Up in the Air: The state of cloud adoption in local government in 2016
Introduction When a Cloud First policy was announced by the Government Digital Service in 2013, the expectation was that from that point, any public sector body would consider cloud services as the first option for technology solutions. In conjunction with the G-Cloud procurement path, it was expected to increase flexibility and cut IT costs across the public sector. Although local government was not mandated to use G-Cloud, or to put in place Cloud First IT policy, the approach offered councils a new opportunity to procure and implement IT infrastructure which could provide a basis for digital government and shared services. Three years on, we have tested the extent to which this has in fact penetrated local government. We have also examined how far councils have developed and adopted cloud strategies and have moved away from a dependence on traditional insourced IT. With responses from 408 UK councils, this report provides a comprehensive picture of cloud use in local government. Our headline finding is that it seems UK councils still have a long way to go in understanding how cloud can or should play a role in local public services modernisation. Whilst councils may be aware of cloud and some of the risks, they are not yet mature in their response to managing those risks in order to exploit what is a valuable technology asset. We found that cloud is being used by half of local authorities, but we also found a widespread absence of IT strategies and policies which support its adoption among the majority of smaller councils and half of the largest ones. This suggests information management risks in cloud adoption in particular may not be being effectively considered. Most concerning is the extent to which the smallest councils are being left behind. Smaller organisations in any sector often have the most to gain from cloud, to reduce IT cost, increase resilience, gain easy access to sophisticated IT solutions and ensure flexibility and responsiveness in IT use. Yet only a minority of smaller local authorities appear to have got to grips with the role cloud might play in their future business plans. Our research points to a pressing need for greater collaboration between smaller and larger local councils and an urgent priority, across the sector, to develop fresh IT strategies which exploit cloud and other emerging IT solutions. This includes more joined up thinking between service planning, IT policy and procurement. We hope this report as part of the EBP work, will give helpful insight to public and private sectors organisations alike working with local government, and support councils in particular in the effective adoption of modern IT platforms and methods. Jos Creese Principal Analyst Eduserv Local Government Executive Briefing Programme (EBP)
Analysis of research: Headline findings 1Councils have yet to be sold on G-Cloud The findings indicate that 69 of councils have a corporate policy which supports use of G-Cloud. This debunks the idea that many councils are not allowed to use G-Cloud: if local government as a sector is not using G-Cloud, it is not because they don t believe they re allowed to do so, it s because they choose not to do so. 2Some procurement policy may be out-of-date 21 of large councils and 37 of smaller councils say they do not have a procurement policy which allows them to use G-Cloud. This suggests that, unlike the majority, they do not believe they can use G-Cloud, which may be limiting their access to best value solutions. 3Cloud adoption is more widespread than suggested by G-Cloud figures With half of all councils and 73 of the top 100 councils saying they used some form of cloud computing it is clear that cloud adoption is taking place through alternative channels: either existing supplier partners or alternative procurement. 4There is significant scope for all councils particularly the smaller ones to benefit from cloud Smaller councils are more reticent in their use of cloud than the largest councils just over a third (38) say they use cloud services, compared to 52 overall. They may be less confident or lack the necessary controls and skills to use cloud securely and effectively, compared with the larger councils. 5IT policy is failing to keep pace with the growth of cloud services Half of councils have no IT policy guidance for the use of cloud. Over 70 of the smaller councils have no policy yet for cloud use compared with 45 in the top 100 councils. More worryingly, less than half of those smaller councils using cloud for data storage and information sharing have a policy for cloud use, which raises concerns about whether smaller councils are treating citizen data responsibly or even know where information is being held. 6Councils still rely heavily on in-house IT infrastructure Over half of councils (52) are making no use of third party data centres, choosing instead to run all services in-house, with 26 of councils (105 councils in total) saying they have no data held off-premise. This means a large number of authorities are still wedded to in-house IT operating models which may not provide the flexibility they need to support the operational change which inevitably lies ahead. 7There s a significant lack of clarity among councils over where data is held While more than two thirds of councils (69) still hold the majority of their data on site. Only a small minority (13) host most of their data off-site. More worryingly, nearly one in five (17) did not know or could not provide a breakdown of where their data is held. Being able to store, move and share data securely and flexibly is key to cost reduction and service improvement in local government. Every council needs to develop a robust understanding of where and how data is held. eduserv.org.uk/lgebriefingprogramme 3
