ICT functions responding well to recessionary pressures

Published on Friday, 07 September 2012 11:20
Posted by Scott Buckler

Local authority ICT functions are responding well to the twin challenges of doing more for less and playing a key role in transforming their organisations for an austere future

This is the conclusion of Making do with less, Soctim's report and summary of results for 2011 from its benchmarking service that assesses the performance of council ICT departments.

Despite a tough year operating with increasing demands and reduced resources, ICT functions have done well to maintain user satisfaction with services above Socitm's target benchmark. However, the tension between growing demand for ICT services, reflecting the role ICT is expected to play in transforming other services, has led to a decline in user satisfaction almost every front.

The report says there is no sign of light at the end of the austerity tunnel. While there are variations in the proportions of overall budget allocated to ICT, no organisation has escaped the funding squeeze. On the plus side, the evidence to date suggests that ICT functions will respond well to the extreme challenges likely in the years ahead.

In current and likely future circumstances, the report identifies four priorities for ICT managers.

  • Protect ICT's budget share by promoting the role, achievements and credibility of the ICT function, and explaining how reduced budget impacts on other services. Explain that only through investment in exploiting information assets will public services survive four years of austerity without very significant service reductions at the front line. ICT investment is central to the organisation's ability to transform.

  • Focus on reducing total costs of ownership. Different procurement practices mean variations in ICT costs remain very wide and organisations should be working together to increase purchasing power. If they are not in full control off the procurement process, ICT managers should take a strong client role in dealing with their procurement colleagues.

  • Review insourcing vs outsourcing. Outsourcers usually provide good services when measured against those metrics that are used as part of contract performance. However, long term contracts can inhibit change, including the ability to exploit opportunities like cloud computing and shared services. A long contract based upon 2010 service delivery methods and volumes may seem very expensive in just two to three years' time. Managing innovation and reaping benefits can be difficult done at arm's length through an external provider.

  • Review information and technology strategies. It is essential that information and technology strategies align with and support the corporate strategy, and the corporate strategy should take advantage of the potential of technology. Agility and flexibility should be built into the ICT service and the technology estate. Every possible opportunity and value must be extracted from information assets. Standards and best practice must be adhere to in order to facilitate opportunities for sharing that deliver economies of scale and reduction of overheads.

The report also explains the importance of benchmarking as a tool in the ICT manager's kitbag. Analysis only of one's own organisation's costs or performance without reference to others' is not a good starting point when arguing for scarce resources in tough times. Benchmarking also allows organisations to probe into processes and procedures, ask relevant questions that reveal how to strip out costs and increase efficiency, and accurately target opportunities to save.

Benchmarking also plays a key role in preparing for and managing the performance of both shared and outsourced services – routes many authorities are embarking on in the search for major savings. In both cases benchmarking establishes baseline costs and performance against which future progress can be measured.

This point is strongly made in the LGA report Services shared: costs spared? published in August, which says: 'Another key lesson [of the report] is the need for baseline financial and service information. This is an essential part of the preparation for setting up a shared service and developing a robust business case. It also allows management and stakeholders to track whether the anticipated benefits are being achieved and to take remedial action as required.'

Source: ©Socitm

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