Category Archives: procurement

SMEs and Agile to play key role as Government launches ICT plan to deliver £1.4bn of savings

Posted on 23/10/2011 | 1 comment

By David Bicknell

Cabinet Office minister Francis Maude has launched a plan to implement the Government’s ICT strategy which it says will deliver around £1.4bn of savings within the next 4 years and help deliver better public services digitally. 

In its foreword to the Strategic Implementation Plan, the Government says it is committed to reducing waste and delivering modern public services at lower cost:

“We have already saved hundreds of millions of pounds in 2010/11 by stopping or reducing spend on ‘low value’ ICT projects. These quick wins demonstrate what can be achieved by taking a whole of government approach and challenging the way we operate and provide services.

“The Government ICT Strategy, published in March 2011, described our longer term programmes of reform to improve Government ICT and deliver greater savings. This Strategic Implementation Plan provides a reference for central government and is designed to be read alongside the Government ICT Strategy.

“Our plans are focused on standardising government ICT. In the past, government departments worked to their own requirements and often procured expensive bespoke ICT systems and solutions to meet them. As a result, departments have been tied in to inflexible and costly ICT solutions which together have created a fragmented ICT estate that impedes the efficiencies created by sharing and re-use. It also prevents government from offering joined-up, modern, digitally-based public services that are suited to local requirements.

“Affordability in the current ‘age of austerity’ requires a different approach. The approach set out in this plan ensures that departments will now work in a collegiate way, underpinned by rigorous controls and mandates.

“This is not just a plan to reduce the cost and inefficiency of departmental ICT.  Effective implementation of the Strategy has already begun in programmes that will radically reform front line public services. For example, the Universal Credit programme is one of the first ‘Digital by Default’ services, using an Agile approach to reduce delivery risk and improve business outcomes. 

“Success or failure of government ICT depends on greater business preparedness, competency in change management and effective process re-engineering. That is why, although we focus on the common infrastructure as a way of significantly reducing costs, the ICT Strategy (and this plan) recognises the need for a change in our approach to ICT implementation. In particular, implementation will be driven through the centre, as a series of smaller, local ICT elements, rather than ‘big bang’ programmes that often fail to deliver the value required.”

Significantly, the government says it will continue to reduce waste by engaging SMEs:

“Building on the £300 million already saved (from May 2010 – March 2011) by applying greater scrutiny to ICT expenditure, government will continue to reduce waste by making it easier for departments to share and re-use solutions through the creation of an ICT Asset and Services Knowledgebase, applications store, using more open source, and improving the ICT capability of the workforce. At the same time, it will reduce the risk of project failure and stimulate economic growth by adopting agile programme and project management methods and reforming procurement approaches to make it easier for SMEs to bid for contracts. 

“For all relevant software procurements across government, open source solutions will be considered fairly against proprietary solutions based on value for money (VFM) and total cost of ownership. Success will be measured initially by a survey of each department’s compliance with the existing open source policy. Longer term, open source usage will be measured annually by the use of a departmental maturity model. The ICT Asset and Services Knowledgebase will be used to record the reuse of existing open source solutions, and the deployment of new open source solutions.”

Specfically on procurement, the Government says it has the potential to leverage its huge buying power in the ICT marketplace. But it admits that government procurement of ICT “has in some cases failed to deliver economies of scale and failed to deliver value for money to the taxpayer.”

The government says its objective is to “reform government procurement through the centralisation of common goods and services spend by funding improvements in technology, processes and government wide procurement resources to better manage total procurement spend and government wide standards, such as those for green ICT.”

“Government is therefore committed to become a single and effective ICT customer, leveraging buying power whilst remaining flexible on how it procures. As part of this process government will create a more open, transparent and competitive ICT marketplace embracing open standards and open source that will remove barriers to SME participation in public sector procurement to create a fairer and more competitive marketplace.

Government Procurement has a number of strategic goals, including to:

  • create an integrated Government Procurement (GP) to deliver and manage the Operating Model for Centralised Procurement for all common goods and services including ICT, delivering cost reductions in excess of 25% from the 2009/10 baseline of £13bn;
  • transform Government Procurement Service (GPS) to be leaner, more efficient and to become the engine room of government procurement, delivering savings through sourcing, category, data and customer management across all categories of common spend including ICT;
  • formalise agreements between GPS and all departments to deliver centralised procurement and to improve capability, including within the ICT spend category;
  • deliver policy and capability improvements covering EU procurement regulations; transparency in procurement and contracting; removing barriers to SMEs; and
  • mandate open standards and a level playing field for open source; streamline the procurement process using ‘lean’ plus supporting programme to develop the capability of civil servants who lead government procurements.

