Stage One: identification of the requirement

2.7  When a requirement is identified, the relevant business unit within the Department appoints a project sponsor, usually one of its senior managers, to oversee and control the project to fulfil the requirement. The project sponsor is responsible, with assistance from the Feasibility Appraisal Service of the Department's Business and Management Services Division and the EDS account manager, for preparing a business investigation brief. This sets out the scope and terms of reference of the investigation and the objectives and anticipated benefits of the proposed project. Agreement to fund a business investigation is the first step of the formal project approval process.

2.8  An imbalance in the relationship between EDS and the Department could lead the company to suggest unnecessary requirements simply to generate income. This would not apply in the case of new work arising out of Government policy changes, and the Department's project approval process also has safeguards to ensure that projects which do not meet a genuine need are not approved.

■  The Departmental planning procedure translates high level objectives into individual business unit plans. Requirements are generated from these plans.

■  No project can proceed without at least the approval of the Feasibility Appraisal Service.

These safeguards, combined with the pressures imposed by restrictions on financial and staff resources, should result in the rejection of proposals which do not meet a genuine business need.

2.9  Of the twelve projects we examined, four were initiated before the Department's contract with EDS. Of the remainder, three arose from legislative or other policy changes and five were identified by the Department to improve business processes, such as the Call Centre experiment to reduce reliance on paper-based systems (see Figure 6).

2.10  We conclude that the Department's arrangements provide reasonable assurance that projects which did not meet a genuine business need would be rejected before proceeding to the investigation stage.