For review and comment: A Strategic Approach to Cloud Implementation (draft)

Scott Wallace - AGIMO
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Following our earlier work to provide agencies with guidance on the consideration and use of cloud computing, we’re releasing a new draft guide, A Strategic Approach to Cloud Implementation: An Australian Government Perspective. This guide complements the suite of better practice guides for cloud computing. It provides agencies with an understanding of the issues around considering and transitioning to cloud services. The guide forms the last component of the Cloud Framework that is a Stream One deliverable of the Australian Government Cloud Computing Strategic Direction Paper.

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. It provides an overarching risk-based approach for government agencies to develop a cloud strategy and to implement cloud solutions. I would be interested in your views on the draft before we finalise it for release.  Please make your comments via this blog or alternatively by email to before COB Wednesday 22 August 2012. I look forward to your input. A Strategic Approach to Cloud Implementation (draft):


Comments (2)

Good to see a draft version of this strategy.

At first glance, it reads overly cautious focusing on cloud as an exotic new and somewhat threatening option.

It gives the impressions that it deserves a lot of attention before seriously considering it over and above outsourcing or other strategic sourcing options currently in place.

This harmonises with AGIMO's cautious DCaaS policy that sanctions cloud services as to be carefully supervised, limited to $80K deals and no more than 12 months duration.

In any event the thrust of the draft is that the "strategy" is to be devolved to agencies for their risk analysis and development, anyway.

I think I understand why AGIMO feels unsure with embracing a US cloud first or UK's move to have cloud for its common IT infrastructure.

But would it undermine your data centre consolidation strategy to foreshadow a few whole of Government cloud infrastructure plans over the next few years?

What cloud options or their hybrids would AGIMO sanction beyond that they be secure and value for money?

Strategy usually means the Government has a vision for the future and a general plan of action.

The draft also reminds me of an issue first raised by Reinecke's review

"There is a raft of strategic ICT issues facing Government as technology continues to evolve, as innovation occurs in the ways that public servants and the community communicate and as the public sector uses ICT to deliver services. The absence of a vision and supporting strategies was a concern to the senior executives interviewed, with one summing up a commonly held perspective in this way: “ there is no five-year vision, no guidance on how it all comes together – there needs to be a serious bit of thinking and work done”.

Perhaps the next draft might spell out a whole of Government future for cloud strategy this more.

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's comment above 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 this 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 …

Last updated: 02 August 2016