Cloud adoption in local government: The research Research results Research results: Procurement policy and cloud strategy Who has procurement policy which supports G-Cloud? 27 of councils do not have a policy which supports G-Cloud 69 of councils have procurement policy which supports G-Cloud 3 councils did not know or could not say if they had a G-Cloud supportive policy Of the top 100 councils 79 have procurement policy which supports purchasing through G-Cloud 21 do not have a policy which supports G-Cloud Of the 100 smallest councils 63 have procurement policy which supports purchasing through G-Cloud 37 do not have a policy which supports G-Cloud Who has a strategy or IT policy for using cloud computing? 39 of councils have a cloud IT policy 61 of councils do not have a cloud IT policy or could not say if they had one 11 of councils are currently exploring or considering a cloud IT policy 25 of councils who use cloud for storage do not have an IT policy for the use of cloud. Of the top 100 councils 55 have a cloud IT policy 45 do not have a cloud IT policy or could not say if they had one 16 of those who do not have a policy say they are currently exploring or considering a cloud IT policy Of the 100 smallest councils 30 have a cloud IT policy 70 do not have a cloud IT policy or could not say if they had one 4 eduserv.org.uk/lgebriefingprogramme
How well are procurement policy and cloud strategy aligned? 33 of councils have a cloud IT strategy and a procurement policy which supports G-Cloud purchasing 6 have a cloud IT strategy but their procurement policy does not support use of G-Cloud 11 of councils who use cloud for storage do not have a procurement policy which supports use of G-Cloud Of the top 100 councils 50 have a cloud IT strategy and a procurement policy which supports G-Cloud purchasing 5 have a cloud IT strategy but do not have procurement which supports G-Cloud purchasing 13 use the cloud for storage but do not have a procurement policy which supports G-Cloud 45 of those who use cloud for storage have an IT policy for cloud use but 28 who use cloud have no strategy or policy for cloud in place Of the 100 smallest councils 25 have a cloud IT strategy and a procurement policy which supports G-Cloud purchasing 4 have a cloud IT strategy but do not have procurement which supports G-Cloud purchasing 10 use the cloud for storage but do not have a procurement policy which supports G-Cloud 42 of those who use cloud for storage have an IT policy for cloud use but 54 who use cloud have no strategy or policy for cloud in place G-Cloud spending data analysis: What are councils spending on G-Cloud? 42 of UK councils have procured cloud services through G-Cloud, totalling 56.5m in sales Of the G-Cloud spend to date, eight councils account for 57 of sales representing a total of 32.2m The top 50 councils by spend accounted for 90 of sales or 50.5m to date The 127 other councils - 72 of those who had used G-Cloud - accounted for just 6m in sales Data from G-Cloud total local government customers adjusted to remove non-council customers such as housing authorities. September 2016. eduserv.org.uk/lgebriefingprogramme 5
Research results: Data storage How many data centres do you run on site? How many? Total councils Percentage None 46 11 One 175 43 Two 152 37 Three 13 3 Four 6 2 Seven or more 3 1 Did not answer 13 3 47 of councils run two or more datacentres 11 only use off-premise data storage 60 of councils with two or more datacentres have no cloud IT strategy 49 of councils with two or more datacentres do not use the cloud for data hosting 32 of smaller councils have two or more datacentres compared to 60 of larger councils How many third party data centres do you use? How many? Total councils Percentage None 217 53 One 73 18 Two 44 11 Three 10 2 Four 12 3 Five or more 14 3 Did not answer/specify 38 9 167 councils use third party data centres 41 Who is using the cloud for data storage? 44 say they do not use cloud 52 of councils say they use cloud hosting for their data 73 of the top 100 councils use the cloud compared to 38 of smaller councils 21 of councils who use cloud hosting for their data use no third party datacentres but have their own on-premise datacentre 6 eduserv.org.uk/lgebriefingprogramme
