Texas last week issued a request for proposals from outsourcers, and vendors have until end of May to respond. The plan is to make a decision by year's end, said Leslie Mueller, assistant director for customer services at the state's IT oversight agency, the Department of Information Resources, in Austin.
The Texas agency believes it "can get tremendous value" by eliminating duplications in its infrastructure, said Mueller.
The state legislature mandated the consolidation in a measure approved last summer, and a state analysis of IT spending estimated that total annual data center operating costs are about US$107 million. The state hasn't decided how many data centers will remain after the consolidation is completed.
Texas is hardly alone, although its consolidation project is one of the largest. Many states are also moving into shared services delivery. Shared services offerings include data center services, communications, payments and disaster recovery as a service, according to a recently released survey by the National Association of Chief Information Officers (NASCIO).
The survey, which drew on responses from 34 states including Texas, Maryland, Massachusetts and New Jersey, showed a solid push at the state level toward shared services and consolidation. For instance, about 77 percent of the states said they had either consolidated data centers or had projects in progress. When it came to offering shared data center services, nearly 85 percent reported projects completed or under way. Other shared services were popular with state officials as well, including portals, security, disaster recovery and telecommunications.
The results "we're higher than I expected them to be," said John Gillispie, chief operating officer for Iowa's Information Technology Enterprise and co-chair of the NASCIO committee that conducted the survey and reported some of the findings. "I think everybody is seeking efficiency."
There are a number of factors driving state action, including aging IT workforces, legacy systems and the advent of technologies many staffs aren't prepared for, said John Lovelock, an analyst at Gartner Inc. The Stamford, Conn., research firm predicts that by 2010 at least half of all major governments will investigate outsourcing initiatives to support major operations.
Lovelock sees the use of shared services as "an enabling step" that moves a state closer to outsourcing because it's "taking responsibility a half a step away" from the state agency that uses the service.
The data center consolidation in Texas, for instance, is seen as a step toward improving interoperability between various agencies, setting the stage for the use of shared services.