Arvato awarded UK central government contract to operate first outsourced shared service centre
Under the agreement, the existing Department for Transport (DfT) Shared Service Centre in Swansea, South Wales, has been acquired by Arvato, which will subsequently provide back office services to the DfT and its executive agencies. The seven-year outsourcing contract, which includes an optional three-year extension, is expected to deliver significant savings to the Department over its duration. The agreement also includes a framework contract under which Arvato will be able to maximise the centre’s considerable potential for growth by competing for additional outsourced central government business.
The Swansea site will be the first Independent Shared Service Centre to be operated by the private sector. It forms a key element of the Cabinet Office’s Strategic Plan for Next Generation Shared Services which aims to achieve savings of £400m to £600m per annum from back office costs by creating a market for shared services within central government.
Matthias Mierisch, CEO & Chairman of Arvato UK & Ireland, said: “Our solution provides a new operating model for back office functions, using industry best practice, economies of scale and standardised processes to deliver improved value for money and service quality.
He added: “This is a significant milestone in Arvato’s BPO growth strategy in the UK, where we have extensive experience in delivering continued improvements, efficiency savings and better outcomes for the public and private sector. The acquisition also complements our existing UK footprint with a flagship Shared Service Centre in an important economic region.”
Arvato will underpin the services offered by ISSC1 with the Agresso Central Government Enterprise Resource Planning (ERP) Platform provided by its partner, and global business software company, UNIT4. The Agresso platform will be introduced at the ISSC1 to replace the existing SAP platform as part of a phased migration process.
Anwen Robinson, Managing Director of UNIT4 Business Software Ltd, said: “With Agresso’s proven flexibility, Arvato will be able to make rapid changes to the solution at a relatively low cost to support the changing business needs of the customer.”
Arvato is one of the world’s leading business process outsourcing companies (BPO) with over 50 years’ experience, including almost 10 in the UK public sector. In addition to its award-winning partnerships with councils such as Sefton Metropolitan Borough Council, Chesterfield Borough Council and Slough Borough Council, its clients include leading international businesses such as Microsoft, Renault, Bosch and AstraZeneca.
Read Cabinet Office's news release about the new partnership here.