Industry news

As part of the Government's commitment to delivering world-class digital products, the Minister for Cabinet Office Francis Maude has announced the Identity Assurance programme would be receiving an extra £10 million in funding.

The Identity Assurance programme deals with the way a service provider can be assured that the customer or user is who they say they are as they access Government services.

CSC and Educational Testing Service Announce Five-and-a-half Year, $200+ Million Contract Renewal and Expansion for IT Services

ETS to Leverage CSC’s Industry-Leading Cloud Services Including CloudCompute Infrastructure as a Service

CSC has announced that it has signed a five-and-a-half year information technology (IT) operations outsourcing contract renewal and expansion with Educational Testing Service (ETS), the leader in advancing quality and equity in education for people worldwide. The agreement was signed in the second quarter of CSC fiscal year 2012, and has an estimated value of more than $200 million assuming all options are exercised.

As part of the agreement, CSC will continue to bring new and innovative approaches to the way ETS leverages IT. CSC will provide its industry-leading cloud services to ETS including CloudCompute, the new infrastructure as a service (IaaS) architecture deployed in the CSC Trusted Cloud Datacenters. CloudCompute, a VMware vCloud Datacenter Service, delivers compute, storage and network resources “as a service” to support any application and is especially suited for hosting mission-critical and business-critical workloads.

“CSC has provided IT solutions for ETS since 2001. We are pleased to continue our long time relationship with CSC and are confident their IT solutions will have a positive effect on ETS business,” said Daniel Wakeman, Vice President and Chief Information Officer at ETS.

IT Services provider Plan-Net plc have agreed a 5-year IT outsourcing contract with the west end law firm Davenport Lyons.

Plan-Net will provide Davenport Lyons with a new virtual infrastructure and 24/7 support delivered from an onsite team and dedicated legal IT support centre based in central London.

Plan-Net Director Adrian Polley commented: ‘We are extremely pleased to be adding Davenport Lyons to our growing list of legal clients and look forward to delivering the high levels service required in this sector’

A Government investment of £950 million will help create and safeguard more than 200,000 jobs across England, the Deputy Prime Minister Nick Clegg has annouced.

The second round of the Government’s £1.4 billion Regional Growth Fund (RGF) will support 119 bids from businesses and local partnerships with projects to expand their operations, create new jobs and attract private investment. Discussions are ongoing with a further 10 bidders about their projects.

Of the 201,000 jobs created or protected, around 37,000 will be directly created jobs, and more than 164,000 will be in the supply chain. The Government investment will support nearly £6 billion of private investment secured by the successful projects.

Expressions of interest are sought for commercial partner/s to provide a managed wide-area network referred to as the LINK, for a range of public sector organisations in East Sussex, Brighton and Hove, West Sussex and the immediate proximity.

The contract is worth up to £100m and should last up to 10 years.

"The provider will maintain and implement operational procedures and standards to fulfil and satisfy the demands of the public sector and in response to public-sector policy demands," reads the tender.

Serco, which runs outsourcing operations ranging from overseas air traffic control centres to school inspections in UK, is buying Excelior, an Australian contact centre firm, for A$13.2m (€10m).

Chief Executive Officer of Serco Asia Pacific, David Campbell, said the company would be managed and run as part of the Serco Australia business. It will also leverage Serco's global capability by forming part of the wider Serco Global BPO capability.

G4S, the security group, has confirmed that it had abandoned its £5.2bn bid to buy ISS, the Danish cleaning company, after belatedly realising the depth of shareholder opposition to such a move.

It also said that it would incur costs of about £50m related to the abortive deal, which had been announced in mid-October. An associated £2bn rights issue has also been called off.

The search for operational cost savings and increased effectiveness is common to public sector organisations across the globe. With that, demand for cloud services within the global public sector has never been more acute as challenging economic conditions bring the benefits of the cloud to the fore.

