Testing before committing: a better way for government and industry to work together

Digital transformation often fails in the gap between what looks good on paper and what works in practice.

That gap matters in government.

A solution can meet the written criteria, perform well in a tender response, and still create problems after the contract is signed. Usability issues, integration complexity, delivery risk, poor fit with the operating environment, or weak adoption can all appear too late.

NSW Government’s Test and Buy Innovation approach is a practical response to that risk.

It brings supplier engagement, testing, and evidence earlier in the procurement process, before agencies commit at scale. Instead of locking every requirement down upfront, agencies can define the problem, explore market capability, test solutions, and make more confident buying decisions.

The strength of the model is simple: it does not treat innovation as a leap of faith. It breaks the buying journey into stages where each step builds evidence, reduces risk, and improves confidence before larger investment decisions are made.

That matters now because the pressure on government is rising.

At Government Innovation Week New South Wales, live polling showed that 62% of respondents saw budgets and competing priorities as the biggest challenge facing the public sector. Yet when asked what change would best help government meet expectations, the top answer was cross-agency and cross-sector collaboration at 43%.

That is the operating context for digital procurement in NSW: tight budgets, high expectations, and a need for better ways to work across government and with industry.

The polling does not point to a lack of ambition. It points to a need for better operating models that help agencies test ideas safely, assess the market properly, and make stronger investment decisions before committing at scale.

Procurement is now part of digital delivery

Procurement is often treated as a process that happens after the strategy is set.

That no longer fits digital government.

When agencies buy cloud platforms, cyber capability, AI tools, data systems, payment solutions, or citizen-facing services, procurement choices shape delivery outcomes. They influence which suppliers can participate, how risk is managed, and whether the selected solution works for users.

In digital projects, procurement is not just a compliance step. It is part of delivery.

That is why Test and Buy matters. It recognises that complex ICT buying cannot always begin with a perfectly defined answer. Sometimes the agency knows the problem, but needs the market to help test the best way forward.

That is not a weakness. It is a more honest starting point.

Testing changes the quality of the decision

Most public sector leaders have seen the risk: a solution looks right in a tender response, performs well against written criteria, and then creates problems after the contract is signed.

By then, the agency has fewer options.

Test and Buy brings those questions forward. It gives teams a way to test assumptions, see solutions in action, and understand supplier capability before making a larger commitment.

In one NSW spatial services technology upgrade, the buying team used a challenge-led approach rather than locking every requirement down upfront. Supplier pitching and interaction gave the team deeper insight into delivery capability than written submissions alone.

That kind of process can surface suppliers that may otherwise be missed. A smaller provider might not have the strongest written tender, but may show stronger delivery capability, better problem fit, or a more practical partnership approach when given the chance to demonstrate.

The same logic applies beyond classic innovation projects. Banking, payments, data, AI, cyber, and service delivery markets all move quickly. Earlier engagement through workshops, co-design, demos, and staged testing can help agencies understand supplier capability before they make larger investment decisions.

The point is not to make procurement less disciplined. It is to gather better evidence before commitment.

The model is disciplined, not informal

Test and Buy is not a shortcut around procurement discipline.

It is a structured funnel.

The stages are simple:

• Discovery: define the problem and confirm it is worth solving.
• Tell us: ask the market for ideas and assess capability.
• Show us: use demos, pitches, pilots, or proof of value to test functional fit.
• Prove it works: test technical feasibility through proof of concept or limited implementation.
• Build it with us: refine the solution with selected supplier(s) and prepare for scale.

As the number of suppliers narrows, the level of proof rises.

That is the right model for complex digital buying: start broad, learn fast, then commit with confidence.

At Government Innovation Week New South Wales, this need for better process was clear. When asked about the biggest barriers to building a culture of continuous innovation, 35% of respondents selected policy and processes, or red tape. Budget constraints followed at 26%, with digital capabilities at 17%.

That is exactly why procurement reform matters. The issue is not only whether agencies want innovation. It is whether the system gives them a practical way to test it safely.

Why this matters for suppliers

This approach is especially important for small, medium, local, and emerging technology suppliers.

Traditional procurement can reward the organisations that are best at writing tender responses. That does not always mean they are best placed to solve the problem.

When agencies create space for demonstrations, workshops, challenge statements, pitches, and staged testing, suppliers can show how they think, how their solution works, and how they would work with government.

That creates a fairer opening, but not an easier one.

Suppliers need to be ready with proof. They need to understand the public problem, not just promote the product. They need to be clear about risks, limits, dependencies, implementation effort, and adoption.

Written claims are not enough. Agencies need evidence that the solution can work in their environment.

For industry, the opportunity is not just to sell technology. It is to help government solve constrained, complex problems. Suppliers that lead with proof, clarity, and partnership will be better placed than those that lead with product claims.

Better procurement means better public outcomes

The point of procurement reform is not to make buying more interesting. It is to improve outcomes for the community.

If agencies can test solutions earlier, they can reduce the chance of buying the wrong thing. If suppliers can engage earlier, they can shape better-fit solutions. If procurement teams have stronger evidence, they can make better value-for-money decisions.

That matters across every area of government: housing, planning, payments, cyber security, service delivery, transport, health, local government, and emergency response.

Digital transformation depends on the practical machinery of government. Procurement is one of those machines.

When it works better, delivery works better.

The conversation we need now

At Public Sector Network, we see this as exactly the kind of conversation government and industry need to have together.

Not a broad conversation about innovation in the abstract.

A practical conversation about how agencies buy better, how suppliers prove value, and how both sides reduce risk before major investment decisions are made.

For NSW procurement leaders, the question is:

- How do we use market engagement and testing to make better buying decisions?

For industry suppliers, the question is:

- How do we prove that our solution works in the real world of government delivery?

And for digital leaders, the question is:

- How do we make procurement an enabler of transformation, not a barrier to it?

Testing before committing is not just a procurement improvement. It is a better way for government and industry to work together.

If we get it right, the result is simple: better decisions, stronger partnerships, and better outcomes for the people of NSW.

Want to learn more? Join us at Digital.NSW Showcase 2026 (25 Nov)