CASH IN THE CLOUD
OTTAWA’S NEWEST CLUSTER SET TO SOAR
A new government department is set to make big changes to the way IT services are delivered throughout the federal bureaucracy, with planned savings of at least $100 million. The federal government’s so-called “shared services” initiative – the idea of providing information technology services in a streamlined manner through one department – has long been in the works, beginning with the establishment of Public Works’s Information Technology Services Branch several years ago.
However, critics argue the ITSB model lacks the bite needed to force government departments to rely on Public Works for IT service delivery, that it doesn’t properly consider different departments’ unique needs, and that small and medium-sized businesses are not properly considered as suppliers.
Enter Shared Services Canada, a new centralized entity within Public Works that was launched in early August with the goal of consolidating and modernizing the public service’s 100 different e-mail systems, more than 300 data centres and more than 3,000 network services.
There are opportunities for industry in this effort, especially as the federal government indicates interest in using private-public partnerships to deliver the new IT services.
The plan is to move to a single e-mail system and fewer than 20 data centres, and to streamline networks. Shared Services Canada will take over for ITSB and within the next two months, roughly 7,000 technology-related staff from the 44 most IT-intensive government departments will transfer to the new body.
As well, the department is developing a deficit reduction action plan to identify five-per-cent and 10-per-cent savings options, translating to savings of at least $100 million and $200 million.
Ottawa Technology spoke with tech executives to gather their thoughts on the newly reformulated shared services strategy, and whether it’s likely to produce the hoped-for savings and efficiencies.
ALEX BERASKOW FOUNDING PARTNER & FORMER PRESIDENT, IT/NET
Alarge part of the discussion over the last 10 years has been going to consolidation. Public Works has always had the mandate to provide a central service, but nobody wants to buy it because the service is bad and it’s far too expensive. So why is that the right model?
My concern is that the actual bureaucratic response is very self-serving, which is “ let’s consolidate, we couldn’t manage when it was small but when we consolidate it all together, we’ll then be able to manage.” And I think that’s fallacious thinking at best. Central planning didn’t work in the Soviet Union and it didn’t work anywhere else because people are not that smart.
A lot of IT has to deal with innovation, and typically large government bureaucracies don’t deal well with deploying innovations. You don’t need what I call rules-based organizations to deal with innovation, and you don’t want government, just like you don’t want the military – which is also a rules-based organization – to be innovative; you want them to execute their mission.
Innovation demands creativity, freedom of thought and exploration and – possibly the most important – the freedom to fail. You don’t want that if you have only one unit. It’s very difficult to say we’re going to have 10,000 people running a central infrastructure and we’re going to let loose a thousand or a hundred cowboys to see what they can come up with. It’s very difficult to do that.
JACK GULAS CHIEF TECHNOLOGY OFFICER, MAPLESOFT GROUP
There’s a fundamental difference ( between ITSB and Shared Services Canada); Public Works was making some proposals on the service being offered, and then trying to host and negotiate on its own these enterprise licence deals, while clearly having other government departments pursuing their own decisions.
With Shared Services Canada now being truly empowered as its own government department, it will have access to the assets of the other government departments to bring in and to create some efficiencies, to make some big decisions.
Typically there’s a bucket of costs with 80 per cent operating and maintenance and 20 per cent capital. I see massive savings on the capital side and that’s easier to prove than, “Hey, we’re consolidating many of these licences down to one licence, or all of this infrastructure to this (one) infrastructure.”
But where the real savings are – and it’s a tricky conversation to be had – a lot of it’s in the labour … resources that are working on these particular systems.
I think that as Shared Services is pulling in ( labour) resources from all different departments and having these people at the table and understanding the efficiencies that come with some of these initiatives, where five or six government departments are all doing things very similarly or duplicating efforts, this does provide a lot of cost savings.
Those people that were maybe working on things that were a little bit lower-value (can) then focus on what’s key to their department, which empowers the government department to be more productive. It’s a big-picture perspective.
JEFF LYNT DIRECTOR, CANADIAN BUSINESS INFORMATION TECHNOLOGY NETWORK, & PRESIDENT, INROUND INNOVATIONS
I f (the federal government is) really going to do this right, they need to make sure they really integrate rather than trying to move to a straight standardization. They need to make sure that they leverage existing systems and not throw away past good investments. Legacy systems should be replaced first, and at some point, there’s going to be a certain level of standardization. But in the meantime, they need to find ways to have existing systems communicate, which includes the technology as well as the processes. You’re always going to have the unique needs of each department, so it’s important to understand that they need to focus on bridging systems, the existing processes and the existing technologies together so that systems are not interrupted.
Provided they have the proper service management strategy that includes the involvement of many companies, both big and small, a multi-source solution, the government will have a very good sounding board across the industry. If they want to essentially outsource the service to one or two large integrators, they’re going to be subjected to the processes and procedures of those one or two companies, and I don’t think that’s in the best interest of the taxpayers. I think monopolies have proven to be inefficient and not as cost-effective as a competitive environment.
KIM DEVOOGHT VICE-PRESIDENT OF PUBLIC SECTOR (CANADA), CISCO SYSTEMS
( Beginning with network, e-mail and data centres is) a good starting point, but with where the world’s going, the intelligence lives in the network itself. The government will need to get to this issue of how we ensure that we have any device hooked to networks everywhere. The proliferation of tablets and mobile devices, and the demographic changes where younger members of the workforce expect to be able to work that way, will drive the government to deal with that issue.
If you think about, for example, the whole notion of teleworkers, it means you really don’t have to be in a physical office anymore to accomplish your work. It doesn’t apply to every function, especially in the public-
sector context, but these tools will result in the government saying, “Maybe we need to look at different ways of managing our workforce. Maybe we don’t need all this real estate we have.” The end result is the significant cost savings on real property and reductions in energy emissions as a result of people not having to commute all the time.
However, you have to walk before you run, so to start with the foundation of networks, data centres and e-mail is perfectly good. But where it needs to lead to will be to look at changing the way people work and taking advantage of the tools that are out there. The end result will be workers will be more productive and government will spend less money in terms of the technical support required and the level of physical infrastructure they have to put in place to support them.
NEIL MCEVOY EXPERT CONSULTANT, CLOUD BEST PRACTICES NETWORK
The shared services initiative is the perfect context to explain the value of cloud computing. Cloud computing is a technology that allows multiple different organizations to share infrastructure for the purpose of finding greater efficiencies between them.
There are different models of cloud computing: the affiliate/public cloud like Amazon, which is generally available to everyone, on one end of the scale, and the other end is a private cloud where one organization implements their own private cloud dedicated to themselves internally. Government can’t easily use something like Amazon because of privacy restrictions, but doing a private cloud internally means you’re not leveraging the fundamental benefits, which is the more people sharing the infrastructure, the greater the cost savings for each user.
In between is the community cloud, which is the ideal model. It allows any number of complementary government agencies to pool their infrastructure requirements, so that rather than each of them going out and buying their own dedicated servers and software, they create one single community cloud platform that they all share in. They’re getting a more modern platform and the costs to each of them is greatly reduced. And that’s actually called shared service computing, so you can then see the immediate analogy between the department they’re creating and the function of this technology.
The ability to move to cloud computing, which is fundamentally about becoming more agile and moving quicker, is part of the modernization which could see ( government) becoming more nimble, which is part of the solution to their organizational nature as well.