Shared Services, the Cloud – the Future? Part 2

Random notes: UCISA Shared Services Manager’s Forum – & not surprisingly a pretty full house. Also not surprisingly suppliers well represented – Oracle, Bull, SunGard, Capita, Tribal, Digitary etc – apologies to any I’ve missed!

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Ian Lewis, HEFCE spoke about drivers – the usual – & then barriers. 1) VAT: commitment to review by Treasury; consultation document eagerly awaited for months; Finance Bill 2011? 2) Culture: fears that shared services undermine autonomy – draft PWC report for UUK Efficiencies & Modernisation Task Group – not really an issue. What can HEFCE do to help? Not too sure I know any more than I did before…

UMF funding – this is what we want to hear about! Purpose: not just hardware but services, & stimulating the uptake of services. Government belief (still) that can make significant savings in back office functions – Finance, HR & ICT. Demand Drivers: data centres; research services; JISC cloud reports.

Purpose of funding: share risk; accelerate timescales; tailor to HE needs; help address cultural issues.

£10m on shared data centres: £1.5m brokerage; £2m hardware; £4.9m infrastructure; £100k financial model; £2m research data & data backup services. JANET & Eduserv – national sharing & will go to market.

£2.5m on admin functions: £600k procurement service; £1.1m research management & admin; £200k electronic documents; £600k ERM.

Don’t pay too much attention to my detailed figures…they don’t seem to add up, but that will be me…

Does it matter if services are provided internally or externally? In one sense, that would be a no, provided effective & efficient; but the view seems to be that (some) internal services are inefficient, even if not ineffective, so maybe it’s a yes, externally being the hot favourite for efficiency gains…

Timescales: next 12 months…impact over next 2 or 3 years.

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Panel Session: Stephen Butcher (Eduserv); Tim Marshall (JANET); Malcolm Read (JISC)

Q: What role will your organisation play in delivering shared services to sector?

Stephen: catalyst; provider capability. Catalyst: getting from A to B. Technical management leadership, governance structure, & critically, taking risks. Capability: data centre; service management.

Tim: risk. Pain. Synergy. Activity so far – tiptoeing around the edge of the swimming pool, no one jumping in. JANET: membership model; understanding diverse needs & articulating to the market.

Malcolm: data centres, cloud etc well understood; admin services more risky as understand the issues less well.

Q: Why don’t JISC, JANET & Eduserv merge & provide ICT services to the sector?

Tim: all bets are off & should look at all opportunities. Must be driven by outcomes: usually think things are impossible because of old way of doing things, looking at inputs.

Malcolm: good question, especially as JISC review published today.

Stephen: OK to think of merger, but most mergers & acquisitions don’t deliver shareholder value. Key = working together.

Q: most costs payroll; savings through process changes that require fewer people; how much effort is looking at processes not technology?

Malcolm: SSPS forum for such thinking. If talk about radical redesign of institutional processes, come up against autonomy. Looking at technology doesn’t get to core of how HEI runs it’s business. Looking at admin systems whilst knowing big savings in process redesign – need to encourage such thinking.

Tim: how much nappy changing should central bodies do? HEI senior management should know they need to get processes in order to take advantage of new opportunities – or they’re in the wrong jobs. Well, there’s a thought…

Q: Everybody moving to outsourced email etc, which is free – so is it all about costs?

Stephen: shouldn’t get hung up on shared services good/outsourcing bad; shared services may be more risky/costly to start with.

Tim: opportunity to put money up front with suppliers to defray risk: UMF brokerage.

Malcolm: danger of lock-in. Idea behind brokerage service – procurement on sector not supplier terms.

Q: regional sharing? Political/social difficulties of sharing between teaching/research focused institutions etc.

Malcolm: interest from mission groups. GuildHE members more likely to share with each other. & does geography matter?

Q: does in/out choice increase or reduce risk? If increase, lower cost may not be the deciding factor…outsourced email to LIVE@edu, but fact that free wasn’t main factor, had to be quality resilient service.

Stephen: SLAs. Ought to be case that shared more resilient than homegrown.

Tim: biggest risks taken when they have to be, support from the centre can help. Still pussyfooting around – no one sharing admin systems, been talking about it for years. Why is no one getting a group together & going to suppliers to cut a deal?

Q: Is it true that if we don’t share business processes, can’t share admin systems?

Answer : (mine) Yes.

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Ho hum. So overall conclusion, it seems to me, is that the real benefits/savings come from sharing/outsourcing business processes/services; but this is too difficult/risky, so we’ll stick with the low hanging fruit ie the technology. Which means we won’t get the real benefits/savings. Well, excuse me, but I think we should go for the prize.

& finally, ref the sharing of admin services being more difficult because less well understood, I quote a tweet from @breaded cod, Paul Hobson, ex-Cardiff University, now University of British Columbia: ‘Issues are well understood, just poorly solved. We are all special snowflakes’. Say no more…

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One response to “Shared Services, the Cloud – the Future? Part 2

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