As cloud services grow in terms of capability and adoption, federal agencies are pondering whether their organizations should entrust their IT to commercial cloud providers, and more significantly, how far should they go in relying on cloud services. The concept of adopting an Everything-as-a-Service (XaaS) model is growing in popularity among industry pundits and writers. But what exactly is XaaS? XaaS is a cloud computing term for practicing a cloud-first policy by adopting cloud-based technologies instead of on-premise solutions.
The objective of XaaS is to reduce, as much as possible, the human capital and capital expenditures from IT required to maintain on-premise, hosted applications. XaaS holds the promise of providing maximum IT efficiency and applying more IT dollars in direct support of an organization’s mission.
XaaS-driven organizations seek adoption of cloud services in several forms. In order of potential value (from low to high), Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS), and Software-as-a-Service (SaaS) have become the main targets for organizations to push as many workloads out of their data centers as possible. In particular, agencies are now focusing on pushing workloads to fully managed environments that include PaaS as SaaS in order to reduce costs. Newer forms of cloud services continuously emerge such as Data-as-a-Service (DaaS), Mobility-as-a-Service (MaaS), and Security-as-a-Service (SECaaS). These digital services have expanded to cover nearly every workload a typical organization might require. As we will see in this blog, all CIOs across all agencies should strongly consider making the move to XaaS to achieve greater responsiveness to their agencies IT needs.
Gaining Greater Efficiencies with Everything-as-a-Service
If we look at IT through the lens of efficiency, we see increased efficiencies as we progress up the cloud service segment ladder including IaaS, PaaS, and SaaS. Each cloud solution represents an improvement, in most respects, to on-premise infrastructure hosting. On-premise hosting places the most burden on an organization because of expenditures like office space, power, uninterruptible power supplies, generators, networking infrastructure, network backbone, industrial-strength air conditioning, server room infrastructure, servers, etc. Simply put, it is very expensive and complex to maintain quality on-premise applications. Performing a cloud transformation to XaaS brings tremendous efficiencies and each of the cloud service types described below provide increasing efficiencies wherever they may be applied. Most importantly, commercial cloud providers possess the talent and resources to ensure the highest degree of security and scalability.
IaaS provides a relatively faithful replacement to the physical infrastructure, hardware, networking, and core security services. It provides virtualized implementations of most physical server resources with a nearly limitless supply of virtual machines, networking assets, and security features for any size workload. The major advantage is that with IaaS you can almost instantly provision new virtual networks and machines with a high degree of scalability. IaaS increases your organization’s stability tremendously and is suitable for most types of workloads. The one downside is that consumers still own the costs of managing the configuration and management of the servers from the operating system through application tiers. While this represents a step forward from on-premise hosting, PaaS is a good step forward in efficiency from IaaS.
With PaaS, providers offer pre-configured infrastructures, manage the operating system, and also the application platform. The consumer only manages their data and applications, which substantially reduces configuration, operations, and maintenance costs for the consumer. PaaS also provides enhanced scalability, so the consumer is not burdened with complex configuration tasks, patching, and management related expenses. Succinctly put, PaaS improves upon IaaS by providing management of the operating systems, networking infrastructure, and scaling infrastructure so your organization can spend more time engineering the business logic for applications and less time building indirect value through infrastructure management. According to Statista’s Platform as a Service Dossier, the recent evolution of PaaS resulted in a very significant 32% growth of the PaaS segment from 2016 to 2017. PaaS is good, but to maximize cost efficiencies and scalability SaaS is better.
SaaS holds the potential of being the crème de la crème of XaaS with the highest return on investment (ROI) because the commercial service provider offers a turnkey software solution. When compared to IaaS and PaaS hosted applications, SaaS requires minimum software development and operational support. Consumers need not worry about the hardware, software, configuration, and patching because the service provider manages it all. As a consumer of SaaS offerings, consumers typically only purchase licenses for their employees. Offloading nearly all infrastructure engineering and support responsibilities allow agencies to shift dollars and focus towards pure business automation support and innovative projects that directly support the agency’s mission.
