NSW swings axe on troubled shared services

Red Axe


The New South Wales Baird government has finally come good on its promise to swing the axe on its unloved internal public sector technology and services provider ServiceFirst, announcing that what is left of its legacy workload will be carved-up between outsourcers Unisys and Infosys.

It is believed the organisation is sitting on a structural deficit of around $15 million, a figure likely to have expedited its demise as agencies unshackled from its grip took on more nimble and cost effective providers.

The junking of the in-house shared services play effectively ends an era in NSW where government agencies attempted to save money on technology and services procurement by consolidating their resources into a centralised provider that was usually outpaced and outpriced by competing private sector plays.

It is understood that around 220 NSW public servants left working at ServiceFirst will be affected by the decision with staff being offered multiple options.

Those include taking a voluntary redundancy, transferring to the new providers, applying for a priority transfer within the NSW government or seeking a ‘job swap’ where the position of another public servant seeking a redundancy is substituted for the abolished position.

According to Minister for Finance, Services and Property, Dominic Perrottet, the sending of work to Unisys and Infosys will result in around 6,000 public servants getting access to better and more modern technology tools, improved customer service, 24/7 support and faster turnaround times.

However to achieve that at reasonable cost, the Mr Perrottet has also acknowledged that some work for the government will be ultimately sent offshore.

It is believed that this is likely to consist of some ‘follow the sun’ IT support call centre work as well as coding and maintenance for some legacy applications until they too are retired.

The enduring backlog of some legacy systems in NSW has become near folklore in tech circles with some state public servants still stuck on browsers as old as Internet Explorer 6 (IE6) that was launched in 2001 and pre-dates Windows XP.

Mr Perrottet paid tribute to the efforts made by ServiceFirst employees but stressed the market and the world had moved on to a point where it was no longer viable to support the organisation.

“The hard working ServiceFirst staff have done a terrific job in a difficult environment of making legacy systems and processes work for the agencies they support”, Mr Perrottet said.

“But this model is inefficient, expensive, based on outdated technology and designed for a 9 to 5 world which no longer exists. This is causing our staff frustration and costing taxpayers money.”

According to the Finance minister the new “hybrid delivery model from on-shore and off-shore locations” will also result in the creation of a new specialist delivery centre in Western Sydney.

Meanwhile, estimated savings of around $20 million a year will be reinvested into front-line services, the government says.

The outsourcing contract is not for suppliers with faint hearts. Mr Perrottet, Premier Mike Baird and public service chiefs will all get to experience the transition to external and offshore services given that their own departments are ServiceFirst clients.

Agencies presently supported by ServiceFirst include the Department of Finance, Services & Innovation (DFS&I), Department of Premier and Cabinet (DPC), Department of Planning and Environment (DP&E), The Treasury (Treasury), Service NSW (SNSW) and the Public Service Commission (PSC).

The move to outsourcers is due to be completed by the end of the 2015 calendar year.

NSW Office of Finance, Services and Property list of key benefits for agencies from dismantling of ServiceFirst:

•    Move from ‘nine to five’ service desk arrangements to 24/7 user support, with automated forms and digital service requests
•    Support for employees to use their own mobile and desktop devices in the work environment and out of office access to the desktop to enable flexible work options
•    Shift to an ‘as a service’ model where agencies will be charged for what they use rather than annual billing
•    Reduced costs from the consolidation of multiple on-premise ERP solutions into a single cloud based platform
•    Transition to the NSW Government data centres, in line with the NSW ICT Strategy
•    Potential for other agencies to on-board and leverage scale and efficiencies.

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3 thoughts on “NSW swings axe on troubled shared services

  1. To say that Minister Perrotet, the Premier, and the other Ministers will be using this new Unisys/Infosys service is incorrect. In fact, they will continue to be serviced by the bespoke, gold-plated Ministerial and Parliamentary Services ICT group.

    Your article is also incorrect in that
    1. ServiceFirst is the only Cluster shared-service provider to be outsourced. Bizlink was incorporated into FACS.
    2. Department of Planning is moving from ServiceFirst and are establishing their own shared services using cluster-entity OEH.

  2. The minister has obviously been misinformed about SeviceFirst technology stack and its ability to support its customers.

    ServiceFirst have a fully functioning remote office solution, staff can work remotely 24/7.

    ServiceFirst are also one of the first into GovDC and are consuming as a Service offerings.

    Inefficiency is not the reason why ServiceFirst has a structural deficit, that comes from previous management engaging consulting firms with little or no productivity gains as an outcome.

    Will the Minister be held accoutable if these savings are not realised?

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