Federal Agencies Struggle To Quantify Data Consolidation Savings - InformationWeek
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10/6/2014
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Federal Agencies Struggle To Quantify Data Consolidation Savings

At least six federal agencies report lack of data needed to calculate savings from data center consolidation efforts.

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Several federal agencies that have shut down IT facilities over the past few years as part of a government-wide data center consolidation effort appear to be having a hard time quantifying the actual benefits of those moves because of a lack of metrics.

The biggest challenge for the agencies apparently is just getting a handle on the baseline costs of running data center facilities from which to calculate savings, according to a recent report by the Government Accountability Office (GAO).

The report showed that, of the 24 agencies participating in the data center consolidation initiative, 19 reported cost savings and cost avoidance totaling $1.1 billion between 2011 and 2013.

[Dept. of Defense explores using private cloud services in government facilities. Read DoD May Invite Cloud Vendors Into Govt. Data Centers.]

The Departments of Defense, Homeland Security, and Treasury alone contributed to $850 million of those savings. Over the next year, the agencies involved in the consolidation effort plan to reduce data center costs by another $2.1 billion, raising the total savings to $3.3 billion.

That amount is about $300 million more than what the White House Office of Management and Budget (OMB) had projected when it launched the Federal Data Center Consolidation Initiative in 2010.

But for several agencies, calculating what they might have saved so far from data center cuts has proved to be challenging. At least six of the agencies participating in the consolidation initiative reported little or no costs savings because of a slew of operational and technical challenges, according to the GAO.

Some agencies, for example, had trouble gathering information on data center inventories and costs when the data centers were located in shared, multi-purpose facilities or belonged to smaller component organizations. Others cited complex organizational structures, service-level agreements, contractual obligations, and technology challenges.

The Department of the Interior, which has closed more than 60 data centers in the last few years, cited a lack of data on facility costs, including power-usage costs, as a reason for not being able to better articulate its actual savings.

NASA officials blamed the agency's complex organizational structure for its inability to report savings from closing 25 data centers recently. Determining savings has been extremely complex and impractical, NASA claimed, considering the multiple data centers that it operates with multiple missions and multiple IT contracts.

The General Services Administration said that its data center costs, including rents, leases, personnel equipment repair, and maintenance, are currently distributed across six component agencies spread out over 11 regions. Calculating savings has therefore been a challenge for the agency, according to the GAO.

Eight agencies reported a lack of electricity metering capabilities to determine power-usage costs.

The Federal Data Center Consolidation Initiative was launched in 2010 as part of an effort to promote green IT within government by cutting energy costs and reducing data center real estate. Under the effort, federal agencies will shutter and consolidate thousands of noncore data center facilities. The total savings from the initiative is expected to top $5 billion by the end of 2017.

The cost savings that have been reported so far would appear to indicate that the effort is on track to deliver the project savings, but some lawmakers have called the lack of metrics troubling.

"As the saying goes, you can't manage what you can't measure," Sen. Tom Carper (D-DE), who chairs the Senate Committee on Homeland Security and Governmental Affairs, said in a press release. "Without accurate tracking and reporting of performance measures, we run the risk of not achieving the full potential savings."

Rep. Gerald Connolly (D-VA), ranking member of the House subcommittee of government operations, said the "incomplete reporting and inadequate metrics" highlighted in the GAO report undermine the core objectives of the data center consolidation effort.

"The report reinforces my concern that more than four years after the launch of the FDCCI, we are losing sight of the initial long-term strategic goals of the initiative," he said in the release.

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Jai Vijayan is a seasoned technology reporter with over 20 years of experience in IT trade journalism. He was most recently a Senior Editor at Computerworld, where he covered information security and data privacy issues for the publication. Over the course of his 20-year ... View Full Bio

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Gregory Matous
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Gregory Matous,
User Rank: Apprentice
10/7/2014 | 4:31:31 PM
Re: Is there any real doubt?
It definitely can be more expensive to consolidate (in the short term).

This is because the existing data centers may be running old, outdated software, and a lot of customized systems. In the worst case scenario, you must do a rewrite, which means reverse-engineering the (undocumented) existing system.

Try copying your COBOL programs from the 70's and your flat-file databases to "the cloud". They won't run. 

This is why I would expect that older, more specialized agencies like NASA will have a harder time consolidating.

Reporting on costs is also a big challenge. Many times there are hidden costs or savings (such as employee training, quality of service, etc) that are difficult to track. The existing accounting reports are also not designed to pull this type of data, so what can happen is some guy pulls a bunch of numbers into a spreadsheet. 

I would expect it to cost more for some agencies to consolidate. That still doesn't mean its not worthwhile, because it forces them to address old problems that have been postponed for years.

 
David F. Carr
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David F. Carr,
User Rank: Author
10/6/2014 | 8:59:31 PM
Is there any real doubt?
The inability to quantify may be annoying but does anyone really doubt that there are savings in there somewhere? Would they be better off if they hadn't consolidated? I guess anything is possible in government, but it seems unlikely.
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