BT and Rotherham Metropolitan Borough Council are setting up a new company, RBT Connect Ltd, which will take over the management of the council’s ICT functions, as well as back-office processes including procurement, revenues and benefits, HR administration and payroll.

The JV will also implement a customer relationship management system based on applications from Siebel Systems Inc, which will enable the borough’s residents to contact the council using different channels including email, telephone, internet and text message. In the region of 100 staff from the council will transfer to the JV as part of the deal, through which the council hopes to reduce its operating costs by 50m pounds ($80m) over the venture’s course.

Jonathon Prew, strategic services manager at Rotherham Borough Council told ComputerWire that one of the aims of structuring the relationship with BT as a joint venture is to eventually offer the services provided by RBT Connect to other local authorities and small and medium-sized companies. However, the 150m pound ($240m) figure does not include any potential revenue from third-party customers.

To date, most local government organizations in the UK have focused on building individual relationships with IT services suppliers. It is usually the case that one local authority uses a different outsourcing vendor from its neighboring authorities to process its benefits claims or payroll, even though they would benefit from the economies of scale that buying from a single vendor using a single data center would deliver.

But Prew believes this mindset is changing. Local authorities have tended to take a local perspective, and it is only recently that they have started to work with companies from the private sector, he said. It is inevitable that we will move towards a shared services model in order to drive efficiencies. He said that back-office processes such as payroll and administrative services are ripe for a shared services model. With UK local authorities under pressure to offer citizens access to services through e-government portals, Prew said that even though they may require a local front end, certain features could be replicable.

Source: Computerwire