Where is your data held? On premise 27 26 17 10 of councils don t hold a breakdown of information on where their data is held while 7 didn t know or refused to disclose a breakdown 69 of councils hold 75 or more of their data on premise 77 of small councils hold 75 or more of their data on premise compared to 55 of larger councils Only 13 of councils have moved the majority of data off premise 4 0 In the cloud 67 3 1-10 9 7 2 4 of data held 11-49 50-74 75-89 90-94 95-99 100 Don t know on premise 0-10 6 11-25 The majority of councils are only using the cloud for storage of small amounts of data currently A quarter didn t know or couldn t say how much data was held in the cloud (23) Third party data centre 62 2 26-74 0 75-89 1 90-100 23 Don t know of data held in the cloud 0-10 2 11-25 3 26-74 3 75-89 5 90-100 25 Don t know of data held in third party data centers eduserv.org.uk/lgebriefingprogramme 7
Methodology All of the local authorities in the UK were contacted between March and June 2016. Each authority was asked the same six questions using the Freedom of Information Act: Do you have a procurement policy which supports the use of the G-Cloud procurement framework? Has your organisation adopted a strategy or IT policy guidance for using cloud computing (cloud infrastructure), not software as a service? Of the 418 councils who were contacted, a total of 408 responses were received. All of the nine councils who failed to respond were in or towards the lowest 100 of the list as ranked by revenue. Where necessary, given the varied nature of responses, we have either clarified or interpreted responses for the purposes of analysis. How many data centres do you have on council premises (secure processing centres which host shared systems)? How many third party data centres do you use? Do you use cloud hosting for your data (public or private cloud)? Expressed in percentage terms, approximately what proportion of your data is held on premise / in the cloud / in a third party data centre? 8 eduserv.org.uk/lgebriefingprogramme
Conclusion If there is one clear conclusion that we can draw from our research, it is that the march of cloud solutions to support local government is an exorable one. Where the larger councils have moved forward in using cloud IT, the smaller ones will follow. The key question is to ensure that it is a process which is managed effectively. This means that developing a policy for the use of cloud IT to support the organisation needs to be a priority for every council. Without clear strategy there is the danger of a proliferation of ad hoc point solutions, which may not serve the business effectively in the future. It is also clear that smaller councils need help in developing their thinking around cloud adoption. Given their size, these are the organisations that potentially have the most to gain from state-of-the-art IT, which is flexible and relatively cheap. This is particularly the case as they are the ones who are struggling to modernise with leaner processes, reduce costs, meet changing service demands and reshaping their workforce so they can better support citizens. There is a strong case for greater collaboration between larger and smaller councils within the sector in order to accelerate cloud adoption. This could be as straightforward as using the Public Sector Network to allow smaller councils to link up with larger councils in a secure fashion to access cloud services. This could extend to sharing skills, knowledge and strategic thinking from larger councils to plug gaps in IT capability in smaller authorities. It is simply unsustainable to avoid putting IT strategy at the heart of business change. At the same time it is worth emphasising that many larger councils need to move faster in develop new IT strategies to support their organisation in the future. Lastly, councils need to think about how they can make sure their procurement policy is joined up with business and IT strategies and takes advantage of the G-Cloud platform. IT leads in councils need to make the case for using G-Cloud, whilst the Crown Commercial Service focus on promoting the platform to local authorities to drive more business through the framework. Jos Creese Principal Analyst Eduserv Local Government Executive Briefing Programme eduserv.org.uk/lgebriefingprogramme 9
About the Local Government Executive Briefing Programme: The Local Government Executive Briefing Programme provides independent opinion on the role of digital transformation in ensuring the future of public services. Through engagement with local government leaders, it provides research-based reports, topical debate and insight for business and digital leaders. Find out more www.eduserv.org.uk/lgebriefingprogramme About Eduserv Eduserv is a not-for-profit IT services provider dedicated to helping charities, local government organisations and the public sector make better use of their IT. Our customers include Bristol City Council, Brighton and Hove City Council, Adur and Worthing Councils, The Department for Education and The Information Commissioner s Office. Get in touch If you would like to find out how Eduserv can help transform your IT, please contact us: Tel: 0844 5000115 Email: ebp@eduserv.org.uk eduserv.org.uk WEB-169.0