Issue Brief - National Governors Association
Issue Brief
Madeleine Bayard, Senior Policy Analyst,
Office of the Director, 202/624-5332
Erin Lee, Program Director, Homeland Security
and Technology Division, 202/624-5392
December 20, 2005 (updated February 28, 2006)
Executive Summary
State governments spend billions of dollars annually on information technology (IT). Individual agencies
frequently purchase and operate independent systems to do similar work throughout state government—
which is inefficient and adds to costs. For example, state agencies often operate their own mainframes and
redundant payroll systems, costing the state more and hampering information sharing and statewide
analysis. Recognizing these problems, a number of states have moved to consolidate these systems.
The two most frequently undertaken types of IT consolidation are physical consolidation and application
consolidation. A review of states by NGA found that at least 42 states have undertaken consolidation
initiatives in recent years; 32 have implemented physical consolidation and 26 undertook application
Physical Consolidation
Physical consolidation consists of data center integration and server consolidation. Consolidated data
centers merge mainframes dedicated to a single agency into a unified, centrally managed operation that
supports both the data processing and the data storage requirements of all state organizations. Physical
consolidation has several benefits, including cost savings, more consistent service delivery, and easier
technology implementation and personnel management.
Operating consolidated data centers and servers frequently saves states millions compared to their
previous systems. Oregon initiated the Computing and Networking Infrastructure Consolidation program
to consolidate state data centers, mainframes, servers, and other networks. The program is consolidating
three major data facilities and nine additional data centers into a single data center. After one-time
transition costs are repaid, annual savings across the 12 participating agencies will be approximately $17
million. These savings are projected to begin accruing in the 2009-2011 biennium. Pennsylvania started
the Commonwealth Connect project to unify e-mail servers, saving the state more than $18 million in
software over the initial three years. Wisconsin framed its IT restructuring with an initiative called
ACE—“accountability, consolidation and efficiency.” The 2004 Enterprise IT Plan brought thousands of
applications and servers into a streamlined enterprise architecture1 with unified platforms, networks,
systems, and applications. The state is consolidating its 220 e-mail servers into 21, a change that is
expected to reduce data server downtime from 22 hours per year to only 1.6 hours per year, saving over
Enterprise architecture is the infrastructure for a statewide IT system. It is a holistic, comprehensive
blueprint for government enterprise that integrates information and services across agency boundaries.
Enterprise architecture supports the coordination of various IT support functions. It also can create and
enforce statewide standards for data, security, purchasing, management, and operational procedures.
$2.5 million annually. After extending its consolidation initiative to other IT operations, Wisconsin saved
a total of $40 million in 2004.
Unified IT systems are often able to deliver more consistent services. Michigan undertook major
consolidation in 2001, creating enterprise data centers to manage storage and network information from
various service agencies in one system. The department of information technology operates an agency
liaison office that communicates with the individual agencies to help them achieve their technology goals
through the centralized state IT office. This restructuring was intended both to improve service delivery
and to save the state an estimated $50 million to $70 million annually. North Dakota passed legislation
consolidating e-mail, database, and application servers in 2003; it was estimated to save $1.4 million and
make government operations more efficient. In January 2005, all IT networks and applications at North
Dakota universities were connected to the government servers, creating a common platform to manage a
majority of the state’s public services.
With physically consolidated IT systems, states can put emerging technology to use more rapidly,
allowing them to benefit from technological advances and increased computing power. Vermont stands
out as a state that has centralized and consolidated all of its IT systems. Since 2004, all IT needs have
been managed through the department of information and innovation, which is responsible for building
and maintaining the IT infrastructure to support state government. The new system allows trained IT
professionals to evaluate agency needs and respond quickly with new technologies such as large-scale
enterprise servers, improved IT security, and disaster recovery services.
With a consolidated system, individual agencies no longer have to maintain a large IT staff to manage
complex servers and data storage systems, so personnel management is easier. Pennsylvania has saved
$270 million by consolidating its infrastructure through initiatives such as the Data Powerhouse Project,
which created a statewide data center that would be accountable for state IT. This alone achieved $127
million in savings from staffing, hardware, networks, software licenses, disaster recovery, and facility
leases. The project resulted in additional economies of scale from unified data center management,
standards, and accountability.
Application Consolidation
Application consolidation merges redundant and disparate systems into a common software program to
reduce complexity, facilitate business processes, and enable information sharing. States frequently
consolidate the applications that multiple agencies require, such as payroll, accounting, and
communications. When several agencies use the same applications, costs are reduced through eliminating
maintenance and integration of disparate systems. Cost savings can also be achieved by consolidating
procurement applications taking advantage of volume purchasing for all state agencies, rather than
scattered, multiple purchases of similar items.
