Sep 12 2013

How Harrow Council’s IT Transformation Didn’t, uh, Work

thaya_idaikkadar2It’s good to see that Harrow’s Conservative Group, namely Cllr Paul Osborn, are keeping the pressure up on the Council’s cabinet over the recent IT debacle. In a snipping from the minutes of a Cabinet meeting from July 18, Cllr Osborn grabbed Independent Labour’s Leader Idaikkadar and gave him a good pasting. The segment of the minutes is below, but it’s worthy to draw out a few points:

  • The programme is currently 19 months behind schedule.
  • The level of User complaints has been “high” – except when the transformation work was all but stopped for a brief period.
  • User complaints are expected to continue to remain high.
  • Capita, the Council’s outsourcing partner, has already had to hand over £500,000 in service credits (ie: an kind of IOU when they mess up). Given that we don’t know the exact value of the contract, it’s not clear what percentage this is, but it’s not beyond the bounds of possibility that Capita could simply give up and walk away.
  • Leader Idaikkadar defines this as a “success” but was unable to define “failure” when pressed.

Here’s the section of the minutes:

Questioner: Councillor Paul Osborn

Asked of: Councillor Thaya Idaikkadar, Leader of the Council and Portfolio Holder for Business Transformation and  Communications, Finance, Performance, Customer Services and Corporate Services, Property and Major Contracts

Question: “Do you believe that Councillor Graham Henson’s outsourcing of the Council’s IT to Capita has been a success?”

Answer: The decision to outsource the IT service was made following the production by PWC of an options analysis and a business case. This looked at the work that  needed to be done to bring the Council’s aging
infrastructure and Novell operating system up to date.  At the point of outsourcing over 90% of the infrastructure was end of life, following a number of years of under investment.  The Council’s infrastructure at that point was at risk of  major failure and required urgent upgrade.  The Council evaluated outsourcing the service as well as delivering the changes in house.  One of the key factors leading to the decision to  outsource was the perceived risk of doing the essential  transformation in-house versus the opportunity to have  the work done for a fixed price with the risk contractually transferred to a third party.  How has the outsource performed? Let me respond in  two distinct respects:

  1. The day to day activities and daily running of the service and support have been generally very  successful. The challenging KPIs set by the contract have largely been met. A few problem areas have arisen from time to time, such as a delay in setting up new users in the autumn of last year but Capita have been responsive in correcting these issues. Most outages and service credits have been caused by the impact of the Transformation Programme on day to day activities. An example of this is the problems with email immediately following the move to Outlook.
  2. The delivery of the Transformation Programme has been more difficult and there have been considerable delays to the completion of the programme. We are currently expecting the work to be completed by the end of November, some 19 months late. The delays are partly due to the fact that Capita took much longer than they should have to get the programme up and running and have had resourcing difficulties. They have accepted this and the Council’s Chief Executive has been in discussion with Capita’s Chief Executive to ensure that the delivery of this programme is of the highest priority to Capita.

However, much of the delay is due to unexpected complexities in the Harrow environment that have made the Transformation more difficult than anticipated. The risk of completion on time and to budget was transferred to Capita and therefore all cost overruns have been, and continue to be, met by them. While the impact of this on the Council’s performance and reputation is a risk borneby ourselves, the costs are borne by Capita as they are contractually committed to delivering at a fixed price.

A key part of the decision to outsource was based on the risk analysis of Harrow leading the work versus a third party leading the work. The current position demonstrates that the risk element identified by PWC was correct and indeed may have been understated. Therefore despite the delays and difficulties the decision to outsource was I still believe a good one since the alternative would have left the Council exposed to the escalating costs resulting from the delays and the complexities of upgrading from the failing IT infrastructure that the Council had in place at the time. Nevertheless, lessons need to be learnt and I would add that Capita’s life term is coming fairly soon and the new contract is to be procured. Capita can apply if they wish to and I have already instructed officers it will be a cross party vote as part of the evaluation of all new applications.

Supplemental  Question: First of all, we have established in the past that actually the failings started after the outsourcing rather than before the outsourcing but I would just draw your attention to the fact that the service has been so bad that according to the Revenue and Capital Outturn report that went to Cabinet last month, Capita have had to provide credits of over £500,000 and according to page 541 of the agenda for this meeting, a report in your name, Leader, it says about the IT system and the complaints “Complaints have remained high. There was a slight dip in Q2 when Transformation activity was virtually halted but throughout the year the level has been high. It is anticipated there will be further disruptions if we press ahead with the Transformation and complaints are likely to remain high”. My supplementary question is, if you regard that as a success, how exactly would you define failure?

Supplemental  Answer: Well, I think you have got to look at the starting point. You can compare with places like Hammersmith. So if you start with a low base, there are going to be problems but I said that there are lessons to be learnt. Let us work together and get a new contract that is helpful for Harrow.

So, much talk and no answer. But 19 months overdue is a long time. If this were outside in the real world, heads would have rolled by now. But we’re talking about a Council, and although Cllr Henson is not currently a Portfolio Holder, should Labour win the vote next week, it’s entirely possible he’ll be back to carry on with this mess. To be fair, it’s not really ILG’s mess to deal with – this was a contract ill-conceived by Labour.

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  1. prem malkani

    The problem with IT Projects is that the Specification is never right because no one discusses the Project with the End User. The guy who will eventually use the software. That is why major IT Projects fail when large organisations do not have good proactive Project management. The first thing I used to ask for was the User manual before the software was written. This would ensure that the Software developer understood what is required by the users.

  2. A very concerned resident

    Oh dear, after 19 months and we are still wasting public funds on a project that is never likely to work as it should be. When are the council going to learn? Perhaps they should stop making politically motivated decision like the Vaughan expansion and concerntrate on what services are delivered to the residents in a cost effective way. Anything that has been done by the current regime has been a total shambles. That is me being polite. Start learning from your mistakes!!!!!

  3. 4Democracy

    Well said ” A very concerned resident” .Apart from Vaughan being a politically motivated decision how many times did the council’s IT affect the planning application with the site going down on several occasions and last January the planning consultation had to be halted and restarted a few months later as the system could not cope. How much must that have cost?

    Even now, several months later ,on line objections are still missing!

    These IT issues affected many other planning applications and caused great frustration to people

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