Before the birth of the electricity generating industry, any enterprise needing power had to build and run private generators. These were inflexible, inelastic and did not scale easily. In the mid 19th Century, centralised generation allowed electricity to be provided as a utility, meaning that consumers only had to pay for what they used. Consumption could be scaled up or down to meet demand without the need for capital expenditure.

A century and a half on, this is precisely the emancipating effect that cloud computing is now having on the enterprise: organisations no longer need to build, maintain and renew cumbersome IT infrastructure in order to consume as much, or as little computing resource as they need.

The cost implications of this model for both public and private sector organisations are clear inasmuch as cloud allows the enterprise to make use of sophisticated business solutions on a “pay as you go” basis with almost no capital costs.

The real challenge for governments is to find ways of exploiting cloud to change the ways that public sector businesses operate in a way that makes the service for the end-user (the citizen) more effective and personalised. Migrating existing government applications to a cloud environment has already proved capable of reducing operating expenses by up to 50 per cent, but while cutting costs is certainly an attractive selling point (particularly in the current economic climate), cloud computing can have a far greater impact in the longer term by enabling innovation in government services.

Cloud removes IT from traditional organisational silos, drives the use of standardised solutions and makes it easier for government departments, suppliers and partners to use common systems. These changes have a dramatic impact on how organisations can collaborate, operate common processes and share data – removing many of the traditional barriers to “joined up” government and driving both openness and participation.

It is through these levers that Cloud computing offers the most powerful tools to support public service reform. For example, cloud could enable social services agencies to collaborate in a way that assists families and individuals using integrated assessment frameworks and a case management approach which is standardised across organisations. It could enable organisations to implement technology based on the life-cycle needs of the citizen by grouping together the sorts of services it anticipates the citizen will need at different points in their life.

From the point of view of the citizen, this means that he or she no longer has to bear the burden of understanding which selection of forms they have to fill in and who is responsible for each. It means one point of entry to an intuitive, coordinated and “on-demand” service. For the civil servant, it means not having to trawl various different databases for fragments of information. The potential for increased resource efficiency is huge.

With cost savings and the ability to drive efficiencies throughout the business processes behind every public service, this cloud most certainly has a silver lining.

Key questions for the CIO

CIOs adopting the cloud should take expert advice on the following issues:-

  • Preserving Information security
  • Changing business, procurement and governance models to achieve the desired economies of scale
  • The changing the role of the IT dept in a “pay as you go” world
  • The capability of the market to offer off-the-shelf solutions to common business problems.