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Poor human resources, social responsibilities and the project based nature of e-government initiatives means that most Middle East government’s outsource their IT requirements.

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By  Matthew Southwell Published  February 25, 2003

I|~||~||~|Whether it be the vision of Sheikh Mohammed bin Rashid Al Maktoum in Dubai, or the ongoing work of Dr. Fawaz Zu’bi in Jordan, the Middle East’s e-government drive has become synonymous with several key figures. However, these champions of the digital economy can only do so much, and each needs a fully-fledged team behind them in order to turn government visions into IT realities.

However, governments within the Middle East rarely have the necessary manpower to design, implement and manage their e-government projects. Instead, they have to employ a number of vendors and other third parties to either help or guide their initiatives. Dubai e-government, for example, has outsourced the bulk of its work since the project’s inception.

“The initial e-government initiative started with 14 executive committee members, who were brought on board to develop the roadmap for the project and to kick the whole thing off. However, most of the work itself is being done through partners,” explains Salem Al Shair, director of e-services at Dubai e-Government and a member of the Dubai e-Government executive team.

“We use different partners for different projects. For instance, we used Etisalat and Cisco when we developed the Government Information Network (GIN) and other partners, such as EDS and AT Kearney, were used as consultants. Among others, we have KPMG as a partner for the implementation of Oracle Financials and we also use Wipro to manage our infrastructure,” he adds.

Jordan’s Ministry of Information Communication Technology (MICT) also outsources many of its projects. With just 10 civil servants responsible for e-government within the ministry itself, it relies on each department appointing its own e-government employees and local partners from the private sector to move its initiatives forward.

“Within the MICT we have no more than 10 people because for the major projects we develop contracts with local companies. We want to keep the number of people at the ministry low, keep it lean and outsource everything else,” explains Mahmoud Khasawneh, chief information officer and head of the e-government team at Jordan’s MICT.

There are a number of reasons why the Middle East’s governments outsource so many of their e-initiatives. Foremost among these is the age-old problem of poor local resources. Whereas Singapore, for instance, can gather together over 600 citizens to staff its various e-government initiatives, Dubai’s e-government office can only boast a workforce that is 46% local. “While it is always better to have someone in your employ, because you have more control over them and the direction in which they are moving, it is not always possible… this is where the outsourcing comes in,” comments Al Shair.

However, a lack of local resources is a problem that affects all companies within the region, and not just government bodies. As such, there are a number of other factors that have contributed to the popularity of outsourcing within e-government circles. Among these is the nature of e-government initiatives, which are typically wide ranging in scope and project based. “E-government is essentially project based, so the skills have to satisfy our needs straight away,” comments Al Shair.

More often than not, this means that governments simply do not have the time to find and hire the right people to tackle a project. Furthermore, Ahmed Darwish, e-government program director at Egypt’s Ministry of Communications & Information Technology (MCIT), says there is little need as the necessary skills can easily be found in the local market.

“There is no need to reinvent the wheel because there are plenty of companies in the local market that have the necessary skills, whether that be enterprise resource planning or anything else. I do not see why the MCIT should invest in building those skills one more time,” he explains.

“Another reason for not having people inhouse is that if you want to get the right skills it is often very expensive, which you sometimes cannot afford on a full time basis. Therefore it is better to hire people for specific tasks,” he adds.

||**||II|~||~||~|In addition to being project based, e-government initiatives also tend to be very laborious in their nature. This in turn sucks up more human resources. According to Nauman Ahmad, government solutions specialist at Microsoft Gulf & Eastern Mediterranean, the reason for this is that while private sector projects are typically embarked upon to solve a particular problem, there is no such motivation attached to most e-government initiatives.

“Within the private sector, whenever you initiate the delivery of a new project, you can identify a lot of pain points and a lot of compelling reasons that will ensure the project will go through. This is something that is usually missing in the government sector, as they typically embark on e-government projects because they want to be a bit more operationally efficient, reduce some costs and have some more presence,” he says.

“Enterprise customers tend to have very focused projects and they have something specific, whether it be a line of business or a process, that they want to improve… With government it is different because you are dealing more with a vision, which has many more components and encompasses a lot more work,” adds Kezar Fidaly, manager at HP Consulting, HP Middle East.

The desire to involve local companies in e-government projects is another factor in the region’s ruling bodies’ decisions to outsource projects. Not only does it provide these companies with a showcase for their talents, but it helps boost local IT sector revenues and encourages the adoption of technology on a wider scale.

“I have a very small team at the MCIT and we only monitor and evaluate how our contractors are doing, rather than doing anything ourselves. One of the reasons for this is our mandate, which says that we are not only doing e-government, but also creating a very strong local industry directed towards exports,” says Darwish.

Jordan also outsources a lot of its e-government projects to ensure that local ICT providers can get involved. Currently, the MICT is employing a number of local companies to develop and run its portal project. “We have five [Jordanian] companies — Estarta, STS, ITT, Allied Soft and Primus — working on our portal project. The reason we use local companies is because we don’t want to be a competitor to the private sector by creating an IT arm for the ministry. Instead, we want to create a policy arm and encourage the local IT sector,” says Khasawneh.

