How should governments go cloud first?

Dr Steve Hodgkinson, Chief Analyst, Global Public Sector

Three Australian state governments have recently released updated ICT strategies that include cloud-first policy positions. However, each state has taken a different approach to driving cloud services adoption. This raises interesting questions about the impact of cloud services on the logic of whole-of-government ICT strategy.

Our view is that central agencies should focus on leadership and enablement. They should be mindful of the risk that too much top-down strategy too early on will kill the golden goose of decentralized cloudy innovation that is created when agencies are simply empowered to buy services that already work.

NSW government agencies are already evaluating cloud-based services when undertaking ICT procurements

The New South Wales (NSW) state government’s ICT Strategy was published in 2012 with an implementation update released recently. The 2012 policy statement on cloud services remains unchanged:

NSW Government agencies will evaluate cloud-based services when undertaking ICT procurements to determine the ICT delivery model that provides the best value sustainable investment, taking account of the full range of cost-benefit considerations.

To promote and support cloud services adoption, the NSW government has

• created the Cloud Services Policy and Guidelines
• created the IT Services Catalogue
• produced the Cloud Pilot Project Report (NSW agencies now have extensive hands-on experience of a range of solutions, including Google Apps, Microsoft Office 365, Salesforce, and SAP Business By Design SaaS ERP)
• added the as-a-service module to the state’s ICT procurement framework
• added as-a-service sourcing models to the state’s ICT investment policy and guidelines.

NSW was visionary enough to include cloud services aspirations in its strategy in 2011/12, and it nurtured pilot projects in agencies while diligently executing a centrally driven program of supportive policy initiatives.

This foresight is starting to deliver results. The NSW government has demonstrated its appetite for cloud services. Sydney has become the obvious choice for any global cloud services provider seeking to establish a beachhead in the Australian market, including, so far, Amazon Web Services (AWS), Microsoft, Oracle, Rackspace, and SAP.

Victoria will evaluate cloud-based ICT services first for new and renewed systems

The Victorian state government recently released an update to its ICT Strategy. A new principle relating to cloud services was added:

Cloud-based ICT services will be evaluated first for new and renewed systems. Public cloud ICT services will be evaluated to assess their suitability. The preference will be for standard versions provided by public cloud vendors, requiring little or no customisation.

Victoria has a handful of well-developed cloud services implementations in agencies using solutions from Oracle, Salesforce, and Telstra. However, within individual agencies, momentum for cloud services has so far been driven from the bottom up.

A range of centrally driven programs to accelerate cloud services adoption are in development, including an Infrastructure and Services Roadmap (with explicit consideration of the impact of as-a-service offerings on enterprise architecture) and a Public Cloud Framework and associated cloud guidance. Victoria is also implementing a new procurement arrangement called VicConnect – an ICT network for the delivery of standardized services to agencies. VicConnect is expected to create a whole-of-government marketplace for telecoms and other as-a-service offerings.

Queensland will architect cloud-based ICT services by default

The Queensland state government recently released its new Cloud Computing Strategy as an addendum to its 2013–17 ICT Strategy. The document includes an unambiguous cloud-first procurement statement:

The Queensland Government will place cloud computing in a prominent position in the government’s ICT reform by taking a ‘cloud-first’ approach to the sourcing of ICT as-a-service: agencies will procure cloud-based ICT services as the default option for their ICT requirements unless a sound business case exists for a contrary solution.

The strategy is part of a suite of documents that also comprises ICT as-a-service policies, an ICT-as-a-service Decision Framework, and a Cloud Computing Implementation Model.

The Cloud Computing Implementation Model describes a comprehensive top-down approach, comprising a cloud marketplace and storefront, external cloud brokers, a private community cloud, and an identity federation platform, and transformation of agency ICT divisions into trusted brokers of ICT services from external suppliers.

How much top-down whole-of-government strategy is “enough” for cloud services adoption?

The strategy agendas of the three state governments vary in the degree to which they are top-down or bottom-up approaches.

NSW appears to have the best balance of a bottom-up, hands-on approach to cloud services adoption in agencies and pragmatic top-down leadership and enablement. The focus has been on celebrating innovation in agencies and providing support by creating policy enablers and removing policy barriers – for example in investment and procurement rules.

Victoria has some highly effective bottom-up cloud services projects in agencies, but has so far done little centrally to create enablers or remove systemic policy and procurement barriers to cloud services adoption.

Queensland is heading for the opposite of this – its approach would warm the heart of any enterprise architect. The state is attempting to catch up from a slow start with a “forced march” toward cloud services. Although this approach may appear necessary due to budget constraints and the pressing imperatives for ICT asset and application renewal, it runs the risk of repeating the errors of over-centralization that have plagued previous ICT strategies in this and other states.

It will be interesting to see how the approaches of these three states evolve over time. Insufficient top-down strategy will slow cloud services adoption by failing to create enablers and remove blockages, while too much will slow cloud services adoption by over-centralizing decision-making and creating unwieldy procurement and operational arrangements that restrict agency autonomy.

Cloud services are an inherently decentralizing – bottom-up – mode of ICT procurement. The best balance is one that focuses on business outcomes for agencies and accelerating the rate at which staff in agencies learn where, when, and how to deploy cloud services – first.

Our view is that central agencies should focus on leadership and enablement. They should be mindful of the risks that too much top-down strategy too early will kill the golden goose of decentralized cloudy innovation that is created when agencies are simply empowered to buy services that already work – cloudy is as cloudy does.