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sourcingfocus.com speaks to Sander Kristel, the CIO of Staffordshire County Council about the benefits they have seen from implementing one the country’s first Public Services Networks.

Kcom were selected by Staffordshire County Council to deliver one of the country’s first public services networks (PSN). Can you give an overview of the PSN and how it will be used by Staffordshire County Council?

The public services network gives the ability to any public sector organisation in or around Staffordshire for broadband connectivity, for any sort of telephone solution and for contact centre solutions as well. The partners can then choose under the contract which services they want to buy, and how they want to implement them. For instance some partners might want a fully managed service, and others might want to manage parts of the services themselves. For the County Council as the lead body in this agreement, it’s a broadband service that we deliver to all our County Council sites and also to the vast majority of our schools. Other partners that have joined up until now are all South Staffordshire Health Partners, Lichfield District Council, and we also provide the education network for Wolverhampton City Council as well.

How is the PSN benefiting the residents of Staffordshire?

Well, it’s in a number of levels. First of all, it’s really important for a PSN that it’s cheaper for the partners than going out and getting connectivity themselves. Clearly there is a saving for the taxpayer; at the start we estimated the saving to be at least £1 million, but actually we can see now that that saving will increase over time. More important than the technology itself and the direct savings, it’s all about shared working and shared services that we provide because the public sector can be quite a complex environment for a customer to manoeuvre. So for us to be able to provide end to end services and work more closely together we need to share more information securely and appropriately, we need to share buildings etc. To do that you really need to write plumbing underneath it to underpin it all and to make it easy to do, and that’s exactly what our PSN does.

On that theme of shared working, can you tell me more about Staffordshire’s integration of public services in general?

As an example, we are the first in the country to have a significant amount of our social workers move into an integrated health trust. For example, a social worker could arrive at someone’s home in the morning and do an assessment of what the needs of that client are. A nurse could be there in the afternoon and do exactly the same, and neither knowing the other was carrying out the same task, which is obviously very inefficient, and annoying for our residents. By moving our social workers into the integrated health trust we avoid a lot of duplication and we hope to improve and enhance the services for our customers, as well as reducing costs.

Which examples of best practice would you like to highlight from the implementation of the PSN from Kcom?

I think what was really important for me was to be completely transparent to all of your partners. For us, this is not something we want to make a profit on; we have been completely transparent with regards to costs, to rollout – and that’s where you could run into some problems with your rollout, you have to be completely transparent for your partners because trust in a relationship like this is incredibly important. Furthermore it was really important that the solution and the contract have flexibility, as mentioned earlier, some partners still want to manage aspects of their contract. If you don’t accommodate for that they will turn around and say “this is not for me, and I don’t want to join this.”

Can you give me some examples of how you maintain transparency throughout that period?

If you look at the procurement, we ran it as a competitive dialogue process and we invited partners even though they hadn’t signed up to the PSN on day one, and they had the opportunity to hear what the suppliers were saying, see the costs, and have conversations with the suppliers. As long as you keep that consistent throughout the process it’s a really good way for partners to get some trust in you and show that you’re not trying to fleece them.

Could you tell me more about the initial procurement exercise and why Staffordshire decided to partner with Kcom?

Obviously in the public sector the procurement processes that we run are very stringent, they can be quite cumbersome at times. We chose a competitive dialogue process because at the time that we did it the Public Services Network framework hadn’t been awarded yet so we had to do it ourselves. We chose the competitive dialogue process because it allows transparency, you can invite partners in, but also because we weren’t entirely sure what it was exactly that we wanted. We knew we wanted something that was shared, and we really wanted to get the expert input from the supplier to help define what it was that we wanted.

Now throughout that process it was clear to us that to be more flexible, more cost effective etc. that we could still achieve the same outcomes but by incorporating other technologies into the solution as well. That is where Kcom were very strong with the flexibility of their solution as well as the price.

What do you see as the up and coming trends in shared services and shared working in general, how do you see it developing and evolving across other counties?

I think, like the county council is doing now, a lot more councils, particularly county councils, will become commissioning organisations so they won’t necessarily deliver all those services themselves, but they will commission them. So shared working will be a lot more evident in the public sector and more important in future, as well as more shared work with other public sector organisations because we have to provide more end to end services for the public. But also shared working with the private sector and looking at more innovative vehicles like joint ventures and social enterprises, which will definitely develop and grow.

Following Infosys’ disappointing revenue guidance, shares slipped by around 2% today as investors continued to sell stock. Infosys announced growth predictions at 8%-10%, despite the industry association NASSCOM predicting growth of 11%-14%.

