HP will be tasked with managing all of the council's ICT infrastructure, migrating from legacy telecommunications platforms onto a new unified communications platform and revising the authority's end user computing strategy.
As part of the deal, HP will refresh all back end infrastructure in the first 12 months of the contract, according to council documents.
It will also work to improve the council's print services and reduce the total cost of ownership.
The deal was approved by the authority's cabinet during a meeting yesterday morning, a spokesperson told ComputerworldUK.
Worcestershire expects the contract to be in place by December and start in February 2015.
The deal will run for five years with options to extend to a total of seven years, the spokesperson added.
The council report said: “The recommended proposal is expected to deliver a range of benefits, including cumulative revenue savings of £3.4 million over seven years and contribute towards overall cumulative savings of £7.06 million over the same period.”
It said that one of the strength's of HP's bid was “a strong financial model with a shared approach to risk.
“Whilst the council retains the risk relating to the reduction in volumetrics (number of users, devices and servers), HP will assume the risk associated with operational performance and efficiencies.”
The authority said HP's offer was the cheapest of three bids, having reviewed pre-qualification questionnaires from 17 vendors during the procurement exercise.
The documents added that the contract “carries significant strategic importance and visibility within HP due to a strong desire to develop an enhanced presence in the local government marketplace. This is evidenced by their recent win in Norfolk County Council.”
Michael Larner, principal analyst at TechMarketView, said: “The win demonstrates that HP can mitigate falling central government revenues and with the unrelenting pressures on councils Worcestershire will be a key reference point to achieve that objective.”
Earlier this week HP announced it had won a four-year £100 million framework agreement to provide IT services to health and social care organisations in Northern Ireland.