addition to reviewing bid documents, a savvy client typically interviews the team. The best buyers focus not only on technical knowledge but also on the team’s dynamics, problem-solving skills, enthusiasm, and ability to communicate with the client.
It is also important to avoid "forced marriage" between the client and supplier. If trust is lost, the client should be able to quickly end the relationship. A forced marriage can arise if the client is locked into large order volumes, long termination periods, or if the supplier has exclusive rights to modify the code.
3. The client prioritizes quality when evaluating bids and manages to get the best team
The success of an IT system ultimately depends on how skilled and motivated people are working on it. A good developer is not only technically proficient but also understands the client’s business and users, communicates effectively, and knows how to navigate within the client organization.
When evaluating proposals, it is wise to use a weighting of, for example, 80% quality and 20% expert hourly rate. Instead of focusing solely on hourly rates, the client should prioritize the total economic value. A project ultimately becomes expensive if progress stalls or the system suffers from severe quality issues. Additionally, incorrect technical choices can, at worst, jeopardize the entire project.
In quality evaluations, simply comparing CVs does not provide a sufficient picture of a person's real competence. Instead, the client should interview the team or even arrange a coding test for them. The most unfortunate scenario is when a client intends to prioritize quality but ends up merely comparing CVs – where all vendors nowadays score nearly full points, making price as the deciding factor.
The three most important factors in managing and organizing the public project
1. The client has a skilled and enthusiastic project owner
A successful public project requires a great team, as well as strong participation and clear guidance from the client. In our experience, internal conflicts within the client organization and unclear goals are among the most common reasons for project failure.
The client must have an enthusiastic project owner who feels personal responsibility for the system being developed and understands how to lead a demanding IT project. A strong project owner has a clear overall vision, can effectively communicate goals to the team, and can align conflicting needs within the client organization.
A skilled supplier can also help guide the project in the right direction. A good development team takes joint ownership of the project's success and also challenges the client when needed.
2. User-centric design is an ongoing part of the project
Savvy clients know that simply hiring "a coding team" rarely results in an optimal outcome. Without user-centered design, there is a risk of developing software that fails to meet real needs. Successful public projects typically integrate designers into the development team. An experienced designer, working alongside developers, ensures that no code is written before it is clear what needs to be achieved.
If the software does not solve civil servants’ or citizens’ problems or improve their workflows, it will not be used. This directly wastes taxpayers' money. By analyzing end-user workflows, we can identify the most frequent and impactful tasks that should be prioritized in the backlog.
In IT development, there is always a balance between user needs, business objectives, and cost efficiency. Our experience in the public sector shows that a project is at risk of failure if any one of these is missing. A skilled designer ensures that all three perspectives are considered throughout development.
3. The client and the supplier work as one team and talk a lot
In a successful IT project, the client and supplier are genuinely in the same boat. The project is not built on opposition or on determining who will be held liable when things inevitably go wrong.
Both the client’s internal staff and the supplier’s experts are equally critical to the project. Public IT projects often last for years, so shared goals, a strong team spirit and occasional cupcakes in the team space can have a huge impact on success.
Surprisingly often, quality and delay issues stem from a lack of communication. Problems occur when the client and team don’t work closely together or don’t talk about the project’s status, needs, and risks often enough. In a successful project, there are lively discussions happening in the team space, steering meetings and daily stand-ups – not to mention team’s after-work gatherings and karaoke nights, which also play an important role.
The Request For Proposal is the turning point of a public project – prepare it in good cross-functional collaboration!
Critical public IT systems are not off-the-shelf products. It is important to remember that in public projects, the conditions for success are established – or not – already during the procurement phase.
“The lawyers will handle the procurement and paperwork, and we’ll focus on the real work afterwards” might sound tempting but this does not lead to good results in public projects. According to procurement law, the RFP and contract are defining moments that determine the project’s direction. Who wins the contract? Does the agreement enable agile and smart project execution?
IT procurements should be prepared and planned through strong collaboration across departments. In a well-managed project, leadership, business, software professionals, and lawyers share a common vision of what success looks like. Everyone is personally committed to achieving this – and the contract has also been crafted for success, not for court.
The author works as a leader and lawyer specializing in public sector business at Reaktor.
