UK public sector IT is now being shaped by a confluence of three powerful forces, Richard Kemp, Senior Partner at Kemp Little Solicitors, told January’s House of Commons meeting of PITCOM, the Parliamentary IT Committee (http://www.pitcom.org.uk).
The first stems from an increasing recognition that many flagship public sector IT projects over the last ten years have not lived up to their promise, Kemp said. “There are many IT projects in the UK public sector that do work, and work well. But these big projects are really demanding and very, very difficult to bring in on time, on budget and to the right standard.”
A number of difficulties do seem to recur, he said. These included too much ‘bespoke tailoring’ – a belief that systems must be designed from scratch, meaning they are likely to be inflexible; cultural issues, whereby “IT projects bear the whole weight of significant changes in culture and working practices”; and supplier dependence: “projects can all too quickly reach a point where there is little realistic possibility of switching suppliers.”
The second major force was the need to reduce public expenditure over the next ten years, Kemp said.
The Treasury has reported that government spend on back office operations and IT reached £34bn in 2007-08, or 5% of total government spending. “So it’s inconceivable that there won’t be pressure on public sector IT spending during the next Parliament or two.”
The confluence of these two forces – difficulties with major projects and severe cash pressure –combine to put the third, the “generational shift” towards cloud computing, in the spotlight, Kemp said.
“You can analogise with the rise of networked PCs in the mid-90s, or the move between the wars from electricity generation in the factory to the national grid: cloud computing represents a shift on that scale.
“We’re not there yet, but where this really takes you to is utility computing – using the internet first to break down the elements of computing into their constituent parts; second, to commoditise, and produce these components on a scale that reduces prices; and third, the aggregation of the parts to form what the customer wants.”
This approach is likely to address some of the challenges of major IT projects, he said: “Even with the most sophisticated projects in the next ten years, many elements will be commoditisable.” It could also help with culture change, as people are used to accessing services over the internet in other aspects of their lives. And it can help alleviate supplier dependence: “If you get the contracts right, where suppliers are providing a service, elements of which are commoditisable, this should mean that strategic supplier dependence and supplier capture can be significantly reduced.”
Of course, cloud computing does also bring risks, Kemp said. “The main threat is over security and privacy of data, and we can really understand this – in our law firm, like many others, we have our own servers in our server room with our confidential client data. But even here, our disaster recovery site, with a complete mirror of what’s on our servers, is at another location, in line with practice in our market.”
What it boils down to is the need to ensure technical and operational measures and processes are in place to make sure the data centre or centres where your data is held in the cloud is no less secure than your server centre at the moment, Kemp said.
The final point to understand about a ‘cloud world’ of huge, joined up databases, is the need for public bodies to look on their data as an asset, he said. “So for example the national collection of orthopaedic or other medical data should be seen as a national asset of enormous value, perhaps like a 21st century equivalent of a property estate.”
Dr Steve Garnett, Chairman of cloud computing pioneer salesforce.com in Europe, the Middle East and Africa, told the meeting that in the consumer world of firms like Google and Amazon, there is a “continuum of reduction in cost and increase in simplicity,” and home internet users – which included civil servants – enjoyed its ease of use.
“If we go to Amazon.com we can log on, order a digital camera, view technical white papers on it, have it gift-wrapped and sent to our home or business, all without installing any software or getting any error messages. It is a lot less complicated than many transactions in business such as invoicing or dealing with a customer complaint. So there is a disparity, and office users ask – why is this so difficult?
The second driver is cost, Garnett said. According to analysts Gartner, 80% of all IT budgets are currently sunk on fixed cost infrastructure – “on keeping the lights on, and managing the IT infrastructure you already have, and so there is less and less for developing new systems and creativity. That is unacceptable.
“In the new world, you buy what you want – whether it’s two users or 200 users – and pay as you go.
“You also don’t need to upgrade – who knows which version of Amazon or eBay they are using? And this has a phenomenal cost impact.”
The commoditisation of software has the added benefit of making suppliers more responsive to their customers, Garnett said. “They make their money over the long-term, so they need to perform year in and year out, because you can switch off at any time and go somewhere else. It’s still not easy to do, but it’s much more likely than in the old world.”
Security is always a key concern to organisations moving data ‘into the cloud’, Garnett said. “People ask – what if data fell in to hands of my competitors?”
His own company keeps each organisation’s data compartmentalised, and after extensive scrutiny customers had found that the technology was more secure than their own current in-house systems, “because we can afford to spend more on it”, he said.
There are cultural barriers to change, Garnett said, both within an organisation and outside.
“The last thing that some of the big IT suppliers want is for you to stop buying computers, software or consultants. The whole computer industry is trying desperately hard to stop what is happening in cloud computing, to slow you down.
“Second, it can be seen as a threat to your own IT people – they have built your computers, and can see the lights downstairs on the server stacks, so when that complexity is no longer there, they sometimes get worried.”
Nevertheless, most forward-looking CIOs (chief information officers) can see the advantages of a shift to cloud computing, Garnett said. “Some have seen it as a massive opportunity to build their career.”
Ultimately, the wave of innovation is unstoppable, he said. “I would not bet against the web. The speed at which companies are now starting to use cloud computing is amazing, because the economics are so compelling.”
MPs and Peers founded PITCOM in 1981 to provide a bridge between Parliament and the IT industry. E-Government Bulletin publisher Headstar is the official writer of PITCOM meeting reports and technology briefings for Parliamentarians. For all PITCOM meeting reports and briefings, see:
http://www.pitcom.org.uk .
NOTE: Article originally published in E-Government Bulletin issue 305.
Click here to visit/return to issue 305 index
Just reading this article, and I am in total agreement about the wave of cloud computing being unstoppable, and a good thing.
However what also jumped out at me was the idea of public bodies seeing data they hold as an asset, outlined in the below quote – as this is exactly what the MHRA (Government’s medicines watchdog – and holder of a drug information database) is currently having an online discussion around at which weirdly enough started yesterday! It appears public bodies are already starting to understand this notion…
“”The final point to understand about a ‘cloud world’ of huge, joined up databases, is the need for public bodies to look on their data as an asset, he said. “So for example the national collection of orthopaedic or other medical data should be seen as a national asset of enormous value, perhaps like a 21st century equivalent of a property estate.””
We who work for the City of Los Angeles are standing on the very precipice as we become the first U.S. government entity to migrate all of our information over to the Google cloud. I am not in IT, so the phrase ‘cloud computing’ was foreign to me until a few months ago and I’ve been reading furiously to get up to speed on what this all means. Although some of the earliest city depts to migrate over have encountered some problems, I’m hopeful these glitches will be cleared up soon. Articles such as this clearly lay out both the caveats and the possibilities. And, as far as I’m concerned, the positives far outweigh the negatives!