Supplier Problems - Accenture
From Nhs It Info
Accenture Reports Second-Quarter Fiscal 2006 Financial Results (28 Mar 2006)
Accenture
http://www.accenture.com/xd/xd.asp?it=enweb&xd=_dyn/dynamicpressrelease_974.xml
“Accenture (NYSE: ACN) today reported net revenues for the second quarter, ended Feb. 28, 2006, of $4.10 billion, a 13 percent increase in local currency. GAAP diluted earnings per share were $0.11, including a pre-tax provision for future losses of $450 million related to the company’s future deployment of systems for the National Health Service (NHS) in England.”
CfH demands heads roll at Accenture (May 2006)
The British Journal of Healthcare Computing & Information Management
http://www.bjhc.co.uk/news/1/2005/n508002.htm
“NHS Connecting for Health — the DoH agency in charge of the policy for, and implementation of, England’s National Programme for IT in the NHS — has issued an icy rebuttal to claims by local-service provider Accenture that delays by its subcontractor iSOFT in developing the core-software solution Lorenzo were responsible for recent losses suffered by the firm. Instead, CfH shifted the blame onto Accenture for failing to manage its suppliers properly, and contrasted the LSP’s performance to date unfavourably with that of another, CSC, which also manages iSOFT as a core-software supplier. Connecting for Health stated that it has demanded sackings of key project managers within Accenture to rectify the firm’s failures.”
Accenture ready to axe NHS IT contract (27 Aug 2006)
The Observer
http://observer.guardian.co.uk/business/story/0,,1859025,00.html
Accenture, the international consultancy and technology group, is ready to resign from the government’s controversial £12bn IT programme designed to keep electronic records of 30 million NHS patients throughout the UK. If it does, it would be a major blow to the project, which has drawn fire from politicians, contractors and the City. The programme is £6bn over budget and more than two years behind schedule. Accenture, the largest prime contractor, is in negotiations with the authorities in a bid to ditch its £2bn contract. But there is something of a Mexican stand-off here, because the government agency overseeing the project is sticking to its position that Accenture is liable to a £1bn penalty if it walks away. Accenture says the sum should be reduced to take account of the fact that the contract has changed in nature since it clinched the deal three years ago. One analyst said: ‘In essence, what Accenture is saying is “we want compensation because this thing isn’t going to plan, and it’s costing us a bomb”.’ Earlier this year, Accenture, which is based in Bermuda and was once part of accountancy firm Arthur Andersen, took a $450m hit because of cost-overruns and delays. A compromise solution would see the whole NHS IT contract renegotiated on more favourable terms for the contractors in recognition of the new trend towards local autonomy in the NHS, which means GPs and NHS trusts can take systems other than those being developed by Accenture and the other prime contractors, BT, CSC and Fujitsu. If Accenture does ‘walk’, it is understood that CSC is ready to step in to take on its responsibilities.”
Accenture winds down acute hospital trust work (31 Aug 2006)
e-Health Insider
http://www.e-health-insider.com/news/item.cfm?ID=2098
“Accenture, the local service provider for the NHS IT programme in the North-east and East of England, is winding down its implementation team working on putting new patient administration system into NHS hospitals. E-Health Insider has been told that the acute implementation team was almost completely disbanded at the beginning of July, with a number of redundancies and contractors let go. Some Accenture staff were redeployed to work on primary and community care projects. . . Industry speculation, however, is increasingly pointing to CSC being allowed to take over Accenture’s acute hospital work in the two clusters – taking over responsibility for implementing iSoft products in trusts across two additional regions. Accenture would potentially continue to be responsible for community and primary care work. “The rumour is that they [Accenture] will get out of secondary care and do primary care across all three clusters,” the source said. . . Whatever the final outcome it is clear that new installations of administration and clinical software at hospitals the North-east and Eastern regions of the NHS IT programme have largely ground to a halt, with the troubled £6.2bn NHS IT project beset by yet more uncertainty and delay. In June Accenture and NHS Connecting for Health stated in a written response to the House of Commons Public Accounts Committee member Richard Bacon MP that it would install iSoft’s iPM patient administration system at five trusts by the end of October. Only one, Ipswich NHS Trust, now says it is working towards meeting this date. The remaining four NHS trusts named by Accenture two months ago have now told E-Health Insider over the past week that they no longer plan to take the system or don’t have an implementation date. . .”
