There has been a tremendous amount of money invested in government technology (GovTech) companies over the past few years. Acquisitions have been completed at a feverish pace and valuations have been higher than anyone could have imagined. However, for the average customer, this has resulted in fewer choices rather than a better experience. Maintenance fees continue to increase while enhancements are less frequent and more expensive.
In order to see real improvement, a different approach is needed. You can’t reinvent an industry within the confines of a “disciplined” corporate structure. Instead, you need to look at the characteristics of the good companies currently being assimilated into the public giants and large private equity firms.
Here are a few of the characteristics of the company that will reinvent government software.
- Raise the bar.
For the better part of the past two decades, GovTech companies have been systematically reducing customer expectations. While the price of support has be increasing, new releases and support services have been reduced. This presents a tremendous opportunity for a company willing to provide increasing value every year. - Do what you say.
Many industry leaders have no problem walking away from an unprofitable project. They provide a token refund in exchange for non disparagement but they won’t put a commitment made to a customer ahead of quarterly profits. Great companies will always step up to meet commitments. Keeping promises needs to be the top priority. - Innovate.
Putting a new user interface on a 20 year old application is not innovation. Real innovation involves risk. It’s expensive and it’s an iterative process that usually sees failure before success. It is also difficult to forecast. Most corporate cultures punish mistakes and they don’t attract innovative people.
I’ve seen some exciting new companies in GovTech. However, I believe that the next true industry leader will lead with integrity, a passion for getting results, and a willingness to innovate.