The double (possibly triple) dip recession has had a profound impact on the public sector. Historically, the last time the economic situation reached such a nadir was in the 1970s, when a hike in oil prices led to fourteen quarters of consecutive recession.
Whilst the drop in gross domestic product has been significantly lower in 2012 than in the 1970s, there is still cause for concern, with the UK public sector compelled to put measures in place to become leaner and more efficient.
One such coping strategy has been to look into the possibility of shared services; consolidating IT, HR, administrative and procurement functions across similar organisations wherever possible.
This is not always a straightforward process. It means a change in working procedures and requires good IT support, solid internal communications and staff willing to give change a chance. However, with local.gov estimating that local government alone could save £30m from making more use of shared services the idea clearly has great potential.
Technology is critical in enabling these processes, both in terms of rapid communication tools between all parties and allowing links and sharing of the more ‘back end’ systems such as databases for the payroll and HR departments.
This means that infrastructure has not only become more powerful, but also more complex as the variety of devices used to access data increases and organisations switch to using virtual desktops, moving away from traditional ‘thick’ clients.
At the same time, organisations have been considering their – frequently dispersed - server estates. These factors have prompted the move to consolidate to reduce unnecessary complexity, as well as automating processes wherever possible.
This consolidation is also advantageous from a management perspective – dispersed servers and infrastructure means more time spent monitoring performance, heating, cooling, patching as well as a cornucopia of administrative tasks.
Public sector bodies cannot shrug off these issues. Unless agencies and authorities embark upon consolidation or automation projects, costs associated with delivering public services will simply rise and rise. For example, between 2000 and 2010, spending on new servers actually dropped globally by around 10%, whereas spending on power and cooling doubled, an overhead that can result in budget overspend.
Once organisations have rationalised their infrastructure, they may be reluctant to simply get rid of data centre sites because of business continuity strategies. Many companies will use more than one DC site so that in the event of a problem or outage, they can fail over to the other.
Organisations can be smart about this as well. For example, it is entirely possible to halve or quarter the size of a data centre estate without compromising on function; spare server capacity at secondary sites can be used for failover, replicating crucial systems virtually and leaving machines and capacity (which has been freed up by the virtualisation process) dormant, gaining ‘free’ business continuity capacity and freeing up capacity to deliver services from tertiary and quaternary sites.
This virtualisation and consolidation process also has some of the same benefits as shared services – better efficiency, lower costs and the same outputs. Maintenance and management costs can also fall dramatically – often by as much as 50%.
Once measures are in place and organisations have virtualised, consolidated and ensured that applications will continue to perform, wherever their location, staff may not notice a difference in the IT infrastructure. As IT teams know, silence can be the most rewarding compliment they can have – and the balance sheet will be noticeable lighter where data centre costs are concerned.
If public sector bodies can embark on a journey towards both shared services and consolidated IT, then they should be able to make substantial cost savings. In a climate of necessity, that is a compelling goal.