Birmingham
City Council has embarked on the largest local authority IT
outsourcing and business transformation programmes seen in the UK,
a 15-year deal estimated to be worth £500m.
The council this
week issued a tender notice asking for a “strategic partner” to
help the authority transform the way its systems and processes
support the delivery of its overall priorities of “flourishing
neighbourhoods and improved services”.
As well as
supporting the transformation programme, the winning IT services
provider will take control of a series of existing outsourcing
agreements Birmingham has in place, including a server support deal
with ITNet, a desktop contract with SCC and a contact centre deal
with Vertex.
The contract,
which the council expects to sign in the summer of 2005, will be
offered on a risk and reward basis with progress made
incrementally. Each individual project within the transformation
programme will only be offered once performance targets have been
achieved.
Glyn Evans, head
of IT at Birmingham City Council, said this phase-by-phase approach
is becoming more popular in the public sector.
“The incremental
partnership is seen as quite attractive as it means the partner has
a greater incentive,” he said. “We are developing a process which
looks at the business case for each area of the project. The whole
public sector needs to tighten up its approach to business
cases.”
There is no real
example of best practice for business transformation projects in
the public sector, so the council will be pragmatic in its
approach, Evans said.
“We are
approaching this with no preconceptions, parts [of the
transformation programme] may be kept in-house, as a partnership or
fully outsourced,” he said.
“We are asking
providers for experience about business transformation, and doing a
parallel exercise ourselves to work out our priorities.”
The outsourcing of
local authority IT staff has become a contentious issue in recent
weeks, highlighted by developments at Bradford Council where IT
staff used the threat of strike action to win assurances that they
would not be forced to transfer to the winning services
provider.
Birmingham said
staffing issues, including the employment arrangements for staff,
will form an important part of negotiations, and said it may
consider options which do not involve the transfer of staff from
the council.