Plugging the Gap

Can you tell us about the history of Tamkeen and how you meet the needs of a rapidly changing public sector that is digitalizing to streamline services?

Tamkeen Technologies was established at the end of 2013 as a company that offered IT services for three government agencies reporting to the Minister of Labor at that time. However, in the middle of 2016, the board of directors decided to transform the company into a fully-fledged IT service provider for the government sector. To accomplish this goal, Tamkeen executives went through a corporate restructuring exercise that resulted in a new organizational structure being approved by its board of directors in December 2016, and fully implemented in April 2017. Based on the new directions for the company, an aggressive strategic plan was developed for the fiscal years 2018-2020. The basic goal of Tamkeen’s new strategy has been to focus on three main areas: implementing Public-Private Partnerships (PPP), supporting the adoption and deployment of open-source technologies within government agencies, and helping government agencies extract value from their data by improving their business processes and commercializing some of them.

How does your business model function, and how are you paid?

We have four different revenue streams. One is a typical IT outsourcing contract in which government agencies that want to employ IT resources but need help screening, attracting, and retaining talented IT resources come to us, since we have a proven track record in hiring and retaining qualified Saudi IT talent for clients. In the second case, Tamkeen provides its clients with managed services in the areas of IT infrastructure, information security, customer care services, and more. The third is executing projects in response to public tenders or private invitations. However, in such projects, Tamkeen is selective about the projects we bid on, such that we prefer to bid on projects where we can make a significant impact or can outsource large portions of the project to the small and medium Saudi companies; hence, allowing them to participate in projects they otherwise wouldn’t. The fourth is where we develop PPP programs, and this is where we concentrate on the most. The principle we adopt is that we help government entities find solutions for the problems they have by customizing one or a combination of our prebuilt products to solve the problem at hand. We do this at no cost to the government entity as long as we are allowed to commercialize and offer an elective premium paid version for the service. The main reason behind this approach is that government agencies can take a long time to build their IT solutions, starting from gathering the requirements. After the project is awarded, the vendor starts to design, build, test, and deploy the solution. This is a lengthy process, during which IT technologies and business policies might change, making the targeted solution obsolete and outdated before it is even completed, which leads to cost overruns and significant delays. At Tamkeen, our approach to PPPs is unique to the government sector but in line with the current trends in the mobile software industry.

Are you growing in terms of revenue?

We predict an annual 20% growth in revenue and profit for the coming three years, with an estimated annual increase in headcount of 15%. We met these targets in 2016 and 2017 and expect to meet or exceed them in 2018.

Why are government-owned businesses such as Tamkeen booming at the moment?

The national Saudi IT industry has several key pillars and cannot fully flourish and blossom unless they are strong. They are: government IT departments, government IT companies, multinational IT companies, and local private IT companies. Government IT departments traditionally suffer from inflexible government pay structures, which impacts their ability to attract and retain top IT talent. As a result, certain government entities have either established their own IT companies or rely on government owned companies such as Tamkeen.