getting to the cloud

INDUSTRY INSIGHT

MGT Act gives government seed funding for cloud migration

While cloud computing is transforming businesses across industries and changing the way hosted services are delivered, the government has been slower to ditch legacy systems and move to the cloud. Now, thanks to the passage of the Modernizing Government Technology Act (MGT Act), federal agencies and departments will soon have access to funds to update their legacy IT systems. The first thing they should do is move these systems to the cloud.

Many federal agencies spend more than 80 percent of their annual IT budgets just keeping their servers running. Operations and maintenance of legacy systems consume so much of their budgets that little, if any, resources remain to modernize or introduce new technology. The American Technology Council's recent Report to the President on Federal IT Modernization called for agencies to move to commercial cloud services wherever possible. The situation is so bad that the General Accountability Office put improving the management of IT acquisitions and operations on its “high-risk” list, meaning the percent of budget being consumed by legacy tech was considered a “high risk” to agency security and effectiveness. Think about that for a second. Agencies’ buying decisions from decades ago are putting their ability to perform essential tasks in limbo.

The MGT Act addresses this funding shortfall by establishing a $250 million Technology Modernization Fund. The legislation also allows agencies to establish working capital funds that act in concert with the TMF to “kick start” fresh initiatives and introduce new tech. This funding addresses one of the barriers to agency IT modernization: seed money. It’s has been difficult for agencies to buy new technology when all their money goes to supporting existing systems. Much like small tech start-ups in Silicon Valley, government agencies need seed money too.

Now comes the big question: What will agencies do with that money? After years of neglect and numerous items added to their to-do lists, agencies now have the funding they need to make critical investments in their IT infrastructure. The answer for most agencies should be: Move to the cloud. Retiring legacy technology and adopting commercially proven cloud-based software–as-a-service solutions should be the first step on every agency’s modernization journey.

Moving to the cloud has numerous benefits, including enabling agencies to deliver better services, increasing citizen satisfaction, reducing case volume and lowering costs. Agencies can work with vendors to consolidate legacy systems and eliminate the expensive upkeep and energy costs from running dozens of servers in their basements.

The cloud also makes it easier for agencies to quickly scale up or scale down based on their needs. For example, an agency may not need to pay for certain applications and massive amounts of storage year-round. An agency like the Census Bureau needs to quickly scale up every 10 years, but it may  not need to pay for some services every year. SaaS platforms allow agencies to grow as they increase utilization of applications across the platform and transform service delivery across all areas of the agency’s mission. 

With cloud-based software, new updates can quickly patch vulnerabilities and introduce exciting new capabilities, such as artificial intelligence and machine learning. Previously, adding new capabilities like these to legacy systems would require a complicated procurement process and years of approvals.

The federal government is on the verge of a new era of digital transformation thanks to the MGT Act. By bringing some of Silicon Valley’s entrepreneurial attitude to Washington, D.C.,  MGT has sparked a modernization in government services -- enabling agencies stop funding legacy IT and move to cloud-based SaaS solutions.

About the Author

Bob Osborn is CTO Federal of ServiceNow.

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