[LINK] IDC lukewarm on federal outsourcing overhaul
Wed, 17 Jan 2001 15:53:01 +1100
"Chirgwin, Richard" wrote:
> If, OTOH, the activity is badly-managed, you won't be able to do it
> cheaper - but you're unlikely to have the management skill needed
> to ensure the outsourcer does it cheaper.
Way back when the Labor party was in power, DoFA decided that
outsourcing sounded like a Good Thing. They decided to test the thing
and they cast around to find a suitable candidate. They picked on the
DVA IT shop which was in a total mess. They went out to tender and
awarded a contract to Ferntree to manage the mainframe. Ferntree made
significant changes and sorted out the problems.
When the contract came up for renewall a fresh tender was called and
the desktop was included. IBM GSA (or ISSC) as it was then called won
the contract. This was justification to the DoFA people that
a) outsourcing worked,
b) the government was able to change supplier at the end of a
DoFA were so pleased they then piggybacked off the DVA contract - so
don't believe DoFA if they claim to have had nothing to do with
The objective of improving the management of a poorly run IT shop is a
legitimate one for outsourcing.
Unfortunately not all government IT shops were or are as poorly run as
was the DVA mainframe. Where DoFA made its mistake was in not
appreciating the difference between DVA and other departments and the
DVA model of outsourcing. Neither did they argue sufficiently
forcefully against the full outsourcing model proposed and adopted by
Mr Fahey and his advisor.
My understanding is that OGIT and the CIO recognised the shortcomings
but were over-ridden by those wanting the 25% savings that were in the
pot of gold at the end of the rainbow. At the end of the day, the
political masters call the shots and get the kudos or the blame.
The fact that an opinion has been widely held is no evidence whatever
that it is not utterly absurd; indeed in view of the silliness of the
majority of mankind, a widespread belief is more likely to be foolish
-- Bertrand Russell