10 June 2002
Logica@local
By Golnaz Bybordi
Logica's progress in the public sector is gathering momentum with the signing of a £12 million, 10-year contract to be a strategic IT partner to the London Borough of Waltham Forest.
Central to the implementation of the new IT systems is the potential to achieve greater efficiency, improve business processes and induce the change required for the council to operate successfully in a commercial environment. The Borough's procurement function is expected to be the main area where efficiencies will be made. The plan is not only to better manage the basic purchasing processes but also to employ a much more structured procurement strategy and overall operation.
Ian Robertson, Manager of Logica's SAP practice and David Lowson, Director of Logica's local government practice are keen to stress that good business leadership will be required to get everyone at the council to use the new system effectively. This is a crucial point as payback on this large expenditure by the council will depend on the degree of uptake of the new system. It also constitutes a management issue which has deep implications for the structuring of risk and reward in strategic partnerships.
The council has already shown what seems to be strong focus in hiring their new IT partners. It certainly helped that the sponsors of the project knew what they wanted and how to get it. For example the terms and conditions of the contract and detailed issues did not present stumbling blocks which meant a very short procurement process for the project. Whether the close familiarity of those behind the contract with SAP ultimately provides value for money will be a subject for discussion and one that will unfold with time and examination of the project.
Another deciding factor for Waltham Forest was Logica's understanding of the public sector. This includes knowledge gained from the successful partnership recently developed with Haringey. Here Logica is undertaking a £13m, 10-year contract for the integration of financial, human resources and payroll functions which, the Council estimates will deliver 3%-6% efficiency savings. Logica is also employed by the Guernsey Government under a 5-year contract to improve core process. Guernsey expects to make 5% savings in procurement, equivalent to £3.5m annually.
The Logica group can also boast successes in other parts of the public sector such as being selected as preferred bidder for an advanced satellite communications system for the MoD and a £200m deal with the Crown Prosecution Service for the management of IT services and the development of a new case management system. With a strong local government focus, further wins are expected in this area and the company is at short-list stage with other councils. They can also lay claim to having been the employer of the new eCommerce Minister, Stephen Timms.
The Waltham Forest win for Logica highlights the company's emphasis on striving to be a strategic partner that understands the business of government. The test for both the Council and Logica is whether in practice they can make the project work well enough to achieve the savings and improvements required to show value for money on the contact.
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