Research council pays by results

The fewer helpdesk calls staff make, the more money the Medical Research Council pays to its supplier, Logica CMG, as part of a...

The fewer helpdesk calls staff make, the more money the Medical Research Council pays to its supplier, Logica CMG, as part of a results-based outsourcing agreement.

Under a £25m, 10-year deal, set up last year, chief information officer Stuart Aitken outsourced MRC's entire IT function to Logica. He insisted on a system of payment based on business-related outcomes.

If Logica does not deliver MRC's annual accounts within one month of the end of the financial year, it loses 13% of that year's overall service charge.

Logica is to develop a human resources output-based specification for MRC, but stands to lose 50% of the total estimated cost if that spec does not lead to a board-accepted business proposition.

The supplier will also lose 25% of the total annual service charge if 80% of MRC's 3,000 staff do not use at least three kinds of portal services on a monthly basis.

"IT is only of value when the business gains demonstrable value," said Aitken. He said that he and a taskforce spent considerable effort in identifying what the business priorities were.

"We worked out the 'what' in business terms. We leave the 'how' entirely to the outsourcer," he said. "I don't care what system it is delivered on, I only care that it is delivered."

Logica has also agreed to MRC's Partnership Charter, which defines behaviours and actions between the two parties.

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