Blackberry News & Tips Newsletter
 
NEWSLETTERS
 

CIO.com updates, insights and advice on technology, management and your career.

 
 
 
LEADERSHIP
 
CIO Executive Programs
The Leader in Face-to-Face Education for Senior Executives

Offering regional and national programs, CIO (and CSO) events bring together some of the most respected names and thought leaders in information technology and security. Presented by CIOs and other senior level executives, these invitation-only programs offer timely topics and strong networking. Learn More »

 
CIO Executive Council
A Peer-Advisory Service and Professional Association for CIOs

Mid-Market CIO Panel: Tips and Techniques for Improving Vendor Relationships

July 15, 4:00 PM - 5:00 PM U.S./Eastern (GMT-4)

We'll highlight relationship priorities and best practices identified in a Council study, and we'll interact with a CIO panel on the approaches they've used to improve strategic vendor partnerships.

Secrets of Successful Vendor Contract Negotiations for the Mid-Market

Sept. 10, 2009, 11:00 AM - 12:00 PM U.S./Eastern (GMT-4)

On this free public Council teleconference, Matthew A. Karlyn, attorney at Foley & Lardner in Boston, will share tips on negotiating tactics and new, creative contract terms to help mid-market CIOs make better deals.

Executive Competencies Assessment Tool

Assess Your Business Leadership Skills with the Council's new benchmarking tool. Rate yourself in change leadership, strategy, customer focus and more.

More / Register »

Learn more about the CIO Executive Council »



 
 
RESOURCE CENTER
 
 
 
SUBSCRIBE TO CIO
 
Are you involved in setting the direction for your company's IT budget or strategy?

Apply today for a FREE subscription to CIO Magazine!

 
 

Government Outsourcing: San Diego Tries to Learn from Contract Mistakes

San Diego County's first big outsourcing deal was heralded as a test of whether wholesale outsourcing would work for local government, but is mostly remembered for the controversy it generated. Will the second time be the charm?

 

May 01, 2006CIO

In January, San Diego awarded a seven-year outsourcing contract worth approximately $650 million to Northrop Grumman Information Technology to run the county’s IT operations. It’s the second such deal for San Diego. The first—a 1999 deal with Computer Sciences Corp.—was heralded as a test of whether wholesale outsourcing would work for local government but is mostly remembered for the controversy it generated over costs, service levels and a problematic ERP rollout. At the height of the troubles, the county threatened to hold CSC in breach of contract.

This time, it’s going to be different. Or will it?

David Perara, an independent analyst who previously led Meta Group’s price benchmarking group, says commercial companies also struggle with large outsourcing deals, and the second experience is usually better than the first. A problem with the first San Diego deal was a lack of sufficient detail in the contract regarding prices, responsibilities and service levels. (To find out more about San Diego’s past outsourcing troubles, see www.cio.com/050106.)

The county appears to have corrected that problem, according to outsourcing experts who reviewed the Northrop Grumman contract. “They clearly learned the importance of defining the service responsibilities between themselves and the service provider,” says Perara.

For instance, the county has created 59 line items to delineate responsibilities for running the help desk. Among those responsibilities, Northrop Grumman must produce and submit help desk solutions and service-level requirements, and the county has responsibility for reviewing and approving them.

Consistent with commercial best practices, the contract also breaks out pricing for services into components. Desktop maintenance costs, for example, are broken out into hardware, software and printer maintenance, among other line items. The first contract included only a lump sum annual service charge, Perara says.

But while it’s generally better to provide more detail than less, the county may have overcorrected in some spots, particularly in the voluminous details concerning service-level definitions. A 152-page document defines the operational services and 76 minimum acceptable service levels, each with its own penalty (transaction response time has nine service levels associated with it, and desktop repair has 15).

“You should only define the service levels that are truly important and provide sufficient incentive for the vendor not to miss them,” says Adam Strichman, vice president of outsourcing advisory firm Nautilus Advisors. With so many service levels in the new contract, he says, the contractor would have to miss many service levels at the same time before a major financial deterrent would become evident.

 
 
Loading...
 
WHITE PAPERS

Managing an Offshore Development Center

Since the early 1990's companies have been searching for places in the world where they can tap into reduced development costs and a better business environment.
 

The Future of Financial Reporting

Finance and accounting executives must understand, adapt to, and manage the costs associated with changes: and doing so opens an opportunity to leverage this shift to better position their companies in the eyes of the investment community.
 

