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ICT Shared Services in Local Government in Australia and New Zealand

Published: December 2010

In this study we analysed perspectives of both business and ICT executives on three models for the delivery of ICT services:

• in-house ICT,
• outsourcing to ICT vendors and
• Shared Services arrangements between peer local councils. 

In particular, we looked into

• current and desired levels of ICT work delivered through different models,
• preferred delivery models for key ICT functions (eg applications support, Help Desk), and
• key impediments to the set-up/ expansion of Shared Services and outsourcing.

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This vendor independent study was conducted to support LG Peership – a benchmarking network of Australian and New Zealand local councils who are committed to performance excellence and innovation in ICT.

In-house ICT workload

This figure highlights a mismatch between the volume of ICT work currently handled by internal council staff (blue line) and the volume that local councils perceive to be a better fit (red line), which suggests an opportunity to reduce the in-house workload through increased outsourcing and/or Shared Services arrangements. 

ICT delivery models

The average proportion of ICT work perceived by local councils as a good fit for the delivery through Shared Services is about 15% (of the total ICT budget). 

Feedback on the mix of ICT delivery models is very similar across Australian and New Zealand local councils. 

ICT budgets

ICT spend in local councils who currently participate in Shared Services is slightly higher than the sector (Australia and New Zealand) average.

Considering that Shared Services is in its early stages, these data reflect current challenges associated with the establishment of this model in local government and are likely to change. 

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