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«Benefits and Challenges of Cloud Computing and the Optimization of Data Centers for the Federal Government Bernard Mazer Chief Information Officer ...»

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Testimony before the Subcommittee on Government Operations,

Committee on Oversight and Government Reform,

U.S. House of Representatives

May 14, 2013

Benefits and Challenges of Cloud Computing

and the Optimization of Data Centers for the Federal


Bernard Mazer

Chief Information Officer

U.S. Department of the Interior

Office of the Chief Information Officer U.S. Department of the Interior


Good afternoon Chairman Mica, Ranking Minority Member Connolly, and distinguished members of the Subcommittee. My name is Bernard Mazer and I currently serve as the Chief Information Officer for the U.S. Department of the Interior. As a representative of the Federal CIO Council, I also serve as an executive sponsor of the Federal Data Center Consolidation Task Force1. Thank you for providing the opportunity to testify regarding the benefits and challenges of cloud computing and of the optimization of data centers across the Federal government.

The Federal Government’s information technology (IT) infrastructure is a massive, heterogeneous collection of networks, unparalleled in private industry or other governmental organizations. In the span of 11 years, from 1998 to 2009, the number of Federal government data centers drastically increased from 432 at the time, to more than 1,1002. During this time period, the Federal Government’s spending on technology increased at a rate of 7% annually3, with little impetus to optimize, share, or rationalize IT infrastructure. The result was an inefficient Federal data center population, with unnecessary operation and maintenance costs, which requires capital that would be better spent on innovative activities that deliver better, more efficient services to the American people.

To reverse this trend, in February 2010, the Office of Management and Budget (OMB) launched the Federal Data Center Consolidation Initiative4 (FDCCI). By optimizing and consolidating redundant and wasteful data centers, the government will reduce the cost of data center hardware, software, and operations; shift IT investments to more efficient computing platforms such as cloud solutions; promote sustainability within our data centers and improve our nation’s cybersecurity posture.

Since then, there has been a halt of net-new data centers being built. In fact, as of last week, agencies have closed 484 data centers5, with plans to close 855 by the end of fiscal year 2013, reducing the overall infrastructure footprint of the Federal Government.

The Federal Data Center Consolidation Initiative Task Force The Federal CIO Council’s Federal Data Center Consolidation Task Force, which I currently chair, was chartered in February 2011, subsequent to its inclusion in OMB’s 25 Point Plan to Reform Federal IT6.

The Task Force is comprised of agency representatives who are responsible for working together to share progress toward individual agency goals and the overall Federal goals of optimization and consolidation.

Today, the Task Force has contributed to the FDCCI by: (i) advising on FDCCI policy and implementation;

(ii) sharing information, best practices, and lessons learned; and (iii) working with agencies to assess the benefits and challenges of cloud computing.

OMB. (Dec. 9, 2010). 25 Point Implementation Plan to Reform Federal Information Technology Management. Retrieved from www.whitehouse.gov OMB. (Feb. 26, 2010). Federal Data Center Consolidation Initiative. Retrieved from www.whitehouse.gov OMB. The President’s Budget for Fiscal Year 2014, Analytical Perspectives, Chapter 19. Retrieved from http://www.whitehouse.gov/omb/budget OMB. (Feb. 26, 2010). Federal Data Center Consolidation Initiative. Retrieved from www.whitehouse.gov See FDCCI Data Center Closings 2010-2013. Retrieved from www.Data.gov. May 2013 OMB. (Dec. 9, 2010). 25 Point Implementation Plan to Reform Federal Information Technology Management. Retrieved from www.whitehouse.gov

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Advising on FDCCI Policy and Implementation One of the critical roles of the Task Force has been to relate the “boots on the ground” experience of optimization and consolidation to agencies and policymakers across the government. Given that the landscape of Federal IT infrastructure is at varying levels of maturity across the government, there is valuable insight to be gleaned from actual practices. For example, the Department of the Interior has launched an IT Transformation initiative to consolidate IT infrastructure operations at the Departmentlevel, including data center operations, in order to eliminate redundancy and speed the adoption of new technologies, such as the migration to cloud computing. Our experiences, and the experiences of other agencies, help identify issues such as whether there are program gaps which can be addressed via policy or whether there are different criteria by which agencies can measure and document data center optimization and consolidation progress.

Information provided by the Task Force helped inform the evolution of the FDCCI, as recently outlined in the March 2013 OMB Memorandum on PortfolioStat (M-13-09).7 PortfolioStat, implemented by OMB in 2012, requires agencies to conduct annual agency-wide IT portfolio reviews, to reduce commodity IT spending, and demonstrate how IT investments align with an agency’s mission and business functions.

The data gathered, with the assistance of the Task Force, in this process led to recognition that agencies should focus on an enterprise-wide approach to address all commodity IT, including data centers, in an integrated, comprehensive plan.

M-13-09 noted that, “Agencies with advanced IT portfolio management see eliminating duplication, such as closing duplicative data centers, as a means of optimizing computing power for the enterprise.

