news The Federal Government’s peak technology strategy division has made a series of announcements aimed at pushing forward its vision with respect to public sector uptake of the new generation of cloud computing services and making such services available on the right terms to departments and agencies.

Like most other government jurisdictions around Australia, the Federal Government has been slow to adopt cloud computing technologies, with most departmental and agency chief information officers holding the view that such technologies should be examined cautiously in light of concerns about data sovereignty issues. Many of the large cloud computing companies (for example, Microsoft, Salesforce.com and Google) predominantly host their services offshore, instead of in Australia.

However, in a series of blog posts published last week, the Australian Government Information Management Office, which sets overarching technology strategy across the Federal public sector, released a number of documents and made several moves aimed at helping to put guidelines and frameworks around government adoption of the cloud.

Firstly, AGIMO released an approach to market document for datacentre as a service services (DCaaS), inviting interested suppliers to respond with details of their solutions in this area – which are commonly listed as part of the broad ‘Infrastructure as a Service’ class of cloud solutions. The procurement effort will create a standardised list of suppliers which departments and agencies can purchase services from – although it’s not mandatory. In a post on AGIMO’s blog, the group’s first assistant secretary John Sheridan wrote that the DCaaS effort represented a departure from historic procurement practice.

“While it reflects an incremental development rather than a revolution, it nevertheless presents an opportunity to significantly simplify procurement of cloud and cloud-like services,” he wrote. “We have aimed at creating a balanced approach that recognises risk but limits it by design. Pre-agreed arbitration, limits in scope of procurements, templated forms, the registration fee, etc., are all combined in this new manner.”

“Unlike many of the coordinated procurements, for which AGIMO is responsible, use of DCaaS is not mandatory. Consequently, the proof of its worth will be in the take up – both initially by suppliers offering services and then by agencies seeking to procure them. Like many new services, we expect that it will take a while to fully develop. As we’ve stated previously, if it doesn’t work, we’ll review its continued operation.”

“We will be adopting a first come, first processed approach to the assessment process. Our intention is to launch the DCaaS MUL by the end of October 2012, however there is a possibility of there being too many AFI responses to process by this date. If this occurs, there will be a second tranche of consideration. However, as the List will remain open, joining later in its life is allowed.”

Secondly, AGIMO has also released several key documents which the agency hopes will assist departments and agencies in responsibly purchasing cloud computing services. The first is entitled A Strategic Approach to Cloud Implementation: An Australian Government Perspective, and aims to provides agencies with an understanding of the issues around considering and transitioning to cloud services.

“We designed the guide as an aid for experienced business strategists, architects, project managers, business analysts and IT staff to realise the benefits of cloud computing technology,” wrote AGIMO first assistant secretary (acting) Scott Wallace in a separate blog post. “It provides an overarching risk-based approach for government agencies to develop a cloud strategy and to implement cloud solutions.”

And in a second post, Wallace also released another related document – the final version of AGIMO’s Community Cloud Governance Better Practice Guide.

The community cloud model is one of several cloud computing approaches which the Federal Government is currently exploring, under a collaborative approach between centralised IT strategy agency the Australian Government Information Management Office and a number of other major and minor departments and agencies.

The model is different from both the public cloud (where various unrelated organisations share public IT infrastructure) and private cloud (where a single organisation provides a common private pool of infrastructure to its own workers and internal departments) models, in that it envisions IT infrastructure being provided by large departments within the Federal Government being somewhat standardised so that smaller departments and agencies can also gain access to IT infrastructure.

In doing so, it recognises the fact that in Australia’s Federal Government, large departments such as the Australian Taxation Office, Department of Human Services (including Centrelink), and Department of Immigration and Citizenship already operate large amounts of IT infrastructure and maintain standardised processes for accessing that infrastructure, and that it might make sense for smaller agencies to be able to take advantage of it. The first version of this guide was published in May, to substantial interest from the industry. It has since been finalised.

“The purpose of this guide is to provide agencies with guidance on providing a governance structure around community clouds,” wrote Wallace. “It is based around related frameworks using formal agreements that are managed by well-defined governance structures with clear roles and responsibilities. I would like to thank everyone who submitted comments and feedback on the draft.”

opinion/analysis
I think it’s highly positive to see this kind of activity around cloud computing policy and guidelines comes from AGIMO. Virtually everyone who works in technology in the Federal Government seems to be interested in the potential for cloud computing to help the public sector rapidly improve service delivery, but without these kind of guides and purchasing frameworks, little gets done due to the lack of ‘officialness’ around these kind of projects.

