NEW SOUTH WALES ICT STATE OF PLAY DIGITAL TRANSFORMATION NOVEMBER 2016
2 Budget impacts & ICT initiatives NSW ICT contracting Transformation journey to date
ICT Investment Shaping Forces 3 $4 $3 Billions $2 $1 $0 -$1 Operating Surplus & Deficit expectations -$2 2012-13 Budget 2013-14 Budget 2014-15 Budget 2015-16 Budget 2016-17 Budget -$3 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
Spending Appetite Set to Shrink 4 12 10 8 9.8 Revenue Growth Expenses Growth 2016-17 NSW CPI 1.8 AU CPI 1.3 Percentage (%) 6 4 2 5.4 4.2 0.6 3.9 0-2 -0.1 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Mar-11 Mar-15 Mar-19
Back Office Bears Brunt of FTE Reductions 5 1.8% FTE growth rates 1.3% 1.8% 0.7% 0.7% -1.0% -1% -0.4% ACT 5.2 2012 2013 2014 2015 Nurses, teachers and police * Overall FTE growth FTE/population ratio June 2015 Median 4.3 TAS 4.2 *Nurses, teachers and police represent the majority of frontline FTE NSW Workforce Profile Reports, 2012-2015
New Initiatives as the Bellwether of Govt Attitude to ICT 6 Number of new ICT initiatives 2016-17 26 2015-16 34 2014-15 51 $160m $264.3m Total value of new ICT initiatives* ($m) $359m *New ICT initiatives Newly announced in this budget. Are usually additional to business as usual operating expenses allocated to agency. Often is multi-year 2013-14 40 2012-13 29 Pre-election budget $561.5m $277.4m
>$100m Projects Extinct in NSW? 7 Millions $500 $450 $400 $350 $300 Light shaded bars represent existing initiatives 2016-17 New 2015-16 New 2014-15 New 2013-14 New Sydney Water Corp IT Projects $57 M Opal Card System $133 M E-ticketing System - Delivery $124 M Sydney Water Corp IT Projects $61 M Opal Card System $125 M Digital Train Radio $101 M Sydney Water Corp IT Projects $ 82 M Next Gen Info Systems $104 M Sydney Water Corp IT Projects $21M Next Gen Info Sys $61M $250 2012-13 New $200 $150 $100 $50 $0 <$5M $5M-$9.9M $10M-$49.9M $50M-$99.9M $100M+
Service NSW Customer Service System Integration $33.9M Network Technology $21.1M Digital Channel Enhancements $19.0M $180 $160 $140 $120 $100 $80 $60 $40 $20 $0 NSW Police Technology Asset Replacement Program $45.0M Dept. Justice Justice Audio Visual Link Consolidation $40.0M NSW Police COPS Phase 3 Technical Migration $44.9M Voice Infrastructure Migration and Data Network Upgrade $20.5M NSW Police Greater Metro Area Radio Terminal/Network Refresh $56.7M Transport for NSW Business System Improvements $151.3M 2012-13 2013-14 2014-15 2015-16 2016-17 8 New ICT Initiatives Priorities By Sector
Pareto Principle applies to New Initiative Allocations 9 $208.75m of total $264.3m is allocated to spend in 2016-17
10 Budget impacts & ICT initiatives NSW ICT contracting Transformation journey to date
Key Points 11 Total contract value (TCV) for 2015-16 is $1.08B The published value of a contract is allocated to the year in which the contract commences Dataset understates the NSW ICT TCV because: 1. It excludes contracts under $150,000; and 2. NSW agencies may be failing to report relevant contracts in a timely manner. Contracts often difficult to categorise because of very poor descriptions
2015-16: the Year Vapourware Became Cloud 12 $160 M $140 M $120 M $100 M $80 M $60 M $40 M $20 M $ K 2015-16 Cloud market YOY increase: 470% $146.0 M $25.6 M 2014-15 2015-16 FaCS: $53.6m Accenture - SAP as a Service Solution Justice: $35.3m Accenture - ERP System/SAP As a Service Solution Transport for NSW: $19.7M SAP - SAP ARIBA Cloud Services for S2C
Real market is in contracts worth more than $150,000 13 Total Contract Value $1 Billion $1 Billion $800 M $600 M $400 M $200 M TCV of reported contracts $1.1 Billion 1081 Intermedium Estimate 2522 $120.4 M 3000 2500 2000 1500 1000 500 Number of Contracts $ K Over 150k Under 150k Total Contract Value 0
