Minneapolis: Once More into the Breach

He knows the risks, but he still wants to give it a shot. Karl Kaiser, CIO of the city of Minneapolis, is issuing an RFP to outsource “the break-and-fix business”?all the city’s desktops, networks, help desk and support staff. “I’ve decided that 60 percent of my money and management go into that break-and-fix business,” Kaiser says. “I want to refocus on becoming an information services provider rather than a maintenance organization.”

He has the same compelling argument the state of Connecticut and San Diego County used to promote outsourcing: that a single vendor could beef up the city’s IT infrastructure and simultaneously reduce the cost of doing business by as much as $12.5 million over seven years.

But Kaiser also faces the same challenges that have crippled those other initiatives?changing the way government does business and selling the change to powerful labor unions. So far, Kaiser has persuaded a majority of the City Council to at least support his outsourcing RFP, which was supposed to hit the streets in April. If all goes as planned, Kaiser hopes to return to the council with a winning bid and a contract proposal in July.

The Minnesota Public Employees Association, which stands to lose 45 members (including its chapter president) through outsourcing, is bracing for a fight, however. “They’re powerful?labor does have a strong influence on who’s elected,” Kaiser says. But he feels his business case for outsourcing is even more powerful. “The state government is in a $2 billion deficit and is actually trying to get money back from the cities,” Kaiser says. “Our timing couldn’t be better.”

But, then, Connecticut and San Diego County felt the same way. And today they know better.