I view what AGIMO has done here as providing some safety mechanisms around the Government’s use of cloud computing technology – safety mechanisms which will be needed for some departments to dip their toes into the cloud computing water.

However, one does also have to wonder whether the Federal Government is moving too slowly in this area. German software giant SAP recently, for instance, won a substantial deal with the NSW Government’s Trade & Investment agency which it described as its biggest deployment of its Business ByDesign software as a service suite globally, and its first cloud platform win in the local public sector.

Does this cloud computing deployment represent a situation where decisive action by the new Coalition Government in NSW will get the state ahead when it comes to the uptake of cloud computing technologies in government? Or does it represent a state rushing to implement a new hyped technology without appropriate safeguards? Only time will tell. The one thing we do know, however, is that when it comes to new technologies, AGIMO will usually take a conservative view of them – a viewpoint which is more often than not appropriate for the risk-averse public sector.

Image credit: joegus74, royalty free

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1. Dr Steve Hodgkinson
   Posted 07/08/2012 at 1:19 pm | Permalink | Reply

   Here are my comments on the AGIMO blog in response to ‘A Strategic Approach to Cloud Implementation (draft)’ …

   It is good to see some momentum growing behind recognition of cloud services as a practical sourcing alternative for agencies … so well done.

   Ovum’s recent report ‘Practical Steps to the Cloud for Government Agencies’ provides case studies of five Australian public sector organisations that have deployed cloud services and found them to be better, faster, less expensive and less risky (overall) than more traditional ways of sourcing ICT capabilities … so there is growing evidence that the benefits are real.

   I agree with John Hilvert’s comment that we need a better sense of strategic direction to understand the context of all this. Mature enterprise-grade cloud services are simply an evolved form of externally provided shared services … infrastructure, software or platform. For agencies, the appropriate comparison for cloud services is not just ‘in-house IT’ or ‘old-style outsourcing’ – it also needs to include internal shared services.

   The benefits of the cloud model stem from two main drivers: (1) the economies of scale made possible by many customers sharing the investment burden of a continuously evolving shared solution platform, and (2) the way cloud services empower individual agencies to access economies of scale and innovative ICT capabilities by unilateral, rather than collective, decisions. Cloud services are actually organisational solutions not technology solutions. They deliver a new way of accessing ICT capabilities along with the organisation required to make them work now and in the future.

   If we took the ‘Cloud Business Management Checklist’ from AGIMO’s document and renamed it a ‘Shared Services Business Management Checklist’ it would reveal the extensive list of factors, risks and considerations that agencies should be aware of before they enter into a shared services arrangement of any sort – whether internally or externally provided. This would also reveal that there are evolving mechanisms to manage counterparty risks in cloud services … but few practical mechanisms for agencies to manage counterparty risks in an internal shared services arrangement. Once agencies are committed to participation in an internal shared service the switching costs are very high – no matter how intense an agency’s disappointment with service quality, responsiveness and cost there is no practical way out of the shared service without throwing the baby out with the bathwater (again).

   The huge benefit of mature enterprise-grade cloud services from an agency’s perspective is that they are already available today (cloudy is as cloudy does) can be fully tested prior to purchase, and can be terminated with relatively low switching costs. Put simply, cloud services can empower agencies to access ICT-enabled innovation and give them better control over their ICT destiny in an environment of increasing budget constraints.

   A strategic approach to cloud services needs to be founded on a realistic assessment of how cloud services compare to alternative ways of sourcing ICT capabilities and on recognition of the pragmatic trade-offs involved … not simply on a list of the supposed ‘new’ risks and considerations that are purported to be unique to the procurement of cloud services. A strategic approach would also be forward looking and founded on an assessment of the underlying trends in the ICT industry and trends in both the strengths and weaknesses of agency ICT capabilities and those available via internal or externally provided shared service arrangements.

   Let’s just make sure we are positioning the trade-offs in the cloud services discussion frankly and honestly …

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