Lengthy outsourcing contracts with the private sector for IT services are "highly risky" and "strategic sourcing" is a better alternative, says public sector IT managers association Socitm,
Socitm is bringing out its "Pocket guide 4 – strategic sourcing" this week to set out its thinking about the outsourcing relationships public authorities should have with the private sector.
The guide is the fourth of six booklets the association is publishing to set out key strategies to approach public service reforms.
Socitm says the guide is published at a time "when a catalogue of failed outsourcing deals, and instances of major services being brought back in-house, show how much the public sector still has to learn about procuring and managing wholesale outsourcing".
Strategic sourcing aims to find the best mix of local public, voluntary and private sector organisations to deliver the services required through a range of formulas, from informal service level agreements to formal contracts.
Potential suppliers may include collaborative partnerships, single public sector organisations providing services to other parts of the sector on a commercial basis, voluntary or third sector organisations, the community itself, and commercial suppliers, including SMEs.
Strategic sourcing also acknowledges that that customer requirements change over time, so flexibility is at the heart of a strategic sourcing strategy, said Socitm, in contrast to "expensively procured, fixed ten-year strategic partnerships".
Pocket guide 4 sets out what local public service organisations need to do in order to adopt this way of buying in services. It recommends "eight critical steps for success", from specifying objectives to defining an exit strategy.
“We all need a fundamental re-think about how the public and private sectors engage in IT matters,” said Jos Creese, CIO Hampshire County Council, who will launch the guide at the Socitm 2012 conference this week.
“There needs to be a move away from complex and detailed SLAs where the main emphasis is on getting the contract in place, towards simple statements of outcomes where the main purpose is to get value out of the contract for all parties involved, especially the tax payer,” said Creese.