Deloitte Research recently completed a study to explore ways that information technology might help address budget shortfalls in the public sector. Entitled Cutting Fat, Adding Muscle, the report suggests a three-pronged approach:
- IT rightsizing: optimize through consolidation, outsourcing, and application sharing
- Reduce costs through the strategic application of IT
- Revenue optimization: reengineer business process, revenue discovery and tax revenue maximization
I have thought a lot about each of these areas and we have implemented a range of programs and systems over the last ten years to do exactly what is recommended here. However, there are certainly additional opportunities if we can overcome physical, technological, and/or political barriers.
Here are the areas that Deloitte recommends for consolidation:
- Core infrastructure
- Data Centers
- Servers with redundant functionality
- Intensive systems management functions
- Hardware that will reduce communication charges
- Mature software applications with stable functionality and usage patterns
- Databases
Consolidated systems in Utah (All state agencies and, in limited cases, public and higher ed):
- Payroll
- Financial systems
- Purchasing
- Fleet management
- Facilities management
- Email - (to some degree, at least we are optimized on a single platform and gateway)
- Wide area network
- Fuel management
- Human Resource Management - (hiring, benefits, classification, training)
- Budget
- Security
- Data centers (to a limited extent)
- Network directory structure (Utah Master Directory)
- High volume printing (80%) - Docutech network, datacenter printers
- Retirement systems (URS)
- Healthcare benefits (PEHP)
- Debt collection
- Automated mail management
- Web applications development (70% - UII, ITS)
- Web hosting / support architecture (50% - ITS, UII)
- Voice networks
- Automated loan / grant system
- Geographic information systems
- Statewide claims management
- Incident management (emergency response)
- Surplus property and online auctions
- Traditional archives
All of these areas resulted in significant financial savings and, I think, helped Utah focus its resources in areas of tremendous needs over the past decade such as education (Utah's population is significantly younger than the US average - generate population pyramides for any country), infrastructure, and corrections. While these services have seen enormous budget growth (until 2001), the appropriated budget for administrative services has actually declined (before 2001) and absorbed some of the largest post-2001 cuts. Needing to seek new opportunities to leverage technology, the State has settled on shared enterprise services, such as one-stop business registration, enterprise licensing, payment portal, and customer relationship management (help desk). Producing major savings through these kinds of services is significantly more difficult than through some of the systems mentioned earlier. I think a second focus is on reducing future cost increases through leveraging existing systems. This leads to a focus on web services and understanding of enterprise architecture to facilitate future value development.
The Center of the American West has put together some interesting dynamic maps, such as this map showing development in Utah from 1960 to 2050. And if you were ever curious about the source of the sagebrush rebellion, here is a map of public lands in the intermountain west. The Center just released a report earlier this month entitled, "What Every Westerner should know about Energy."
1:48:53 PM
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