Westminster Council expects to save £30 million after agreeing a deal with BT to overhaul its HR and finance platforms.
BT is set to put in place a "radical redesign" of Westminster Council's existing services, in an eight-year framework deal that will see the company provide ongoing systems management to the council.
The service agreement has also been recommended to Hammersmith & Fulham and the Royal Borough of Kensington and Chelsea as part of deal to enable the sharing of services across the three authorities. BT said that a further 17 boroughs have also expressed interest in the contract to replace computer systems in finance and HR departments.
According to Westminster Council the deal will reduce its costs by £30 million, halving the outlay it would have incurred by continuing its current deals.
Previously Westminster Council outsourced its HR through Serco, using Oracle systems, with finance systems run in-house using JD Edwards software hosted by Liberator.
This was an "old fashioned and uncoordinated" baseline to work from, said Westminster Council's chief operating officer Barbara Moorhouse, and the council will now use a Unit 4 Agresso platform.
Agresso will offer better reporting and systems capabilities than its current infrastructure, Moorhouse added, enabling it to achieve its aim of cutting bureaucracy through its workforce, with BT providing a managed service for some, but not all, of its HR and finance systems.
"We will have a single system for both HR and finance," Moorhouse told Computerworld UK, "they need to be closely aligned. It is a technology systems platform that we think is very flexible, which gives us a lot of power to our teams to be able to use the tools very effectively."
"This is backed by BT's technical skills in supporting it, and running the systems overall, as well as providing some of the services on other sites for transactional services."
Moorhouse added: "We will try and make sure that all of our finance and HR processes operate as one integrated suite. It doesn't sound at all sexy, but in most organisations it is way short of what is actually achievable."
Neil Rogers, President of Global Government, BT Global Services, added that the contract could open the door deals with other boroughs across the capital.
"This is a landmark deal for BT and provides a great opportunity to develop a true shared service across a number of London boroughs," Rogers said.
"We are confident that working with the three authorities will provide huge benefits for the councils and allow them to provide greater value for money for London's council tax payers."
Last year a group of twenty London councils including Westminster launched a framework contract for back-office services worth up to £1.4 billion, in a bid to improve efficiency and reduce costs.