Michael Pietsch

The HERKULES project: Lessons learned from Public Private Partership Michael Pietsch

Scholarly Research Paper from the year 2011 in the subject Business economics - Economic Policy, grade: -, The Open University (OU Business School), course: B856 Managing Public Policy, language: English, abstract: In late December 2006, the German Federal Armed Forces (Bundeswehr) commissioned a consortium consisting of Siemens Business Services (SBS) and IBM to modernize and manage its non-military information and communications technology ("white IT") under the HERKULES project. The HERKULES project is designed to update the Armed Forces' data centres, software and applications, PCs, telephones, and voice and data networks to modern standards. This includes maintenance and support of desktop software, SAP software as the large-scale back end, web-based applications belonging to the intranet of the Bundeswehr, and communication programs such as IBM's Lotus Notes. Siemens will be responsible for operating and modernizing the decentralized systems at more than 1,500 locations in Germany, encompassing 140,000 PCs, 7,000 servers, 300,000 fixed-network telephones and 15,000 mobile phones. In terms of objectives (Newman: 2001), the BWI IT was created predominantly to bear the enormous financial upfront investment of the project. The yearly parliamentary approved defence budgets were neither flexible nor big enough to engage a project of this dimension. The Social Science Institute of the Bundeswehr (SOWI) has been charged with the evaluation of HERKULES. In my functional capacity I have had the opportunity to contribute actively to the performance evaluation to date. This paper outlines the scope and schedule of HERKULES and identifies the major (dis-)advantages of this PPP compared to unilateral public policy implementation. Special focus is given to the question of risk sharing and the project inherent partnership dynamics. Hereafter, potential room for improvement and areas of concern are being analysed. The paper concludes with a brief lessons learned chapter.