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Consolidated IT Operation: The Desired End Game for CIOs?

For government tech chiefs, there is always more consolidating to do.

According to Center for Digital Government research, 25 states run IT centrally — the preferred method by a comfortable margin. Other surveys back up the preference that a consolidated IT operation is the desired end game for a majority of government CIOs, including the 2014 Digital States Survey when consolidation ranked as the second most widely adopted computing initiative. But while some who follow this sort of thing started to get the impression that what could be consolidated already had been, that assumption proved faulty. It seems there is always more consolidating to do.  

At the NASCIO Midyear conference in Virginia at the end of April, we talked to several CIOs in the midst of significant efforts to consolidate. It’s one major way state CIOs can help governors address the budget shortfalls that continue to plague many states. Here’s how three CIOs are approaching the task:

Both Pennsylvania CIO John MacMillan and Montana CIO Ron Baldwin are involved in surgical consolidation efforts, each expecting to achieve millions in savings as a result. Baldwin’s, driven by an executive order signed last year by Gov. Steve Bullock, is focused on infrastructure at the executive branch level. MacMillan’s has taken the form of a shared services initiative between human resources and IT that started in January.

“What we’re trying to do there is reduce cost, eliminate overlapping, functional redundancy and — we hope — deliver better value to the business,” MacMillan said. 

Nebraska CIO Ed Toner turned to consolidation for similar reasons. Building his business case, he found that industry standards pegged the state as overstaffed in every area of IT. Coupled with anticipated cost savings in the millions, similar to what was expected by his peers, he methodically began to consolidate in three waves, starting with the network, followed by servers and capping it off with desktop support.

Each phase involved employee surveys and in-person interviews to inventory workloads and skills and determine the best path forward. Toner was careful to appoint former agency staff to leadership positions in the consolidated organization along the way to ease the inevitable cultural friction involved in such a major change.       

Toner saved about $5 million to $6 million — roughly 5 percent of his budget — in the first year and expects to achieve that again in year two by combining networks, virtualizing servers and replacing the state’s single storage solution with a money-saving three-tiered set-up. Nebraska also got rid of its disaster recovery site and now offers continuous availability at two redundant primary sites.

One of the biggest changes for Nebraska brought about by the consolidation was the addition of service centers throughout the state, with staff and spare equipment, ensuring that everyone is within an hour or two of IT support and eliminating the need for expensive, overnight travel to remote locations from the capital in Lincoln.

“The cost, definitely lower; the service, definitely better when you don’t have to wait two days to get help,” Toner explained, while pointing out an unanticipated benefit — enabling recruitment across the state, broadening the talent pool beyond what’s available in the capital area. 

Toner credits Nebraska Gov. Pete Ricketts for his crucial support for the consolidation process. “My biggest advice for anyone that wants to go through consolidation is have a strong governor that endorses it and helps you out all the way.” 

Noelle Knell is the executive editor for e.Republic, responsible for setting the overall direction for e.Republic’s editorial platforms, including Government Technology, Governing, Industry Insider, Emergency Management and the Center for Digital Education. She has been with e.Republic since 2011, and has decades of writing, editing and leadership experience. A California native, Noelle has worked in both state and local government, and is a graduate of the University of California, Davis, with majors in political science and American history.