---------- DOCUMENT HEADER ----------
---------- DOCUMENT HEADER ----------
ARIZONA HOUSE OF REPRESENTATIVES
Forty-ninth Legislature – First Regular Session
Minutes of Interim Meeting
House Hearing Room 5 -- 9:00 a.m.
Chairman Stevens called the meeting to order at 9:04 a.m. and attendance was noted by the secretary.
|
Representative David Stevens, Chairman |
Representative Debbie Lesko |
|
Representative Carl Seel, Vice-Chairman |
Representative Anna Tovar |
|
Representative Rick Murphy |
Representative Rae Waters |
|
Representative Laurin Hendrix |
Vice-Chairman Seel introduced John Kost, former Chief Information Officer for the State of Michigan.
Presentation by John Kost, Vice-President, Gartner Research
John Kost, Vice-President, Gartner Research, explained that he worked for the Michigan Legislature for 11 years before going into the Executive Branch. He was the first Chief Information Officer (CIO) for Michigan, holding that title for four years. The CIO has a much different role in Michigan compared to Arizona. The CIO runs the Information Technology (IT) Department in addition to setting IT policy. One element that made their program successful was a highly involved Governor.
He explained that the legislation went through two rounds of consolidation; the first one starting in the mid 90’s. That segment focused on the infrastructure including the mainframes, networks and servers. The second consolidation occurred in 2001 when the Governor signed an Executive Order to consolidate all application development staff and business analysts. These efforts were not initiated to save money but to improve customer service. Both efforts resulted in saving a considerable amount of money long term. In the first consolidation there was a savings of about 15 percent which worked out to about $60 million in annual savings. The IT re-invested a significant amount of that by upgrading technology and infrastructure. The state started out with 23 mainframes and downsized to three. Reducing staff was also a major component for saving money.
Mr. Kost pointed out some findings in the handout; Gartner IT Consolidation in Government: A Checklist for Success (Attachment 1) and explained that there are three kinds of consolidation. The first involves moving all IT equipment into one location. The second is organizational and has all IT staff reporting to a different organization which reduces management and operation costs. Rational consolidation is the third type, here the goal is to convert data and operating systems to a reduced number to eliminate unused operating systems and supporting hardware. This results in paying less money to fewer vendors by having fewer systems, less software and fewer staff.
Mr. Kost emphasized the importance of developing state-wide standards. Consistency creates a great deal of savings. He opined that now is a good time for consolidation; however, most efforts are failing. The focus needs to be on the reason for consolidation, the scope of the task and leadership engagement. The governor’s and directors’ involvement is vital to the success of consolidation. The host organization that takes over must be respected and competent, operating on charges to its customers, rather than depending on the legislature for appropriations. It would be difficult for IT to compete for funds versus acute public policy issues like public safety, welfare and transportation so Gartner recommends that any central IT operation be dependant on payment from customers and not from direct appropriation.
Chairman Stevens asked about inner operability. He stated that in Arizona the Department of Revenue is not associated with the Department of Transportation or the Arizona Health Care Cost Containment System (AHCCCS). The goal would be to obtain a centralized database of names, addresses and phone numbers. Mr. Kost explained that the key is to examine how databases are structured and how firewalls between databases operate. The focus should be less on data initially and more on how the applications interoperate. This concentrates more on how changes and updates are made and less on where the data is. He explained how Singapore uses E-government to collect citizen information updates. Mr. Kost responded to a second question, stating that there is a significant savings when usage is reduced from 23 mainframes to three, specifically to maintenance fees for hardware and software vendors.
In answer to Representative Lesko’s question, Mr. Kost explained that through the power of Executive Order the Governor of Michigan mandated the consolidation of the state agencies into one agency. Discussion ensued.
Vice-Chairman Seel asked about firewalls and privacy. Mr. Kost explained that when Michigan made the IT changes there was no impact on the ownership of the data. The departments continued to own the content and applications and Gartner only provided a hosting site. When the physical location of data changed Gartner ensured that the firewalls would continue to protect that data. Everything else remained the same. Discussion ensued on privacy technology in a centralized organization and identifying fraudulent activity.
In response to Vice-Chairman Seel, Mr. Kost explained that offering the public internet self-service will make E-government more cost effective by reducing the need for office space, personnel, etc. The initial learning curve could be a challenge to the public.
Chairman Stevens thanked Mr. Kost for his time. Mr. Kost said he is available for any follow-up questions by the Members.
Without objection the meeting adjourned at 9:41 a.m.
____________________________
Sarah Griffith, Committee Secretary
December 2, 2009
(Original Minutes, attachments and audio on file in the Office of the Chief Clerk; video archives available at http://www.azleg.gov)
---------- DOCUMENT FOOTER ---------
AD HOC COMMITTEE ON AGENCY
INFORMATION TECHNOLOGY
2
November 19, 2009
---------- DOCUMENT FOOTER ---------