A global study by Accenture shows that the South African government is fairly well transformed in terms of outsourcing processes.
According to Accenture`s "Outsourcing in Government" study released this week, IT outsourcing in the SA government is currently focused on applications, specifically financial systems and Internet portals. The report says that although SA is moderately experienced in outsourcing practices, with projects going back to the mid-1980s, it has only recently implemented a structured approach to outsourcing.
The report notes that despite centralised oversight and policy management, outsourcing in SA is largely decentralised, with each department responsible for handling its own deals.
Accenture`s study entailed surveying and interviewing more than150 executives in 23 governments in Africa, Asia, Europe, North America and South America. It found that governments outsource mainly to improve the speed or quality of the service they provide to citizens and other constituents. Among the activities and services that these governments outsource most often are staff training and education programmes; finance and accounting, human resources and supply chain operations; and information technology applications and infrastructure.
The study found that nearly 90% of global government executives outsource activities that are critical to service delivery. Based on the data and in-depth interviews with government executives, Accenture also concluded that governments usually outsource to achieve one of two objectives: make changes in government operations to improve citizen satisfaction and address severe budget deficits, or create efficiencies through cost reductions and greater productivity.
Ryan Johnson, Accenture South Africa associate director, says this country`s government has progressed well down the transformational trajectory, being ranked behind the UK, Canada and the US, next to Australia and ahead of countries like Brazil, Brunei, Mexico, Finland, Norway and France.
Government executives who said they outsourced to gain access to technology, change operations or gain access to workers with specific skills reported greater satisfaction with the results than executives who said they outsourced primarily to reduce costs.
For instance, 71% of executives who said they outsourced to access new technology, 71% of executives who said they outsourced to centralise or standardise operations, and 70% of executives who said they outsourced to gain access to expertise indicated that these objectives were "mostly or fully met". By contrast, only 50% of executives who said they outsourced primarily to reduce costs and only 24% of executives who said they outsourced to increase revenues said their objectives were "mostly or fully met".
The Accenture study also found that governments which used outsourcing to change the way they operate, were more inclined to engage in business process outsourcing than were governments that primarily used outsourcing to reduce costs. More than two-thirds of the executives who said they used outsourcing to transform their agencies indicated that they achieved change by outsourcing business processes.
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