LogicaCMG wins £25m 'risk reward' deal

LogicaCMG has won a £25m ten-year risk-reward deal to manage the IT infrastructure of the UK's Medical Research Council (MRC).

A huge amount of risk will be transferred to LogicaCMG with the contract linking payments and bonuses to business, and not IT, objectives.

Stuart Aitken, CIO at the MRC, told silicon.com that it is a unique contract that moves away from the traditional IT outsourcing agreements.

"We defined the business we wanted to do. LogicaCMG has to decide what hardware and software is required to meet those business needs. A large chunk [of the contract] is based on the MRC getting real tangible business benefits," he said.

Among the first tasks for LogicaCMG are a new accounting system that will reduce the time it takes to consolidate accounts from six months to one month, a new corporate-wide portal with specific usage targets, and an electronic records management service.

Aitken said: "There is a lot of risk transfer. If [the portal] is not used, LogicaCMG doesn't get paid."

No staff will be transferring to LogicaCMG as the MRC previously outsourced its IT to Cap Gemini Ernst & Young. The contract was re-tendered when that deal came to an end. Aitken said CGEY was on a shortlist of three before withdrawing its bid.

Aitken said the underlying IT infrastructure of the MRC is "critical" to its 3,500 users in enabling them to maintain the institution as a centre of excellence in medical research.