Selecting, Managing Partners
One of the earliest responsibilities Granger took on was to study Britain’s health-care IT market. He commissioned the research to McKinsey & Co. Though the full results of the study were never made public, it recommended that no outsourcing service provider had the capability to deliver at such a large scale and scope. It was only then that Granger decided to split the entire region of England into five parts, and then have contractors for each of those regions. Thus, keeping the organizational and market structures in mind NHS selected the providers.

For large outsourcing projects such as NPfIT, it’s always difficult to find a single service provider to fulfill all the needs. Hence, in such cases, the decisions always lean toward the multisourcing model of outsourcing. For NPfIT, Accenture, BT, CSC and Fujitsu were the winning bidders — chosen for the North East region, East of England and East Midlands, London, North West and West Midlands, and the Southern region respectively. All these providers were selected as per the rules suggested by Official Journal of European Union. Under the NPfIT program, it was clearly mentioned that any loss due to delays or cost overruns, etc. would be borne by providers. That is, the service providers were to be penalized for not meeting deadlines whereas they enjoyed very little control over the project.

In Sept. 2006, Accenture chose to quit NPfIT. As per the contract clauses, Accenture attracted heavy penalties. The company had to pay a penalty of £63 million on project revenue of £173 million. As a buyer, NHS held tremendous power and control and the delivery risk remained with the suppliers.
When service providers quit mid-way, it leads to institutional loss of knowledge, which lengthens the learning curve for the next provider and the project inevitably gets delayed.

Framing Strategies for Sound Project Management 
It is assumed that a project like NPfIT would follow the best practices approach in procurement management and project management. Traditionally, U.K.’s public sector was known for inefficient procurement methods but the NHS project changed that perception. As said before, the contracts were framed so cleverly that NHS held tight control over the project but the delivery risk remained solely with the contractors.

In fact, when Global Services asked NHS about its cost overruns, NHS CfH said, “The program is on budget, and there have been no cost overruns to date. Based on early evidence from around 20 percent of NHS organization where NPfIT products and services are in daily use, these had already provided over £200 million in one-off cash savings as of Mar. 31st, 2007. A further £120 million in annual recurring savings have also been reported, as well as large efficiency gains such as time savings for staff and patients have resulted. The procurement approach has saved in excess of £4.6 billion as compared with prices previously paid by the NHS for comparable systems on a local basis, NHS said.

In fact, there are some who are no less impressed with the procurement strategy adopted by NHS CfH. John Oughton, CEO of Government Commerce at the time, said in evidence to the PAC on Nov. 27th, ’06, “I think the procurement process for Connecting for Health was an exemplary example of procurement. It was run to a very tight and rapid time scale; it started when it was intended and completed when it was intended; and it produced a very good result.”

However, it is evident from the NPfIT’s past failures that the program still needs a giant dose of professional program-management and project-management practices. In fact, ESSU’s Dexter Whitfield says, “NPfIT has almost similar problems as other public sector projects have. And, the problem is inadequate investment in project management.”

The NPfIT project has been a muddle of controversy. Now that Richard Granger has moved on, what becomes of the project is the moot question. He would be replaced by two people: A CIO for health and a Director-IT Program and System Delivery. There have been interim appointments for both the positions but final appointments would be based on open competition for both jobs. A senior official from the Department of Health said that there would be a major shake-up at NHS and the attempt is to establish ‘unified governance’. One thing’s sure — the NHS project will be in a limbo till these issues are ironed out.

 

Uncomfortable Truths
Since its inception, NPfIT has been surrounded by numerous controversies, especially when:
The captain decided to leave in the middle. In June 2007, Richard Granger announced that he would step down from his position of Director IT, responsible for running NPfIT,  and of chief executive of Connecting for Health. Granger declared that he would leave in Oct. ‘07, but he continued in office till January 31st, 2008. NAO’s report published in mid of 2006. The National Audit Office (NAO) report, The National Programme for IT in the NHS, was published in 2006. This report was meant to critically examine the project, but the final report was mainly supportive. The controversy began when the BBC's World at One radio program revealed in mid of 2006 that it had obtained the NAO's report's early version that threw light on several criticisms of the project. Surprisingly, some criticisms had been removed in the final version and replaced with less controversial statements.			Deliver The Good News, Shun The Bad "One U.K. IT expert who was involved with the NAO report confirmed to ZDNet U.K. that changes were made to the draft report after it was circulated to various interested parties, including the U.K. Government, at the start of this year. He expressed unhappiness that important recommendations weren't included in the final version." — ZDNet U.K., August 21st, 2006
Major Hiccups:
Provider		Contract Value (£ million)	Contract terminations, problems, cost increases and delays
BT		530	N3 for the NHS, seven-year contract started in Feb. 2004. Paid extra £69 million for broadband connections and £90 million for integration
BT		620	National Data Spine forming the core of NHS Care Records Service holding summary of patients' information. 10-year contract started Dec. 2003
Atos Origin		64.5	Choose and Book, five-year contract started in Oct. 2003. Most of 261,983 bookings of hospital appointments up to April 2006 made by telephone because GPs unable to book online. Extra £80 million for additional services
EDS		90	E-mail and national directory service for all NHS organizations, 10-year contract started in 2002 but EDS' contract terminated in Mar. 2004 because of delays, poor functionality and service quality. Cable and wireless awarded nine-year contract from July 2004. EDS received £9 million compensation
Accenture and iSOFT		1,099	LSP-North East. 10-year contract started in Dec. 2003. Accenture quits contract in Sept. 2006, which is taken over by CSC at original contract price. Accenture received £173 million and repays £63 million in compensation to NHS. P1R2 release 12 months late
BT and IDX		996	LSP-London. 10-year contract started in Dec. 2003. GE Healthcare acquired IDX in Jan. 2006, replaced by Cerner because it failed to deliver systems on time. Patient Administration System 14 months late
Accenture and iSOFT		934	LSP-Eastern and East Midlands. 10-year contract started in Dec. 2003. P1R2 over a year late. Accenture received £173 million and repays £63 million in compensation to NHS
CSC and iSOFT		973	LSP-North West and West Midlands. 10-year contract started in Dec. 2003. Delays in hospitals getting new systems by Oct. 2006
Fujitsu and IDX		996	LSP-Southern. 10-year contract started in Jan. 2004. Fujitsu 'Lost confidence' in IDX who were replaced by Cerner in Apr. 2005. Fujitsu 18 months behind schedule. Promised system running in 17 acute trusts, 36 community trusts, 36 community trusts and eight mental health trusts by Apr. 2006 but only managed one installation
Atos Origin		—	NHS North West and South West. Suspended for mishandling ultrasound scans.

LSP stands for Local Service Provider; Source: European Services Strategy Unit