The Southwest One story (part 2) – from hubris to High Court (almost) –

(Dave Orr, retired public servant, IT and project management professional and campaigner for truth continues his story of Southwest One  with the procurement errors made in letting the contract. Part 1 is here)

 The year is 2005 and Project ISiS (Improving Services in Somerset) is underway, led by Somerset County Council from their 4*+ HQ in Taunton…

Were strategic errors in procurement baked into Project ISiS from the outset in 2005, leading to an inevitable partnership breakdown in 2013? Yes, they were.

 ISiS only set high-level, aspirational requirements: for example

  •  to help modernise and transform the overall workings of the County Council and Taunton Deane Borough Council;
  •  to invest in new world-class technologies to improve productivity;
  • a better deal for the public – better and more convenient access to services, joined-up public services, better value for money;
  • a better deal for staff – job security, career development prospects, training opportunities;
  • a better deal for the authorities – better for less; delivery of customer-facing services.

 Why did Somerset County naively leave it to the winning bidder IBM, to do the detailed work, to “square the circle” of: more investment (through borrowing), better services for lower cost and a profit for IBM shareholders? The IBM solution was, utterly predictably, to implement a large and expensive SAP IT system!

 ISiS had “political” timescales set by former CEO Alan Jones that bore no relation to the actual work involved.  Jones set the first completion date just 12 months away from project start! That end date was progressively moved, until ISiS became Southwest One after 2 years and 6 months. Why was crucial, pre-contract work still not carried out (such as detailed service-by-service requirements and baselines)?

 Council services were simply split up into Back Office (in scope) and Front Office (out of scope). That largely exempted the 90% of the out of scope frontline services (Social Care, Schools, Highways etc) where the greatest scope for process improvement and transactional savings lay; also where the greatest beneficial impact for the residents using those frontline Council services lay.

 IBM came up with savings figures for Somerset County that were questionable from the outset: Avon and Somerset Police had a modest procurement savings target of £15m by Southwest One. Yet, Somerset County, with an annual budget three times bigger than the Police, had an un-believable procurement savings target of £192m! To win the contract, did IBM overestimate the procurement spend in Somerset County and under estimate how well it was already procured? Result: Business won, credibility lost.

 The ideal of a “Strategic Partnership” relationship was elevated to avoid the need for the Council to be savvy and recognise the realities of commerce. Was the Council in denial of the need for hard contract management skills, for a complex contract, over a long 10-year term?

 The contract called for transformation based upon “world-class technologies”, yet all of the IT Service was placed into Southwest One with no IT expertise back in the Somerset County client (until after a poor SAP implementation in 2009). Was the lack of retained IT skills in the Somerset County client behind the formal acceptance of a badly configured SAP implementation?

 The contract was let in the boom times of 2005-07 to take the Council to something Jones hubristically called “Beyond Excellence”; a veritable “land of milk and honey”. When boom turned into bust in 2007/08 with big funding cuts in 2010/11, why was the Southwest One contract not adaptable or flexible enough, to support “less services from a lot less funding”?

 Former CEO Jones was totally intolerant of all challenge to his Vision for ISiS. He insultingly labelled people who questioned the innate risks involved in a complex, long-term contract as being “Organisational Terrorists”! Did the intolerance of all challenge, lead to poor risk management?

 The staff-side commissioned a report from Professor Dexter Whitfield in July 2007. His report highlighted the future outcomes for Southwest One with uncanny accuracy:

“ISiS faces five main risks -

•           Operational failure to meet the performance and investment requirements.

•             Partnership failure

•             Shared services failure

•             Savings smaller than planned

•             Inward investment lower than forecast”

You, dear reader, can sit comfortably and be the virtual juror, in the court of your own opinion, as you watch the key players being forensically cross-examined in the ITV West Eye View programme (allow 23 minutes):  http://www.youtube.com/watch?v=rmW99D-r2MQ

  Next week: Part 3…  The Southwest One story turns controversial in 2009, with SAP implementation issues, disastrous reputational results and relationships becoming strained.

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