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Biggest Contract Ever has One of the Shortest Procurement Timeframes Ever

by Kim James •
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The recent announcement of IBM as the successful tenderer for DIMA’s $495m Systems for People redevelopment is a major event. If press reportage is accurate, and it has been let as one contract to IBM, it is in fact the single biggest ICT contract ever awarded by a federal government agency, overshadowing the next closest, the ATO's $262m contract with Accenture by a long stretch. The Accenture contract is the only one above $200m, but contracts between $100m and $200m have been a little more commonplace over the last four years.

The relative speed with which this largest ever procurement has happened is in contrast to the usually long time frames required for the procurement of major government projects, indicating the degree of pressure the agency has been under to respond to the criticism of DIMA’s systems in the Palmer and Comrie inquiries in mid 2005.

However, in truth this procurement has a history which stretches back further than the September 2005 briefing sessions where DIMA outlined its needs to the industry.

Prior to that, the then DIMIA had been considering its IT directions through preparation for 'next generation' outsourcing arrangements and a range of other initiatives including biometric trials, so was in procurement mode already.

This procurement may have had a more traditional duration if it had not been for impetus created for the Systems for People project by the Palmer and Comrie inquiries in mid 2005. These inquiries found that serious flaws in DIMA’s immigration systems had led to the wrongful detention and deportation of two Australian citizens and recommended review of the systems by IT specialists.

The government and departmental response was, by public sector standards, swift.

  • A new Deputy Secretary, Bob Correll, was made CIO in September 2005. He announced that the full procurement process for a range of DIMA initiatives would go ahead as soon as possible, without waiting for the results of forthcoming IT specialist reviews, as an indication of the urgency of the project. DIMA also restructured its IT areas.
  • 'Health' assessments of current systems were commissioned in September 2005 with CSC and a review of business information needs in October 2005 with Apis Consulting.
  • DIMA held industry briefings on 27 and 30 September to outline its procurement plans for 2005-07. Proof-of-concept demonstrations by invited suppliers including Tibco, Software AG and PegaSystems followed.
  • EOI documents were released in November 2005, initiating a multi-stage tender process. Tenderers were advised that the results would be impacted by the results of the reviews. This procurement process then ran until May 2006, with Bob Corell indicating to Senate Estimates in April that DIMA was still evaluating proposals and hoped to have a strategic partner appointed by mid-year.
  • CSC and Apis reviews were released in January 2006, providing key input to funding and other subsequent decisions, including procurement.
  • DIMA established panels in March/April for project management, project team and IT architecture services. Both the project team and IT architecture panels were valued at $50m.
  • Additional funding of $376m was provided in the 2005-06 Federal Budget along with $119m of existing funding.
  • IBM was announced as successful tenderer in June 2006, heading a consortium which includes Microsoft, Oracle, Siebel, Tibco, RuleBurst and Apis Consulting.

The timeline described here covers 10 months, with DIMA moving at top speed through its procurement processes and Budget funding readily and promptly available.

Less urgent initiatives have been known to take up to 2 years (and sometimes more) to move through scoping and procurement processes and receive funding.

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  • Federal
  • Health
  • Accenture
  • Bob Correll
  • Contract
  • DIMA
  • IBM
  • Systems for People
  • tender