SAAQclic: CGI’s offer was 29% lower than winning LGS-IBM bid

Quebec software firm CGI submitted a bid that was approximately $135 million lower than the contract won by its competitors LGS-IBM for the digital transformation of the Société de l’assurance automobile du Québec (SAAQ).

According to a document presented Tuesday morning before the Gallant Commission, CGI, which wanted to form a consortium with software publisher Oracle, had an offer of around $323.5 million.

This is approximately 29 per cent lower than the $458.4 million bid won in 2017 by the group formed by LGS-IBM and German software publisher SAP.

The commission’s attorney, Alexandre Thériault-Marois, sought to put this comparison into perspective.

CGI’s proposal was submitted before the “competitive dialogue” stage of the bidding process. This phase served as a forum for exchanges between the Crown corporation and the finalist consortiums to clarify, in particular, the needs and efforts related to the technology project known as CASA, which includes the SAAQclic platform.

Following this “dialogue,” there were “upward or downward variations” in the bids submitted by the finalist alliances LGS-IBM-SAP and Deloitte-SAP, said Thériault-Marois.

CGI and Oracle were disqualified before this stage of the process. The SAAQ never opened the consortium’s envelope, as it was rejected at a stage in the bidding process when the bidders’ prices were still confidential.

CGI’s estimate was presented Tuesday before the public inquiry commission following a commitment made last week by the multinational IT consulting firm, while one of its former employees was testifying.

Francis Mathieu, who had been involved in preparing CGI’s bid, suggested on Friday that certain factors could explain why its costs were lower than those of its rivals. In particular, he pointed out that the Montreal-based company had a “good pool of French-speaking experts” in the Quebec City region, requiring less transportation or accommodation costs, for example.

“Having pools of resources on widely used technologies eliminates the risk of overbidding for specific profiles,” said Mathieu, adding that the company also relied on people who were familiar with SAAQ systems.

He also believed that Oracle’s solution could be less expensive than SAP’s.

LGS-IBM used resources from abroad, mainly India, to develop SAAQclic. This led to language issues and translation needs, as we learned during the Gallant commission. A former IBM manager explained that due to the limited number of French-speaking employees in the province to carry out the company’s IT project, the consortium had no choice but to look abroad.

After CGI was disqualified, Mathieu met with the SAAQ, which informed him of the weaknesses in the bid. The element that seemed to make “the difference” was CGI’s desire to have control over the project. The company suggested using its own “proven management foundations,” while the SAAQ wanted to be the project manager, Mathieu said.

“The company felt that our offer made them vulnerable to suppliers,” he said.

–This report by La Presse Canadienne was translated by CityNews