G-Cloud 'will be a complete game-changer'
Programme director Denise McDonagh explains how G-Cloud is reducing costs, enabling agility and driving change across government
With plans underway for the third iteration of the G-Cloud programme to 'go live' in less than two months time, it's easy to forget that the programme has yet to even celebrate its first birthday.
Although G-Cloud is still young, its ambitions are huge, according to Denise McDonagh who has led the programme since previous director Chris Chant stood down in April 2012. Its key aim is to create a market populated by a wide variety of suppliers and services, thus helping the government to "break away from the usual suspects that used to deliver IT into government", she says.
Amid the current period of austerity, the programme is partly about reducing cost. However, according to McDonagh, its remit goes far beyond that. "This isn't just a cost reduction exercise. It's about improving services to our customer base", she says. "It also fits into the growth agenda."
Despite some initial concerns over security accreditation, the programme is now receiving international attention. According to McDonagh, "last night we spoke to the Americans, this morning we spoke to the Australians, we've got the Poles coming in this week, the Sardinians want to come and speak to us, I'm going to speak over in Brussels. We have so much interest from around Europe- and wider- in terms of what we're doing and the fact it's quite innovative."
One of the key objectives of the programme was to get SMEs engaged in bidding for government IT contracts, and McDonagh says, "70-odd percent of our suppliers are SMEs and a number of the sales we've done through cloud are with SMEs."
McDonagh plays down fears that SMEs cannot necessarily compete with the larger suppliers. She says, "I think they can compete, and I think they've probably got an advantage over the big boys because they can be far leaner in their pricing, they can be far more competitive, and they can be a lot more agile in how they deliver services.
"And sometimes you've probably got an advantage if you're a smaller organisation because you don't have the bureaucracy that some of the big players have to go through."
McDonagh says that the G-Cloud framework is already being "used as a benchmark for other suppliers. So, for example, we've heard instances where a department goes to a supplier, asks for a service, they check on the CloudStore, see the price on offer is too much, go back to the supplier, tell them how cheaply they can get it, and that supplier goes down and makes it that price."
G-Cloud III and CloudStore
According to McDonagh, the new iteration of the programme, dubbed G-Cloud III, will see a number of alterations based on customer feedback. She admits that "we have a particular challenge around CloudStore, which is a kind of marketplace and the store front for suppliers. We've recently conducted a survey of all our suppliers...and the big thing coming out of that was that the CloudStore needed significant improvement."
McDonagh says this is "really constructive criticism", adding, "We have started the next round of improvements on the CloudStore, based on customer feedback. I'm not sure when the next version will be ready but we've taken on board all the comments."
Once the changes are in place, she is clear that the baton will then pass over to the suppliers. McDonagh says, "Once that [G-Cloud III] goes out, suppliers should then have a better opportunity to display their wares and make sure they look attractive to customers.
"I can understand the challenge but I also think there's a bit of an onus on the suppliers as well, albeit if we give them the mechanism to do it in terms of an improved CloudStore."
New services for G-Cloud III
One of the key changes for G-Cloud III will be the inclusion of new services alongside the expansion of existing ones. McDonagh points out that there are certain services where demand outstrips supply in terms of number of suppliers, such as NHSmail.
She says, although "We do have secure e-mail services on the cloud...we don't have enough to drive a proper competition." In response, the team is working with NHSmail through supplier group Intellect to stimulate the market and encourage more suppliers to come forwards to deliver those types of services.
In addition, McDonagh says, she is regularly asked for "things like service integration and systems integration services because one of the big issues as we move into a more disaggregated world is how do we do service and systems integration.
"We have some of those services on the framework now under specialist cloud services, but we need more to make sure that competition and innovation is maintained...I need to ensure that I've got the right types of services. For me that's the important thing."
McDonagh says she is confident that G-Cloud will deliver on its aim to achieve savings of £120m a year by 2015 and account for 50% of new central government ICT spend on public cloud computing services.
However, as she points out, "there is a definition to be made of what is really new spend. The majority of IT spend is already locked in a number of SI (system integration) contracts...the new spend is different from that."
McDonagh says the new spend target will be achieved, but not until 2015 "because a number of our big contracts don't end until 2015 or 2016."
There are a number of difficulties comparing cloud contracts with other government IT contracts, according to McDonagh, including for example the fact that "cloud contracts tend to be shorter one or two year contracts compared to five to ten year contracts with SIs...so you can't just do a crude comparison."
