By Tony Collins
Anti-cloud CIOs should “move on” says Cabinet Office official, “before they have caused too much harm to their business”.
For years Chris Chant, who’s programme director for G Cloud at the Cabinet Office, has campaigned earnestly for lower costs of government IT. Now his work is beginning to pay off.
In a blog post he says that nearly 300 suppliers have submitted offers for about 2,000 separate services, and he is “amazed” at the prices. Departments with conventionally-good rates from suppliers pay about £700-£1,000 a month per server in the IL3 environment, a standard which operates at the “restricted” security level. Average costs to departments are about £1,500-a-month per server, says Chant.
“Cloud prices are coming in 25-50% of that price depending on the capabilities needed.” He adds:
“IT need no longer be delivered under huge contracts dominated by massive, often foreign-owned, suppliers. Sure, some of what government does is huge, complicated and unique to government. But much is available elsewhere, already deployed, already used by thousands of companies and that ought to be the new normal.
“Rather than wait six weeks for a server to be commissioned and ready for use, departments will wait maybe a day – and that’s if they haven’t bought from that supplier before (if they have it will be minutes). When they’re done using the server, they’ll be done – that’s it. No more spend, no asset write down, no cost of decommissioning.”
Chant says that some CIOs in post have yet to accept that things need to change; and “even fewer suppliers have got their heads around the magnitude of the change that is starting to unfold”.
“In the first 5 years of this century, we had a massive shift to web-enabled computing; in the next 5 the level of change will be even greater. CIOs in government need to recognise that, plan for it and make it happen.
“Or move on before they have caused too much harm to their business.”
He adds: “Not long from now, I expect at least one CIO to adopt an entirely cloud-based model. I expect almost all CIOs to at least try out a cloud service in part of their portfolio.
“Some CIOs across government are already tackling the cloud and figuring out how to harness it to deliver real saves – along with real IT. Some are yet to start.
“Those that have started need to double their efforts; those that haven’t need to get out of the way.”
Cloud will cut government IT costs by 75% says Chris Chant
This is my response to Chris Chant – in summary Politicians need to be intelligent about understanding the issues to help the CIOs and UKplc?
“Government CIOs need support in achieving the desired result of being the “intelligent buyer”. That will include the use of “cloud” but more importantly they need to understand exactly what they are buying into. There is hope just recently someone in government summed it up neatly “need to leave our previous tooling agnostic approach by specifying tooling capabilities holding back from mandating specific toolsets”. Some may puzzle what this actually means.
HMG has in the past been the “unintelligent buyer” by just going through the procurement process to place a contract but not understanding the capabilities in the toolsets that will eventually deliver the solution. This in particular applies to software which is now dominated by 4 suppliers which is always “bad” for innovation. So it is important that buyers understand such capabilities to choose capabilities that can help reduce costs now and in the future. For example “agile software” where core code does not change, no code generation or compiling but can builds any custom solution thus makes investment future proof and achieves value for money (VFM). The final part to that statement refers to the fact that under EU rules you are not allowed to specify any particular vendor. So the blindingly obvious is the need to become intelligent to understand underlying capabilities and articulate them with out naming the supplier.
The issue is how is this to be achieved? I think there are two key areas that need to be addressed; how to gain the knowledge and how to distribute such knowledge.
Gaining knowledge goes to the core of how we in UK are so poor at supporting our innovators. Politicians make great play of “R&D” indeed just recently Universities and Science Minister David Willetts made great emphasis that place bets on tech research for growth. Well yes but is this not a cost until it is exploited? Not only that from idea to commercialisation is about 5 years and can be 10? Another mistake by politicians is that they do not differentiate between Tech SMEs and SME generally when they expect 25% of HMG contracts to go to the SME sector. So take comfort CIOs being the “unintelligent” buyer goes right to the top! It is from the top direction is urgently needed to set the framework to help the CIOs at the frontline.
This needs politicians to first recognise that real innovation is likely to come from small tech companies (STC) and therefore once their product is ready for market so is proven to deliver VFM they need to have a defined route to the UK’s biggest buyer – HMG. At this point an assessment for relevance and benefits can be quickly assessed and thus the knowledge build begins. If the capabilities and outcomes can be effectively used in government contracts of what ever type then these can be articulated (just as I did with agile software) and this knowledge is then distributed to all involved parties to help CIO make good decisions, procurement understand what they are buying and service suppliers be aware of the buyer’s expectations. This will be a central resource that STCs can use It is highly inefficient to handle at departmental or local level.
This is not difficult nor costly but the benefits could be significant not only in VFM achieved but UK at last tackles a serious gap in helping our home grown STCs at a critical stage in the life cycle of development of real innovation. It is from these STCs that new British globally players can emerge. If HMG buys into innovative products then it makes it 10 times easier to export. So CIO you are an important player in this vital action for UK plc. But first politicians need to recognise the issues and then appoint a person responsible to implement action that will help you achieve your demanding goals.”