Published on the 27/08/2013 | Written by Newsdesk
A new report has identified five steps that organisations need to take to ensure that their ICT projects are not held hostage by unscrupulous contract staff…
When the NSW Independent Commission Against Corruption (ICAC) this month released its new paper looking at how best to manage ICT contractors, it was focused on delivering practical guidelines to support government agencies. The recommendations however will ring true for any enterprise which finds itself increasingly reliant on specialist ICT contractors to design, build and manage information systems.
According to the report – Managing IT contractors, improving IT outcomes – Australia now boasts 20,000 IT businesses – the majority of them (85 percent) being very small with five or fewer employees. It is these organisations which are often brought in as contractors to supplement the skills in government departments or enterprises.
In its report ICAC warns that organisations which hire IT contractors without strong controls will find that the “opportunities for profiteering and corruption increase”. In a fairly damning assessment of IT contractors the ICAC notes that there can be a tendency for contractors who are not tightly managed to over service, over price and under deliver, warning also that “contractors often have incentives to slow down and impede project completion in order to extend their work contracts”.
ICAC also uncovered evidence of one contract project manager left in charge of resourcing who then hired five additional contractors who subsequently defrauded an agency of more than $400,000.
To arrest the problem the ICAC recommends organisations establish a five pillar approach when using ICT contractors:
- Closely link the business case to project controls which provides clear definition of deliverables, establishes measurement techniques and reporting regimes. Linking business goals to technical specifications can reduce the risk of scope creep and budget over-runs;
- Separate contractors used in the design phase from those in the build phase, to reduce the opportunity for collusion;
- Guard the gateway for contractors to enter the organisation – so that permanent employees are responsible for hiring contractors, rather than allowing one senior contractor to bring in their associates without proper checks and balances;
- Ensure proper project management frameworks are established and followed; and
- Have a clearly defined exit strategy so that the short-term contractor does not become a de facto permanent member of the payroll.