This has led to growing concerns amongst the analyst community. Many think that Infosys’ guidance can be taken as a bench mark for the whole of the Indian IT industry due to their sheer size. So why is the industry, and Infosys in particular, struggling?

V. Balakrishnan, Chief Financial Officer of Infosys, has blamed an unstable economic environment for the poor predictions: “You should understand, the economic volatility is too high and most of our revenue comes from US and Europe. In the March quarter, we have seen confluence of three or four things.” He continued: “Today, the challenge is not about budgets because most of the clients have finalised the budgets and budgets are either flat of slightly down but the ability to focus on the spending has come down.”

While the European crisis still lingers, it appears that the US is on its way to recovery, however, Infosys are yet to see the benefits of this. In the upcoming US election, outsourcing has become something of a dirty word, and politicians may become obliged to crack down on immigration issues. V. Balakrishnan says: “It is going to be volatile because if you look at all the recent macroeconomic data emerging from US, there are concerns about growth. The employment creation has not been up to the expectation”. Infosys themselves are under investigation for allegedly flouting immigration laws to get Indian employees in to the US.

This desire to keep work on shore also suggests that the trend for outsourcing solely for cost cuttings sake is ending. Previously, 90% of Infosys sales were made up of basic “application development and maintenance work”. As modern businesses look to also keep quality of service and innovation at the heart of any outsourcing venture, cost cutting becomes a secondary benefit. This means that businesses who would previously offshore to India, now want IT services performed locally.

However, while the outlook may appear gloomy for Infosys, they are well positioned to recover from this minor crisis.

Infosys have built a strong onshore US presence, with 15,000 employees based there. If new US laws, such as the ‘House Bill (HB) 3596’, which is currently being tabled, do not hurt the firm too badly, they have in place a great infrastructure for recovery, despite the added competition of huge firms such as IBM.

For Infosys, geographical expansion seems to be a key goal, as echoed in the recent news that they are keen to expand their European presence. According to recent reports, the firm are willing to spend as much as $500 million on an individual European acquisition, as they look to purchase business that own intellectual property and niche consulting firms to boost business on the continent.

While this may mean that Infosys may have to sacrifice the benefits of low cost labour, they have adjusted accordingly to maintain their reputation as an attractive outsourcing supplier. Sales of lesser skilled work has now fallen to 40%, and Infosys have moved their focus to complex consultancy work, with adjusting business models to adapt to new mobile technology and smartphones one of the services on offer. In a recent survey of 267 bankers, 40% of respondents said that they would like the facilities for mobile corporate banking, and Infosys are responding to provide these in demand services.

The fate of Infosys is yet to be determined. So, while on the surface, a sharp drop in share price may suggest a bleak outlook for Infosys, the infrastructure and strategy they have in place should see them bounce back stronger than ever.

With the recent announcement of G-Cloud project director Chris Chant’s retirement at the end of this month, coupled with his public criticism of the implementation of the project, it’s clear that the G-Cloud is facing difficulties.

The G-Cloud was conceived as a programme in order to radically change the way in which the public sector operates with ICT, and create a competitive marketplace for sourcing Cloud software contracts. It was developed in order to provide economic savings and increase efficiency through a flexible system. The G-Cloud in providing a competitive marketplace was designed to encourage suppliers to increase the quality and value of their services.

While the G-Cloud has seen the adoption of the framework across much of the civil service and the use of included services such as Cloud email, progress has been limited by public sector hesitance to fully utilise its services. The implementation of the G-Cloud has been hindered by CIOs failing to properly utilise the full benefits of the program.

Chant prior to his resignation stated that departments had continued to enter into costly and ineffective contracts with large companies. CIOs have failed to effectively source contracts or utilise the broad range of cloud computing suppliers provided through the G-Cloud, or take advantage of SMEs in order to increase savings and reduce risk of project failure. This reluctance to fully employ the competitive benefits of the G-Cloud has hindered the progression and modernisation of ICT within the public sector.

The G-Cloud also faces limitations imposed by security concerns. Chant expressed on his blog that Government policy “allowed our users to suffer with IT that is a decade – or more – behind what they are using at home.” His replacement Home Office IT director Denise McDonagh, faces multiple obstacles to overcome in the continued development of the G-Cloud. There are signs of light from within the public sector as attitudes begin to change. The economy has brought pressure on departments to ensure that contracts are of better value and quality.

