Outsourcing Excellence Award – Best ITO Infrastructure – GSA and Catapult Technology
Managing one outsourcing contract can be challenging. How about 39?
Over the years, the General Services Administration (GSA) had built up 39 separate contracts to manage its hardware and software infrastructure across the agency. It had accumulated 15 different help desks to assist thousands of employees located in 11 regions around the globe. “The primary reason for outsourcing the GSA Infrastructure Technology Global Operations (GITGO) was to consolidate our IT infrastructure and make IT more commercial,” says Phil Klokis, director of Enterprise Consolidation Services.
The agency had other challenges. It had no baseline for its IT hardware assets like phones, BlackBerrys, computers, printers, and servers. At the time it outsourced, employees were using 300 different models of desktop printers. There were over a dozen versions of the e-mail client.
Additionally, each regional office provided its own IT infrastructure services. Each office had its own staff “with differing standards of data security,” the GSA executive continues.
Supplier selection
Klokis says “it was a priority to give the contract to a small business” or in government parlance, an 8(a) firm, which means that the company is considered a small disadvantaged business eligible to compete for a certain percentage of government contracts. Catapult Technology qualified because it is a Service-Disabled Veteran-Owned (SDVO) business.
In addition, GSA wanted:
- A strong technology solutions team
- Competitive pricing
- A distinguished performance record
- The financial capacity to execute
The federal government issued a Request for Proposals (RFP) and then selected the winner “especially on cost.” Adds David Lyons, Catapult’s senior vice president of technology and management solutions and chief technology officer, “We weren’t the cheapest, but we provided the best value.”
Transition
“It was a difficult and challenging transition,” reports Lyons. Despite the fact that manufacturers no longer supported their eight-year-old equipment, Klokis says “GSA users were resistant to change. They saw GITGO as disruptive.” He says “changing the culture so people would adopt the new, centralized support model was the biggest challenge. This was the obstacle we had to overcome to make this program a success.”
The GSA executive says the GITGO team held regular meetings “to anticipate and mitigate” this resistance. Lyons says the pair constantly “communicated to the user community why the GSA had to make this change.” Catapult joined GSA in ongoing forums and local “town hall” meetings where the Catapult team and executives of GSA’s Office of the Chief Information Officer (OCIO) could actively solicit users’ ideas. “We stood together and listened to their concerns,” says Lyons.
Three hundred employees from contracting firms who had previously held contracts with the GSA joined Catapult as part of the transition. To ensure the success of the transition, Catapult traveled from coast to coast to capture the institutional knowledge of those workers over the course of 30 days. “The help desk went live on the 31st day, but it took a year to get the kinks out,” he reports.
Solving problems together
At the outset of the GITGO project, says Klokis, GSA “underestimated IT support requirements.” Because the partners had to adopt a common approach to providing customer support, it took longer than planned to stabilize the consolidated help desk. “We only allotted 30 days to make the switch; this task needed 90 days,” he notes.
The current challenge is optimizing the infrastructure. The partners are also working on Local Area Network (LAN) and server consolidation; Catapult is decommissioning hundreds of network devices. Lyons points out the Obama administration has a big emphasis on green technologies, so Catapult is helping GSA go green.
The change of administration gave a public profile to this outsourcing relationship. “We had to make sure the transition between administrations went smoothly,” says Lyons.
Klokis says both organizations are “learning as we go and making strides.” He says the two partners have “created a synergy that helps the agency reach its goals.”
Business benefits
“Despite the complexity, difficulty, and disruptions in the beginning, the consolidation has been worth it,” says Klokis. This outsourcing engagement “effectively” combined 39 contracts into a single contract worth $200 million versus the $270 million the government paid before consolidation.
In addition, GITGO helps achieve GSA’s broader goal of imposing stricter fiscal discipline, which earns a higher return on taxpayer dollars, a big issue in today’s economy. Klokis says at the outset GITGO promised to save American taxpayers at least $15 million per year; these savings came from the decline in IT contract support costs. GSA is investing these funds in new technologies “to make us more agile.”
Outsourcing provides financial transparency into how the GSA spends its IT dollars. “We now have the ability to measure savings,” says Klokis.
The consolidation provides more efficient delivery of more services. “The consolidation made these services more powerful and less costly because they are simplified and streamlined,” reports Klokis.
For example, the help desk consolidation means GSA maintains fewer IT staff but provides better coverage. At the same time, help desk support expanded to 24/7 coverage. And a single system provides faster detection of potential issues by monitoring multiple locations simultaneously.
GITGO provides GSA with a “secure and dependable IT infrastructure that scales to support our business needs,” continues Klokis. He adds the initiative “ensures GSA’s information technology investments increase federal productivity, customer satisfaction, and legal compliance.” Lyons adds that now the IT infrastructure operates under “commercially recognized best practices.”
Users are happy. Catapult conducts a customer satisfaction survey to assess the user experience. The survey’s numbers went up 15 points from year one to year two; “now we’re over 90 percent,” Lyons reports proudly. “We’re doing well.”
Why this relationship works
“We both want to succeed; we both understand the other party has to succeed too. We have a common interest in making each other look good,” says Klokis.
Lyons says “we consider the GSA our partner. We understand their business concerns, especially in this economy.”
To keep interests aligned, this relationship has what the GSA calls “an incentive pay-out.” If Catapult performs above the acceptable levels, it earns an award fee. If its performance falls below the baseline, there are revenue disincentives.
This engagement helped Catapult “grow significantly” since it was the largest award in the company’s history. “It has enabled us to pursue other projects of a similar scope and size,” says Lyons.
The bottom line: “GSA today is more secure, up to date, and agile. We are better able to support key initiatives such as the continuity-of-operations plan and telework,” sums up Klokis.
Lessons from the Outsourcing Journal:
- Don’t underestimate employee resistance to change. Even if the new way of doing business will clearly benefit them, some employees will fight for the status quo.
- Allow enough time to effectively consolidate multiple departments into one.
- Government agencies can function more effectively and save taxpayers money by adopting commercial best practices for their IT infrastructure.
Criteria for Best ITO: Best use of outsourcing to achieve the buyer’s objectives for ITO while also achieving mutually beneficial outcomes.
About the Author: Ben Trowbridge is an accomplished Outsourcing Consultant with extensive experience in outsourcing and managed services. As a former EY Partner and CEO of Alsbridge, he built successful practices in Transformational Outsourcing, Managed services provider, strategic sourcing, BPO, Cybersecurity Managed Services, and IT Outsourcing. Throughout his career, Ben has advised a broad range of clients on outsourcing and global business services strategy and transactions. As the current CEO of the Outsourcing Center, he provides invaluable insights and guidance to buyers and managed services executives. Contact him at [email protected].