The government says its key procurement metrics will be

  • Total spend under management on ICT common goods and services
  • Savings on ICT common goods and services
  • Number of ICT contracts with a lifetime value greater than £100m
  • Time to deliver ICT procurements
  • Number of active ICT procurements

On Agile, the government says many large government ICT projects have been slow to implement and technology requirements have not always been considered early on in the policy making process, resulting in an increased risk of project failure. Agile project methods, it argues, can improve the capability to deliver successful projects, allowing projects to respond to changing business requirements and releasing benefits earlier.

Its Agile objective is to improve the way in which the central government delivers business change by introducing Agile project management and delivery techniques.

By 2014, it says, Agile will reduce the average departmental ICT enabled change delivery timescales by 20%.

In delivering this, the government says it will be measured by:

  • Number of departments who have used the online Agile facility
  • Number of projects using “agile” techniques, by department
  • Total number of instances where the virtual centre of excellence has been utilised

ICT Strategy Strategic Implementation Plan

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Posted in Agile, Campaign4Change, Cloud Computing, government, Government IT, procurement, SME, Universal Credit

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Fiddling savings on shared services? Officialdom in need of reform

Posted on 21/10/2011 | 3 comments

 By TonyCollins

An NAO report today suggests that some officials are fiddling projected savings figures from a shared services deal involving seven research councils.

It all began so well. A Fujitsu press release in 2008 said:

“UK Research Councils to implement shared services with Fujitsu. £40 million project will generate cost and efficiency savings across the organisations.”

An executive who representedFujitsu Services’ was quoted in the press release as saying at the time:

“Fujitsu is consistently proving that it can deliver effective shared services infrastructures and is playing a vital role in driving forward the transformational government agenda through shared services.

“Organisations that adopt a shared services approach can experience genuine economies of scale and reduction in costs which can be essential in their drive for continuous improvement.

Twenty-one months later Fujitsu and Research Councils UK parted company. The 10-year shared services contract began in August 2007. It was terminated by mutual consent in November 2009.

A revealing report, which is published today by the National Audit Office, shows how, despite the best intentions by the Cabinet Office to improve the management of IT-related projects and programmes, and decades of mistakes to learn from, some officials in departments are still making it up as they go along.

The worrying thing in the NAO report is not only what happened in the past – few will be surprised that the NAO report characterises the shared services deal as lacking professionalism. What’s worrying is officialdom’s more recent disregard for the truth when claiming savings for its shared services arrangements.

The NAO’s report”Shared Services in the Research Councils” suggests that officials manipulated – some could say fiddled – projected savings figures.

The NAO also found that officials awarded a £46m shared services contract to Fujitsu which came second in the bid evaluation. Exactly how the contract came to be awarded will be investigated soon by MPs on the Public Accounts Committee.

Origins of shared services contract  

In 2004 a review led by the Government adviser Peter Gershon suggested that the public sector should save money by sharing support services such as IT, HR and finance. In 2006 officials at the Department of Trade and Industry (now the Department for Business, Innovation and Skills) encouraged their colleagues at seven research councils to set up a shared service centre, which they did.

The UK Research Councils is an important organisation. In 2009/10 it spent £3.7bn, mostly on giving research grants to universities, the European Space Agency and other organisations. Its biggest recipient of grants is the Medical Research Council.

Fujitsu contract

Public servants appointed Fujitsu in August 2007 to put in place the ICT systems to underpin the shared service centre in a ten-year contract worth £46m. Fujitsu came second in the initial bid evaluations.

The NAO said that the bidding process produced a shortlist of three companies including Fujitsu. Said the NAO:

“The initial weightings applied by the [bid] panel had placed Fujitsu second: although the bid had scored well on quality, it was 19 per cent more expensive than the cheapest bid.”

An independent review commissioned by the project board backed the evaluations which put Fujitsu second. But the bid panel and the project board had concerns about the evaluation. The supplier chosen in the evaluation – which the NAO refuses to name – did not score well on quality requirements.

It appears that the bid panel and the project board preferred Fujitsu.

Mathematical error

Then officials happened to spot a mathematical error in the bid scoring. The corrected scoring left Fujitsu on top, as the new preferred bidder.

Said the NAO:

“… a mathematical error was identified by a member of the project team that changed the order of the preferred suppliers, leaving Fujitsu as the front runner

“The [bid] panel reconvened to discuss this but, rather than re-performing in full the quantitative and qualitative analysis and submitting this to independent review, it decided to appoint Fujitsu on the basis of a vote.

“In September 2007 the gateway review team concluded that the incident had weakened the value of the overall process and had left the project at risk of challenge.”

