3  The target application

The target application for the MISMA is a 2nd/3rd generation outsourcing arrangement for Managed ICT Services involving only modest levels of transformation risk.  This is a significantly different application to that for the Model Agreement (refer to Appendix A for a summary of the key differences between the two contracts).  Figure 2 (below) provides a high-level overview of the key phases for a typical project using the MISMA in which blue (upper row) activities are those of the incumbent contractor and red (middle and lower rows) the incoming contractor.

Figure 2: MISMA - typical project phases

The broad principles of the target application are as follows.

The incumbent contractor will continue to provide the core services under the existing agreement until the Effective Date when it will also be required to provide exit-related services, and support the incoming contractor to undertake the necessary Transition Activities.

When Transition Activities have been satisfactorily completed (and tested), the Service Commencement Date will be sanctioned by the Authority, allowing the Legacy Services to be cut-over from the incumbent contractor to the incoming contractor. In order to minimise transition risk and preserve business continuity, the incoming contractor will normally provide the Legacy Services in substantially the same way as the incumbent contractor.

At some agreed point on or after the Service Commencement Date, the incoming contractor will normally commence certain Transformation Activities to refresh and/or revise the Legacy Services. Once the Contractor successfully completes these activities and passes the Transformation tests, the Authority will issue an Authority To Proceed (ATP) notice at which point the delivery of Transformed Services will commence. The complete switch from Legacy Services to Transformed Services may be instantaneous at ATP or it may be phased over a period of time.

The payment principles associated with this project life cycle are at Appendix B.