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Defence names Systems Integration panelists

by Paris Cowan •
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The Department of Defence has released a list of the five Preferred Industry Partners (PIPs) making up its Applications Managed Services Partner Agreement (AMSPA). 

Some have strong track records with Defence and DMO, others less so.  There are also several noteworthy absences as some of Defence /DMO’s traditional suppliers failed to achieve places on the panel.

Defence expects to channel an estimated $340 million worth of systems integrations work through the AMSPA over the next three years.

The panel will be available to Defence and the Defence Materiel Organisation (DMO) only, which runs counter to the trend Intermedium sees across the rest of Canberra, which is to make panels available for multi-agency use.

All five PIPs are major players in the ICT industry and have previous supply relationships with Defence. 

They are:

  1. Accenture;
  2. BAE Systems;
  3. CSC;
  4. Hewlett-Packard; and
  5. IBM.

As previously reported by Intermedium, the AMSPA introduces a new model of panel procurement into the Federal Government.

After a lengthy process of industry consultation, which commenced in September 2010, Defence has settled on an industry partnership model which will place the five panelists at the interface between the department and its supplier base.

The PIPs will perform a dual role for Defence’s Chief Information Officer Group (CIOG). They will be expected to provide both systems integration services in their own right while also interposing between Defence and other suppliers with the expectation of leveraging better procurement and project outcomes for the Department.

It is likely that this model will result in extensive sub-contracting opportunities for other suppliers, but at the PIP’s discretion.

In fact, some of the biggest current suppliers to Defence will find themselves in the position of having to pursue these sub-contracting opportunities.

Fujitsu was the biggest IT services supplier to Defence and DMO from 2008-09 to the present (three financial years), with $253 million worth of contracts signed in the period. The second and third ranked IT Services suppliers to Defence and DMO for this period, Thales and Raytheon, similarly did not make the panel.

CSC, IBM and Accenture rank fourth, fifth and sixth respectively by total value of IT Services contracts at Defence / DMO in this period.

In terms of 2011-12 performance across all components of IT supply (Hardware, Software, IT Services and Telecommunications), CSC signed almost $126 million in total value via 51 separate  ICT contracts with the Defence agencies in 2010-11, including $52 million for the development of an electronic health data information system.

IBM signed 133 contracts with the agencies in 2010-11 with a total value of $44 million.

BAE Systems also signed 133 contracts with Defence and DMO, but with a total value of $38 million.

Hewlett-Packard signed 214 contracts for a total value of $27 million.

Accenture is the only one of the five PIPs to win less than $20 million in total value of contracts with the Defence agencies in 2010-11, achieving $8.5 million in total contract value across 11 contracts.  

There is a strong likelihood that this panel will be one of a handful of major IT services panels which the Australian Government Information Management Office (AGIMO) has suggested will make up the government marketplace of the future.

While an ‘approach to the market’ for a Whole-of-Government IT Services Panel is yet to commence, the Australian Tax Office has announced the membership of its Application Services Panel. DHS has confirmed its intention to renew its ICT Contractor Panel in 2011-12.


Related Articles:

A share of $340 million up for grabs as Defence embarks on journey to transform supplier relations

IT Services Panels – Defence shortlists industry partners, and ATO apps panel opens for business

DHS ICT Contractor Panel to be renewed in 2011-12

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