Memphis takes plunge into IT outsourcing

Memphis, Tenn. has finalized a 7 1/2-year, $50 million deal with SCT to

outsource the city's entire information technology department and services.

Under the contract signed Dec. 18, SCT will plan, manage, staff, operate

and support the city's data processing and telecommunication services, application

software development, help desk and system security, among other services.

SCT also will manage the delivery of IT services by several city subcontractors.

The city plans to offer 24-hour electronic-government services to residents,

visitors and businesses.

"With the [rapidly] changing pace of technology, it's probably more

cost-effective to outsource the services," said Gale Jones Carson, a city

spokeswoman. She said costs, such as overhead and training, are hard for

a city such as Memphis to keep up with.

Carson said the deal has not drawn any negative reaction from the public.

"When you start talking about upgrading systems and providing e-government

services, it's a win-win for everyone," she said.

Most of Memphis' 40 IT employees would become SCT employees. Carson

said negotiations with SCT included jobs for the former city employees.

"No one was left out of a job," she said, adding that several former employees

have gotten jobs elsewhere.

SCT was awarded the contract over Electronic Data Systems Corp. and

Affiliated Computer Services Inc. after a 10-month search.

Malvern, Pa.-based SCT has similar outsourcing deals with Indianapolis;

Anaheim, Calif.; Fort Wayne, Ind.; Greenville, S.C.; and Lee County, Fla.