Partnerships between private and public sector organisations in outsourcing and development can work, provided the parties have the same vision and the same business model in mind, says a senior Accenture consultant.Karyn Mottershead, Australia-based partner responsible for “solutions operations” — outsourcing — for the consultancy’s Asia-Pacific region, replies to the scepticism of SAP’s Dietmar Pfaehler’s about public-private partnerships (see No justification for 'e-waiting': Boyle) by suggesting that he is viewing matters from a software vendor perspective.
“If you were a car salesman, whom would you sooner sell to — a mechanic or someone who knows nothing about car engines?”
The situation is similar when a software vendor finds itself selling to a strong partnership involving a consultancy that knows the IT business throroughly, as opposed to selling directly to a government department, she says.
The business model should be designed to support the common vision and should be set out in writing and agreed to. Where outsourcing partnerships fail, it is often because of a divergence of objectives, she says. A helpdesk partnership in which the government agency has the objective of making citizens’ and businesses’ lives easier but the helpdesk provider is being paid a fixed fee per call, for example, is doomed to failure.
Accenture itself redesigned IT-based services for the Ministry of Community and Social Services in Ontario, Canada, “where we only got paid if we delivered savings”, she says. This is working well and has attracted favourable published comment from the ministry, she says. Accenture also had a successful joint-venture with Belgium’s government-owned postal company.
With the public-private partnerships that have failed “you have to ask whether it is because they are PPPs, or because the model is wrong”, she says. PPP contracts will be complex, and will undoubtedly grow and change. It is unrealistic to regard what is signed on day one as the contract for all time, Mottershead says. Managing the inevitable variations also needs special skills. “We don’t trust [our ordinary consultants] to do it; we have a special unit dedicated to managing contracts.”
Many providers, and even their customers, try to carry “private-sector thinking” into public-sector relationships, she says. Changes of government and policy ensure that the public sector is more fluid than the private sector, she says.
Organisations entering a PPP, must have not only a shared vision and business model but an agreed exit strategy if the arrangement does not produce the expected results, she says. This avoids the damage done by an uncontrolled collapse.