A Florida school district has announced plans to outsource its entire information technology (IT) department to a third-party communications firm–a move district officials say could save the school system more than $1 million a year for the next 10 years.
The Okaloosa County School District will pay Titan Corp.–a company that provides communications systems and solutions to such federal agencies as the U.S. Department of Defense–between $25 million and $35 million over the next five years in exchange for a full range of technology services, from network maintenance and wireless internet access to IT support and computer refreshes. The contract includes a renewal clause that could extend the deal to the 2013-14 school year, officials said.
The 30,000-student district is the latest school system to outsource its entire technology department–a trend that already has caught on in Detroit and Cobb County, Ga., in metropolitan Atlanta, where school leaders have been able to increase efficiencies in light of shrinking budgets, while still maintaining their commitment to technology in schools.
Titan will furnish Okaloosa County’s 43 facilities with desktop and laptop computers, network servers, and support services, including help-desk support, remote-desktop management, asset management, and local- and wide-area-network support and management. The company also will provide technology retrofits, web-site development and maintenance, and commercial software applications.
District Chief Information Officer J.C. Connor said the contract would ensure that every student and faculty member throughout the district enjoys the same access to technology no matter what building they’re in. He also believes the service portion of the agreement will free up busy educators, who often spend too much time worrying about technology, to do what they do best: teach students.
Besides freeing up more time for classroom instruction, officials say the deal will save money while helping them keep better track of technology spending. It also will eliminate the need for full-time technology staff and bring the responsibilities for planning and resource allocation together under one roof, they say.
“We now have a coordinated effort throughout the district, as opposed to a bunch of ad-hoc plans,” Connor said.
In deciding to outsource, he said, the district gave considerable thought to the fate of current technology staff members and determined it could make the transition with “little impact.”
Of the 32 positions that were eliminated, Connor said about half these employees had served in instructional positions or as librarians before and would be allowed to return to their original posts. Some staff members were offered new positions as instructional technology directors responsible for training teachers in how to integrate technology into the classroom more effectively. Others, he said, were offered jobs with Titan. Six employees who declined the offer were granted assistance in finding new jobs elsewhere.
Under its agreement with Titan, every school in the district is slated to operate on a 5 to 1 student-to-computer ratio. The contract also adheres to a strict refresh cycle, ensuring that none of the 13,000 desktop computers and more than 500 laptops used by faculty and students is more than five years old.
Instead of buying machines outright, the contract calls for the district to lease its equipment through Titan, giving the company the power to replace computers and equipment in accordance with a set schedule.
Before the outsourcing deal, Connor said, the district had shortchanged itself in trying to make do with machines that had outlived their usefulness. “We were spending a lot of our resources on obsolete machines,” he said. “And obsolete machines cost more than new machines to maintain.”
The contract takes care of another potential headache for schools: computer disposal. Just as Titan will be responsible for cycling in the new technology, it also is responsible for cycling out the old–a chore Connor contends is often difficult for schools to afford on their own. “This is no longer our problem,” he said.
Okaloosa isn’t the only district to outsource its entire IT service. In 2001, the Detroit Public Schools became the first high-profile school system in the nation to experiment with full-service IT outsourcing when it entered into a $75 million deal with local technology services provider Compuware Corp.
Upon signing on with Compuware, Detroit–the nation’s tenth largest school system–underwent a host of technical renovations, such as the addition of a district-wide, web-enabled eMail system; the replacement and upgrade of network components, including hardware and communications lines; the installation of T-1 data connections at all remote locations; the replacement of outdated hardware with high-speed servers; upgraded software for payroll and human resources management; an improved IT help desk; and an expanded student information system. In June, Detroit officials said the deal had paid off to the tune of $3 million in savings per year.
The movement to outsource is experiencing similar traction in Cobb County, Ga., where Titan recently struck another full-scale outsourcing deal to provide hardware, support, and services to students and faculty in the nation’s 25th largest school system.
Kevin Smith, vice president and general manager of Titan’s Enterprise Support Solutions, who heads up both the Okaloosa and Cobb County contracts, said the Georgia deal is unique because it is based on performance. Titan receives incentives depending on its ability to demonstrate increased efficiencies and fulfill service requests in a timely fashion.
At certain times during the year, school district officials perform evaluations of Titan’s service and support system and then decide based on those surveys whether the district must pay additional incentives to the company. “It’s the big stick Cobb County has, so to speak,” Smith said.
While all three contracts are expected to translate into significant savings for their respective school systems, Smith cautions it would be misguided to outsource IT for the sole purpose of saving money.
What companies such as Titan do best, he says, is provide experience and best practices to help schools and other public-sector organizations make the most efficient use of their resources. “Improved services should be the true focus of outsourcing,” he said. And increased efficiencies can translate into savings in other areas, such as giving teachers more time in the classroom or streamlining the communication of increasingly vital student achievement data throughout the district.
In terms of staffing, large companies such as Titan have the ability to bring on staff temporarily to handle routine surges in the need for technology service and support. Schools, for example, tend to experience the greatest need for technology support during the beginning of the year, when educators and students still are working out the kinks in their respective systems and getting used to the infrastructure. In many of these instances, outsourcers are able to bring in experts from other areas of their business, reallocating them as needed. A school, on the other hand, might be forced to contract for new employees to meet that need, Smith said.
According to Connor, Okaloosa entertained competitive bids from at least 17 different vendors before deciding on Titan. The company has been providing partial IT services to the district since 1999.
Despite enthusiasm in places like Detroit and Cobb County, outsourcing isn’t the right approach for all districts. Experts recommend that you evaluate whether to outsource your technology systems and support on a case-by-case basis, looking at factors such as the cost of providing the service, how critical it is to your day-to-day operations, and how comfortable you are with having an outside company do the job.
Okaloosa County School District
eSN Special Report: Outsourcing IT