Core financial systems vendor and application outsourcing wannabe QSP has secured its first Australian agreement in a deal with the Federal Department of Finance & Administration (DOFA) and has set up a data centre in Canberra to run it.
Gail Hopkins, QSPs general manager, marketing, said that application outsourcing has grown to become 20 per cent of the UK parent company's revenue source since it began marketing its Systems Management Services 18 months ago. She said QSP expects that figure to "at least" be matched in Australia within the same increment of time and indeed would not be surprised if it is surpassed.
"We have only been doing marketing on [application outsourcing] for three months," Hopkins said, adding this is a great deal for them to kick it off with. "This is definitely a serious business for QSP in the Asia-Pacific.
According to Hopkins, outsourced application services need to be very well-defined to complement existing infrastructures and QSP is looking at partnering with infrastructure outsourcers.
"We believe these sorts of services are complementary to infrastructure outsourcing," she said. "Infrastructure is not application specific and each customer has different applications. Not many traditional infrastructure outsourcers have the core competency in applications that we do.
"Unless you have that core competency, you will not be able to add the value that customers are looking for in this sort of deal."
The agreement between QSP and DOFA commenced on September 1 and will see the former providing "the management and supply of financial system services" while the latter expects a 30 per cent cost saving.
"When we went through the process of selecting a new financial system, we discovered we had two options," Alistair Cochrane, DOFA's CFO said about the debate as to whether they would keep financial systems in-house.
"Outsourcing was clearly more cost effective. We expect to save about 30 per cent, or a few hundred thousand dollars a year, on the cost of an in-house solution."
The application outsourcing contract is for the next five years and covers all configurations, administration, upgrades, maintenance, performance monitoring of systems plus a disaster recovery plan.