Many states implement application consolidation to improve internal agency efficiency. New Hampshire
has made centralized IT a primary goal since the 2003 introduction of the office of information
technology (OIT), one of two state agencies under direct control of the governor. OIT is responsible for
standardizing software platforms, networking, and desktop services to avoid duplicating IT efforts across
agencies. Minnesota offers consolidated applications through the state data center, including real estate
management and grant management. These enterprise applications were undertaken as part of the state’s
Drive to Excellence Initiative, which is expected to save the state $570 million by 2011. North Carolina
has taken an enterprise approach to its IT by using state technology architecture to implement common
applications to handle payroll and expenses, e-mail, and access management. The consolidated Ohio
Administrative Knowledge System (OAKS) integrates major business functions such as human resources
and accounting into a unified system for every state agency. Its system cost $158 million, but Ohio
projects a potential $446 million in savings over five years. The majority of the savings come from
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
reducing the number of redundant systems currently in place across state agencies. Savings are also
realized because OAKS gives the state better oversight of state processes, for example, reducing potential
federal penalties and eliminating benefit payments to ineligible payees.
Application consolidation also supports information sharing, which has become increasingly critical for
many external government functions that provide services to businesses and citizens. Georgia has
integrated applications for 76 state agencies; consolidated services include payroll, personnel, purchasing,
law enforcement, child support enforcement, and payments to retirees. The Georgia Technology
Authority’s broad IT strategic plan focuses on service delivery through integrated networks, for example,
connecting law enforcement databases to health and human services databases which has improved the
operations of both agencies. Massachusetts maintains several consolidated business applications through
its information technology division, including payroll; licensing for several commissions and boards; the
state health insurance system; and data storage for all applications hosted from the state’s data centers.
Virginia is in the process of implementing enterprise architecture to consolidate external business
practices, including licensing, issuing grants, collecting fees and debts, and sales as part of the state
strategic IT plan. After the IT restructuring is complete in 2009, Virginia expects to have saved $100
million. Wyoming uses a modified enterprise architecture framework that has consolidated infrastructure
and service networks. While the restructuring cost $250,000, the state has already realized that much in
savings from the increased efficiency of its networks, which minimize the cost of delivering services to
About Table 1 (page 4)
The table gives an overview of recent consolidation initiatives by states (it may not include every state
program). The majority of the language is taken directly from the states’ technology Web sites.
Many states have consolidated physical data centers and servers, as well as applications for internal
business purposes and external service delivery. Besides improving government efficiency and service
delivery, many streamlined state IT systems have lowered costs and improved information-sharing
Other Resources
IT consolidation is one way to achieve technology cost savings. States have undertaken many other
approaches, involving areas such as governance and procurement. The strategies are addressed in the
following publications:
The View from the IT Industry - What States Can Do to Improve Government Efficiency and
Service Delivery (2005)
Managing the IT Investment: Experiences from State CIOs (2005)
Reforming State Procurement to Buy the Best IT Solution (2003)
Reforming State Procurement: Update (2005)
This Issue Brief was prepared by Sarah Hoffman, Homeland Security and Technology Division, NGA
Center for Best Practices.
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Table 1: Recent State IT Consolidation Programs
This table collects information on recent consolidation initiatives by states; it may not include every state program.
Most the language is taken directly from the states’ technology Web sites.
Consolidation Initiative
The state is incrementally building a data center from the bottom up to allow for rapid
application development.
• The new structure is embedded in long-range data warehouse architecture.
The Technology Management Council (TMC) advises state agencies on IT.
• Data center consolidation began 1 June 2004.
• The state is also working on server consolidation.
Enterprise architecture supports the business of government and improves the ability to deliver
responsive, cost-effective government functions and services. The state hopes to achieve the
• Effective use of technology to achieve business functions and services.
• Increased citizen access to services.
• Share information and resources at all levels of government.
• Getting the most from its investment in IT resources.
The state has also
• Developed data standards but has not consolidated data systems.
• Consolidated purchasing to use the volume of all state agencies.
The state recently announced organization of its Department of Technology Services (DTS)
after a period of decentralization. The Temporary Consolidation Management Office oversees
• Plans data consolidation and procurement consolidation but rejects server
• Does plan to standardize servers.
• Expects $2 million in annual cost savings within three years, larger savings once DTS
is established and further opportunities for consolidating and supporting technology
are identified.
Commission on Information Management (IMC) manages state IT.
The following was the state’s 2004 IT strategy:
• Centralize IT operations and create one portal; citizens expect transformation to a
more efficient e-government.
• Authority remains decentralized, but the IMC makes recommendations.
• IMC will work to improve data sharing.
Created by a legislative task force in 2001, the Department of Technology and Information
(DTI) is responsible for the selection, development and deployment of technology solutions for
all of state government.
DTI's areas of consolidation include the following:
• Deployment of statewide e-mail network to 140,000 users, including K-12 and some
of higher education.
