Friday, January 21st, 2011 - 11:28
Friday, January 21, 2011 - 10:24
As we start the new year, I am excited to kick off a series of posts on each of the seven cost takeout initiatives. We will dive deeper into each of the initiatives, exploring how the federal government can move from concept to realized savings through the application of commercial best practices to reduce costs and improve performance.
Here’s a quick review of Initiative 1: Consolidate Information Technology (IT) Infrastructure
The government’s costs of operating its IT infrastructure are higher than they need to be—in some cases by more than a factor of two. Significant savings can be realized if departments and agencies employ proven methods to reduce overall costs of IT ownership. The federal government spent approximately $78 billion in fiscal year 2010 to support its widely-dispersed IT assets. At least 20–30 percent of that spending could be eliminated by reducing IT overhead, consolidating data centers, eliminating redundant networks, and standardizing applications. IBM has dramatically reduced its own data center operations and saved up to 40 percent in operating expenses. IBM has cut its IT expenses in half over the past five years through consolidation and standardization. Gartner Group reports that these types of efforts generally deliver a 20–30 percent reduction in costs. If the federal government could achieve similar improvements in performance, it could save $150– 200 billion over the next 10 years.
There are opportunities for savings from IT consolidation through efforts large and small, and at multiple levels across government. Agencies can consolidate servers, departments can consolidate data centers and move to one email system, and even across different departments services like payroll applications, can be shared. These are just some of the many examples of how IT infrastructure consolidation can reduce costs. Realizing the full savings from IT consolidation across the federal government will require innovative leaders to take up the challenge and many, many individual initiatives across agencies and departments.
So what might IT within the federal government look like in the future?
It could consist of an IT infrastructure within the cloud that is faster, more secure, and continually refreshed with the latest application versions and updates. Data will be much less prone to loss because the data backup processes within a cloud environment will render the data much safer. Hackers too will find it much harder to access data within a cloud, as focused cyber-security professionals will be able to provide real-time 24x7 monitoring and protections.
The government of the future will have accessible mobile apps that provide useable data to citizens, businesses, non-profits and the media. Finding and using government data will be greatly simplified, as data is placed in open and standardized formats.
The government workforce of the future will also be more mobile. No longer will employees be chained to their computer terminals. Instead they will be able to get their work done from anywhere at anytime. A flexible, mobile workplace will be a powerful attractor to a new generation of public servants.
The government of the future will be cheaper. The promise of the future of IT is that while IT costs can be reduced through IT consolidation efforts, the delivered IT capabilities can increase significantly, and the costs of many processes can be significantly reduced.
This is not a vision of a Jetsons’ style future. This is the vision of Federal IT laid out by Federal CIO Vivek Kundra, and this future is a reality today for IBM and others who have pioneered and adopted these ideas, and turned them into commercial best practices. Now it’s time for the Federal Government to reaps the benefits of lower cost, enhanced capabilities, and improved performance.
Over the next several weeks, we will be discussing what IT consolidation is, and how federal leaders can make the promise of the next generation of IT a reality. I hope you’ll join the conversation and share your ideas!