The Office of Government Commerce has warned that the
public sector faces problems with outsourcers as a result of
capacity problems in the market.
In a
report for the public sector’s Chief Information Officers’ Council
(CIOC), the OGC outlines the findings of its Information,
Communications and Technology (ICT) Capacity Pilot Project.
This
project was commissioned to identify potential capacity issues
within the ICT market. The findings were based on commercially
available market research, and information obtained from 20 public
sector organisations and 13 key ICT suppliers.
In
addition, details of more than 170 ICT public sector projects with
an annual value of about £3bn were obtained to help put together
the report.
The OGC
identified “a number of specific capacity issues and constraints
that could have an adverse effect on the delivery of ICT public
sector projects”.
These
included: suppliers’ ability to field senior experienced bid teams;
a shortage of programme managers, technical architects, and change
managers on both the supplier and public sector side; and increased
risk being placed on suppliers, with them reporting “increasingly
onerous terms and conditions”, causing them to be more selective on
the contracts they bid for.
The OGC
also said there were problems over the time it took for outsourcing
staff to get security clearance and for software to be accredited
for use in the public sector.
The OGC
said offshoring was an unlikely solution to overcome capacity
problems in the short-term.
It said,
“While these specific capacity issues and constraints could
adversely affect individual projects, it seems unlikely that there
will be a widespread shortfall in ICT delivery capacity over the
next three years.”
It went
on, “This is primarily due to the UK ICT private sector growth
forecast being relatively subdued, public sector project services
spend being forecast to peak in 2008, and most suppliers advising
of the need to maintain a balanced public and private sector
portfolio, despite the level of growth in any one sector.”
Recommendations made by the OGC included public sector CIOs needing
to ensure there was adequate visibility of their projects so that
major approaches to the market could be better co-ordinated, and
departments ensuring they were not competing with one another for
the same resource.
Consideration should also be given to establishing a skills working
group, involving the Cabinet Office’s Professional Skills for
Government (PSG) and e-Government Unit, programme and project
management (PPM) teams, and organisations such as Intellect and
e-skills UK.
Given the
bid capacity issue, coupled with the need for requirements to be
attractive, departments need to ensure that the level of risk being
placed on suppliers and the terms and conditions are consistent and
appropriate, said the OGC.