Consultant may sue to quit IT upgrade (15 Sep 2006)
The Guardian
http://politics.guardian.co.uk/economics/story/0,,1872995,00.html
“Accenture, a lead contractor on the £6.2bn upgrade of National Health Service IT systems, is preparing legal action against the government as part of an attempt to extricate itself from the project. Accenture, the US-listed consulting group responsible for implementing the National Programme for Information Technology (NPfIT) in eastern and north-eastern regions, has already made provisions of $450m (£238m) against potential losses from its contract with the government and has been rumoured for some time to be keen to withdraw. Industry sources suggest that Accenture has threatened legal action by the end of the month if it cannot reach a satisfactory agreement with Connecting for Health, the NHS’s IT procurement arm, on ending or substantially renegotiating the contract. Any withdrawal would be a further blow to the NPfIT, already beset by worries about cost overruns and delays. The move comes as BT said it would consider taking the place of Accenture if given the opportunity by Connecting for Health.”
Accenture to quit NHS technology overhaul (28 Sep 2006)
The Guardian
http://business.guardian.co.uk/story/0,,1882423,00.html
“Accenture, the biggest and most successful regional contractor working on the NHS’s troubled £6.2bn IT overhaul, is poised to pull out of the project. This will be a body blow for the NHS as Accenture has been responsible for deploying more than 80% of the systems installed so far by the four lead contractors under the National Programme for IT. An exit deal has been agreed with health executives. A joint statement from Accenture and the NHS could be issued as early as tonight, when the consultancy firm is due to report full-year earnings figures in the US. . . The loss of Accenture from NPfIT - the world’s largest non-military IT project, designed to revolutionise the health service’s largely paper-based systems - raises questions about the performance of the other lead contractors, BT, Computer Sciences Corporation and Fujitsu. None of them has disclosed provisions or write-downs despite NHS figures showing that their work on comparable NHS contracts remains some way behind Accenture’s. According to figures released by the NHS, of the 1,028 systems deployed by the regional lead contractors so far under the programme 827 were carried out by Accenture. The US consultancy has deployed 89% of general practitioner surgery IT systems so far installed, 94% of community primary care systems and 82% of primary care child health systems. While NPfIT still has a long way to run, it is losing its largest and most advanced contractor. . .”
Accenture pulls out of national programme (28 Sep 2006)
e-Health Insider
http://www.e-health-insider.com/news/item.cfm?ID=2163
“Accenture has departed from the NHS National Programme for IT, walking away from two contracts worth a total of more than £2bn. The company, which is the second biggest supplier to the national programme, made the announcement before its fourth quarter earnings call today. It is understood that the firm has been unable to reach an agreement with NHS Connecting for Health on renegotiation of its contracts. As widely predicted by industry and city sources, Computer Sciences Corporation (CSC), the local service provider (LSP) in the North-west and West Midlands cluster, will take over both of Accenture’s two national programme regions: the North-east and Eastern clusters. The departure of Accenture is a body blow for the NHS IT modernisation programme, raising tough questions over why one of its most experienced international contractors has decided it is best served by walking away from over £2bn worth of contracts. It also raises a question mark over the viability of the programme for the other prime contractors: BT, CSC and Fujitsu. According to CfH figures, of the 1,028 systems deployed by the regional lead contractors so far under the programme 827 were carried out by Accenture. . .”
iSoft was central to Accenture's NHS pull-out (28 Sep 2006)
ZDNet UK
http://news.zdnet.co.uk/business/management/0,39020654,39283714,00.htm
“On the day major contractor Accenture announced it was pulling out of the NHS' NPfIT programme, troubled subcontractor iSoft emerged as key to its departure. Healthcare software provider iSoft has emerged as the central cause for Accenture's withdrawal from the NHS' massive IT rehaul. Accenture confirmed on Thursday afternoon that it was pulling out of most of its £2bn contracts with NHS Connecting for Health, the department responsible for implementing the National Programme for IT (NPfIT). With the exception of its role in moving medical imaging services to a digital platform in the North West, Accenture's work will now all be handled by Computer Science Services (CSC), another of the major NPfIT contractors. In a teleconference on Thursday afternoon, Guy Hains, the European president of CSC said the rollout of new NHS software and infrastructure could be sped up following Accenture's withdrawal, mainly because of new arrangements surrounding iSoft — which had been subcontracted into NPfIT by both Accenture and CSC. . . The transferral of work from Accenture to CSC will take place over the next three months. A sizeable proportion of Accenture's NPfIT staff will move to CSC to ensure "an orderly transfer of services and to minimise disruption", according to NPfIT boss Richard Granger. Accenture's withdrawal means the technology services and consultancy firm will have to repay £63m of the £173m it has already been paid by the NHS. It will, however, be unable to recoup any of its losses by bringing legal action against iSoft, as any potential litigation relating to the period between 2 April, 2004 and 28 September, 2006 was annulled in the termination agreement between the two companies. . ."
