We were interested to note that yesterday the Ministry of Defence (MoD) published an OJEU notice seeking expressions of interest for a Strategic Partner to support the delivery of the Defence Core Network Services (DCNS) Programme. We have tracked the development of this programme for many years (in its many guises.... it used to be called Future Core Networks (FCN)). We could make a comment on the MoD’s statement that it is seeking “early engagement” of a strategic partner but we will refrain from doing so.
The outcome of the DCNS Programme has the potential to massively disrupt the UK defence SITS supplier landscape. It is the MoD’s ICT Services Acquisition Change programme intended to put in place the next generation of ICT services contracts. It is focusing on five main contracts – DII, DECS, DFTS, DHFCS, and SkyNet 5, and the services provided by them. Many of the leading UK software and IT services providers derive a significant amount of revenue from the existing contracts: DII (HP, Fujitsu, Logica); DFTS (BT); SkyNet 5 (Logica), DECS (Capgemini). And they work alongside a wide range of specialist providers, such as defence contractors and communications specialists.
These contracts have various end points and one of the key roles of the ‘strategic partner’ will be to better manage the transition to new contracts. Essentially, the MOD is looking for a supplier to offer them support and expert advice to build on the strategies, plan and approach for the programme. How this plays out will be fascinating to watch. The big prime approach has gone. The MoD is working closely with the Cabinet Office, including UK Government CIO, Andy Nelson, and Liam Maxwell to determine the new contractual model. One thing is clear; the MoD is facing numerous challenges in moving forward with DCNS, including feeling pressure to drive out more cost and the need to fit with the pan-Government agenda. The current MoD thinking is that the contractual model will involve a three layered approach involving Component Service Providers (CSPs), Managed Service Providers (MSPs) and an Independent Service Integrator (ISI). The latter role is particularly interesting as it is not expected that the ISI will hold contracts for the providers in other layers. How interesting that role will be to suppliers is yet to be seen.
We will be taking a closer look at the UK defence SITS supplier landscape in light of the DCNS procurement in a forthcoming report, for TechMarketView subscription clients only!