It could be argued that it would make little sense for most public sector bodies to run their own IT infrastructure when they can work with companies that have advanced systems, skills and scale that can guarantee economies of scale and reliability that might be unachievable for even the largest public bodies due to the complexity and expertise required.

Despite a strong culture of outsourcing, progress in delivering the G-cloud, which will replace the current myriad of department hosted IT systems with dedicated government secure data centres in the UK, has been hampered by the high costs and complexity around meeting government information assurance policy.

The good news is that there has been a notable acceleration in the acceptance that these concerns can be addressed within a well-designed, secure and managed infrastructure. In fact, in a report issued by the Cabinet Office on March 2011, shared IT infrastructure, open-source software and a stripped-back IT estate are at the very heart of the UK government's ICT strategy.

On this note, Savvis launched the Government Wide Services (GWS) (accredited IL2/IL3) shared service platform earlier this year. The platform is now available to all government departments and third-party government suppliers in the UK. GWS is having a positive impact on the uptake of hosted IT operations and services within the UK government, which in turn provides the potential for a more agile and efficient public sector.

GWS offers government departments and public sector bodies flexible procurement of data centre infrastructure that includes converged connectivity to secure government networks.

Working in partnership with Savvis enables the public sector the ability to leverage cloud capabilities. This further paves the way for a new wave of smart services and lays the groundwork for government application stores, which will further drive down the cost of IT for the country.

Utilising the pre-built, accredited platform virtually eliminates upfront capital costs for new public sector projects, whilst decreasing the deployment time of IT projects dramatically. Government IT departments and suppliers in turn benefit from immediate access to infrastructure and only pay for the consumption of their IT services on a pay-as-you-go basis, rather than the costly procurement, maintenance and management of hardware seen in the past.

With government analysis indicating there is potential for annual savings by 2020 of between £1.9bn and £3.8bn from moving public sector IT infrastructure to the cloud (Cabinet office G-cloud Programme outline), there is an obvious monetary advantage to the G-cloud project. However, what must not be forgotten amidst the headline billions of pounds saved is the myriad of other added benefits that migrating to hosted services will bring.

Increased collaboration and sharing of good practice have been shown to improve innovation and cut costs in the private sector and these benefits will be mirrored in the public sector. As more and more public sector bodies share information and ideas and begin to use similar systems with a common purpose, there is likely to be a shift away from the traditional public sector procurement models that often proved expensive and time consuming in the past.

In addition to the cost saving, it allows in-house IT teams to concentrate the majority of their effort by supporting the business through development of business critical systems rather than focusing on maintenance of the infrastructure elements of the system.

The benefits of cloud computing are being experienced throughout the private sector, from multinational corporations to SMEs and the introduction of the G-cloud programme is a signal that the public sector will not be left trailing behind. In the end, a potential £3.8bn saved is not the only silver lining in the cloud.

The drive for a more customer centric approach and focus is even greater in today’s market than ever before. The agility of any sourcing professional to engage, articulate and secure the trust of the customer is taken for granted in today’s competitive business landscape. What sets one apart from the crowd however is the ability to take personal ownership for customer satisfaction, resolving issues and exceptions perhaps occasionally exceeding the customers’ expectations or even delighting them.

Insight, control and compliance are now key attributes that any service professional must bring to the table. The ability to transform and adapt to the customer’s environment while providing a client centric leadership approach to procurement can only enhance the customer’s journey and experience.

Time and again the customer’s expectations are at best mis-managed and at worst not even remotely considered which is tantamount to gross negligence and mis-conduct disenfranchising the customer from the procurement experience and process. Procurement teams, meanwhile, are constantly striving to avoid a ‘business pariah’ label and be accepted within the business community for the benefits they can and do deliver.

Procurement is at times perceived as burdensome bureaucracy, a dark art, that complicates what, in the eyes of the budget holder, is already a ‘done deal’ and something that should be kept at arms length. The procurement professional must embrace the concept of customer service and satisfaction adapting their style to ingratiate themselves to the rest of the business to truly become an asset with widely recognised intrinsic value.