User requirements unclear

Full delivery was due in September 2008 but the project team and Fujitsu “quickly encountered difficulties, resulting in contract termination by mutual consent in November 2009”.

The NAO said there was “miscommunication between the parties about expectations and deliverables, primarily because design requirements had not been sufficiently defined before the contract started”.

Fujitsu consequently missed agreed milestones. “Fujitsu and the Centre told us that the fixed-rate contract awarded by the project proved to be unsuitable when the customers’ requirements were still unclear.”

Officials paid Fujitsu a total of £31.9 million, of which £546,000 related to termination costs. Despite the payments to Fujitsu, parts of the system were withdrawn and rebuilt in-house.

Overspend on Fujitsu contract

The NAO found there were “significant overspends on design and build activities and the contract with Fujitsu.”

At least £13m wasted on Fujitsu deal

Said the NAO:

“Had the Fujitsu contract worked as planned, we estimate that the additional £13.2m design and build costs … would not have been needed. In addition the project management overspend of £9.1m would have been lower, as, after termination of the Fujitsu contract, a significant overhead in managing contractors was incurred by the project.”

Fujitsu out – Oracle in

The breakdown in relations with Fujitsu led to the appointment of Oracle as supplier of the grants element of the project. “The contract with Oracle suggested that lessons had been learnt by the project following its experience with Fujitsu, with greater effort given to specifying the design upfront,” said the NAO.

Did officials know what they were doing?

In deciding how to share services the research councils came up with six options including setting up a centre run jointly by the councils or joining with another public sector agency such as one supplying the NHS.

But two of the options including the NHS one were dropped without proper analysis, said the NAO. The remaining four options were each given a score of one to three, against seven criteria. “The scores appear to be purely judgemental with no quantified analysis,” said the NAO.

Even if the six options had been properly appraised, the evaluation would have failed because it did not include a “do-minimum” option as recommended by HM Treasury.

“Overall, the quality of options appraisal was poor,” said the NAO.

Fiddling the figures?

 The NAO found that:

–         Initial estimates were of zero projected procurement savings from shared services. But by the time the first draft of the business case had been written the projected savings had soared to £693.9m.

–         When this project board queried this figure the research councils’ internal audit service scaled down the figure to £403.7m – but this included £159.3m of savings that internal audit had concluded were not soundly based.

–         Since the shared services centre began officials have recorded procurement savings of £35.2m against the business case and while of these are valid savings some are not. The NAO investigated 19 high-value savings that represented 40% of savings recorded to the end of 2010 and found that 35% “should not be claimed against the project investment”.

–         The research councils have been “unable to provide paperwork to substantiate the claimed saving”.

–         Savings claimed were indistinguishable from normal business practice such as disputing costs claimed by a supplier.

–         Clear evidence exists that the budget holder had no intention or need to pay the higher price against which the saving was calculated

–         Last month the research councils claimed that savings were £28m higher than they had reported previously owing to errors in the original numbers. But the NAO found that the councils were unable to reconcile fully the two sets of numbers; had not used a single method for calculating benefits or tracked these effectively; and had not included £7m of spending incurred by the councils. “Overall, this review has highlighted that Councils have not put in place proper processes to track benefits and forecast future operational savings,” said the NAO.

–         Further, investments needed to deliver projected savings have not been included in calculations.

–         Double counting. A revised target for projected procurement savings procurement “includes elements of double counting …”

Other NAO findings:

–        Four Gateway review reports of progress on setting up the shared services centre, including a review which put the project at “red – immediate action needed”, were not fully followed up. 

–         There was no evidence of intervention by the Department for Business, Innovation and Skills when it became clear the shared services project was likely to overspend.

–         The shared services centre has begun to match the pre-shared services payment performance of the research councils but a high number of invoices was on hold at the end of July 2011 because of problems with the end-to-end processes. About 5,900 invoices were on hold, awaiting payment, in July 2011, which was 21 per cent of all invoices due to be paid in that month. The reason for the delay was being investigated.

–         Despite the shared services arrangements, some research council staff were at times running parallel systems, or managing their businesses without adequate data.

–         In July 2011 the shared services centre had 53 key performance targets to meet but was only able to measure activity against 37 of them and of these met only 13..

–         Five of the seven research councils did not file annual accounts on time in 2011 in part because functions in the finance ICT system were not delivered by the project.

