Locals missing out on state contracts, says Jade

By ADAM GIFFORD AND RICHARD PAMATATOU

No one in Wellington takes us seriously.

That is the plaint from one of New Zealand's most successful international software companies, Jade, and echoes a widespread view among local software developers that they are let down by state-sector procurement practices.

The problem was highlighted in a just-released report from the joint government-industry ICTX Working Party, which said state-sector procurers relied heavily on their existing knowledge of the marketplace, existing reputations and saw large companies as one-stop shops for solutions.

"These methods tend to deliver results based on past purchases, generally lead to identification of non-New Zealand solutions and perpetuate local industry decline or lack of growth," says the report.

Jade chief executive Rod Carr said the problem was underlined by the Social Development Ministry's choice of Irish firm Curam to provide a client management system.

The ministry was looking for a systems integrator to build a proof of concept before the decision was made to implement the full system.

What upset Carr was not that the Jade proposal missed out - "we are not relitigating that. It is what happens in business" - but that Curam would get its foot in the door to replace sections of other ministry systems that form part of the SWIFTT benefit payment and Trace debt management systems.

"The key functional and technical capabilities within the Curam Framework may also provide strategic alternatives for these critical business systems in the future," the ministry said.

The problem is SWIFTT and Trace are built in Linc, the development environment for Unisys mainframe computers developed by Jade founder Sir Gil Simpson.

Jade is putting up its technology as the best path forward for Linc systems, allowing them to be moved to cheaper hardware with an increase in flexibility and functionality.

That means the ministry's systems could be replaced or evolved for much less than the ministry's estimate of $87 million to $178 million.

"The risk here is we are damned for not having a case management product, then not seen as having a product for the rest of the system," said Carr.

The Linc to Jade conversion product, called Jet, was now proven, he said. Taranaki Savings Bank had converted its core banking systems from Linc to Jade, halving system operating costs and improving performance and usability.

More than 70 million records were switched without a major rewrite of the existing systems.

British financial services company Homeloan Management had also completed a Linc conversion and outsourced software development to Jade.

And Flathead County Sheriff's Office in Montana had successfully switched its Criminal Justice Information System.

Said Carr: "Wellington seem to be only interested in systems which are big, international and referencible."