MPs say Accenture's departure evidence of NPfIT failure (29 Sep 2006)
e-Health Insider
http://www.e-health-insider.com/news/item.cfm?ID=2166
“Opposition MPs were quick to voice doubts about Accenture’s departure from most of its work under the National Programme for IT, seeing the move as evidence of failure. Liberal Democrat health spokesman, Steve Webb, said: “This is yet more evidence of a project in deep trouble that will doubtless mean more instability distracting health professionals from concentrating on patient care. “This firm’s departure will generate yet more fears that the NHS IT project’s costs and problems will escalate further. Inevitably, when you change supplier there will be handover costs and the danger that people with valuable knowledge will leave.” Conservative MP and member of the Commons Public Accounts Committee (PAC), Richard Bacon, said: “This just replaces one regional contractor with another which has less experience. However, the main problem is not with the regional contractors but with the product they are being asked to implement, iSoft’s Lorenzo system, which still does not work properly. . .”
Inquiry call into NHS IT project (29 Sep 2006)
BBC News
http://news.bbc.co.uk/1/hi/england/staffordshire/5391222.stm
"A Staffordshire MP has called for an inquiry into an NHS computer programme set to cost £6.2bn. It comes after one of the main contractors, Accenture, pulled out of the Connecting for Health programme which will link GPs with hospitals. NHS chiefs said the move would not cause significant further delays to the IT project. Labour MP for Newcastle, Paul Farrelly, said the Department of Trade and Industry should carry out an inquiry. Accenture has handed over £1.9bn of its contracts to another US company, Computer Sciences Corporation. "The big question about this contract is whether in actually designing the system for the NHS it is too ambitious by half," said Mr Farrelly."
Life support for the NHS IT programme: Is Accenture's decision to abandon the NHS IT programme an indication that the project is heading for disaster, or just good management? (23 Oct 2006)
Information Age
http://www.information-age.com/article/2006/october_2006/nhs_it_programme
"The computerisation of the National Health Service (NHS) is the most ambitious public sector IT programme ever undertaken. The new system – due for completion in 2014 – will connect hundreds of thousands of doctors, nurses and other health professionals, creating an integrated electronic patient management network. . . But while there is little debate about what the overall objectives of the NHS IT project are – ultimately saving lives through increased efficiencies – the enormous size and scale of the project has attracted plenty of detractors. Doctors have complained about a lack of consultation, and concerns about patient confidentiality in an electronic system accessible by any health professional in the UK have not yet been resolved. . . Richard Granger, CEO of Connecting for Health, the UK government agency responsible for the implementation, has taken a hard line in dealing with contractors not able to meet deadlines. After Accenture’s exit, he announced that CfH will tender for extra suppliers to increase capacity and ease its reliance on sub-contractors. Ultimately, whether Granger’s hard-line stance is viewed as good vendor management, or overly-aggressive bullying, will depend on the success of the project."
Accenture pulls out of core NHS IT services (11 Jan 2007)
ZDNet UK
http://news.zdnet.co.uk/itmanagement/0,1000000308,39285428,00.htm
"Consulting firm Accenture has completed its withdrawal from delivering core IT services to the National Health Service. The company withdrew from the National Programme for IT (NPfIT) — the largest civilian IT project in history — in September 2006, abandoning most of its £2bn contracts with the NHS in the process. . . Accenture's transfer of core services in the East and Northeast to CSC was completed on Monday as planned, according to the NHS department responsible for NPfIT, Connecting for Health. However, Accenture will still be responsible for delivering medical imaging systems. . ."
