The waiting game — has it paid off?

A slow initial uptake has positioned local government to leapfrog ahead on the cloud journey.

When it comes to keeping enterprise solutions up to date, local government has historically fallen behind when compared with other industry sectors, including its state and federal counterparts. That looks set to change in 2019, with nearly two-thirds of councils aiming to upgrade existing enterprise applications and nearly half looking to procure entirely new solutions, according to a recent study from IBRS, titled ‘The State of Enterprise Software’.

That invigorated appetite is based on the realisation that ‘new’ delivery models for enterprise applications are now proven and that web or cloud-based upgrades of existing solutions have reached or surpassed functional parity of ageing on-premise versions. Pent-up demand is causing a spike of interest in alternatives that offer significant operational benefits including; reduced infrastructure and hardware investment, better utilisation of IT staff, a greater focus on innovation and simplification of security.

Local government is also subjected to external pressures which are driving change. Executives within this sector see cloud services (such as Software as a Service or Infrastructure as a Service) as essential for the delivery of greater citizen engagement; from the ability for residents and ratepayers to engage in self-service and reporting civic issues, to delivering entirely new service experiences to the public.

“Cloud-based alternatives like Software as a Service (SaaS) are not just essential for citizen engagement, but also for organisational agility, scalability and generally being a better run organisation,” said TechnologyOne Group Director — Local Government, Peter Suchting.

The push for greater engagement is leading councils to seek out and procure cloud-based enterprise solutions and exploit the close link between a cloud-delivery model and service innovation. An initially delayed entry has proven to be well-judged, positioning members of the local government sector to take advantage as innovation reaches maturity.

Local government insights

According to the report, 2019 marks a year of change for the local government sector, manifesting as a surge of investment in enterprise software — both new applications and upgrades to existing solutions.

A notable 44% of study participants are already engaged in procurement of a new solution and just over a quarter (26%) have committed to a time frame of between one and five years. 13% already invest in a maintained program of continuous update. Only 18% reported having no short-term plans to invest in a new enterprise solution.

There is an even higher commitment to current investment in enterprise solution upgrades, with 58% of study respondents currently in the throes of the process. Nearly a quarter (23%) will engage within the next two years and another four per cent within the next three-to-five years. The numbers for continual investment and no plans align with those for new solutions.

This significant shift in investment after a prolonged period of latency (particularly when compared with other levels of government) suggests that confidence is on the rise across the sector.

Satisfaction with existing solutions

Study participants were asked to rate their existing enterprise solutions, with more than half reporting high levels of dissatisfaction. Given the swing toward upgrade or replace behaviours, this is unsurprising. Digging deeper into the study results uncovers a significant link; organisations that exhibit dissatisfaction levels at the upper end of the spectrum also report high degrees of difficulty in getting staff to accept and adopt the level of change required by most enterprise solution implementations.

“This implies that the problem doesn’t necessarily lie with the software, but the change management processes linked to large-scale IT projects,” Suchting said.

Change management challenges are inherent with any software upgrade or deployment. A thorough assessment of the organisation’s change management maturity level followed by implementation of processes required to improve capability — prior to deployment — will significantly improve the transition. Training that concentrates on a solution’s user interface is simply not enough. A shift in mindset and vision is required and staff need to be educated on how these solutions will fundamentally change citizen engagement, drive further innovation and change the face of the working day.

“This mindset shift also provides an opportunity to drive a cultural shift towards fostering innovation and new, better ways of delivering services,” said Suchting.

“A key benefit of an enterprise SaaS solution is that the upgrade process is easier, quicker and far less resource intensive, meaning the day-to-day impact on council IT departments is minimal,” Suchting added.

Understanding options and determining preference

With cloud-based technology solutions increasingly common, participants were asked to rate their organisation’s understanding of the cloud. 82% of councils identified a moderate-to-high level of knowledge around the cloud. Only 18% interpreted their organisation as having a low level of understanding.

Despite this, when asked to nominate the preferred delivery mechanism for an enterprise solution, a surprisingly high number of participants (35%) claimed a preference for on premise, versus cloud-based (SaaS or IaaS) alternatives or completely outsourced via a Managed Services delivery model. This aligns with another key discovery from the study — some myths will not die.

Myths about the cloud

A clear highlight from the study was a direct correlation between a preference for on premise and a belief in one of several seemingly unkillable myths about the cloud; 1) a perceived security risk; 2) cloud infrastructure is more expensive and; 3) cloud services are inherently hard to integrate.

It’s time to separate fact from the fiction:

1. Most organisations simply cannot compete with cloud vendors when it comes to budget and capacity to manage complex cybersecurity. The Australian Federal Government’s current aggressive migration to cloud-delivered enterprise services illustrates the ‘thinness’ of the security excuse.
2. The State of Enterprise Software study has revealed that organisations moving to the cloud enjoy multiple benefits including; freeing up IT resources, reduced on-premise infrastructure investment and lower operating costs.
3. Cloud services are simply not more difficult to integrate when compared with on-premise solutions. Commonly arising integration issues are more closely related to business unit ad-hoc procurement practices and the absence of whole-business strategic planning.

“SaaS and other cloud-based solutions are far superior to on-premise software solutions. The security, scalability and flexibility that they afford are second to none,” Suchting said.

“SaaS not only allows councils to reduce IT costs from removing the complexity of running and updating software and infrastructure, it allows them to innovate faster and drive unparalleled productivity — transforming mobile workforces into connected teams,” he added.

Easy does it

Study participants were asked to describe their ideal enterprise solution across the board, and one word stood out — ‘Easy’. C-Level Executives from every surveyed sector agreed; an enterprise solution must be easy: to procure, to configure, to deploy, to access, to integrate and to use.

SaaS solutions are allowing councils to procure new software, develop new innovations and improve citizen engagement, but the most successful deployments originate from a council-wide strategic focus that enables true integration across the entire enterprise rather than simply at a functional level.

Hear an in-depth analysis of The State of Enterprise Software research from IBRS researcher and author of the report, Dr Joe Sweeney, at TechnologyOne’s Showcase events in Brisbane, Sydney and Melbourne this month. Register for this free event to uncover the impact of these findings for local government.

Image credit: ©stock.adobe.com/au/Jakub Jirsák