2015-16 decrease in TCV correlates to budget investment 14 IT Services $529.7 M $621.4 M Software $216.6 M $318.3 M Telecommunications Hardware $137.4 M $125.4 M $153.1 M $163.1 M Labour Hire $78.9 M $59.1 M 2015-16 2014-15 2014-15 new initiatives = $561m 2015-16 new initiatives = $160m
IT Services contracting 15 $0.5B NSW IT services 2015-16 Federal IT Services 2011-16 - average SI Services 50.18% Training 0.25% Unspecified 4.59% Business Consulting 6.75% IT Managed Services 38.22% Training 1.02% Unspecified 2.31% Business Consulting 7.73% SI Services 50.38% IT Managed Services 38.55%
2015-16 NSW contracts by cluster 16 Agency cluster Contract Value Contract Number Market Share Transport and Infrastructure $391.6 M 299 36.1% Health $298.9 M 528 27.6% Family and Community Services $141.1 M 41 13.0% Finance, Services & Innovation $80.0 M 113 7.4% Justice $49.3 M 20 4.5% Education $44.3 M 28 4.1% Treasury $35.7 M 4 3.3% Industry, Skills & Regional Development $28.6 M 27 2.6% Planning and Environment $10.5 M 10 1.0% Premier and Cabinet $3.2 M 11 0.3%
2015-16 Supplier Leaderboard 17 Rank Supplier Contract Value Contract Number Market Share 1 UXC LIMITED 113.30 M 1 10.46% 2 TELSTRA 102.14 M 31 9.43% 3 ACCENTURE 90.05 M 4 8.31% 4 CERNER CORP 38.76 M 13 3.58% 5 DIMENSION DATA 36.96 M 33 3.41% 6 SALESFORCE.COM 31.37 M 3 2.90% 7 PWC 30.04 M 4 2.77% 8 ORACLE 29.48 M 31 2.72% 9 IBM 26.55 M 8 2.45% 10 DELOITTE 25.09 M 12 2.32% 11 SAP 21.00 M 5 1.94% 12 METRONODE 18.80 M 1 1.74%
2015-16 Supplier Leaderboard Rank Supplier Contract Value Contract Number Market Share 18 13 DATA#3 GROUP 15.73 M 36 1.45% 14 HEWLETT-PACKARD 15.10 M 19 1.39% 15 NEC AUSTRALIA 13.37 M 13 1.23% 16 DE LAGE LANDEN 12.93 M 2 1.19% 17 LENOVO 12.21 M 4 1.13% 18 UXC RED ROCK 11.99 M 13 1.11% 19 UXC CONNECT 11.13 M 14 1.03% 20 PAXUS 10.45 M 43 0.96% 21 FUJITSU 10.19 M 22 0.94% 22 SQUIZ 10.15 M 3 0.94% 23 RISKMAN INTERNATIONAL 8.69 M 2 0.80% 24 HEALTH COMMUNICATION NETWORK 8.42 M 1 0.78% 25 ROUTEMATCH SOFTWARE 8.37 M 1 0.77%
2015-16 Top 25 Contracts Rank Supplier Agency Contract Title Value 19 1 UXC LIMITED Transport for NSW NGIS Managed Network Services Agreement (RFP2014/052) $113.30 M 2 ACCENTURE Family & Community Services SAP as a Service Solution Agreement $53.61 M Next Generation Infrastructure Services (NGIS) Fixed Voice & 3 TELSTRA Transport for NSW Mobile Services $41.27 M 4 ACCENTURE Department of Justice ERP System/SAP As a Service Solution Agreement $35.34 M 5 PWC NSW Treasury Prime Implementation $25.50 M 6 CERNER CORP HealthShare NSW Operational Management Services (OMS) $23.92 M 7 IBM Transport for NSW TfNSW NGIS Hardware Purchase $20.92 M 8 SAP Transport for NSW SAP ARIBA Cloud Services for S2C $19.66 M 9 SALESFORCE.COM Family & Community Services ChildStory Deployment Phase - Salesforce Professional Services $19.22 M 10 METRONODE Finance, Services & Innovation GovDC Monthly Provisioning Payments $18.80 M 11 DELOITTE Transport for NSW RMS Systems Integration $18.03 M 12 TELSTRA Department of Education Telecoms - Voice and Mobile $17.81 M 13 TELSTRA Family & Community Services Fixed Voice & Mobile Services $13.00 M
2015-16 Top 25 Contracts (Cont.) 20 Rank Supplier Agency 14 DIMENSION DATA Transport for NSW Contract Title Value Microsoft Enterprise Agreement (Desktop O365 Services) 2015-18 $12.40 M 15 LENOVO Roads & Maritime Lenovo Contract Variation: Execution of option to extend $10.72 M 16 DE LAGE LANDEN HealthShare NSW Server and Cloud Agreement 062014 $9.64 M 17 TELSTRA Service NSW Telecommunications Data Services Contract $8.67 M HEALTH COMMUNICATION 18 NETWORK HealthShare NSW Standing Order - Not Applicable $8.42 M 19 ROUTEMATCH SOFTWARE Transport for NSW Centralised Trip Allocation and Booking