Outside the office doors, as consumers, we demand higher and higher levels of customer service driven by our insatiable need for an easier, less complicated life, so why should our customers be any different. Quick enough to establish robust and rigorous levels of customer service with the supply chain to deliver contractual commitments, procurement should consider establishing a service charter of it’s own to it’s customers, the budget holders, that not only commits to the delivery of tangible financial benefits but also establishes a commitment to customer service and satisfaction.

Only by investing in these less tangible skill sets will procurement dispel the metaphor of Neanderthal man on the hunt wielding a big stick against the supply chain and win the hearts and minds of the wider establishment to truly instil procurement as an integral part of any business community.

Procurement after all is a service not a privilege and our ability to interact and converse with our customers are as vital to realising value from any supplier relationship as any honed negotiation skills. The true value is the sustainability of the relationship and our ability to act responsibly and with responsibility.

Through a higher quality customer service experience we can establish solid and sustainable relationships with our ‘customers’ whether they are internal stakeholders, suppliers, colleagues or within our private lives that will stand the test of time and challenge. It is essential to the fabric of our business, and social, interactions that the more willing we are as individuals to accept and take responsibilities for our actions and the way we behave, the more our customers will value us for our integrity, contribution and insight embracing the procurement service.

Often BPO is used by Procurement as a means of applying labour arbitrage, exporting a bundle of processes and activities off-shore, for these processes then to be optimised overtime.

Some use BPO as a means to augment procurement resources and cover more spend. However few use BPO as a strategic lever to “drop in” a new best in class business process that will resolve current inefficiencies and secure Procurement is involved in the right places throughout the purchase cycle.

Procurement professionals can buy best practice processes for specific business activities (or spend categories), like Fleet, Travel, Resourcing, or FM. Proven solutions that have Procurement embedded in the right places of the business cycle, and with the visibility to manage the supply base for continuous improvements.

Take for example Resourcing Process Outsourcing (RPO), often offered by recruitment companies, followed by Outsourcers specialising in off-shoring. RPO often creates a “black box”, from which Procurement can only influence via audits. This puts procurement in a difficult position. After the honeymoon period is over. The better alternative is to have Procurement inserted at the right stages of the process, and make sure the suppliers are engaged in win-win solutions that incentivise them to offer best value. Xchanging offer a vendor neutral process, where we manage the supply chain from start of hiring to payment to the contractors. We ensure this is done efficiently to a high service standard. Along the way we manage compliance to policies and save our customers money by ensure accuracy in billing. We work with the supply base in a collaboratively to create win-win situation been the suppliers and our customers. We don’t focus on reducing the agencies mark-ups on candidates, but rather on incentivising them to find the best value candidate for the customer.

Another example of where BPO can solve procurement challenges is FM outsourcing. A full outsource of the FM portfolio also creates a “black box” which is difficult to un-tangle. It also creates a challenge around spend visibility, not allowing finance or procurement to understand the drivers. We manage the back-office financial processing for our clients in the FM market, covering transactional and administrational tasks from Vendor set-ups to Payment, including all the financial reporting. Our standard platform services are able to deliver clear tracking of budgets and spend across the portfolio. Most finance and procurement functions recognise the challenge in obtaining granular visibility of the spend across a real estate portfolio. “Drop-in” Xchanging’s platform services and achieves full visibility to track budgets and compliance to the procurement strategy.

Furthermore, we are seeing emerging interest for complete “drop-in” Procurement solutions, inclusive of people, processes, and technologies, across all categories of spend. These solutions enable our customers to drive procurement value across their businesses to an accelerated timetable, as opposed to building from scratch or adding to legacy business processes

Procurement professionals can apply BPO to act quicker in the value delivery, while becoming strategic contributors to their businesses.