In the coming months McDonagh will be getting to grips with a framework that requires the involvement of IT SMEs to ensure the success of the G-Cloud. Chris Chant his written that CIOs are starting to become more flexible, and that the days of poor value services from large corporations are numbered. The success of the G-Cloud rests heavily on the Public Sectors own flexibility in its application and in offering competitive contracts to a wide range of users.

Growing London as a digital centre London has been receiving a lot of column inches recently pushing the capitals growth as a technology center, at the same time government led initiates have pushed the same agenda.With the economic pressure of 2012 the government has been quick to support the growing London IT industry, however the attempt to develop London into a technology hub has been met with long term obstacles.

At the Inno Tech Summit in London today, some of the issues which are affecting London’s attempts to position itself digital centre where detailed by leaders within the industry. Charles Irving, co-founder of Pond Ventures, spoke to delegates about the lack of investors with knowledge of the industry, saying: "We are a long, long way to having smarter investors in Europe."

While the government have taken steps to promote digital start-ups by providing tax breaks in the 2012 budget and encouraging the growth of hubs containing up and coming business, Irving said that this is of little actual importance to investors. Companies are looking for cheap locations for development and London fails to compete with other markets such as Berlin, "As investors, we could not care less if [the start-up] is in London, Berlin or Silicon Valley.”

While companies and investors are looking for talent which London possesses, the city is unattractive economically in comparison to nearby neighbours. There is risk of a brain-drain where talent grown in London is taken to develop technology in cheaper locations. Irving suggested that the support of tech city and other hub ventures was also missing the end objective and that customers represent a more effective if figurative hub to base business around.

Boris Johnson’s campaigning in the run up to mayoral elections included his pledge to turn London into one of the top digital cities and being number one for Wi-Fi connectivity, however government input can only achieve so much progress. The growth of the UK digital industry depends on expanding the UK consumer base and reducing operating costs for companies.

The French utility company GDF Suez has entered into a contract to secure the remaining 30 percent of British International Power that it does not already own.

In securing complete coverage of the British electricity company, GDF are looking to increase coverage of global and developing markets with view to substantially increasing future growth.

Spokesmen from GDF comment today saying,"IPR has leading positions in regions supported by steady energy demand such as South America, the Middle East, South-East Asia and Australia."

International IT security managers' organisation (ISACA) have released COBIT 5, a free to download business governance framework. The open design customisable software has been created in order to meet the requirements of security, management and regulatory compliance.

ISCACA commented that the growth of Cloud computing can provide significant savings, but introduces new risks including the transferring of IT decision making progress from IT specialists to business leaders.

Derek Oliver, co-chair of the COBIT 5 Task Force, said: "Information is the currency of the 21st century and COBIT helps enterprises effectively govern and manage this critical asset."

London is being limited as a digital city because of a lack of investors who are familiar with the industry and of the high costs of development in the city.

Charles Irving, co-founder of Pond Ventures, said "You want to pitch to people who understand your business. Investors have to remain experienced."

Irving said today at the London Inno Tech Summit that while Government initiatives had helped growth, London faced obstacles in developing its position as a technology hub in comparison to Berlin and Silicon Valley because of high prices.

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Infosys Ltd (INFO) are looking to spend $500 million on acquiring European business. The Indian computer-service provider walked away from a $645 million deal in 2008 to secure UK based Axon Group and are now looking again to expand their portfolio.

With research suggesting that Europe will experience slow technology spending in 2012, the investment of Indian based companies will be welcomed.

Chandrashekar Kakal, head of Infosys global IT services, said in an interview: “We do have cash, but we are looking for a company which adds to our capability and becomes complementary to our growth rather than becoming a laggard.”

The Federal Communications Commission has levied the maximum fine of $25,000 after a regulatory probe into Google’s privacy practices.

The FCC conducted an investigation into the companies email, text messages and information provided through the Street View map service. Google has come under increasing scrutiny from regulators over the firms data policies and its past practice of collecting sensitive data from wireless networks.

Marc Rotenberg, executive director of the Electronic Privacy Information Center, which requested the FCC investigation, said “Google unlawfully intercepted and stored millions of wireless communications from Wi-Fi routers.”

Interserve, which is already involved in providing welfare-to-work programmes for the public sector, has announced a joint deal with Durham Tees Valley Probation Trust to run UK prison and prohibition services.

The move comes as the government looks to further open up the probation service to the private sector, with justice secretary Kenneth Clarke proposing complete privatisation.

Interserve is just one of six competing firms looking to run three of nine prisons that have been opened up to the private sector. The contracts also include bonuses based on the rate of re-offenses committed by inmates.