These agencies have found that cloud computing is a more scalable and transparent way to provision IT services, giving agencies a viable enterprise alternative to major and often stove-piped, capital IT investments. By procuring technology "as-a-service," agencies can quickly stand up enterprise IT solutions, paying only for what they need, and reducing duplication.” Through PortfolioStat, agencies have already realized nearly $300 million in savings8, some of which is attributed to data center consolidation.

Under M-13-09, the FDCCI was formally integrated into PortfolioStat. Additionally, based on input provided by the Task Force which noted that focusing solely on consolidating data centers was not yielding optimal outcomes, M-13-09 shifted the FDCCI from having a singular focus on consolidation to a dual track focus: optimizing core data centers and consolidating non-core data centers. From the Task Force’s perspective, too many agencies were still treating their data centers as the end, rather than as the means, to deliver optimized infrastructure services, enabling agencies to meet their diverse missions. A data center exists to support mission delivery, and execution and optimizing these assets, which are central to these missions, was recognized in M-13-09.

Sharing Information, Best Practices, and Lessons Learned Any complex, government-wide initiative needs a forum and group to serve as a community of practice, exchanging ideas from a variety of sources, learning from what works and what doesn’t, and, on a OMB. (Mar. 27, 2013). Fiscal Year 2013 PortfolioStat Guidance: Strengthening Federal IT Portfolio Management. http://www.whitehouse.gov/sites/default/files/omb/memoranda/2013/m-13-09.pdf.

OMB. (Mar. 27, 2013). PortfolioStat 2.0: Driving Better Management and Efficiency in Federal IT blog post. Retrieved from www.whitehouse.gov Page 3 of 6 Office of the Chief Information Officer U.S. Department of the Interior continual basis, assisting others to innovate, trying out novel ideas which improve outcomes and results.

The Task Force is no different and I am extremely proud of the work done in this arena. Agencies have presented on a variety of topics, including consolidation planning, energy efficiency, application mapping, using cloud computing and deploying enterprise applications to drive optimization and consolidation. These are all available publicly on CIO.gov, the web platform of the Federal CIO Council.

Working with Agencies to Assess the Benefits and Challenges of Cloud Computing

The expected benefits from moving to the cloud can be great and are driving the transition from existing hosting environments that focus on managing servers to modern cloud-based environments. These benefits include: (i) improving service delivery to internal and external customers, (ii) modernizing computing capabilities, such as scalability, on demand provisioning, and resource pooling, (iii) enhancing collaboration within each agency and with external stakeholders, and (iv) replacing legacy IT infrastructure that is nearing the end of its useful lifespan. Moreover, as agencies refine their business processes during cloud migrations, they can also realize significant cost savings.

The deployment of cloud computing also presents challenges, including (i) culture and change management of users and customers who are not comfortable migrating from their existing hosting solutions; (ii) data interoperability and portability due to highly customized nature of many legacy IT systems; and (iii) a lack expertise or experience in implementation. The Task Force is helping address these challenges by providing ideas on ways to inform and educate existing system and business owners; pointing out ways agencies can assess legacy systems and highlighting the need to train existing staff on cloud technologies.

Another challenge agencies have experienced is calculating cost savings related to optimization and consolidation. Federal data centers are spread across agency missions, program and functions. In some cases, the costs of agency data centers are shared between different offices and contracts. Providing the total cost of ownership continues to be a challenge as it is much more comprehensive than just energy or equipment costs. That is why the Task Force worked with participating agencies, GSA, and OMB to develop a total cost of ownership model, based on agency-provided inventory data, built on best practices in the public and private sectors, and tailored to reflect the Federal Government’s operational structure. The model is now being used as a planning tool as agencies optimize and consolidate their data centers.

In support of the Federal cloud-first policy, agencies are also leveraging cloud-based technologies to accelerate their consolidation efforts. Agencies are in different stages of moving IT applications to the cloud and in doing so can leverage offerings from the Federal Risk and Authorization Management Program (FedRAMP), a government-wide program that provides a standardized approach to security assessment, authorization, and continuous monitoring for cloud products and services.


Federal agencies are continuing to make progress towards optimizing and consolidating data centers. As of May 2013, 484 data centers have been reported closed and agencies are publicly tracking their consolidation progress through Data.gov, the Administration’s platform to increase public access to high value, machine readable datasets generated by the Executive branch.

Page 4 of 6 Office of the Chief Information Officer U.S. Department of the Interior As discussed above, the FDCCI has been integrated into OMB’s PortfolioStat program. This integration is expected to strengthen the focus on tracking cost savings, increase the number of tracked metrics, facilitate collaboration across agencies, expedite implementation of best practices seen across the private sector, and should result in a consistent and repeatable method for tracking costs. All this is expected to result in a more accurate assessment of the benefits to this initiative.

I am confident that cloud computing and data center consolidation has the potential to provide modernized IT at a significant cost savings. It is our job as CIO’s to provide the evidence of these benefits to the American people.

Chairman Mica, Ranking Member Connolly, and Members of the Subcommittee, this concludes my prepared statement. I would be happy to answer any questions that you may have at this time.

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