Some good news

Said the NAO:

“The grants function and its associated ICT system developed by the project has allowed the Councils to replace older systems that were increasingly at risk of failing. This is of critical importance, given that the processing of research grant applications lies at the heart of what the Councils do. The single grants system has the potential to make it easier for the Councils to collectively modify their processes in the future…”

Comment

The commendably thorough NAO investigation has shown once again how badly departments and their satellites are in need of independent Cabinet Office oversight when it comes to major IT-related projects. In that respect thank goodness for the Cabinet Office’s Major Projects Authority. But how much influence can it really have? How much influence is it having?

This NAO report suggests that some officials are fiddling the figures without a care for professional accounting practices. Double counting, not including full costs in projected savings calculations, not having paperwork to support figures and other such administrative misdemeanours indicates that some officials are making up savings figures as they go along.

What is to be done when some departments and their agencies are not to be trusted in managing major projects?

NAO report on shared services at seven research councils

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Posted in Campaign4Change, change, change management, collaboration, Government IT, improving communications, legal disputes, managing change, openness and transparency, outsourcing, private sector lessons for the public sector, procurement, public sector, public services, reforms, research, Uncategorized

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Maude: “We want services to be run by mutuals, social enterprises and small businesses”

Posted on 20/10/2011 | Leave a comment

By David Bicknell

Cabinet Office minister Francis Maude is to reinforce the message that the government wants its  services to be run and delivered by mutuals, social enterprises and small businesses.

Maude will tell a conference: “In the current climate we can no longer afford waste – demand for services is growing at a time of fiscal constraint.

“But we should not tolerate wasting public money whatever the economic climate. We need to find new ways of delivering public services that are high quality, cost effective and genuinely responsive to the needs of individuals, communities and businesses at local level.

“We believe that nearly all public services can be improved by being delivered by a wide range of organisations. What and how services are delivered are more important than who they are delivered by, and competition breeds innovation and creativity. These in turn will deliver service improvements.

“We want services to be run and delivered by mutuals, social enterprises and small businesses; and we want the talented people who are enthusiastic about what they do to be freed up to deliver services in the way that they think is best.”

Maude’s message comes as most public sector managers say they outsource work to save money, with few believing it leads to improved services.

A survey of 100 human resources directors from government departments, local authorities, NHS trusts and police forces revealed concerns that outsourcing services to private firms would lead to a loss of expertise in the public sector.

The research, by Totaljobs.com, found that almost two-thirds of managers believed outsourcing would cut costs, while only one in four said it would deliver better quality services.

The report will be discussed at the conference aimed at examining the implications on recruitment and skills of Government plans to achieve £40 billion of procurement savings in the next three years

Mike Booker of Totaljobs.com said: “The perception that the skills needed in the public and private sector are somehow different is being swept away by the more pressing need to work together to achieve £40 billion in savings.

“While we’re seeing large numbers of public sector workers looking to migrate to the private sector, it must not be forgotten that essential private sector skills are in high demand in the public sector with our site alone housing 326 postings for public sector procurement professionals.”

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Posted in Campaign4Change, procurement, public sector, public services, SME, social economy, social enterprise

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A webinar on legal, procurement and contractual issues around public sector staff mutuals

Posted on 19/10/2011 | Leave a comment

By David Bicknell

This Thursday, 20th October, Local Government Law.tv is hosting a webinar on procurement and contracts issues arising out of the government’s encouragement of  the formation of staff mutuals by public sector employees to take over the running of services from their employers.

The course will cover the following:

•    Outline Government policy towards transfer to mutuals
•    Explain the provisions of the Community Right to Challenge under the Localism Bill
•    Outline issues which may arise under Public Contract Regulations
•    Consider  the ability of such a body to discharge a statutory function
•    Look at possible contractual issues  to be considered
•    Examine potential Governance issues which may arise

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Posted in Campaign4Change, employment, EU procurement, law, mutualisation, mutuals, procurement, public sector, public services, social economy, social enterprise

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Examining why smaller organisations may be in danger of missing out on public sector contracts

Posted on 10/10/2011 | Leave a comment

This article in the Guardian’s Social Enterprise Network asks whether smaller organisations are getting a raw deal out of public sector contracts. It takes a look at the problem from the point of view of the buyer e.g. a council, and from the SME’s perspective.

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Posted in Campaign4Change, mutualisation, mutuals, procurement, public sector, public services

NPfIT – criminal incompetence says The Times

Posted on 05/10/2011 | 2 comments

By Tony Collins

In an editorial not everyone would have seen, The Times said the history of the NPfIT was “one of criminal incompetence and irresponsibility”.

The main leader in The Times on 23 September had the headline “Connecting to Nowhere”.

It said:

“The comically misnamed Connecting for Health will continue to honour its contracts with big companies and to swallow taxpayers’ money for some time to come: up to £11bn on current estimates. The figure demonstrates the truly egregious scale of the previous Government’s incompetence on this issue: this vast sum seems to have been committed irrevocably, even though the project has never achieved its objectives.

