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5 steps to making the cloud a reality

How much creative destruction are agencies willing to embrace?

• By Mark A. Forman
• Oct 14, 2009

The Obama administration recently launched a cloud computing initiative that could be a game changer for the federal information technology community.

Keep in mind what drives federal IT leaders: figuring out how to best use information and technology to help their agencies run better. Historically, agencies have developed their own technology applications. Yet most successful business models now take advantage of a shared-services approach that uses repeatable, scalable and market-proven applications.

The administration’s strategy could take shared services to another level. The promise of the cloud is that the federal government could obtain higher-quality, more secure and lower-cost applications, which could have an impact on the federal IT community similar to what economist and political scientist Joseph Schumpeter called creative destruction.

Here are five principles that could get the federal cloud initiative moving in the right direction.

1. Show the benefits. Cloud computing advances the concept of “buy once, use many” and could eliminate much of the redundant spending that results when agencies own and operate similar applications. But agencies will need to see the value, so the savings, security, reliability and other benefits agencies can expect should be spelled out.

2. Create a vibrant broker organization. For security and other considerations, a governmentwide broker function should negotiate cloud contracts, including assembling service-level requirements, identifying agency needs and integrating standards. The broker should be given incentives to acquire applications as shared services that achieve clear benefits for agencies. It should also have expertise in performance-based services contracting.

3. Identify and define enterprisewide services. Success also depends on having a governmentwide IT leader, such as the e-government administrator or CIO Council, identify standards for security, identity management, access controls, data architecture and other elements needed to use Web services in a secure, scalable manner.

4. Let the market decide. Agencies that insist on sticking with the old model should be given a chance to make their case – in the marketplace. If they want to keep a customized application, they should be required to make it available for sale to other agencies so the market can decide whether it performs better and costs less than a similar application available online.

5. Have leaders drive adoption. The fiscal 2011 budget process is vital to the success of the cloud initiative, as Office of Management and Budget Director Peter Orszag highlighted in guidance he issued in June. Next year’s budget should clearly signal that the old days are over and priority will be given to secure, scalable cloud computing applications.

Questions remain. How much creative destruction is the government willing to accept? And what’s the best way to take advantage of cloud computing while managing the disruption it will inevitably cause?

Although cloud applications can be made more secure than many of today’s government applications, there are legitimate concerns about data security. But let’s not lose sight of the payoff: Lower costs and better performance are bottom-line benefits every federal IT manager can embrace.

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