311 systems come of age

When IBM Corp. acquired PricewaterhouseCoopers Consulting Ltd. in October 2002, the company decided that the market for non-emergency call centers, so-called 311 systems, wasn't promising enough to stay involved.

But having submitted a proposal for a new 311 system in Fairfax County, Va., Big Blue appears ready to charge back into the market in 2006. The county was scheduled to award the contract in early February, but a spokeswoman said, as of press time, the proposals still were under review, and the announcement could come later in the month.

Stefanie Langsam, formerly a principal consultant at PWC and now an associate partner with IBM Public Sector, said IBM is waiting to see if it wins the Fairfax contract, which could launch the company back into the 311 market.

"We're in that stage where it's just starting to look like there might be something out there that interests us," Langsam said.

10 years in the making

Nearly a decade ago, the Federal Communications Commission designated 311 as a telephone number for non-emergency calls, such as alerting public works departments about potholes in need of repair. The idea was to relieve pressure on 911 emergency systems. As a result, large cities including Baltimore, Chicago, Houston and New York began building 311 systems.

Some of these systems have evolved to include several agencies and their IT systems. They let citizens call one number and get answers to a variety of questions and concerns.

A sophisticated 311 system can collect, analyze and report data for local governments, letting them save money by more efficiently allocating resources for city services.

Recent events, such as Hurricane Katrina, have shown the need for these systems. As hurricane evacuees arrived in Houston, the Federal Emergency Management Agency set up a call center in Houston's 311 center to help relocation efforts, said Unisys Corp. program director Mike Antash.

"If you look in those areas of Florida and Texas where the storms came through, those disasters really brought this to the forefront," said Kenny Leverett, a national sales director with Motorola Inc.

Many counties are looking to join forces with cities and other counties to share costs of a 311 system. Right now, Miami and Miami-Dade County in Florida share the lone joint system, said Alan Shark, executive director of Public Technologies Inc., a Washington non-profit research and development firm for local governments.

"I see a trend where people get stymied when they try to justify costs, and they hit a wall, and they suddenly realize that this could be a win-win for a whole region if they get together," Shark said. "We're going to see more of that."

Different strokes

A philosophical divide separates vendors in the local government 311 market. There are those such as Motorola and Remedy Corp. of Sunnyvale, Calif., which offer work order management tools.

On the other side sit systems integrators, such as Unisys and Accenture Ltd., which implement customer relationship management tools, mainly from Oracle Corp. The Redwood Shores, Calif., company strengthened its 311 capabilities the past two years through its purchases of Siebel Systems Inc. and PeopleSoft Inc., the primary CRM software vendors in the United States.

These systems can change the culture of city operations and link services under one information system via a centralized call center. They also can collect, report and analyze data, though many must be expanded to take full advantage of those features. Incident-based systems also have this option, but it is not a focus, said Motorola product manager Scott Imhoff.

"The service model here is much more holistic and customer-service-focused than many of the ones you see," said Marc Marin, a director with Accenture's government practice. He said systems tend to focus primarily on processing service requests and providing some public safety features.

Even Microsoft Corp. has joined the fray with a new offering that has Extensible Markup Language functionality, Shark said. As more companies pursue 311 systems work, prices will likely go down, he said.

More companies are getting involved because the demand for 311 systems appears to be spreading from the largest U.S. cities, which have, for the most part, implemented some version of 311, to those in the 200,000 to 500,000 population range. This opens a potentially vast market, industry officials said. In the last two years, Canadian cities also have started implementing similar systems.

Implementation costs vary greatly, depending on the municipality's size, the system's complexity, whether a centralized call center is required and the number of systems to be integrated. Costs range from $400,000 to more than $20 million, and typical CRM solutions range from $1 million to $4 million.

Last year, Knoxville, Tenn., implemented a Motorola system for $450,000. That solution did not include building a call center and began by linking only four city departments, Motorola's Leverett said.

Accenture in 2003 completed a New York system, the largest U.S. implementation to date. An Accenture spokesman said the project carried a price tag of $25 million, including software and hardware the company didn't provide. He declined to say how much went to Accenture.

City officials and Accenture are negotiating a contract option to implement a data warehouse and analytic tools for roughly $7 million to $8 million, Marin said.

Unisys won a $3.2 million contract in January to implement a CRM package from Lagan Technology Ltd., Belfast, Ireland, as the backbone of a new 311 system for Minneapolis.

Unisys also built Houston's call center for $3.8 million in 2001 using Motorola's solution. The solution would cost significantly more now, Antash said.

New York's 311 system had to work overtime during December's Transport Workers Union strike. Call volumes, typically at 46,000 per day, spiked to 241,000 in one day and 718,000 over the three-day strike, Marin said.

"Those are great examples of what can occur when a municipality stands up a centralized call center with a robust application," Antash said. "They can not only meet every-day demands of citizens, but also when that emergency situation comes up, they're much better prepared for it."

Staff Writer Ethan Butterfield can be reached at ebutterfield@postnewsweektech.com.