Issue - meetings

[Report of the Director for Customers, Transformation and Resources. To be introduced by the Cabinet Member for Corporate and Civic Services.]

This report seeks approval from Cabinet to award a contract, for a term of 2 years with an option to extend for 2 further 1-year periods, by way of a call-off from the Crown Commercial Service’s GCloud 11 framework to replace the current SAP managed service supplier. 

The Cabinet Member for Corporate and Civic Services introduced this report which sought approval to award a contract, for a term of 2 years with an option to extend for 2 further 1-year periods, by way of a call-off from the Crown Commercial Service’s GCloud 11 framework to replace the current SAP managed service supplier. The new contract would facilitate the continuation of critical SAP support and hosting for the Finance, Payroll, HR and Procurement systems.

The Cabinet Member noted the spend on SAP represented a significant revenue cost for the Council. However, the services from the proposed new supplier, which already provided licensing for SAP and provided hosting and support services that met the Council's requirements, represented a saving of over £1.2m over a maximum four-year contract term.

The Director of Customers, Transformation and Resources, added that the Council’s SAP system had different providers for the host system and the license to use the system. The new supplier would provide both the hosting of the system and the license to use it. The Council was confident the supplier would provide a quality service and the contract provided significant savings for the Council.

In response to questions from Cllr Adje, the following information was provided:

• Regarding the 2+1+1 year structure to the length of the contract, Officers noted the software the Council was running would be superseded in the next couple of years, at which point it would be looking to move to a new system. It generally took 2 years to specify and re-procure the system. The +1+1 would provide the Council with flexibility if it was not ready to launch that new system within 2 years. The Council had the option to go 2+2 but 2+1+1 gave the Council more flexibility.
• Officers were confident the savings proposed would be met and highlighted the supplier already worked with the Council. There would be no data migration involved, due to it being a service the Council already used.

RESOLVED

To approve, in accordance with Contract Standing Order 9.07.1d), the award to the supplier identified in the exempt report of a contract for SAP hosting and support services for an initial 2-year term valued at £533,816.00 with an option to extend for two further one-year periods valued together at £533,816.00 with a total contract value of £1,067,632 over the maximum term of 4 years.

Reasons for decision

The current SAP managed service contract with HCL Axon expires in March 2020 and so the Council needs to either extend the current contract or replace it with a new contract with an alternative supplier.

The incumbent supplier was only able to offer a minimal reduction of just £16k per year.

Haringey already have a satisfactory relationship with the proposed supplier.

The proposed supplier are able to provide an equivalent service to the current one at £330k per annum less than the incumbent supplier.

Alternative options considered

Request the incumbent supplier to review its pricing model to reduce the costs for the final 4  ...  view the full minutes text for item 44