Turning crisis into opportunity

Today, public sector IT departments – from local councils to the largest government departments – have the difficult task of delivering improved efficiency without affecting their service performance levels.
VMware works with many public sector organisations to help them achieve such efficiencies and drive business transformation in the sector. We have therefore been working closely with polling and research consultancy ComRes to monitor the developments prior, during and since the publication of the Comprehensive Spending Review (CSR) – speaking to senior finance officers in the public sector to discover their opinions, approaches and strategies to meet their 
CSR cost-cutting targets.
Public sector cuts
We’ve so far run two sets of research – an initial phase before the CSR was announced in October 2010, and a second phase six months on. In both phases of our research, we questioned 250 CFOs in the sector and found that many organisations are both fearful of the cuts and have yet to instigate action to start trimming back on their budgets.
Given the gravity of the situation and with less than three years to reach their target savings, it was surprising to find that as of March, public sector finance bosses had achieved less than nine per cent of the desired IT savings four months on from the CSR, leaving a total of £2.6 billion of savings still to be found, while nearly a quarter said they still did not have their final plans in place.
While I have seen a number of public sector organisations making fantastic strides in innovating and cutting IT costs, there has been a substantial delay by many others for implementing a cohesive savings strategy. With this in mind, it is even more worrying that three in five finance officers state that the cuts are already impacting the delivery of front-line services.
The right technology
We believe huge savings can be made within public sector IT without having to impact on front line services. Moreover, immediate savings could be made by simply deploying the right technology platform.
This will not only help to make the savings, but will ultimately improve services at the same time.
A striking element of our study has been the belief in the strategic importance and value of IT that is spreading beyond technology departments. The vast majority (73 per cent) of senior finance officers believe that IT is integral to delivering cost-cutting projects across their organisation. Despite public sector IT often being associated with well-publicised IT failures, senior finance bosses also share the view that technology delivers organisational value and can transform the way in which organisations can operate.
However, the benefits which can be found through IT, depend not only on the technology, but also on how it is implemented. Here I have outlined three ways in which public sector organisations can drive transformation through every level.
Server virtualisation
One of the simplest ways – and one singled out by the government as a recommended strategy for cost savings – is through straightforward server virtualisation.
This is where IT infrastructure, primarily servers and data centres, are optimised so that applications require 90 per cent fewer physical machines to run. This method can cut capital and operational expenditure through lower hardware, maintenance and energy costs. Organisations that have virtualised their server estates have seen costs reduced by up to 70 per cent, and benefitted from the ability to deploy and manage servers much more rapidly.
While many public sector organisations will already have virtualised some parts of their infrastructure, not all take full advantage of what the technology can offer. One organisation that certainly does is Camden Council. When it needed to reduce ongoing investment in new hardware and a new data centre facility, it turned to virtualising its server infrastructure, and saved an estimated £600,000 – a quarter of this on power alone. The council is also currently working towards the goal of reducing its IT budget by 25 per cent by 2014, and virtualisation is playing a crucial part in helping deliver this.  
Some of the most advanced public sector organisations are virtualisation to revolutionise server estates by creating local cloud computing facilities, which can be accessed and rented out across local institutions effectively as an outsourced service. Not only does this help drive revenues for the cloud host organisation, but it also helps reduce IT costs for the organisations consuming the cloud shared service.
Applications in the cloud
As infrastructure is ultimately there to support applications, it is important for companies to consider the way they approach applications, as this can affect both operational expenditure and capital expenditure. With many organisations looking to the cloud era as an opportunity to modernise many existing applications and enhance their capabilities to provide more value to the business, they need to be able to develop and roll out applications much more quickly.
Therefore, public sector organisations have to start considering cloud services which will enable their applications to be ready for a hybrid cloud world, and to take advantage of the new applications that are emerging in the consumer world – such as social networks or online collaboration.
Cloud application layers, and technologies can speed up application development by 50 per cent and enable organisations to deploy to a runtime environment that is ideally suited for virtual infrastructures and appropriate for the needs of modern applications.
Simplifying end-user computing
The way users interact with tools and technology has a big impact on the way they carry out their work. At the moment, end-user computing within the public sector is complex, costly and not meeting requirements. Organisations might be regularly refreshing their hardware and software, but they aren’t making changes significant enough to make their workers more productive.
With the consumerisation of IT, users are now more sophisticated and have better devices at home than those they are given to use at work and, in fact, if an organisation gives an employee an older piece of equipment to work on, it’s likely that they’ll find a way to use their newer, better device instead, regardless of whether or not it’s set up to comply with the company’s security measures.
Of course, if public sector organisations were to virtualise their IT estates, then they can enable their workers to access their desktop through any device – no matter where they are. Organisations can therefore let employees collaborate across applications and data from any device, safe in the knowledge that the environment is fully managed, safe and secure.
Don’t fear innovation
The potential scale of public sector ICT transformation is clearly an enormous undertaking. Cost reduction is key, but in addition, the highly virtualised and automated infrastructure platforms of the future will deliver agility in application provision, to enable IT to respond to global incidents and the fiscal benefits of a cost model based on operational expenditure.
There are, however, some challenges to overcome on the journey to the cloud. Competing commercial models, concerns over information assurance and general cultural resistance all need to be addressed. Yet, as we have seen in the examples above and in the successes of the many other public sector organisations which have already started on this journey, these challenges are being faced, attacked and ultimately resolved, allowing for easier and more widespread adoption of the cloud approach in the future. L
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