Tuesday, 29 September 2009

Wellington Confidential: NZ Treasury looking to save 30 per cent 'back office' costs

NZ Treasury wants to save 30 percent of IT costs
Courtesy of Twitter and a news report today from the Dominion Post, I learned that the NZ Treasury held a vendor briefing in Wellington last Friday, to outline their plans to centralised 'back office' services, and save 30 per cent of costs through savings and increased productivity. Quite what the scale and intent of the latter encompasses, is yet to be detailed. However, it's reported that this includes, IT Services. 

These, days, as with its mystic twin, 'interactive' when I hear the phrase IT services, I reach for my gun. I mean, in an age when every conceivable human activity  from birth to death, has an ICT touch point, what in the name of a parallel universe of flying blue ducks does IT services mean?

Centralise back office - save 30%
Well apparently, according to Fairfax Media's Dominion Post, here,  whatever it is, the NZ Treasury believes the 30 per cent savings are achievable. 

As to how - what - and why - well we are in the dark on all three. However, given that according to OECD figures, New Zealand government services, both local and national, take up 35% of GDP, we are not talking trivial here.  Indeed, taking logic to the extreme, it would appear that NZ Treasury have found at least a corner casing to the holy grail of public service efficiencies?

Testing the quality of the gold plate
So how do we test this claim? Ah - well there's the first obstacle. Apparently, the announcement came at a vendor briefing held by Treasury last Friday, at which its claimed the participants were advised the briefing was confidential.

It's also reported that at the meeting  Treasury officials hinted they were looking for a single provider of a size and reach that could handle the load. Sub text - a multinational - or at least one of the big consulting giants - with no need for the small - the gifted and the agile to apply because, according to a Treasury participant, ' he doubted there were many small service providers with the expertise and experience sought'.

2nd October, 2009, 11am, 1 The Terrace, Wellington for another briefing
Missed the first installment of Wellington Confidential? Want to test the accuracy of these reports for yourself? Never fear -  I learn from GETS, the government tender site, that there will be a second briefing to be held at 11am on 2nd October, at the Treasury, No1 the Terrace, Wellington

The forum
is for vendors 'interested in providing the Treasury with management and technology consulting services' Additionally, the forum will 'indicate Treasury’s requirements in relation to benchmarking and the preparation of a business case to support a whole of government initiative'

How big was the room?
And yes, this is indeed a repeat of the same forum described by the Dominion report and is being held, again according to GETS, 'because many vendors were unable to fit into the venue'

It's also noted that the material used at last Friday’s forum will not be posted on GETS until after this weeks forum.
So, if interested, prospective vendors should RSVP indicating numbers to statesectorproducitivity@treasury.govt.nz

Some thoughts for the briefing
As I live in Auckland, and have prior commitments, I wont be able to attend.  However, someone might like to ask some questions on my behalf?

NZ Treasury versus SSC?
First, why is this being run by the NZ Treasury? I thought the notion of an integrated public sector, and in particular, a vibrant and efficient e-government strategy was the responsibility of the NZ State Services Commission, SSC ?

Also, what is the role and status of the NZ CIO here?  Since the last incumbent resigned, the notion of a joint up strategy for government services seems to have taken a back seat - at least from an SCC perspective. And now we have NZ Treasury running briefings? Doesn't make a lot of sense from way up here in Auckland.

The Wellington thing
Of course, that might be entirely the whole point. For those unfamiliar with the way NZ Government works, it's hard to get over how central Wellington is to the whole of the government procurement process. Not only does half the city work in government, it feels - not entirely fairly I might add - that the other half consists of companies servicing the various needs of government.

And, being essentially a small town, everyone talks to everyone else, so sometimes it feels like people don't feel the need to consult wider, because everyone who needs to know, will already have heard. Without raising my head to think, I can count two projects that immediately fit that bill.

That said
That said, and to balance the analysis, in the ICT and online service delivery area - a couple of other nuances are worth noting. Firstly, there is already a substantial market for the big multinational integrators, especially around platform and service support. Secondly, the big consulting firms do seem to have a healthy, and I might add very competent relationship with the NZ public sector around strategy and independent policy advice, even if their pre-cooked methodologies can, on occasion, appear on the laptop, just a tad too early.

The Third Sector - small - bright - agile
However, there is a third sector - if I may call it that - one which consists of a myriad of small firms -  studios - agencies - who, either as consultants, boutique service studios, provide the bulk of the external consultancy, support and development to the plethora of public agencies who see online as a core service delivery channel.
And for sure, I should declare an interest in that I co-run one of these.

No doubt, especially from the perspective of people who don't use them, from the outside dealing with this sector can look messy and disconnected. In short, untidy.

However, it's to be hoped that the NZ Treasury hasn't got it into its head that untidy is inefficient. Or worse, stupid. And that some single agency, or a few competing big contracts will provide the magic efficiencies. Nothing feels more likely to provide exactly the opposite .

Like the rest of the web, online government services - especially when trying to connect with the emerging social and semantic personalised web, needs small, smart and agile.  'Tis to be hoped someone takes the opportunity to remind them of this on Friday.

Mike Pearson, free lance consultant, and former SSC  solution architect has posted a good summary of the session, here.


Anonymous said...

To speak plainly, SSC has been gutted and they have little technical knowledge left.

What knowledge was there was went to DIA who, it would seem, would be better suited.

Are there any names of who's involved at Treasury.

(interestingly the capcha for my comment is "rationalise")

Hamish Keith said...

Don't you have a close friend who might well have been complaining and moaning and pointing this out to you for yonks

Adam said...

Great. Treasury wants to shift it to the"bill and bullshit" sector of the market who will outsource what they can to their Philippine subsidiaries while continuing to charge out at NZ/Aust/US rates. Just as well then the govt IT sector is all individual fieldoms who will fight this to the death.

Hamish said...

So just after the GSN gets slapped down to the lower layers of the networking stack, Treasury seeks to resuscitate the ongoing fantasy that "joined up Government" will be more efficient, more effective and less costly.

Some dreams never die.

(Here's what pops into my when people mention "joined up:" http://www.abc.net.au/news/photos/2007/11/20/2096057.htm
For an Auckland perspective Paul, consider what's going to happen when all your parts (Super City)are joined up, what is the past tense of arthritis?

Not having attended, and not being the least bit involved, this sounds like a bit of Government Cloud computing, at least a giant Microsoft Exchange installation selling seats to agencies, perhaps incorporating the GTS network for carriage, and just possibly some kind of Public Records Act compliant DMS?

All made out of whole cloth in my head.

I mean forget the complexity of ICT, is there even a whole of Government electricity deal?

Anonymous said...

(same Anonymous guy here again)

More details over at the Mike Pearson blog,


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