"The key thing for us is about how we encourage government to buy cloud services and that, as in any IT-enabled programme, is about a culture change. That's always the difficult part.
"We have some very clear evidence about the savings buyers can make, but the majority of central government is sitting with a lot of legacy IT. It's about how you break that up and move it into the cloud. And it's a difficult thing to do, especially when you're dealing with some very business-critical applications."
The programme, by its very nature, challenges traditional IT suppliers. McDonagh is unafraid of this aspect of the job. She acknowledges that "many of our system integrators (SI) are beginning to provide cloud services, and they can see the direction we're moving in" but admits, "when we're talking to them about current contracts, it is difficult for them to want to change their cash cow...so I think there's some resistance from some pockets of our big suppliers on wholesale moving into the cloud environment."
"Big SIs, like any other organisation, have people on both sides of the fence. To be fair to them, there are some that have been proactive in terms of trying to get to a cloud-based solution for government."
According to McDonagh, propagation is "the big thing for us." Although this includes the use of blogging, social media and the usual sorts of e-mail communication, it also means the various events, referred to as 'camps', that the team uses to target specific sections of the supplier and buyer community. There are BuyCamps, AccreditCamps and SupplyCamps, where people can learn how to get onto the framework, or buy from the framework.
On top of that work, McDonagh says that the G-Cloud programme is starting to target BuyCamps for government departments. "We go into a government department, talk to their procurement people, and say 'this is what G-Cloud is all about, this is how it can help you, and these are the things you need to think about'."
McDonagh admits that for some, culture change is difficult. "If people have been used to doing the same thing for the past 10 to 15 years, to get them to think in a different way means we can't just go in and tell them what to do. It's about showing them the benefits and building up an evidence base of how it's worked so far."
Central government and beyond
McDonagh is optimistic that, despite the difficulties, culture change can and will happen. She says, "Most big government departments, and certainly all government departments on the CIO delivery board, have bought services from the cloud. The Home Office itself [of which McDonagh is IT director] is going down that route, so we're taking our own medicine."
Interest in G-Cloud is far from being confined to central government, however. According to McDonagh there has been huge interest, and a strong degree of take-up, from local government, and devolved legislatures. There has also been interest from surprising sources, she says, such as the Bank of England, charities, and offshoots of local authorities, not to mention huge spenders such as the NHS.
McDonagh says that CloudStore currently offers 27 CESG-accredited services, and roughly 60 services are currently going through the accreditation process. She says that this should not hold back public sector buy-in, however, because "not every service needs to be accredited.
"For the ones that do need to be accredited...the process itself is fairly quick. The challenge is that we've had so many new entrants to government who have never really done that sort of security stuff before. We've had a huge learning curve with them in going through the process sand trying to teach them."
McDonagh admits that issues around accreditation may have caused some glitches at the beginning, but she says "people are beginning to learn a lot more, and services are starting to get put through the process more quickly."
Indeed, according to McDonagh, "if you want a service off the cloud, and it hasn't had pan-government accreditation, you can accredit it yourself.
"People just don't like to hear that because it takes away an excuse. They can ask us to push their service up the queue [of services to be accredited]...so it shouldn't be a barrier at all."
McDonagh is clear that she believes G-Cloud will be truly revolutionary. She points to the fact that the government's chief procurement officer Bill Crothers mentioned G-Cloud as a framework that is "delivering significant change" and "a model of success". She says, "I believe that this will be a complete game-changer for government.
"We have a lot of conversations with people around local government, police, the NHS, education, who are all really keen to get on this journey. A lot of them are at the stage where they're doing the visioning, the 'art of the possible'. We've even got some organisations looking to go completely cloud. So there's as whole pent-up thing being released out there where people are beginning to change their mindsets."
Central government, McDonagh admits, is "sometimes a little slower to change. But I certainly do think that this will be a game-changer. Because it will change the way we procure the services we need and it will, if people use it properly, reduce our dependency on the oligopoly and reduce our costs significantly, allowing us to be far more agile."
The Future of G-Cloud
McDonagh says that a measure of success of the programme will be "hitting the targets obviously, and the uptake in sales going through cloud."
But the height of achievement for G-Cloud, she insists, "will be when people see cloud as just 'business as usual'. It's when there's no second thought about buying a cloud service...you only don't buy it in a specific, unique, different situation. When I hear people starting to talk about a cloud first policy, I get really excited about that."