The Cloud: A Viable Cost-Cutting Option For The Public Sector?

The hype is almost cacophonous. Try picking up any IT-focused magazine and not finding an article on cloud computing; it is an almost impossible challenge. Following on from the Comprehensive Spending Review announcement on 20th October, there is likely to be an even greater focus on the cloud.

Public sector organisations that, up until now, have never considered the cloud as a viable IT delivery model, will be looking at its cost saving benefits in an effort to achieve the deep budget cuts required.

The public sector is being forced to cut costs and cloud computing, with its focus on on-demand computing and flexibility, can achieve increased efficiency at a much lower cost to managing IT in-house. A survey by Vanson Bourne has identified that cloud use can decrease IT spend by an average of 15% with some enthusiasts expecting savings of more than 40% (see further reading, below).

Furthermore, industry experts do not expect the push to the cloud to stop any time soon. Analyst Gartner predicts that, with the continued growth of cloud, various forms of outsourcing will represent more than 30% of the IT services market by 2015.

The hype has become so loud that analyst Neil Ward-Dutton has suggested that some people in the industry are already referring to the term ‘cloud 2.0’. Such excitement, however, is far from the end of the story.

Technical constraints and legal complications can mean that the path to on-demand computing is not always straightforward. So, when is it right to consider cloud computing for your organisation?

The simple answer is that it depends on your ability to absorb risk. IT leaders pushing applications and information to the cloud will need to present a strong case to the board. If something goes wrong, the CIO – despite the wider clamour for cost savings – is likely to find their head on the line.

Key questions that need answering before considering a move to cloud computing include: Do you have the necessary resources to manage IT internally or is IT outsourcing your most viable option? How safe and secure is the information held on the cloud?

Is the cloud supplier reliable and experienced? Can the supplier provide your organisation with the necessary service-level required e.g. 24/7 online access? Is your organisation practically and culturally ready to use online services on-demand?

All these questions will need to be considered and answered satisfactorily before you consider a move to the cloud. On-demand cloud computing is now a realistic and cost-effective proposition for all types of organisation including government departments and public sector organisations, but it is important to consider the move to cloud very carefully and to work with specialist cloud partners that can manage their services in line with your organisation’s requirements.

Dean Dickinson is Managing Director of Advanced Business Solutions, formerly COA Solutions. Dean has been in the finance software business since 1990. He was part of the senior management team at QSP/Arelon prior to the acquisition by COA Solutions at which time he became Deputy Managing Director for the business as a whole. Since the acquisition of COA Solutions by Advanced Computer Software Group in February 2010, Dean has become Managing Director for Advanced Business Solutions. He is a specialist in consultancy and has a strong knowledge of business processes within a high volume/high value environment.