Public Sector and the Cloud: Doing more for less

GROWTH AND TRUST
Global cloud insiGht - public sector

Space to transform

2

summary

• people want their governments to act more quickly, so
“all processes and systems that support quick changes in
laws and regulations have to be in place.
applications
that can be • public sector bodies need to: focus on doing more
shared will be for less; make sure they deliver services reliably
shared and and consistently; get the most out of existing
hosted on legacy systems; and use technology to encourage
a common collaboration and quicker decision making.
infrastructure.” • More and more people, especially younger people,
Donald van Gasteren
expect to get services when they want it and
Global Insight Director where they want it. and getting people to look after
Logica
themselves – the ‘self-service’ approach – is a big
benefit for the public sector too.
• budget cuts in the public sector are severe, so it’s no
surprise that clients see ‘cutting business costs’ as the
cloud’s number one role. but they also believe cloud
services offer simple and speedy solutions to business
issues.
• public sector clients have started to think about how
cloud services could help them achieve their top
priorities and get rid of costly legacy services.
• consolidating services, making them virtual, and
sharing them is a key part of moving from a fixed-fee
service or licence to a pay-per-use model, and bringing
down costs and capital investment.
• ‘data security’ is the number one concern for public
sector clients. some even see it as a ‘show-stopper’
because of the sheer amount of legal and regulatory
requirements that they need to comply with.

Global cloud insiGht – public sector

3

introduction

“the cloud is just common
business sense.”

is the cloud just another delivery model
or will it change the public sector’s
relationship with citizens? can it give them
better services or is it a distraction? is it
just about cutting costs, or about finding
new ways to do things? or a bit of both?
this research report puts forward evidence
that these questions can be answered, and
in fact have been already. and that getting
the implementation right is critical.

“our clients’ cloud assessment.”

We had more than 250 conversations
with our public sector clients across
Western europe in 2011 and found many
interesting attitudes towards the cloud.

in this report, we’ll look at how these public
sector organisations see the impact of
cloud services on their business, now and
in the future, and what concerns they have.


4

the cloud’s getting a lot of
interest
the public sector’s use of the cloud has
picked up momentum over the past few
months, and the way these organisations
use it has changed, too.

some public bodies see the cloud as
an evolutionary move from delivering
products to delivering services; others
see it as a fundamental change in how a
government organisation works internally
and with others. however they see it, our
public sector clients are assessing and
developing their cloud strategies. it isn’t
hard to imagine how cloud services could
dramatically change current business
processes.


5

the cloud: it’s all about delivering
services to citizens
We found that the issues our clients want some of the current services lack flexibility
cloud services to deal with changed a lot in and choice, but more citizens are asking
the first half of 2011. this is because they for more flexible access to public sector “We have been
now understand much better what these services. able to reduce our
services can do.
a number of facilities could help
headcount by 40%
in one out of three client here – those that support changes in over the past two
conversations We talked governmental organisational entities, years.”
encourage different departments to work
about hoW iMportant it is Client quote
together more, can ‘ramp up’ and ‘scale
to Make orGanisations More down’ infrastructure capacity, and speed
aGile up the deployment of new networks and
storage. they would also let organisations
in fact, ‘becoming more agile’ has introduce smart working practices, make
moved into first place. people want their their workforce more agile, cut down the
governments to act more quickly, so number of offices they need, provide self-
processes and systems that support quick service portals for citizens and make more
changes in laws and regulations have to use of conference calls and technology.
be in place.
some clients also see agility as being able
Most clients see agility as being flexible to deliver integrated services alongside
enough to cope with sudden peaks in private companies. for example, hospitals
demand – at both the development are sharing patient information with other
and service delivery stages. they need health professionals like laboratories,
to improve the way they develop new, family doctors and independent nurses
updated or enhanced services for more often. these programmes need
citizens, for example, by improving the flexible it services, modern tools at
development cycle or by taking advantage reasonable prices, flexibility in capacity,
of developments that have already been shared application support and flexible
made centrally. clients recognise that software licensing.

