Outsourcing back-office services

This was a public sector assignment involving the outsourcing of back-office services, including, ICT, Human Relations, Property & Asset Management, Highways Maintenance, Revenues & Benefits and Customer Contact Centres. The complexity of the procurement and the intention to award a long-term contract of not less than 10 years meant that full cost driver exposure was required. The largest cost driver was labour and therefore the cost model included the full hourly cost build up. In addition the exposure to forward pension liabilities and payments, overhead (including Corporate overhead recovery), contingency provision and profit were other areas for cost modeling. The cost model also required exposure of the investment scheduling, the proposed return on investment and the contractual consequences if the investment was not made.