System $8.37 M Design, Supply, Installation and Maintenance if the Trip 20 SICE Roads & Maritime Reconstruction and Rating Module (TRARM) $8.23 M 21 C3 BUSINESS SOLUTIONS Family & Community Services ChildStory Deployment Phase - EYC3 Professional Services $8.20 M 22 SALESFORCE.COM Service NSW Customer Service Systems Technology $7.35 M 23 SQUIZ Family & Community Services ChildStory Deployment Phase - Squiz Subscription Services $7.25 M 24 MULESOFT Family & Community Services ChildStory Deployment Phase - Mulesoft Subscription Services $7.07 M 25 NEC AUSTRALIA Family & Community Services Consolidated Call Centre Platform $6.71 M
2015-16 IT Services TCV - top 10 agencies market share 21 Transport for NSW Department of Family and Community Services HealthShare NSW Department of Justice Department of Finance, Services and Innovation NSW Treasury Roads and Maritime Services Department of Education Sydney Trains Service NSW Other Agencies 5% 6% 7% 4% 4% 2% 2% 18% Total ITS market $0.5 B 27% 22%
2015-16 IT Services TCV - top 10 suppliers market share 22 UXC LIMITED ACCENTURE SALESFORCE.COM 21% PWC CERNER CORPORATION DELOITTE 33% Total top 10 market value $0.3 B METRONODE DE LAGE LANDEN Total ITS market $0.5 B 16% SQUIZ HEALTH COMMUNICATION NETWORK Other Suppliers 2% 2% 3% 4% 5% 6% 6%
23 Budget impacts & ICT initiatives NSW ICT contracting Transformation journey to date
Four scenarios for the year 2025 24 Substantial Shallow Scenario 2 New Order Scenario 1 Heritage Scenario 4 Stargate Scenario 3 Turbocharge Deep Digital Transformation means institutional and technological change Limited Adapted from Figure 1 of Queensland s Digital Marketplace for Public Services: Four Scenarios in the Year 2025 (DSITI, Data61)
Digital Government Maturity 25 Automation Digitising current procedures as is Hybrid Simplifying & redesigning current processes before digitising Institutional Change Rethinking & redesigning entire administrative systems
Transformation Initiatives Hybrid $51.2M Technology for Learning & ICT Department of Education Institutional Change $31.8M Building Digital Capability & Transition of Agency Transactions Service NSW Institutional Change $10M Whole-of-System Digital Reform Ministry of Health 26 $56.7M Greater Metro Area Radio Network & Terminal Refresh NSW Police Business as Usual $45.03M Critical Communications Enhancement Program NSW Government Telecommunications Authority Business as Usual $20M Ambulance Radio Network Replacement Ministry of Health Business as Usual
Digital Government Readiness 27 Rate of Change: July 2015 July 2016
NSW The National Leader 28 NSW DGRI Score: July 2015, March 2016, July 2016 Jul-15 Mar-16 Jul-16 8.9 9.1 9.4 0 1 2 3 4 5 6 7 8 9 10 ICT Strategy ICT Governance Procurement Policy ICT Policy Service Delivery Key Agencies Cross-Jurisdictional Cooperation
Leaderboard 29 Rank July 2015 Score March 2016 Score July 2016 Score 1 NSW 8.9 NSW 9.1 NSW 9.4 2 QLD 6.8 QLD 7.0 QLD 7.4 3 VIC 6.4 Federal 6.6 SA 7.4 4 SA 6.3 SA 6.5 VIC 7.3 5 Federal 6.2 VIC 5.9 Federal 6.9 6 TAS 4.5 ACT 5.2 WA 6.1 7 NT 4.5 TAS 4.5 ACT 5.1 8 ACT 3.8 NT 4.5 TAS 4.8 9 WA 3.5 WA 4.4 NT 4.1
Drill Down: ICT Strategy 30 ICT Strategy Score (as a %) NSW QLD VIC 94% 26% Common strategy elements across Australia SA WA Federal TAS 40% 100% + 55% Frameworks to promote coordinated aas adoption WofG data analytics integration WofG digital platforms Emergence of WofG Chief Digital Officer (with variances) ACT NT 0% 20% 40% 60% 80% 100%
Drill down: ICT policies 31 ICT Policy Score (as a %) Privacy Data Retention Open Data Cyber Security VIC VIC NSW Federal SA QLD 8% 7% NSW Federal SA ACT QLD WA NT TAS 100% + 14% 50% 0% 20% 40% 60% 80% 100% ACT WA NT TAS
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