When, in 1997, the British Ministry of Defence (MOD) decided to consolidate the Human Resources systems used by its three military services (Army, Royal Navy and Royal Air Force) into a small number of tri-service ones, it saw the challenge as an IT problem that could be solved through an IT solution. The goal was to increase efficiency and cut costs, and both would be achieved--the MOD thought--by streamlining the more than two hundred customized computer applications developed over time by each of the three services to meet their specific needs. The Texas-based Electronic Data Systems corporation (EDS) was hired to implement the project. But the first effort soon collapsed: the MOD had overestimated how much those systems had in common, and how quickly and easily they could be harmonized. This case describes the unusual partnering approach the MOD and EDS developed in order to make their second attempt a successful one. Realizing that what was needed was a business change, as opposed to an IT solution, the MOD revised the contract to better reflect the more fluid and organic process that would be required. There were a number of essential components to that new workflow: the decision to integrate EDS staff into all management meetings in order to develop mutual trust and a common knowledge base; the establishment of a clear division of labor and responsibilities by which MOD would focus on efficiency and EDS on IT, and an agreement to prioritize the schedule and resolve cost overruns after the fact.
This case was developed for a Kennedy School course on strategy, structure, and leadership in the public sector. It can be used in courses on contract management, human resource management, or public/private partnerships.