Keywords: Oracle, Department for Work and Pensions, purchase to pay, procure to pay, shared service, finance shared services, ebusiness suite

Department for Work and Pensions saves £230 million with Oracle

Anna Bowsher | News | 15 October 2012

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In a recent statement released by Oracle and the Department for Work and Pensions (DWP), it was announced DWP has saved £230m since 2006 through its implementation of Oracle's E-Business Suite.

In 2005, the Department were running accounting, employee services, debt management, payment resolution and purchase to pay on separate systems across 24 physical sites and with a FTE workforce of 4,500 running these services.

However, since consolidating into one single instance of E-Business Suite, DWP has managed to increase the number of service lines it has and simultaneously reduce the amount of staff running them to 1,300 across just five sites.

In 2009 DWP started selling this as a shared service to the Cabinet Office, which was shortly followed by the Department for Education in 2010.

Debra Lilley, Oracle Alliance Director for Fujitsu in the UK, said, "DWP has a real shared service. This isn't a shared service where it is in one organisation with different parts of that organisation working together, they actually sell this as a service to other government departments, and that has cut down their costs down as well."

She added: "Benefits come when you consolidate yourself, but the true benefits come when you can sell those services on to somebody else and you are actually sharing infrastructure, and also the people that are running that."

The DfE achieved its return on investment within three years, where now it is also saving £8m a year by using the shared service.

Lilley said that the reason DWP, DfE and the Cabinet Office have made significant savings is because they are operating a shared service throughout the entire stack, rather than just at the infrastructure level, which often occurs with shared services in local government.

"We are finding that when people just look at the infrastructure, there are some savings there. Your shared service story could be just you just share a box with somebody, have totally separate instance, and they only know about each other if they doing something at the box level," said Lilley.

"But actually the power of shared services happens when you move further up the stack. So if you move in your separate organisations within an application, then there is another level of savings to make there."