Figure 1. Top 5 most mentioned business issues

45% 45%
40% 40%
35% 35%
30% 30%
25% 25%
20% 20%
15% 15%
10% 10%
5% 5%
0% 0%
Improving business Reducing operational Moving to a variable Improving Enhancing the current
operating models risk cost structure business agility customer experience

Central Government Local Government Healthcare Public Safety and Justice Space and Defence


6

froM siMplifyinG processes
to iMprovinG the business “cloud services would
operatinG Model allow us to move
at the end of last year, clients were more
to a mission-based
concerned with simplifying their business structure where a
processes, delivering services and cutting new mission can have
operational costs. but 30% of them now
see improving their business operating
resources assigned to
model as a big issue to sort out, specifically it from the cloud.”
in areas of public safety. Client quote

public sector bodies have a number of
reasons to do this. in particular, they need
to:

• focus on doing more for less. this is
MakinG the custoMer
about being more efficient, not just experience better
cutting costs. one item mentioned
was consolidating data centre services another challenge clients mentioned a lot
to significantly reduce costs across was how to make the citizen’s experience
estates, communications and staffing of dealing with the public sector better – a
as well as improve services. another key part of becoming more ‘citizen-centric’.
was increasing the support for front
and back office business process everyone should get the same high service
outsourcing services – even those who live in rural areas. so a
number of existing web-based facilities “a unified support
• make sure they give their citizens need improvements. one of these areas is service will eliminate
reliable and consistent services mobile web-based applications. More and duplication in staffing,
more people, especially younger people,
• get the most out of existing legacy
expect to get services when and where estates, and contact
systems. clients see partnering with
a commercial body as the best way to
they want them. and getting people to centre infrastructure
do this, for example, in the area of web
look after themselves – the ‘self-service’ (processes,
approach – is a big benefit for the public
hosting
sector, too. telephony, tools, etc.)
• offer services so citizens can get whilst delivering a
more involved with policy and other cloud services could well help at both more consistent,
decisions (for example, new ways of ends, giving citizens premium services
communicating with citizens based through simple but innovative products, better quality, user
through social media) and public sector organisations smart experience.”
working facilities. Client quote
• make decisions more quickly, both
for national and local authorities and
community bodies.


7

vieWs in the sub-sectors ‘improving the business operating model’ Moving existing solutions and applications
as their top business issue. clients from to the cloud does come with some cost. so
the other two – central government and you need a solid business case and a short
clients from three of the five sub-sectors
local government – put ‘becoming more payback period for it to make sense.
– healthcare, public safety and justice,
agile’ at the top.
and space and defence – mentioned

Figure 2. Top 3 most mentioned roles of cloud

40% 40%

35% 35%

30% 30%

25% 25%

20% 20%

15% 15%

10% 10%

5% 5%

0% 0%
Reducing business cost Improving the business’ access to technology Other


cuttinG business costs iMprovinG access to
technoloGy “all applications
budget cuts in the public sector are severe,
so it’s no surprise that clients see ‘cutting
that can be shared
clients believe cloud services offer simple
business costs’ as the cloud’s number and speedy solutions to business issues. will be shared and
one role, switching places with ‘improving they’re not really interested in how the hosted on a common
access to technology’ from the end of last technology works, but in the way it lets
year.
infrastructure.”
them offer citizens better and richer
services, give up physical documents,
public sector clients see how the cloud can share more, get economies of scale and Donald van Gasteren
consolidate and standardise processes Global Insight Director Logica
better accessibility.
and make them more cost effective. but
they’re concerned about the cost of clients realise that younger citizens have
moving to the cloud and the possible loss grown up with devices in the palms of
of control. their hands and that they need to reach
them through these new channels. but
they also understand how important it is
“any scope to reduce to keep a service up and running 24/7 and
costs without loss performing well. so they often experiment
of service is very with the cloud on non-critical business
elements first, like twitter, as a way to
welcome.” encourage working together and changing
Client quote behaviour in the organisation.


8

neW ideas for cloud vieWs in the sub-sectors

an interesting change has taken place almost a quarter of clients put ‘cutting
over the past couple of months: clients business costs’ as their top role for the
are now mentioning other business roles cloud, as did the majority of clients from
the cloud could have. for example, clients the local government, public safety and
think of the cloud as a way to improve justice, and space and defence sub-
operations and make sure services are sectors. Many central government clients
available 24/7, while making less impact are still trying to find a role for the cloud.
on the environment at the same time. healthcare clients gave a mix of responses,
the cloud could also encourage different like ‘cutting business costs’ and ‘achieving
departments to work together more and service excellence’.
cut down the number of local applications
the public sector has to manage (some
governments have more than 2,000
of them). and of course new ways of
communicating, like social networking,
have taken off, which call for cloud-type
models.

business reasons: and get rid of costly legacy services. the cloud services bring the flexibility
providinG a better service way they deliver services is a key element the public sector needs. for example,
in this, as it has to strike the right balance hosting a number of existing local and
between being cost effective and fitting national applications in one place boosts
now that cloud services are easier to get
with the organisation. since capabilities in cooperation between governmental
hold of, public sector clients have started
some areas are scarce, it makes sense for organisations and provides a scalable
to think more about how these services
departments to share cloud investments. platform for the future.
can help them achieve their top priorities

