Showing posts with label Shared Services. Show all posts
Showing posts with label Shared Services. Show all posts

June 15, 2013

IT Departments, Here To Stay

InformationWeek asks "Will IT Departments Disappear By 2020?"

This question comes from Forrester Research which sees the commoditization of IT as eroding the base for the traditional IT function and roles.


As we move to cloud computing--apps and infrastructure, as well as continue the trend for outsourcing IT such as help desk, desk support, and more what will be left for the CIO and his or her team to do?


The article answers this question with another major trend--that of consumerization--"differentiating value and visibility among consumers and employees."


This is where IT can be highly strategic in serving those needs in the business that are truly unique and that enable them to be high performing and even outperform in the marketplace.


These ideas of commoditization and consumerization are anchored in Lawrence and Lorsch's business studies of integration and differentiation of organizations, where organizations need to find their ideal state for integration of subsystems--such as through cloud computing, data center integration, and shared services--and for differentiation, where organizations differentiate themselves to address the unique value they bring to their customers.


So even with commoditization of IT and integration of services, the IT function in organizations will not be going away, no more so than HR or Finance functions went away with Enterprise Resource Planning (ERP) solutions. 


The CIO and IT function will be able to leverage base enterprise services as commodities, but they will be expected more than ever to focus on and provide strategic solutions for their customers and give their organizations the real technology competitive advantage they are looking for and desperately need. 


This is what distinguishes a real CIO--one that provides strategic leadership in being user-centric and coming up with customer-oriented solutions that are not available anyplace else--from those managers that only help to keep the IT lights on. 


If you are not differentiating, you are not really engaging--so get out there with your customers and roll up your CIO sleeves. ;-)


(Source Photo: Andy Blumenthal)

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October 12, 2012

Cloud $ Confusion

It seems like never before has a technology platform brought so much confusion as the Cloud.


No, I am not talking about the definition of cloud (which dogged many for quite some time), but the cost-savings or the elusiveness of them related to cloud computing.

On one hand, we have the Federal Cloud Computing Strategy, which estimated that 25% of the Federal IT Budget of $80 billion could move to the cloud and NextGov (Sept 2012) reported that the Federal CIO told a senate panel in May 2011 that with Cloud, the government would save a minimum of $5 billion annually.

Next we have bombastic estimates of cost savings from the likes of the MeriTalk Cloud Computing Exchange that estimates about $5.5 billion in savings so far annually (7% of the Federal IT budget) and that this could grow to $12 billion (or 15% of the IT budget) within 3 years, as quoted in an article in Forbes (April 2012) or as much as $16.6 billion annually as quoted in the NextGov article--more than triple the estimated savings that even OMB put out.

On the other hand, we have a raft of recent articles questioning the ability to get to these savings, federal managers and the private sector's belief in them, and even the ability to accurately calculate and report on them.

- Federal Computer Week (1 Feb 2012)--"Federal managers doubt cloud computing's cost-savings claims" and that "most respondents were also not sold on the promises of cloud computing as a long-term money saver."

  - Federal Times (8 October 2012)--"Is the cloud overhyped? predicted savings hard to verify" and a table included show projected cloud-saving goals of only about $16 million per year across 9 Federal agencies.

  - CIO Magazine (15 March 2012)--"Despite Predictions to the Contrary, Exchange Holds Off Gmail in D.C." cites how with a pilot of 300 users, they found Gmail didn't even pass the "as good or better" test.

- ComputerWorld (7 September 2012)--"GM to hire 10,000 IT pros as it 'insources' work" so majority of work is done by GM employees and enables the business.

Aside from the cost-savings and mission satisfaction with cloud services, there is still the issue of security, where according to the article in Forbes from this year, still "A majority of IT managers, 85%, say they are worried about the security implications of moving to their operations to the cloud," with most applications being moved being things like collaboration and conferencing tools, email, and administrative applications--this is not primarily the high value mission-driven systems of the organization.

Evidently, there continues to be a huge disconnect being the hype and the reality of cloud computing.


One thing is for sure--it's time to stop making up cost-saving numbers to score points inside one's agency or outside.

One way to promote more accurate reporting is to require documentation substantiating the cost-savings by showing the before and after costs, and oh yeah including the migration costs too and all the planning that goes into it. 

Another more drastic way is to take the claimed savings back to the Treasury and the taxpayer.

Only with accurate reporting and transparency can we make good business decisions about what the real cost-benefits are of moving to the cloud and therefore, what actually should be moved there. 

While there is an intuitiveness that we will reduce costs and achieve efficiencies by using shared services, leveraging service providers with core IT expertise, and by paying for only what we use, we still need to know the accurate numbers and risks to gauge the true net benefits of cloud. 

It's either know what you are actually getting or just go with what sounds good and try to pull out a cookie--how would you proceed? 

(Source Photo: Andy Blumenthal)

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December 10, 2010

Federal IT Management Reform

New IT management reform from the White House.

Very exciting development.

The plan is published at this link.

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March 7, 2010

A Turning Point for the Government Cloud

Los Angeles is moving to the cloud, according to Public CIO Magazine March 2010, and “they are the first government of its scale to chose Gmail for the enterprise.”

“It turned out that Washington D.C., was using Gmail for disaster recovery and giving employees the option to use it as their primary e-mail.” But LA is implementing Gmail for more than 30,000 city employees (including police and fire departments) as well as planning to move to Google Apps productivity suite for everything from “calendar, word processing, document collaboration, Web site support, video and chat capabilities, data archiving, disaster recovery and virus protection. “

CTO Randi Levin is leading the charge on the move to cloud computing, and is taking on concerns about cost, data rights, and security.

  • On Cost: “The city estimated $5.5 million in hard savings form the Google adoption, and an additional $20 million savings in soft costs due to factors like better productivity.”
  • On Data Rights: Nondisclosure agreement with Google includes that the data belong to the city “in perpetuity,” so “if the city wants to switch to another vendor after the contract ends, the city will be able to recall its archived data.”
  • On Security: “Google is building a segregated ‘government cloud,” which will be located on the continental U.S. and the exact location will remain unknown to those outside Google. The data will be “sharded”—“shredded into multiple pieces and stored on different servers. Finally, Google will be responsible for “unlimited” damages if there’s a breach of their servers.

LA conducted an request for proposal for software-as-a-service (SaaS) or a hosted solution and received responses for 10 vendors including Google, Microsoft, and Yahoo. Google was selected by an Intradepartmental group of IT managers and a five year contract issued for $17 million.

Currently (since January), LA is conducting a Gmail pilot with about 10% of its city employees, and implementation for the city is slated for mid-June.

Additionally, LA is looking into the possibility of either outsourcing or putting under public-private partnership the city’s servers.

And the interest in government cloud isn’t limited to LA; it is catching on with Google Apps pilots or implementations in places like Orlando, Florida and within 12 federal agencies.

Everyone is afraid to be the first in with a major cloud computing implementation, but LA is moving out and setting the standard that we will all soon be following. It’s not about Google per se, but about realizing the efficiencies and productivity enhancement that cloud computing provides.


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