• Through Enterprise Resource Planning, DTI has significant application consolidation
including the Payroll and Human Resources Statewide Technology system, which
brought all state government human resources, benefits, and payroll into one system.
The COTS (Courts Organized to Serve) project consolidates many legacy systems for
4 court divisions and permits all to operate from same software; e-Benefits eliminated
stand-alone systems and consolidates multiple open enrollment periods during the year
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Consolidation Initiative
into a single event.
Until July 2005, the State Technology Office managed the state’s IT. However, the legislature
did not fund the STO for 2006, so consolidation is on hold. Florida had developed an IT action
plan in 2003 with the goal of “enabling the enterprise.” The plan aimed to do the following:
• Shift to enterprise-compliant technologies, standards, and processes.
• Integrate enterprise information to make data from legacy programs available.
• Leverage improved technologies to upgrade to more effective and efficient
• Reduce the cost of IT.
• Drive interoperability.
• Extend networks to connect more citizens to the government.
• Create best practices for efficient solutions; this may include open-source software,
commodity-based technologies and franchised services shared between agencies.
• Expertly integrate services.
Data center integration was completed in March 2005.
Florida had also consolidated contracts through enterprise procurement.
Through the state portal Georgia offers online business registration. It uses consolidated
procurement to take advantage of agency volumes. Application integration is in progress—
services are online but not integrated. Upgrades were in the works in 2004.
The state data center supports 125 state systems including the following:
• Personnel, payroll, purchasing, billing, etc., for 76 agencies
• Law enforcement
• Child support and family assistance
• Payments to retirees
E-mail is in the process of being consolidated by working with each agency to use a single
platform, email address book, and data center.
The state’s strategic plan focuses on a service oriented, integrated framework.
In 2002, the General Assembly approved an $18 million bond package for purchase of a new
data center, but because of the state’s economic condition the purchase has been delayed.
The IT department is centrally managed by the department of administration; the state is
working on building consolidated infrastructure and telecommunications. In general, IT policy
promotes interoperability and data sharing.
Through the Central Management Services (CMS) office, Illinois offers many online services,
including licensing and registration. CMS spent six months developing plans to standardize and
consolidate technology services used by agencies. The state’s plans focus on the following:
• Achieving cost savings related to unnecessary duplication of hardware, software, and
personnel resources
• Creating a structure for demand management
• Centralizing decision making
• Producing new technology assets and abilities
CMS initiatives have saved the state over $135 million and improved service quality.
• Currently, 75 percent of state agencies are under central authority.
• E-mail and telecommunications are centralized.
• Network infrastructure is consolidated.
The technology department manages educational technology and advises other agencies. It also
reformed procurement and vendor management.
The state started a government-wide enterprise project, giving the Department of
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Consolidation Initiative
Administrative Services authority to advise state agencies on IT enterprise approaches but no
management authority over the agencies. Its goal is to promote compatibility and
interoperability. DAS handles IT procurements over $50,000.
The strategic plan of 2003 recommended adopting a consolidated approach to increase IT
efficiencies, streamline reporting processes, and increase communication among agencies.
• Thus far 82 agencies are coordinated.
• The state IT budget is $195 million.
• An IT executive council has tech authority.
• The state has had online applications since 1991; it is aiming for 24/7 integrated
applications for all government services.
• The state hopes that integrated systems that share information will improve service
delivery to citizens by reducing duplication of information required by individual
agencies. It hopes to improve the accuracy of data and speed processes for auditing,
archiving, and retrieving data.
A master IT plan was written in 2003 and is currently being updated.
All computing systems will be housed in one of two data centers.
Subsequent phases will address
• Operational consolidation,
• Product standardization,
• Support services centralization and consolidation, and
• Shared lines of service.
E-mail is scheduled to be consolidated by 2007. Contracts were consolidated under the
Consulting Support Services Agreement.
Maine is in the early phases of a comprehensive reorganization of IT, under the leadership of
the CIO, who is sponsored by Governor John Baldacci. The Office of Information Technology
(OIT) provides services to all Executive Branch agencies. Enterprise email service is provided
to all Executive Branch, Judicial, and Constitutional Offices.
OIT provides enterprise security, project management, strategic planning, applications portfolio
management, eGovernment and other shared service functions. The enterprise "central" group
provides desktop support, applications, operations, network, and radio services.
The enterprise technology transformation has been enabled by an executive order and a
legislative budget document. Budget savings are estimated at over $2 million, with staff
reduction of about 30 positions.
Currently the state is inventorying IT systems and adopting state architecture:
• NetworkMaryland will connect statewide agencies.
• Consolidating e-mail platforms is expected to save licensing and server costs, lower
staff support costs, provide interagency messaging, and standardize domain and
directory services.
• Web sites will be consolidated and standardized.