Figure 3. Top 3 most mentioned business reasons
50% 50%
45% 45%
40% 40%
35% 35%
30% 30%
25% 25%
20% 20%
15% 15%
10% 10%
5% 5%
0% 0%
Allows us to focus resource on Lowers overall costs If it is only available as a service
more important projects



9

focusinG resources loWers overall costs

departments are losing skills: it’s hard to one of the biggest challenges for clients
keep good people, and many are retiring is lowering overall costs to balance
anyway. so it would come as a relief to be their budget. they’ll carefully look at
able to focus on their core business and any proposition that makes actual cost
business critical projects, and let trusted savings each year, after taking transition
suppliers look after the infrastructure and costs into account. at the moment they
applications. for example, using a secure think infrastructures are expensive and
cloud environment to deliver infrastructure inefficient, and can’t cope with growth.
and applications as a service would save consolidating services, making them
money and resources by reducing the virtual, and sharing them is a key part of
hardware needed. moving from a fixed-fee service or licence
to a pay-per-use model, and bringing down
costs and capital investment, of course.
but the formal purchasing procedures of
the public sector could be an issue for pay-
per-use.

vieWs in the sub-sectors of space and defence clients put ‘lets
us focus resources on more important
Many clients viewed ‘lowers overall costs’ projects’ as their major business reason.
as an important business reason for the healthcare and central government clients
cloud; almost half of local government gave a mixed response.
clients and a third of public safety and
justice clients mentioned it. the majority

Figure 4. Top 5 most mentioned business concerns
60% 60%

50% 50%

40% 40%

30% 30%

20% 20%

10% 10%

0% 0%
Uncertainty regarding Vendor lock in Loss of control Data security Other
location of server



10

security is the top business reluctant to share projects because it
concern breaks down the separation of different
types of data. and because you have our approach to securing
‘data security’ is the number one concern
to delete some data after a certain the cloud
amount of time, you have to be able to
for public sector clients. some even see
find it easily. 1. Work out the risks for each cloud
it as a ‘show-stopper’ because of the
sheer amount of legal and regulatory project, taking into account applicable
• Public opinion and reputation. recent
requirements in this area that they need regulations, data sensitivity and
security breaches have damaged
to comply with. so there’s a strong need business requirements.
reputations and fostered the opinion
for a cloud service that supports secure that data isn’t safe once it’s left your 2. decide on the deployment model
operations. own premises. (private, public or hybrid) and the
• a big challenge is to set up different service model (infrastructure as a
there are different aspects of data
levels of access to data and services, service, platform as a service, or
security:
without adding to the cost. software as a service) depending on
the risks.
• Legislation. the movement of data
across borders has to be strictly other concerns
3. Make sure you integrate security with
regulated. there is flexibility when it
the existing technical, organisational
comes to moving data around the the security aspects above are closely
and procedural set-ups. evaluate the
european union. but some people linked to the second and third most
need to add security services like
believe that governments should keep important business concerns, ‘not knowing
digital signatures, time-stamping,
their data in their own country. where the server is’ and ‘losing control’.
secure archiving and logs.
some clients don’t want to be dependent
• Sensitive information. you should on outside service providers – they might
never store confidential government 4. if a third party delivers the service,
feel helpless if things go wrong. there
documents in a public cloud. data like make sure you understand exactly
are other concerns as well, like ‘being
personal medical, military and criminal what security is in place.
locked in to a particular vendor’, ‘not
records can be highly sensitive and being compliant’ and ‘having migration
needs its own solution. 5. set up and monitor performance
problems’.
indicators for security so you can make
• Privacy. for personal data you need to sure it keeps doing the job over time.
comply with national laws and privacy
regulations. citizens want to know you
Thibault Chevillotte,
can segregate data so that only the
relevant officials can get hold of the Senior Manager, Security & Risk
relevant information. clients can be Management, Logica Business
Consulting

A protected space


11

conclusion

is the cloud here to stay? We say yes, but
we also say the cloud is just the beginning.
as cloud services in the public sector “When we talk to our clients we find Governments
start to mature, new business models will across europe are using the cloud to transform
appear, eventually reshaping the whole
business environment.
the way they operate and deliver public services.
it saves them money, supports inter-departmental
is it really that important? again, we say information sharing and new ways of engaging
yes. cloud services will help you deal with
the growing need to cut costs and put the
with their citizens.”
citizen at the centre of what you do.
Monique Mulder, Global Director Public Sector, Logica
What about the challenges? Well, the
it’s already in place – that’s not an issue.
We do need to overcome worries about
security and trust, which in time, we will.
We need to be sensitive to how the public
sector deals with change, and help it
through these business and technological
changes.

so challenging? yes. impossible? no.
desirable? definitely.


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by logica.

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Public Sector and the Cloud: Doing more for less

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