“The story is a dismal catalogue of naivity, ambition and spinelessness. NHS managers and officials …were [not] brave enough to question the direction of travel at crucial moments when IBM and Lockheed pulled out of the project early on. Whitehall was sold a grand vision by consultants, software and technology companies charging grandiose fees. It signed contracts that appear to have been impossible to break when the promised land did not appear. Yet no one seems responsible. No one has been sacked. Most of the officials involved have long moved on…

“There have been spectacular failures in the private sector too. But businesses, with tighter controls on spending, tend to halt things earlier if they are going wrong. Many prefer off-the-shelf systems such as SAP or Oracle, which are tried and tested. They know that it is cheaper to adapt their processes, not the software.

“This newspaper is in favour of serious investment in technology, which could play an important part in economic growth. The NHS debacle has done enormous damage to this country’s reputation for expertise in IT systems. The lessons for the future are clear. Governments must hire people who can make informed and responsible procurement decisions. Patients, in every way, are going to end up paying the price.”

A separate article in The Times 0f 23 September included comments by Campaign4Change whose spokesman said that if the Department of Health continues to spend money on NPfIT suppliers it will probably get poor value for money.

Comment:

Compare the remarks in The Times with those of David Nicholson, Chief Executive of the NHS and Senior Responsible Owner of the NPfIT who refused to agree to a request by 23 academics to have an independent review of the scheme. Nicholson could not contain his enthusiasm for the NPfIT when he told the Public Accounts Committee on 23 May 2011:

 “We spent about 20% of that resource [the £11.4bn projected total spend on the NPfIT] on the acute sector. The other 80% is providing services that literally mean life and death to patients today, and have done for the last period.

“So the Spine, and all those things, provides really, really important services for our patients. If you are going to talk about the totality of the [NPfIT] system … you have to accept that 80% of that programme has been delivered.”

It’s difficult to accept Nicholson’s figures. But even if we do, we’d have to say that the 20% that hasn’t been delivered was the main reason for the NPfIT: a national electronic health record which hasn’t materialised and isn’t likely to in the near future.

The contrasting comments of The Times and Nicholson’s are a reminder that the civil service hierarchy at the Department of Health operates in a world of its own, unanswerable to anyone, not even the Cabinet Office or Downing Street.

Can the Department of Health be trusted to oversee health informatics when it has such close relationships with major IT companies and consultants? While Katie Davis is in charge of health informatics there is at least an independent voice at the DH. But as an interim head of IT how long will she last? The DH has a history of not being keen on independent voices.

Nicholson: still positive after all these years.

NPfIT goes PfffT.

Beyond NPfIT.

Surge in tenders for non-NPfIT systems.

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Posted in Campaign4Change, Government IT, legal disputes, NHS, npfit, openness and transparency, outsourcing, procurement, public sector, public services, supplier relationships, Uncategorized

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Agile for Universal Credit – a good choice says report

Posted on 05/10/2011 | 3 comments

By Tony Collins

Universal Credit is one of  the government’s biggest IT-based projects and the biggest test for agile in the public sector. It is due to start rolling out in April 2013.

The choice of agile for the scheme is supported by a “Starting Gate” review which was carried out for the Cabinet Office’s Major Projects Authority, and for Terry Moran, the Director-General, Universal Credit at the Department for Work and Pensions. The review was carried out between 28 February 2011 and 4 March 2011.

This is what the Starting Gate report says on agile aspects of the project.

Agile

The challenging timetable for delivery of UC meant that DWP elected to use an Agile approach to the delivery. There is no evidence of such a methodology being used on a public sector programme of such scale and during the course of the review it was evident that there had been some initial scepticism to the use of such a methodology with a programme of this scale.

However, during the review there was overwhelming evidence of buy-in to the methodology at all levels up to and including the highest levels. DWP have set about thoroughly educating all involved on what can be expected from them and there was clear evidence within the interviews that this is being taken up enthusiastically.

There was a view that policy decisions being made later in the programme would pose a problem for delivery. This was countered by the view that the methodology should allow decisions to be made when they need to be made, which is in contrast to fixing requirements early in more traditional (‘waterfall’) methodologies.

On balance, the review team found that the use of the chosen methodology here was judged by interviewees to provide greater assurance of delivery in such an environment. The review team agrees with this finding.

In terms of the use of Agile within Government, DWP also have the best current experience via their Automated Service Delivery (ASD) Programme, which used a slightly less ‘lean’ version of the methodology based on an Accenture interpretation.

