DOL addresses PPP threats
The Department of Labour (DOL) admits its exit from the Siemens contract poses risks and threats.
CIO Thabo Sefali says expected threats are increased levels of attrition with the current Siemens resource pool, procurement of services that may result in higher than expected costs, the transition to a new operating model, representing an inherent risk in operational stability, and other security risks.
However, he adds the threats are being attended to and the DOL is working on plans to mitigate them.
In February 2011, the IT contract between Siemens and the department - to deliver IT systems - was put under investigation due to non-delivery, among other issues.
At a committee meeting in March, the DOL said it would not renew its contract with Siemens to deliver its IT systems. An early termination of the contract was negotiated for the end of November 2012.
The initial contract was valued at R1.2 billion, over a 10-year period. At its conclusion, in November, it is expected to have nudged up to about R2 billion, with budget overruns attributed mainly to additional services and the rise in the consumer price index, according to the department.
The department yesterday announced a new five-year ICT strategy. It said this is to help it enter a new phase of modernisation to increase its operational efficiencies and strengthen its institutional capacity.
"The 2012-2017 strategy will be a dynamic initiative to propel ICT into the apex as the department embraces change, takes advantage of advancements and furthers the progress of the department's modernisation."
Labour minister Mildred Oliphant said of the strategy: "A new paradigm has dawned upon us requiring that we reflect and take stock of the key lessons learned from previous experiences.
"Our ICT strategy represents how we intend on exploiting human and technology resources at our disposal to speed up service delivery. As such, we endeavour to have an ICT environment that is adaptive and responsive to the continually changing regulatory and legislative environments."
The strategy follows a December 2011 and February 2012 assessment by the DOL to understand the full extent of the ICT landscape and the challenges it was facing.
The DOL says the assessment revealed key challenges facing the ICT department. Some of these included the lack of capacity and strategic capabilities.
It also revealed that the PPP contract provided ICT capabilities with significant gaps that must be addressed in the new ICT strategy and future ICT operating model.
"This strategy explores a five-year horizon; however, an ICT strategy does not remain static, but requires periodic refresh to remain relevant," said Sefali.
He added that failure to implement the strategy means the DOL will regress and possibly remain with the current unacceptable situation of a lag in technological innovation and the department's business units working in silos, without integration at all levels.
"The strategy aims to achieve more with less; technology costs have been reduced over the years, [so] the DOL will have to invest first before we could reap the benefits."
Sefali also said the proliferation of ICT devices and services among members of the public has increased expectations on the quality of services and the opportunity of providing those services smarter and more efficiently.
"We intend to strengthen institutional capacity by using information systems to improve reporting and decision-making capabilities. Among the key lessons learned from the PPP outsourcing has been the importance of retaining a strong internal capacity in IT. To this degree, going forward, IT service provisioning will be delivered by a combination of internal staff and external industry specialists."
The imminent conclusion of the PPP contract, coupled with the challenges it will leave behind, forces the department to re-invent the manner in which ICT will be delivered going forward, he added.
According to Sefali, a positive feature of the new strategy is the pioneering of an ICT Skills Factory vision in which the department will seek to employ the unemployed but qualified people into the junior ranks, allowing them to develop skills in key strategic and operational ICT functions.
"The ICT Skills Factory vision will ensure collaboration with other public sector organisations and ICT industry to develop required and relevant skills not only for the department, but for the country."