SAP wins R800m IFMS deal

By Leon Engelbrecht for SAP
Johannesburg, 18 Jan 2008

SAP SA has won what an insider says is an R800 million contract to supply the treasury and the Department of Public Service and Administration with a human resources business process management system.

The State IT Agency (SITA) made the announcement just after noon today. "SITA today confirmed that SAP South Africa has been conditionally awarded a tender for the provision of the human resources management system (HRMS) of the integrated finance management system (IFMS) project," says spokesman Elton Fortuin.

The HRMS is one of four pillars making up the IFMS and will replace the state's antiquated "Persol" mainframe. It is believed the entire IFMS will cost about R4 billion.

"The scope of the project covers financial management, HR management, supply chain management, asset management and business intelligence across both national and provincial departments and as such constitutes the biggest integrated business solution undertaken in the country," adds Fortuin.

SITA chief of strategic services Moses Mtimunye says the final awarding of the HR tender is subject to an acceptable due diligence evaluation of the SAP offering by an independent party.

"The award is also subject to the conclusion of successful negotiations on price and a service level agreement, among others, between SAP and treasury," he says.

Boosting transformation

Mtimunye adds that a due diligence evaluation of the IFMS procurement module, conditionally awarded to ICT Works in November, is still under way. ICT Works is a small, female and black-empowered ICT consultancy. The procurement module is said to be worth R700 million.

The contract for the integrated development environment (IDE) of the IFMS has been signed as well, says Mtimunye. He says IBM and the National Treasury recently penned the deal.

"The parties have successfully concluded negotiations for the IDE, which is the underlying open enterprise architecture on which the IFMS applications will operate."

SITA CEO Llewellyn Jones says the IFMS project will support government's transformation by improving the efficiency and effectiveness of the public service.

"The new integrated transversal applications will improve government's administrative efficiency by providing systems to support legal compliance, strategic planning processes, data and information security and business intelligence," says Jones.

He adds that the project is also a catalyst for SITA's transformation to a prime system integrator. He also sees it as an important contributor towards sustainable skills development and BEE for the ICT sector.