However, there are still valuable lessons that can be transferred from this programme and there exists experience that is being directly deployed on UC. The review team felt that whilst effectively piloting this methodology on a programme such as UC did pose a risk, this was acceptable in view of the risk of delivery out of line with expectations, for example in terms of timing or quality of service to the public.

Accenture remain involved in UC, although DWP have brought in consultants (Emergn) to provide an independent methodology not based on any ‘out of the box’ methodologies, but rather one that Emergn have tailored.

New contracts supporting this development are due to be awarded in June 2011 and DWP state that their use of this independent methodology will serve to remove any supplier advantage.

There was evidence that DWP have understood the need for decision-making delegated to the level at which the expertise exists, with the appropriate empowerment supported within the planned governance re-design.

There was also an acknowledgement that the right domain/business knowledge needs to be made available at the workshops that will drive the detailed design processes. It was also accepted that there is a continuing need for this knowledge to be made available and also that it will need to keep pace with the changing policy.

One key risk identified by DWP is how an Agile methodology will interact successfully with the various approvals processes that will come into play across the programme – most especially the ICT Spend Approval process (formally known as the ICT Moratorium Exception process).

Engagement has begun already with the Major Projects Authority (MPA) on designing the Integrated Assurance and Approval Plan (IAAP) that will ensure the correct internal and external assurance is brought to bear for the identified approval points. The production of this plan is seen by the review team as a key mitigating factor for the risk identified and it is recommended that this is produced, with MPA guidance, by the end of March 2011 at the latest. This may need fine-tuning as approval points are finally agreed.

Recommendation:

DWP, with guidance and assistance from the MPA, produces an Integrated Assurance and Approvals Plan (IAAP) by the end of March 2011.

As noted earlier, there are contracts that are relevant to this development that are being re-competed at this time, with a wish to award in June 2011. There was some evidence that the design of contracts to deliver in an Agile environment will require a different design in order to draw out supplier behaviour in line with an accelerated delivery environment.

There is a always the risk that any development methodology will fail to deliver and whilst this methodology itself provides early warning of failure, there is recognition that in such a circumstance the prioritisation of customer journeys with high-value returns would be needed.

There was much evidence of the reliance of UC on successful delivery of the HMRC PAYE Real-Time Information (RTI) programme. There was also recognition that whilst ‘just-in-time’ decisions as a consequence of policy development could be made within UC, the RTI requirement would need to be more rigidly fixed as the traditional ‘waterfall’ development methodology in use cannot so easily absorb such changes without consequence.

There was some concern that fraud would remain a major issue for UC and appropriate Information Assurance should be built into the requirement from the outset – rather than being a ‘bolt-on’. Also, as UC and its interface with PAYERTI [PAYE RTI] will become part of the UK Critical National Infrastructure, appropriate discussions should be maintained. There was evidence that DWP have gripped these requirements.

Overall, the use of an Agile methodology remains unproven at this scale and within UK Government; however, the challenging timescale does present DWP with few choices for delivery of such a radical programme.

That said, there has been evidence of strong support at all levels and DWP do have some expertise within their own organisation that they can call upon from the outset. The review team not only felt that an Agile development is an appropriate choice given the constraints, they also believe that DWP are well placed with their level of support, knowledge and enthusiasm to act as a pilot for its use at such a scale.

Compound failure

DWP has made a strong start in identifying risks to delivery.   This could be developed further by thinking through the likelihood and impact of a number of risks being realised simultaneously (eg lack of synchronisation between reduced income and UC top-up, plus wrong employer data plus labour market downturn).and what the responses might be.

The programme could extend its preparedness by drawing on a wider range of experience the elements of recovery and their prioritisation; and test their robustness in advance, including an early warning system for Ministers.

Agile and Universal Credit – Secret report.

Agile can fix failed GovIT says lawyer.

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Posted in Agile, change management, Government IT, innovation, managing change, openness and transparency, procurement, public sector, public services, Uncategorized

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Why the public sector must stop buying printers

Posted on 04/10/2011 | 1 comment

In the first in a series of Campaign4Change guest insights, Tracey Rawling Church, Director of Brand and Reputation at Kyocera Mita UK explains what steps the public sector needs to take to transform its procurement of printers and make its ITTs more cost efficient and low-carbon friendly

To cut its costs and carbon emissions, the public sector should stop buying printers. That may seem a ridiculous statement, coming from an imaging company executive, but actually there’s a serious point here. Most ITTs are written around a notional product – calling for a certain number of machines of a certain specification. And the tender process is quite rigid, so companies invited to tender are forced to propose a solution that fits the criteria in the ITT.