The differing requirements of e-government have had a knock on effect for those vendors that complete such projects. The most obvious example of this is that virtually all of the big name vendors in the region have specific e-government teams located in the Middle East. Microsoft, for example, has e-government consultants located in Dubai, Saudi Arabia and Egypt, while Sun Microsystems retains a high number of staff in Dubai that it can deploy throughout the region. Furthermore, because government projects are more wide-ranging than typical enterprise engagements, these teams tend to include more people with more diverse skills.

“Extra people are normally required due to the strategic nature of [e-government] projects. There are a lot of things that can go wrong with a government project so you need to have the right people on site to be able to deal with any problems and make sure things are on track… Also, because government projects have many different elements to them, you need a wide range of consultants,” explains Microsoft’s Ahmad.

||**||III|~||~||~|Vendors’ teams also have to be more hands on than their private sector counterparts — both in the planning and implementation of projects. As such, it is not unusual for vendor teams to be located on site for a number of months. Sun Microsystems, for example, typically keeps its employees on a government site for at least six months.

“Most local governments do not have the required skills so we have to help them build the team while also managing the project… This means we are onsite for at least six months because this is how long it typically takes to bring [an inhouse team] onsite,” explains Sameer Fardad, business development manager at Sun Middle East & Africa.
These teams also have to develop individual methodologies for each project. HP’s Fidaly says this is different to the private sector engagements, where teams can reuse processes from past projects.

“If you look at something like the financial industry, there is little difference in the way that they run their businesses. Because of that we can work in an offshore model, take all of the best practices and implement them. With a government [project] this is not possible. Instead, you have to align yourself with the government, its suppliers and its internal customers to understand how the processes work and, because governments tend to have very complex processes, you have to work hand in hand with them,” he explains.
While the assumption is that these extra requirements make e-government projects more expensive for the vendors, those involved in local projects say this is not the case. “The development requirements [of government projects] are the same [as the private sector] so the investment from Microsoft is the same… There is no fluff on the top just because it is a government project,” says Ahmad.

However, while there may be no extra cost to the vendors from being involved in government projects, there are other pressures due to the high profile nature of the engagements. Foremost among these is the need to deliver the project on time and within budget. As Fidlay says, “you don’t want to fail.”

Another quirk of e-government projects is the greater degree of social responsibility vendors feel. According to Ahmad, this manifests itself in the amount of effort vendors have to put into education and training.

“With e-government projects there is a lot more effort needed from our side in terms of education, awareness and training. There is a lot of strategic briefing involved for government leaders because they have to understand what is happening and see the best practices from around the world. This has to be done so that the government leaders understand why they are embarking on something and to ensure that the project will go through,” he explains.

In addition to educating high level government officials, any vendor involved in an e-government project is expected to transfer a lot of its knowledge by training inhouse teams. Sun’s Fardad, for example, describes this aspect of working on an e-government project as the “key component,” while Microsoft’s Ahmad says his e-government team is expected to complete more training than its private sector counterparts.

||**||IV|~||~||~|“All government projects are based on complete technology transfers to the government teams because governments would like to have an assurance that they will be able to control it when the project is complete. As a result, we do a lot of technology boot camps and workshops for government employees,” he explains.

The end users’ motivation for this additional training is two-fold. Firstly, local governments tend to be starting from a lower level in terms of skilled staff and, secondly, there is also a strong desire for governments to one day run their integral systems themselves.

Bahrain’s Ministry of Finance & New Economy (MOFNE), for example, invested heavily in its inhouse team when it began deploying Oracle Financials across 33 different government bodies back in the early 1990s. The education of its own IT team was paramount and, as such, it took regular training from Oracle so it could run its own project.

“When we started we didn’t have very much experience with Oracle Financials and we had to arrange a lot of training with the vendor. Now, however, we only use Oracle consultants in the development areas and we are even trying to do this ourselves. We are doing the upgrades ourselves too, the biggest of which was the upgrade to 11i last March,” explains Najwa Raheem, head of systems development at MOFNE.

“Today we have a very competent project manager and we use the Navigator [implementation] methodology from Ernest & Young… By using inhouse skills on projects we don’t need the consultants and it [the project] costs less,” she adds.

Muscat Municipality is taking a similar approach and in addition to shadowing vendors closely it sends graduates on six-month training programmes to specialise in certain technologies. Yaqoob Al Bulushi, the municipality’s director of information systems, says such an approach is key in a market such as Oman, which normally doesn’t have a direct vendor presence.

“We try not to depend on third parties, because Oman is a small market and this means that the vendors tend not to have the resources on the ground here. This means that people have to come from elsewhere, which takes time. This is why we try and depend on ourselves as much as we can. If we were in another country then we could rely on vendors, but by being in Oman we cannot,” he explains.

This lower cost, self-staffed model is the ultimate goal of Dubai’s e-government too. As Al Shair explains, “there are things that are very critical within the core business that you need to have control of… this is one of the reasons why this year one of our targets is to produce our own junior consultants. We are going to do whatever it takes to produce these people because, at the end of the day, they will then be able to act as consultants to the other government departments.”||**||

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