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How Honolulu Cut $1 Million from the IT Budget and Continues to Innovate

Honolulu CIO Mark Wong slashed annual IT budget costs by $1 million for four consecutive years during his tenure at the Aloha State, yet he continues to innovate. Here’s his secret.

Honolulu CIO Mark Wong’s passion for these five words have led to an annual IT budget cost savings of $1 million each fiscal year for the past four years — and without the expense of restricting his ability to innovate.

His mantra? “Can we do this in-house?”
During his five-year tenure as CIO and director of the Department of Information Technology for the city and county of Honolulu, Wong has managed to bring a large slug of software — and hardware — development in-house, as well as training for his staff of 150 people. That has resulted in cutting his budget of more than $21 million in fiscal 2017, for example, to be on track for slightly less than $19 million in fiscal 2019.
For example, his engineers designed and built kiosks that are deployed in such locations as the city’s service centers where residents can conduct transactions like paying for utility bills, buying bus passes or purchasing permits for picnics.
“Because we built the kiosks, if they break, we know how to fix them,” Wong told Government Technology. “By doing this in-house, we save money.”
Wong’s passion for bringing work in-house even extends to the most mundane matters. When a pencil sharpener in the department broke, Wong got the specs for the broken piece and had it crafted in-house, rather than secure a vendor and purchase the broken hardware.

Saving Big Money

But the biggest cost savings have come from developing a large portion of the city’s software in-house with open source software and reducing the need to pay re-licensing fees or costly consultants, Wong says. Additionally it creates a base of institutional knowledge by developing the software in-house, which is not achieved by hiring consultants, he added.
“The more I save, the more money I have to spend on salaries for the staff and new projects,” Wong said. “They say you can’t save your way toward innovation, but I have proved that wrong.”
And the software projects his team has built in-house have been sizable.
Honolulu’s IT department created Lokahi, which serves as an enterprise operations platform that merges data, core business logic and agency workflows in a single dashboard to improve the efficiency of city employees. Rather than outsource the project — potentially at a sizable cost — all the work was done in-house, except the purchase of a $200 antenna that was needed.
Wong explains the decision to move Honolulu from creating a smart city approach to an intelligent approach with Lokahi.

In addition to Lokahi, Honolulu’s IT team also developed HIperCloud, a private cloud that can perform operating system provisioning on hundreds of servers and deploy them as needed in a matter of minutes. 

Getting ROI on Staff Training

Wong is not afraid to roll up his sleeves and delve deep into code, given his experience as a software architect. Over the past four decades, he has held a variety of IT roles, starting as a mainframe programmer-analyst with Yale University, then in the 1980s as founder of consulting firm Commercial Data Systems that specialized in Unix and TCP/IP and later grew into the state's largest local IT company before it was sold in 2012.  
As a result, Wong does not spend money to send his staff to training classes run by other organizations and instead will train them himself. Honolulu’s IT staff has developed to a point where they can conduct training sessions themselves for their co-workers, Wong added. 
The combination of providing his IT staff with the ability to lead, as well as increase their own skills development, has served as a good retention tool and also a benefit of cutting his training costs, he noted.