Technology firms don’t need lessons in how to make the world a better place. The sector already is at the forefront of driving significant societal improvements, especially for the world’s most disadvantaged. The sector is already responsible for bringing transformational benefits to some of the world’s most disadvantaged people. Its innovations in fields like energy efficiency help safeguard the planet for the next generation.
Not many industries can rival technology in terms of their impact on society. However, tech companies often find themselves navigating through a maze of regulations. These not only incur substantial costs but also seem redundant, especially when small and midsized businesses (SMBs) in the tech sector are disproportionately affected.
Regulatory Hurdles with Government Contracts
Robert Jessel
The United Kingdom’s Public Services (Social Value) Act is one such example where technology companies face a cumbersome regulatory environment. Tech firms in the UK employ more than 2 million people, and the digital sector contributes close to 200 billion euro to the UK economy.
The legislation requires any firm bidding for local or central government work worth at least 50,000 euro to show how they would deliver a range of economic, environmental, and social benefits.
You’d think this would be no problem for tech firms, which seek to make organizations more efficient and better able to serve stakeholders — which in the instance of public sector authorities is the taxpayer, or society in general. But under the Social Value Model and Model Award Criteria, applicants must show compliance with page after page of requirements covering everything from job creation to supply chain resilience to environmental considerations.
U.S. tech firms bidding for government contracts face their own regulatory challenges, which often place a heavy burden on these companies. For SMEs, this burden is exacerbated by their limited resources, making compliance a daunting task.
The Ripple Effect to MSPs and Clients
So why should MSPs care about regulations like the Social Value Act? No one likes bureaucracy, but larger enterprises have the resources and expertise to tick the right boxes, while tech firms are probably fulfilling many if not most of these requirements.
The problem is the damage the Social Value Act does to the wider tech ecosystem and to channel partners.
SMB tech firms rarely have the resources or expertise to comply with such, either in the bid process or during delivery. Often, the cost of meeting the requirements would overshadow the total value of the contract itself. As a result, many SMBs may not even bother to bid on public sector contracts.
A Call for Awareness and Action
MSPs understand the crucial role SMBs play in delivering innovation and driving the tech sector forward. A healthy, competitive environment where SMBs can flourish is essential for the industry’s overall health and for maintaining a strong domestic tech sector.
That’s why MSPs should take part in advocating for regulatory reforms that support, rather than hinder SMBs’ participation in government contracts.
Despite the clear advantages tech SMBs bring to the table, they face unnecessary obstacles that jeopardize their contributions to society. It’s time for a concerted effort to bring these issues to the forefront of the legislative agenda. We encourage the tech community to advocate for a more equitable and sensible regulatory environment that recognizes the value and potential of SMBs in the tech sector.
Robert Jessel is CEO of the Campaign for Fair Procurement and a public relations professional with a specialist interest in technology.
Image: DALL-E