But in many organisations, the number of devices has crept up over time and device to user ratios are unnecessarily high – so replacing machines on a one-for-one basis only perpetuates a system that has become bloated and inefficient.

Sometimes the decision is made to consolidate devices, replacing desktop printers with shared multifunctional devices and an ITT is written on that basis, but to achieve real efficiencies that could reduce costs by typically 30% and carbon by as much as half, a detailed print audit should be undertaken to determine precisely what hardware is needed at which locations to support business processes.

However, even this approach misses the opportunity to obtain a solution that is properly optimised not just at the point of implementation, but into the future.

In the private sector, there is a growing trend towards managed document services, a holistic approach that encompasses every aspect of the printing and imaging needs of an organisation.

A managed document service project begins with a detailed audit of both the machines currently in place and the document flows through and within the organisation. Then a solution is designed that aims to reduce reliance on hard copy by combining document management software with a fleet of machines that have exactly the right functionality to support the document flow.

In most cases, this results in a much smaller number of devices, usually with more extensive functionality than those they replace. A bespoke service contract is crafted that includes remote monitoring of device states, service support to agreed service levels and detailed reporting of device use that can be segmented and analysed in a myriad of ways. And using the business intelligence gained from the reporting suite, the service can be continuously optimised to ensure it remains efficient, accommodating changes in the organisation over time.

For example, the managed document solution provided for insurance giant RSA has reduced paper consumption by 21% in just one year – despite the fact that their product depends on having a printed certificate. And energy consumed by imaging devices has been reduced by 55% with resulting savings in both electricity costs and CRC levies.

As you can imagine, this type of service doesn’t fit easily into a device-centric ITT. So vendors who know they could save cash and carbon through applying a managed document service are forced to respond with a ’round peg, square hole’ solution that is less than ideal, simply because the tender process focuses on products rather than outcomes.

Concerns about carbon emissions and resource scarcity are driving the evolution of innovative business models that overturn conventional norms and challenge the status quo. But unless procurement processes keep pace with these changes, the benefits of this fresh thinking won’t be realised.

To really drive through change, let’s have ITTs written by commercial managers and procurement departments that focus on objectives and targets rather than feeds and speeds. Throw down a challenge to reduce paper consumption by x, cut energy use by y% and drive down costs by z and see what the industry comes up with. I guarantee it will deliver solutions that are more resource efficient, productive and economical.

Events: http://www.kyoceramita.co.uk/index/events.html

MDS in the public sector http://www.kyoceramita.co.uk/index/mds/mds_in_the_public.html
RSA case study
For more information on the full results of the latest independent research into printing attitudes and behaviour,  email Tracey Rawling Church: trc@kyoceramita.co.uk

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Posted in Campaign4Change, environmental, greentech, printers, procurement, public sector, sustainability

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CSC repays £170m to DH after non-signing of MoU

Posted on 03/10/2011 | 1 comment

By Tony Collins

CSC reports today that it has repaid to the Department of Health £170m of a £200m advance it received earlier this year for NHS IT work that was due to be carried out under a memorandum of understanding.

The MoU was not signed as had been expected by 30 September 2011, so CSC has repaid the money.

But the Department of Health has entered into an “extended advance payment agreement” with CSC for £24m.

In a statement dated 3 October 2011 CSC has also disclosed that uncertainty continues over the future of its NPfIT contracts that are worth about £3bn.

It says that it is having a series of meetings with the NHS and Cabinet Office officials over the “next several weeks” and adds that: “there can be no assurance that the MOU [memorandum of understanding] will be approved nor, if it is approved, what final terms will be negotiated and included in the MOU”.

The statement relates to CSC’s negotiations with the Department of Health and the Cabinet Office’s Major Projects Authority over a draft memorandum of understanding that proposes cutting the cost to taxpayers of CSC’s contracts by about £800m but would cut back planned deployments of Lorenzo by nearly two thirds and could nearly double the cost of each remaining deployment. One Cabinet Office official has described the terms of the memorandum of understanding as unacceptable.

CSC says today that “progress is continuing in development and deployment projects under the contract in cooperation with the NHS, although progress has been constrained due to the uncertainty created by the government approval process”.

It adds:

“Humber NHS Foundation Trust has been confirmed as the early adopter for mental health functionality to replace Pennine Care Mental Health Trust, which withdrew as an early adopter in April 2011, and CSC and the NHS are preparing to formally document this replacement under the contract.

“On April 1, 2011, pursuant to the company’s Local Service Provider contract, the NHS made an advance payment to the company of £200m related to the forecasted charges expected by the company during fiscal year 2012.

“The amount of this advance payment contemplated the scope and deployment schedule expected under the MOU and the parties had anticipated that the MOU would be completed and contract amendment negotiations would be underway by September 30, 2011.

