IBM And Oracle To Support 280,000 Users After Winning Mega ERP Govt Tech Contract

IBM and Oracle have won a competition to supply an ERP upgrade to a group of UK central government departments in a deal worth £711 million ($950 million).

The UK government has signed the tech giants to provide ERP and systems integration services for a massive upgrade across four major Whitehall departments and their arm's-length bodies, supporting around 280,000 employees.

In the graveyard of troubled IT projects, the Department for Work and Pensions (DWP) leads the Synergy Programme, which will see it and the Ministry of Justice (MoJ), the Department for the Environment, Food and Rural Affairs (Defra), the Home Office transferred to one ERP and HR system with a common set of processes.

Awarding the tech side of the project to Oracle and IBM, the DWP said it would "procure and adopt a cloud-based service leveraging the capabilities offered by a Software as-a-Service (SaaS) ERP platform and associated technologies."

"The prime driver of the Synergy Programme is to drive significant business transformation across the… departments," it said.

The plan is to work with suppliers to jointly develop a new Common Operating Model (COM) and introduce a new "user-centric service including common data standards."

"The COM design will continually evolve throughout the five programme delivery phases. As a result, benefits will also continue to evolve over time. This will help identify additional benefits for the Programme and provide more robust data and narrative to justify the current benefits profile," the procurement document said.

The DWP has recently kicked off procurement for industry help with the other side of the project. Earlier this month, it published tender documents to attract suppliers to provide business process services for the massive ERP overhaul, with the deal worth up to £958.7 million ($1.2 billion), bringing the total expected tech spending on the project to around £1.9 billion ($2.5 billion).

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It will surprise few that the plans for the new ERP technology center around Oracle. Big Red is the incumbent supplier for all the departments in the cluster. SSCL, a venture owned by outsourcing firm Sopra Steria, provides the system for the DWP, Defra, and the MoJ. The so-called Single Operating Platform (SOP) is built on Oracle eBusiness Suite 12.2.6, which has recently been migrated from on-prem to Oracle Cloud Infrastructure (OCI). The Home Office completed the move from the old platform to the Oracle Fusion cloud platform – on OCI – in 2021.

The Synergy Programme is part of a broader mission across central government departments to consolidate and upgrade their ERP and HR systems into clusters. The mega-project has been heavily criticized for a lack of funding and an insufficient business case.

In January last year, chief operating officer for the civil service and permanent secretary for the Cabinet Office Alex Chisholm told MPs that Whitehall departments had initially sought £400 million ($535 million) for the spending review period to March 2025, but the Treasury offer was well short. He said the departments and the Cabinet Office were closing the £100 million ($134 million) funding gap for the ERP refresh left in the November 2021 spending review.

The spending review period from 2025 will be set in the Autumn Statement, expected on October 30. ®