UK - Government must get to grips with shared services if Cloud is to work

For over a decade now the large services firms have made a tidy living out of implementing large business applications and managing outsourcing or systems integration projects on behalf of their clients. 

Such projects have typically been multi-year, multi-million pound contracts – in others words, exactly the sort of thing that we don’t do any more in the public sector now that the Age of Austerity is here.

All of which rather raises the question: what do the services giants do next? The answer to that question – as it is to so many question these days  - is: the Cloud.

The next question then is: what do the traditional service providers do in the Cloud? Is it business as usual for those firms that have provided outsourcing services to the public sector – to greater or lesser effect – over the decades? Or is there a new role emerging?

“We have made good business in professional services helping clients with Cloud strategies,” says Andrew Greenway, Global Cloud lead with Accenture. “We select SaaS solutions and build both public and private Cloud infrastructure and more recently to re-platform and build using PaaS.”

But doesn’t Cloud strip away the complexity of systems implementation and in so doing disintermediate the systems integrators?  It’s not that simple, argues Greenway.  “When a client is starting to buy into the idea of Cloud services, it can appear very easy – you buy some Salesforce.com licences, give them to the sales guys and away you go,” he states. 

“But if you don’t manage this very carefully then data can get out of date very easily. You have to learn a different set of passwords and so on. Maybe you can manage that with one system, but if you buy 20 Cloud services then it becomes very difficult.“

This is where Gartner’s ‘big new idea’ of the Cloud Broker comes into play. Several services firms have laid claim to this concept, which remains conveniently imprecise in its definition to such an extent that multiple providers can pitch multiple versions of what it entails in practice.

For his part, Greenway states the Accenture vision in simple terms. “We see the role of being a Cloud Broker as being to provide clients with full access to all services.” He argues. “Integrating Cloud to legacy is fundamental. We see a real role in providing that broker plus service.”

Public sector carrots and sticks

Interestingly Greenway doesn’t seem to be of the view that the benefits of the Cloud will be so glaringly obvious that the public sector will rush wholesale towards it. “It will be a case of carrot and stick,” he predicts. “Where we’ve seen Cloud work is where there has been a mandate from the top, such as President Obama’s Cloud First policy. You need some level of stick and some level of forcing shared services.

“Procurement into government will continue across three routes,” he suggests. “There will still be the RFI and RFP process. We will continue to do that and to partner and work with other companies. The sort of scale of opportunity where we can add value will continue to be our modus operandi.

“The second level will at the CloudStore level which will be for smaller opportunities,” he adds. “My personal view is that there will need to be some governance around this. We will need to say that all universities need to be on the same email, for example. If we don’t have that stick, then…

“The third way is the way that things are done today where departments just go and do their own thing,” he concludes. 

Does this explain why Accenture, unlike rivals CapGemini and Fujitsu, doesn’t appear in the first iteration of the CloudStore providers then?  “We did have a look at CloudStore, but we have done similar procurement efforts with government before,” says Greenway. “We’ve decided to take a wait and see approach for this first round.”

That doesn’t seem an entirely whole-hearted endorsement of the G-Cloud, but Greenway would like to see more of a wider-reaching strategic approach.  “The government has struggled for a long time with the question of how much should there be a strategy across government,” he argues.

“The US has taken the approach of pulling together departments and centralising as much as possible. So they put out tenders for common email, common HR and millions of seats at a time. We haven’t seen that kind of strategic thinking here.  You can end up with a lot of fragmentation which leads to integration problems.”

He adds: “Government has to adopt shared services to make this work.  The real savings are if you can share Cloud services across departments."

Back to basics

There are those of course who argue that what Cloud does is send services firms back to basics – providing managed services in areas such as shared services, change management and process re-engineering. Indeed there are those who suggest it’s just another form of outsourcing at the end of the day.

“Cloud is about building a service rather than building the ingredients,” insists Greenway. “It has a lot of the elements of traditional outsourcing. I don’t think there’s actually much new technology, it’s just a different way of thinking and commercialising.  What we’ve done traditionally is use the clients existing systems and use people in lower cost locations and apply more rigour. Increasingly we see that we can bring increased value by bringing technology with us. Increasingly that is in the form of a shared capability such as shared HCM.”

But for Cloud to take off, in-house IT has to rethink its role.  “If IT doesn’t come to understand the organisation better, it will become irrelevant. It’s a fundamental change for the IT department,” he warns.  “We need IT people fully integrated into the departmental organisations and provide real-time advice so that IT can be run like a business.”

Stuart Lauchlan

publictechnology.net

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