Yesterday I visited a large central government service provider, which offers infrastructure and basic software to almost all departments in its jurisdiction. This is entrenched in that jurisdiction’s strategy, although I am not clear whether that’s a mandate or not.
I was asked to present a condensed version of my standard pitch on cloud computing in government, and started from illustrating like cloud-based services may be both an opportunity for shared service organizations to broaden their own sourcing options, and a threat, as their clients may challenge their price performance ratios for commodity services by using cloud service players as benchmarks. The reaction was almost immediate, stressing the need for data to be located in the jurisdiction and claiming that they have accumulated sufficient experience to be better than any cloud service provider at matching their clients’ requirements.
The senior official who was there took a very defensive attitude and fought back, claiming that I had no first-hand experience to appreciate how different their jurisdiction is. Then he turned to his colleagues asking them whether they felt they may be overcome by commercial vendors. Actually this was not what I had implied, but very clearly he was eager to show off. Inevitably what emerged was that they are in the early phases of a data center virtualization effort. I was trying to tell them that, unless this clearly add value to their users, there was no reason to jump onto selling cloud-based services internally: however they would not really listen, trying to collectively prove that they are a truly excellent service organization.
I wonder whether most government shared or centralized service organizations would actually take the same attitude. Rather than looking at cloud computing as a smarter way for them to source their capabilities and reflect on what is best, they will adopt a me-too attitude and ultimately compete with vendors. Wouldn’t it be smarter to figure out what to let go which is not mission-critical and where vendors are likely to do better, and focus on where they can really still make a difference?
This may have to do with an ill-defined attitude toward self-preservation, motivated by the inability or unwillingness to change, together with a fundamental distrust of vendors and their ability to execute. While caution is in order and claiming that the cloud will take over the world is both a premature and incorrect statement, it is important for government shared service organizations to be ahead of the game and leverage vendor offerings as they nature.