Why the days of big outsourcing deals are over

The GLA's IT chief, David Munn, explains why agile and DevOps mean that huge outsourcing deals are unnecessary

I was surprised, recently, to be asked to speak at a conference in China about outsourcing. Given that I think my position could at best be described as ‘agnostic' in relation to the value of outsourced solutions - I thought that perhaps they had mixed me up with someone else.

I spoke to Kerry Hallard - the CEO of the National Outsourcing Association (NOA) who had invited me to lay out my position.

I told her that if I go, I'm going to be saying that from where I'm standing, the days of big outsourcing deals are over.

The move towards developing customer-centric solutions, using agile development and then deploying these solutions quickly using DevOps requires a very different approach. We need specialist external services that can work closely with us and act as an extension to our team to support this work. The value of information and data as a key strategic asset mean that it is something that needs to be valued and nurtured - rather than being seen as a problem that someone else can deal with for us.

Fortunately, Kerry was supportive of this; felt it was in line with feedback she had received from other IT services buyers and was a further illustration of the new outsourcing ecosystem that is emerging. She encouraged me to go.

China is gearing up as a serious provider of IT services. As I waited for my flight at Heathrow I picked up a copy of Wired magazine - "It's time to copy China", said its cover. It described a range of exciting Chinese companies that are already making a global impact. While in China I was shown incredibly ambitious plans for development of their cities' infrastructure. I felt a bit like an ancient Celt being shown the plans the Romans had for Britain.

Yet despite all this global-scale ambition I felt that many of the people I spoke to understood that the future of IT services is not all about scale and infrastructure, but also about people and relationships. Small can also be beautiful.

In my experience, the companies that really make an impact are often those that are able to get under the skin of an organisation by building a genuine understanding of the culture and goals of their client and use that knowledge to build solutions in close co-operation with them.

When procuring new services I now have an expectation that high-quality individuals will be based in my team and I've seen, first hand, how a single co-located team can cut through tortuous bureaucracy and misunderstanding to deliver quality solutions fast. This approach also has the added benefit of making the whole process much more enjoyable for all concerned - particularly the customer.

This new breed of service providers often provide specialised "niche services". They are experienced in dealing with agile development, they are comfortable about communicating with non-technical individuals and crucially they invest in taking on fantastic people who make things happen. This fast, people-orientated approach feels miles away from the soul-sapping, SLA-driven approach of the traditional outsourced IT provider.

Two changes have supported this shift. The first is the use of cloud-based services in both simplifying and speeding up the provisioning of a suitable infrastructure to support new developments. The second is that information and data are now seen as vital organisational assets - with the success of an organisation often dependant on how well they make use of that asset. I want to have partners who can work closely with my team in both exploiting the opportunities cloud based services offer as well as making the most of our data and information.

Manchester-based company CTI Digital recently worked with the Greater London Authority in this way to support us in the development of our new website - while some of their resources remained in Manchester others were based with the GLA DevOps team, testers, analysts and content managers. There was a genuine sense of a single team with a shared purpose. When you get the people, relationship and sense of purpose right then delivering quality services becomes almost inevitable.

I've seen the outsourcing industry go in and out of favour as well as the scope and scale of services expand and contract. My sense is that this new approach; one that emphasises speed, communication, relationships and most importantly puts the customer in the driving seat - is one that should be applauded. It is also an approach that I believe plays to the strength of the growing UK technology sector. If this is the future for UK technology services - then it's an exciting one.

David Munn is head of ICT at the Greater London Authority

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