With current XaaS options in the marketplace, agencies have an opportunity to reduce human capital cost and capital expenditures while gaining major efficiencies and ROI. Is XaaS, therefore, going to be the holy grail of IT management for CIOs?
Benefits of XaaS
It is possible with XaaS to instantaneously provision nearly any business service. For example, office automation can be immediately, and cost-effectively, provisioned through products such as Microsoft Office 365 and Google Apps. Within XaaS, the SaaS services market has grown substantially with ever-increasing breadth and depth of services to address common business needs. SaaS services support an overwhelming majority of workloads such as human resources (HR), client relationship management (CRM), and enterprise resource planning (ERP). Services such as Automatic Data Processing (ADP), Salesforce, SugarCRM, Oracle Cloud, and Microsoft Dynamics have become compelling solutions. These services may be instantly provisioned, require little maintenance, feature fault tolerance, reduce redundancy, and offer nearly infinite scalability.
Implementing XaaS is relatively painless and fast for most organizations, you don’t have to spend years building out an IT ecosystem like with traditional IT models. Best of all, XaaS holds the promise of achieving high degrees of efficiency of IT spending to directly support an agency’s mission. Computerworld quotes a Computer Economics study that states “cloud-centric organizations are saving 15% in their IT budgets, mostly due to a reduction in data center costs.” Because of those savings, organizations were increasing investments on new IT projects. Many startup companies adopted a XaaS philosophy, enjoying the benefits of never having built or co-located a server room, hiring expensive infrastructure support personnel, or adopting business processes to existing software.
Funding is also an area where XaaS offers tremendous upside in terms of simplicity. Budgeting for XaaS is generally a question of identifying the number of seats/licenses required for each service and projecting demand throughout the year – it’s highly scalable based on an agency’s demand. The XaaS budgeting model is significantly different from traditional IT procurement, where the government must spend months or years to procure hardware, licensing, storage, equipment, energy, cooling, and other aspects that can be a daunting and expensive task. There is no need with XaaS to track those costs as those expenses are born by the service provider.
For the public and defense sectors, there is an additional compelling aspect of XaaS. Many government IT organizations struggle with meeting Continuity-of-Operations (COOP) requirements due to the technical complexities, the acquisition processes, and the number of agreements that must be executed. Most modern commercial XaaS services all have COOP built in, have multiple “regions” where the solutions operate from, and have an ability to automatically scale across these regions. This helps government IT organizations achieve their COOP requirements with comparatively little effort.
The Potential Difficulties with XaaS
With any IT model, there are pros and cons and it’s important to evaluate whether the pros outweigh the cons or vice versa. Adopting a XaaS strategy in the public sector is not without risks. XaaS is heavily network dependent because in an ideal world all services are accessed via the Internet or private VPN. As such, there will be increased costs for maintaining highly performant and robust networks – although the savings incurred by transforming to XaaS are much greater. Also, implementing a XaaS strategy requires a substantial amount of transformation and may initially have a positive or negative impact on existing business processes. Lastly, there are still perceptions regarding the security and reliability of cloud services, especially with system security managers.
XaaS provides a tremendous opportunity to achieve a leaner, stronger, and more agile government. Agencies will have the ability to rapidly field new capabilities without the conventional delays incumbent in traditional IT hosting approaches or procurement models. Agencies will no longer need a dedicated physical infrastructure on premise for IT hosting. Due to the significant ROI achieved, agencies will be able to transition IT support staff from maintaining legacy systems to building valuable and innovative solutions that directly impact the mission. The complexity of funding is reduced, and IT budget forecasting is simplified. With proper planning and adherence to FedRAMP accreditation, the process of transforming to XaaS will lead to more secure, scalable solutions with greater continuity. Agencies that opt out of XaaS will be at a disadvantage and continue to incur unnecessary expenses to maintain their IT infrastructure. If implemented and managed correctly, Federal CIOs may have, after all the years of searching, found the holy grail for IT management!
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