Outsourcing moves full steam ahead

Georgia's new governor expected to support planned telecommunications project

CONNECT GEORGIA TEAM

Team Leader

Electronic Data Systems Corp.

Partners

AT&T Corp.

BellSouth Telecommunications Inc.

Cingular Wireless Inc.

Cisco Systems Inc.

Information Management Systems Inc.

Science Applications International Corp.



ENVISION GEORGIA TEAM
Team Leader

IBM Corp.

Partners

Sprint Inc.

Resource Network International Inc.

Enterasys Networks Inc.



Source: Georgia Technology Authority

Convergent outsourcing project

This program will provide Georgia state and local government agencies with telephone services, computers and support, local area networks and high-speed online access.

October 2001 Original request for proposal issued.

June 2002 Proposals submitted by EDS and WorldCom teams.

July 2002 Georgia cancels bids of EDS and WorldCom.

August 2002 New RFP issued.

November 2002 Proposals submitted by EDS and IBM teams.

December 2002-January 2003 New proposal bid clarifications and refinements done.

February 2003 Final proposals with pricing due.

April 2003 Project award expected.

July 2003 Winning team assumes telecom operations.

"It's a very visible project, and new governors don't always keeps projects like that." ? John Kost, Gartner Inc.

Olivier Douliery

Georgia governor-elect Sonny Perdue is expected to support the state's groundbreaking $1.8 billion telecommunications outsourcing project when he takes office next month, because the project will help him deliver on a pair of key campaign promises.

Perdue views the Convergent Communications Outsourcing Project as crucial to increasing telecommuting among government workers and to extending telecommunications and Internet access to the farthest corners -- to the "last mile" -- of the state, said Larry Singer, Georgia's chief information officer under outgoing Democratic Gov. Roy Barnes and a driving force behind the project.

"I believe that what we will see is the governor's office working to see that those objectives are satisfied in as efficient a way as possible," said Singer, who left the CIO post Dec. 9. Perdue, a Republican, has asked Singer to serve as an adviser to his transition team, according to the Georgia Technology Authority.

The future of the project under Perdue has been a major source of concern to companies bidding on it. Industry officials and analysts said these kinds of high-risk, high-profile projects are susceptible to alteration or even cancellation when a new governor takes office.

"It's a very visible project, and new governors don't always keep projects like that," said John Kost, vice president of global public sector research for Gartner Inc. of Stamford, Conn.

Competing for the Georgia project are two teams: "ConnectGeorgia," led by Electronic Data Systems Corp. of Plano, Texas; and "EnvisionGeorgia," led by IBM Corp. of Armonk, N.Y.

State officials have told both teams that the procurement will proceed as scheduled, said John Nyland, vice president of public sector, Americas for IBM. "Our expectation is that the procurement will continue," he said.

"All indications are that the project is still a go," said Rob Press, EDS' client delivery executive.

The 10-year, $1.8 billion outsourcing project has had its share of troubles since it was first up for bid in October 2001. The most glaring problem came in July, when the state canceled bids submitted by EDS and WorldCom Inc. of Clinton, Miss., on the grounds that the financial information WorldCom submitted was not valid. In the earlier competition, IBM was a participant on the "GeorgiaAdvantage" team led by WorldCom.

The state issued a new request for proposals Aug. 8, which attracted the existing ConnectGeorgia team and the new EnvisionGeorgia team. Both submitted bids Nov. 15, which the state is now evaluating.

Since the project is not scheduled for award until April 2003, Perdue will have ample opportunity to make substantive changes to it as it moves through the bid evaluation process, Singer said.

The bids received contain technical proposals without pricing information, GTA said. Clarifications and refinements to the proposals will be negotiated in December and January. Final proposals with pricing will be submitted by February.

Neither Singer nor Perdue's transition team elaborated on possible changes the new governor would make.

Following the initial evaluation, GTA expects to issue an addendum and set a date for the submission of the second response and price proposal, Singer said. Perdue will be able to use the addendum process to make substantive changes that reflect his personal positions, he said.

Singer said the governor-elect's transition team is briefed weekly on the contract negotiations. In the coming weeks, Perdue plans to review the state's telecom plan and take an active role in key decisions about it between now and the time of contract award, said Derrick Dickey, a spokesman for Perdue's transition team.

The Convergent Communications Outsourcing Project would provide Georgia state and local government agencies with local, long-distance and wireless telephone services; statewide high-speed online access; local area networks; and personal computing equipment and support.

The contract would offer the same access and pricing model to every state agency and department regardless of location. Local government offices, schools and libraries also could obtain their telecom and IT services through the project as voluntary participants, according to GTA.

Georgia is facing a $450 million budget shortfall for fiscal 2003, according to the National Conference of State Legislatures in Denver. While the contract will not produce direct savings, it will provide better service for the same cost, Singer said.

Singer said Georgia's telecom infrastructure is antiquated and wasteful and, for those reasons, would be very costly to modernize. He said the concept behind the project is that the contractor will "drive the waste out" and invest the savings in a modern telecom infrastructure.

Companies invest millions of dollars to bid on projects such as the Georgia outsourcing contract, and if the new governor were to cancel the project, it might create a credibility problem for Georgia with vendors in the future, Kost said.

"Company officials, who make these investments only to see procurements canceled for what will appear to them to be arbitrary political reasons, are less inclined to spend money to bid on large future opportunities," he said. *

Staff Writer William Welsh can be reached at wwelsh@postnewsweektech.com.

About the Author

William Welsh is a freelance writer covering IT and defense technology.

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