Offset Expenditures with Old Switches

Learn how to unleash the hidden cash in your used equipment.
 

5 Tips for Data Loss Prevention Solutions

RSA® The Security Division of EMC has identified 5 key considerations to help organizations simplify the evaluation process for selecting a DLP solution that is right for their business.
 

Communications Transformation Platform

The Communications Transformation Platform enables you to provide the services your customers demand - faster, cheaper and with less risk.
 

Global Change in the TV Industry

Capgemini and MediaXchange have captured key insight to the change across the TV industry.
 

WEBCASTS

Managing Client Systems in the Enterprise

Keeping client systems costs under control is just one of the many initiatives IT must address when trying to manag...
 

IT Consolidation Made Easy

The Primary IT Initiative for Reducing Costs
 

Webcast with Dan Vesset: Investing in Business Analytics Technology

What exactly is business analytics and why should you care? Dan Vesset of IDC and Gaurav Verma of SAS answer this a...
 

Capitalize on Your SAP Content

After 18 years of partnership and over 3,000 successful customer deployments, Open Text has become SAP's premier pa...
 

Enterprise Cloud Computing: Ready for Primetime?

The progression toward enterprise cloud computing is happening today, as industry leaders deploy technologies that ...
 

Preparing Your Business Services for the Future

Would you trust your network monitoring tools enough to know when something is truly halting a business service? Wh...
 

Resource Alerts

Get instant email notifications by topic when white papers, webcasts, and case studies are added to our library.

 
FEATURED SPONSORS
 
 
 
SPONSORED LINKS
 

Offshoring Risks - How Will You Stay in Control?

64-page prescriptive guide to security, compliance, and IT operations.

Get Google Enterprise Search for your business information.

Accenture IT Consulting: Enabling high performance. More...

Top Five CIO Challenges

Insight makes it easy to spend your Microsoft subsidy check.

Five minute business analytics assessment. Immediate results.

Dangerous Collaboration Practices: 5 Ways IT Can Minimize Risk

Accenture: Outsourcing for uncertain times. Click to learn more.

Keep online transactions fast with CA Wily APM

Get agile IT security with CA Security Management

Trade in your old laser printer and get up to $1000 back!

Taking the Service Desk to the Next Level

Revolutionizing Enterprise Application Deployment

Why Data Loss is Increasing--and What You Can Do About It

Data Loss Prevention: A Better Way to Approach Security

Learn how to managing client systems in the enterprise.

Build a High-Performance Open Web Platform

Mid-Sized Company CIO Community: infoBOOM!

Enterprise PBX Comparison Guide

Getting Value from Outdated Networking Equipment

Top-line Performance that's Bottom-line Efficient

White Paper: 8 Key Ingredients to Building an Internal Cloud

Read about virtualization and consolidation effort best practices

Building the Virtualized Enterprise with VMware Infrastructure

Reduce risk, gain agility. See how Progress can help your business.

Improve ROI, lower TCO and reduce energy consumption.

Introducing the new HP ProLiant G6 server family

Accenture: Outsourcing for Competitive Advantage. More...

Better spam protection with Postini for just $1/user/mo

Introducing the new HP ProLiant G6 server family

infoBOOM! - The Mid-Sized Company CIO's Exclusive Community

Accenture IT Consulting: Logical meets technological. More . . .

The Fraudster Economy Model: Operating a Business in the Underground

Payback in 9 months with CA Spectrum solutions

The Case for Investing in Business Analytics Technology. Read white paper.

Live Webinar: Applying Business Analytics. Click here to learn more

Seven Ways ITIL Can Help You in an Economic Downturn

Developing A Dynamic, Real-Time IT Infrastructure

Maximizing the Business Value of the PC Infrastructure

Communications and Collaboration Needs at Business Organizations

Using Open Source to Deploy Web Applications

Cloud Computing: Read about VMware's compelling vision & set of products

Enterprise PBX Buyer's Guide

Secondary Market Primer: Your Network at Half Price

How Interactive Viewer Reduces the Effort to Meet Visualization Requirements

Stop Application Fraud at the Source with Device Reputation

Learn about the VMware vSphere (TM) & Intel (R) Xeon (R) Processor 5500 Series

Learn how a virtualized enterprise can help your company reduce costs

Why Isn't Server Virtualization Saving Us More?