“… the advance payment agreement provided the NHS the option to require repayment of the advance payment if the parties were not progressing satisfactorily toward completion of the expected contract amendment by September 30, 2011.

“Because completion of the MOU has been subject to delays in government approvals and, as a result, contract amendment negotiations have not progressed, the NHS required the company to repay approximately £170m of the April 1, 2011 advance payment on September 30, 2011, and the company agreed and made the repayment as requested.

“Also on September 30, 2011, the NHS and the company entered into an extended advance payment agreement providing for an advance payment of approximately £24m to the company in respect of certain forecasted charges for the company’s fiscal year 2012.

“The extended advance payment agreement acknowledges that the company’s Local Service Provider contract, as varied by the parties in 2010, is subject to ongoing discussions between the parties with the intention of entering into a memorandum of understanding setting out the commercial principles for a further set of updated agreements.

“The company intends to discuss the extended advance payment structure and certain fiscal year 2012 deployment charges with the NHS in connection with the MOU negotiations.

“However, there can be no assurance that the parties will enter into the MOU or that the company’s forecasted charges under the contract for the remainder of fiscal year 2012 will not be materially adversely affected as a result of the delay in completing the MOU and the related contract amendment.”

Meanwhile some investors of CSC have taken legal action against the company.

.

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Posted in Government IT, legal disputes, NHS, npfit, procurement, public sector, public services, supplier relationships

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Agile and Universal Credit – secret report

Posted on 30/09/2011 | 4 comments

By Tony Collins

Below are excerpts  from the supposedly confidential “Starting Gate” report by the Cabinet Office’s Major Projects Authority on Universal Credit.

The main finding is that, despite inherent challenges, “the programme can deliver Universal Credit”.

Media reports on Universal Credit have depicted the scheme as an impending disaster that may blight the coalition in the run-up to the next general election, but the Authority’s report says the programme has got off to an impressively strong start.

This will encourage advocates of agile in government as Universal Credit is the Government’s biggest agile development.

We requested the Starting Gate report on Universal Credit under the Freedom of Information Act but the Department for Work and Pensions refused to release it; and turned down our appeal.

We obtained the report outside the FOI Act, via the House of Commons Library. It appears that one part of the DWP was trying to keep the report secret while another part had released it to two Parliamentary committees [the Public Accounts Committee and the Public Administration Select Committee].

It may be that the DWP, when it comes to FOI, doesn’t know clearly what it’s doing – or is all but indifferent to the FOI Act and chooses secrecy to keep things simple. The DWP’s FOI reply to us was, at best, in  perfunctory compliance with the FOI Act. It made no attempt to set out the arguments for its decision not to disclose the report, other than to say disclosure was not in the public interest.

The Starting Gate  report was dated March 2011 and was largely positive about the start of the Universal Credit . These were some of the findings.

Deliverability

“The review team finds that the Programme has got off to an impressively strong start given the demanding timetable and complexity of the design and interdependency with other departments.

“This involves liaison with HMRC in particular, but also with CLG and local government in respect of the replacement of Housing Benefit as part of the Universal Credit.

“We found that the foundations for a delivery Programme are in place – clear policy objectives, a coherent strategy, Ministerial and top management support, financial and human resources – with no obvious gaps.

“The strong working relationship with HMRC and the inclusive approach with other key stakeholders within and outside DWP have quickly established a high level of common understanding.  All this gives a high degree of confidence that, notwithstanding the inherent challenges, the programme can deliver Universal Credit.

“There is a greater degree of uncertainty around the achievability of the intended economic outcomes because of factors which are not within DWP’s control e.g. the general state of the economy and availability of jobs.

“There are other risks which derive from trying new approaches: the Agile methodology offers much promise but it is unproven on this scale and scope.  The actual response of different customer groups to UC may pose a risk to its transformational impact if, for example, factors other than net pay turned out to be a greater barrier to take up of work than expected.

“The development of a range of approaches to contingency planning (which could be beyond changes to UC) could cover off unintended customer behaviour, whether ‘no change’, or ‘change for the worse’.”

Campaign4Change will publish more excepts next week.

Links:

Agile can fix failed Gov’t IT says lawyer

DWP FOI team hides Universal Credit report

Universal Credit – guaranteed to fail?

DWP gives IBM and Capgemini 60 application maintenance and development apps

DWP partners with IBM to help deliver Universal Credit

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Posted in Agile, Campaign4Change, change, change management, government, Government IT, innovation, Lean, managing change, openness and transparency, procurement, public sector, public services, Uncategorized, Universal Credit

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