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San Diego County Nears Completion of 7-Year Outsourcing Contract, Prepares For Next Steps



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Feb 11, 2005, By Wayne Hanson

Back in Sept. 1999 Government Technology covered the impending outsourcing of San Diego County's IT functions. Now, six years later -- as the outsourcing agreement nears the end of its seven-year contract, the Center for Digital Government hosted a teleconference with San Diego County's CIO Michael Moore.

Moore, CIO since November 2003, is responsible for oversight of the county's information technology, including strategic planning, contract oversight and execution, and operational support for over 18,000 county employees at more than 200 sites. He serves on the board of directors for the California County Information Directors Association, as is a member of the Government Technology Conference Advisory Board.

The Problem
The county has about 3 million residents, 18,000 employees and $4 billion in revenues per year. Before outsourcing, the county's IT infrastructure was outdated, and the projected cost of upgrades would cost some $100 million. The county's 50-odd departments each had their own IT staff, systems didn't integrate and there was no good communication mechanism. The county thought that outsourcing might be a solution, but a few months earlier, Connecticut had pulled the plug on an outsourcing project, and four or five municipal governments had unsuccessfully tried to outsource.

The Solution
Then, in Oct., 1999, says the County Technology Office Web site, the San Diego County Board of Supervisors made the decision to upgrade the county's information technology program through an outsourcing partnership. The Board voted unanimously to approve a seven-year agreement with Computer Sciences Corporation and its team of Pennant Alliance technology companies (the consortium).

There were to be four major changes occurring simultaneously, said Moore:
  • IT employees, hardware and processes were transferred to the consortium in what Moore called a "bold move."
  • Every component of the county's IT infrastructure was replaced.
  • The county's IT authority was centralized under a new County Technology Office, which Moore now oversees.
  • Three major systems were to be built, under fixed-price contracts: ERP through Oracle; a PeopleSoft HR and payroll system, and an integrated property tax system. The property tax system vendor went bankrupt, said Moore, and the contract was terminated.

    "Any one of those would have been seen as ambitious," said Moore. The idea was to make the changes quickly, although he said in retrospect the change management was difficult and things perhaps moved too rapidly for county staff to handle well. "We staffed the new County Technology Office with county employees that had been managing pieces of it, said Moore, "but they had never managed a performance-based contract. We had to learn to perform the new roles. The transformation and paradigm shift took three years. It was a painful time for people in the county."

    The Changes
    The changes were significant. Moore said that 17 separate help desks were combined into one; five e-mail systems became 1, and 800 or more servers -- distributed across 300 sites -- number about 520 today and are housed in a single data center. "We had no integrated security," said Moore, "we had every imaginable desktop and operating system." Some 12,000 county PCs now have a common operating and desktop system, and are refreshed every 36 months. Where there had been 45 stovepipes, an enterprise began to appear.

    "Now my staff concentrates on strategic IT planning," said Moore. While some IT staff work with private contractors, others are planning and building new systems.

    The pain of change has been offset by the added value of transformation, and Moore was careful to define value. "The outcome we wanted was not to save cost, but to improve service. Measurement is aimed at how are we performing from an IT perspective. Better service? Fewer outages? Are our 18,000 employees



















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