It was a real shock that EDS won that deal, said Kilroe. The big question for me is how the MoD is going to measure what they want. I guarantee they won’t be able to measure it 100% a few years down the line, and that’s why things are always destined to failure.
EDS’s track record in the UK government sector has been tarnished by recent botched IT projects for the UK Government’s Child Support Agency, Department of Work and Pensions, and Inland Revenue. However, Plano, Texas-based EDS beat out a rival consortium called Radii, led by Computer Sciences Corp to win the multi-billion-dollar contract that will see EDS create the Defence Intelligence Infrastructure, which is a common IT network that will bring together the information systems of the Army, RAF, and Royal Navy.
The project will be staggered over three separate incremental phases to protect the buyer from project mismanagement. The first increment of the project is worth some 2.3bn pounds ($4.4bn) over seven years to EDS and its consortium partners Fujitsu Services, General Dynamics, EADS Defence and Security Systems, and LogicaCMG.
Two further increments start in 2007 and in 2008, respectively, but these are only available if EDS and its partners meet their strict performance targets. The MoD also has the option to hand over responsibility for the program to another member of the consortium should EDS prove to be not up to the job, and it can also step in to temporarily manage the contract itself.
Kilroe has doubts about the long-term viability of the project. In an outsourced contract, the first year is always hunky-dory, said Kilroe, but in years two or three things start to fall apart, because performance can’t be measured by function point.
Kilroe estimates that between 20% and 25% of all deals fall down due to the lack of transparency of how the outsourced service is performing. The MoD contract will have serious challenges without application intelligence software, he said.
Meudon, France-based Cast provides application management software that can monitor the performance of outsourced projects, such as application, mainframe, and distributed outsourcing services. It uses industry standards to feed back information such as service levels, cost, functionality, and quality compliance to either the IT buyer or outsourcer.
However, Ed Kirby, director at outsourcing consultant Morgan Chambers, said EDS has been unfairly treated, and that the primarily blame for past mistakes lies with the client.
EDS is simply being used as the whipping boy, he said. The question is, can the MoD gear itself up to buy what EDS can deliver? The MoD is steeped in history, but it is the people on the ground that have to change. The CSA and DWP problems arose because they haven’t been able to change their internal politics.
