Government focuses on outsourcing and sharing to cut costs

The UAE Government departments will focus on outsourcing and sharing services across departments rather than investing in new IT infrastructure.

The Executive Council, a government department, formulates and implements federal regulations and local laws, prepares annual budgets along with development plans and co-ordinates between various departments.

The council has stopped investing in projects in strategy and policy areas and is focusing more on the operational side.

Aisha Butti bin Bishr, Director, Corporate Excellence, Executive Council in Dubai, said: "The council is focusing more on projects on the operational area to optimise services. There is no staff cutting but we are looking at outsourcing operations, administration of network and applications. From the beginning the purpose was to make investments to get the basic functions implemented and completed. Beyond that the functions could be outsourced and this was decided before the economic crisis."

She said this is a decision common across all government departments.

"By outsourcing our operational functions we have not been affected negatively for instance our helpdesk and network administration is already outsourced."

Government departments are optimising the maximum output on their previously made IT investments.

Premchand Kurup, CEO at Paramount, a security solutions specialist working closely with government departments, said: "The region has spent a considerable amount of money in IT, especially banks. These sectors are under financial stress but are looking for optimisation. Now they are turning to technologies like virtualisation to get maximum out of their preset infrastructure."

He added: "The CIOs have to justify cost and have to establish an ROI on all purchases. We were living in an age of surplus and now as a solutions provider we have to offer firms ease of use and maximum thoroughput."

The Executive Council is also seeing benefits of Green IT and virtualisation.

"The council has always been focused on concepts such as virtualisation and green IT. This investment will give us full optimisation today therefore the benefits of our IT investment will be seen now. There is downsizing and cutting down within the same units and we are able to do this flexibility because of the investment put in last year," said Bin Bishr.

As government departments opt for outsourcing they are also looking at sharing their resources.

The recent restructuring by Dubai Holding, the emirate's largest corporate entity in financial and real estate operations, saw the merging of the back offices of three real estate companies.

"It is a challenge to merge but this is the right time and should be done in the manner. Finance and HR departments can be brought together and have one shared services company. A company can start by centralising all functions and then outsource the rest of the activities to that department. In Abu Dhabi, for example, they have one IT company serving all the government departments," said a top official from the IT department of Dubai Holding.

In Dubai, there is a government entity called GIR that provides ERP solutions across all government departments.

"They serve 55,000 to 70,000 employees. In this kind of scenario the network and administration is the same. This can be taken a further with the right plan to run all kind of services," said Bin Bishr.

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