The consolidated government of the city of Indianapolis and Marion County has extended its contract with IT services provider Northrop Grumman through 2013, under a new four-year deal worth nearly $34 million.
Northrop Grumman will continue managing IT services for most of the consolidated government's agencies, more than 50 in all -- excluding some public safety functions, such as 911. The vendor provides help desk, server and storage management, desktop support, and it manages the municipality's data center.
The new agreement, announced this week, lengthens the public-private partnership, which began in 2004 with a five-year, $46 million pact. The extension comes as the vendor is working to remedy service issues from its multibillion IT services contract with Virginia. The problems have spurred some observers to wonder if such partnerships are on the wane.
But don't tell Indianapolis that.
"[Northrop Grumman] has been performing here at a high level, and that is part of the reason why that partnership was able to blossom," said Indianapolis CIO Glen Baker. "We have some significant service levels, and they consistently meet or exceed them. That sets the stage for them being able to help us on strategic initiatives."
The city/county has several strategic projects under way, including a new property system and a new land management system. The consolidated government also is starting enterprise resource planning, which Baker said is long overdue for Indianapolis. With those initiatives in the pipeline, he said switching to another IT services provider would've been disruptive and costly, which would be unacceptable during these tight economic times.
"We really tried to slice and dice all the services we were getting, understand what it was costing us, and then what it would cost us to provide it in a different way -- whether it be internally or through another provider. We then negotiated on a service-and infrastructure-component basis. That helped us understand and negotiate services and service levels that made sense," he said.
Like some other public-private partnerships of its kind -- such as Northrop Grumman's IT management of Virginia and San Diego County -- Indianapolis overcame obstacles during the initial agreement. The city/county pared down about 150 service-level requirements (SLRs) in the original agreement to 65 in 2005, Baker said. In the new agreement, he said even more noncritical SLRs were taken out because they were wasting money. The government took back some services from the vendor that were deemed to be redundant. And more flexibility was also built in to the new contract, he added, so that opportunities to share costs might be possible down the road.
"Right now we have a single mainframe that supports our courts, public safety and finance systems. Hosting it ourselves, having to supply all the support for our own infrastructure is fairly expensive. We have the flexibility to leverage external support options, or for that matter, to potentially host applications for other cities and counties. That would help disperse our costs," Baker explained.