• Disaster recovery server sites will be consolidated.
The Information Technology Division maintains and manages several business applications,
including the following:
• The Commonwealth's payroll system
• The Commonwealth Information Warehouse
• Licensing for the Alcoholic Beverage Commission, Division of Professional
Licensure, and Division of Professional Standards
• The Universal Health Insurance System
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Consolidation Initiative
• The Commonwealth's enterprise e-mail and directory services
• Disk space and data bases for all applications hosted at the state data center.
The Department of Information Technology oversees all IT but does not have total authority
over it.
• The state hopes to save $50 million to $70 million annually through consolidation.
• Centralized IT operations in 2001 (e-Michigan).
• Employed a Data Center to consolidate the storage of information.
The state has consolidated procurement and established a data center. It expects
to save $570 million by 2011.
The state’s shared infrastructure includes mainframes, the state Web portal, servers, and e-mail.
• The State Data Center manages storage systems.
• Internal support IT staff manages human resources and accounting.$File/2005
Office of Information Technology was re-established in December 2003.
• The state is building a statewide enterprise.
• Mainframe consolidation was achieved in 2000.
• A state data center exists but needs to consolidate its own six servers.
• The state has begun justice information sharing and some consolidated purchasing.
The state promotes a federalized system, neither completely centralized nor decentralized.
The information technology services division’s strategic plan recommend centralizing:
• Applications that multiple agencies require, such as e-mail, messaging, Internet access,
calendaring, scheduling, personnel, payroll, accounting, workflow and imaging
• Data centers, servers, and applications that require operator attention 24 hours a day
for job scheduling, tape mounts, and printer handling
• Applications that have to be available at all times, including immediate recovery from
• Data that are common across agencies and applications (name, address, phone number,
IT restructuring is in the planning stage; recommendations are being made for enterprise
architecture to share data and make systems interoperable. Through the IT agency’s
intergovernmental data services, the organization is updating the current inventory of
equipment deployed throughout state agencies in order to manage their assets more efficiently.
Future plans include:
• Using the National Association of State CIOs (NASCIO) enterprise architecture model
to create a standard platform for applications, security, and governance.
• Offering e-mail to counties through the state network.
Intergovernmental and interagency data issues are looked at by the Nebraska Intergovernmental
Data Communications Advisory Council and Criminal Justice Information Systems Advisory
The state emphasizes enterprise resource models.
• The Department of Information Technology plans to integrate or consolidate IT
servers and networks.
The Office of Information Technologies was created to centralize the state IT in 2003. It is one
of two agencies under direct control of the governor rather than an agency commission.
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
New Mexico
New Jersey
New York
North Carolina
Consolidation Initiative
Initiatives include the following:
• Leveraging the state's buying power by negotiating and establishing aggressive
statewide consolidated contracts to obtain best pricing.
• Standardizing on common platforms and vendor solutions to reduce research, training,
and maintenance costs.
• Centralizing IT utility-like services to avoid duplicating efforts in many agencies.
• Developing areas of expertise by centralizing certain services and redefining the state’s
delivery model to allow staff members to become specialists in their positions.
• Managing and tracking IT expenditures both by agency and statewide to help identify
areas for future savings.
• Using technology to simplify the paper processes.
• Embracing new technology to improve efficiency.
• Wide area network (WAN) efficiency planning, using a WAN efficiency team to
review the statewide design for redundancies and inefficiencies that can be
consolidated or moved to more cost efficient connections.
Mandatory IT consolidation began in 2004 with an executive order from the Governor.
• Agencies are required to give up IT power to a new IT department.
• Agency CIOs report to central IT.
At three levels, agency, interagency, and technical infrastructure, the state’s goals are to:
• consolidate leadership,
• consolidate network services and data storage, and
• consolidate contracts and procurement.
The state believes that its plan will save $19 million in 2005.
New Jersey’s Data Management Council was formed in June 2000.
• The IT community, represented by the council, will promote an increase in data,
information, and application sharing among New Jersey agencies to support efficient,
high-quality service delivery.
Its policy is to combine enterprise architecture with a federated approach that provides
standards for operations and growth, strengthens speed in implementation, maximizes cost
efficiencies, and provides an optimal return on investment.
• Over 800,000 residents access the state's Web site, which delivers dozens of online
services, each month.
• Approximately 975,000 New Jerseyans filed their 2002 state income taxes
electronically, representing about 20 percent of all returns filed.
• There are more than 42,000 registered users of the state portal, “My New Jersey,”
through which they can conduct business with the state securely through the Internet.
• The Garden State Network, the statewide government computer network, processed
more than two billion transactions last year.
• The state plans to increase and improve IT service delivery over the next two years.
New York’s Enterprise Plan covers all state IT.
• Enterprise applications have been developed.
• Data center consolidation has been initiated, including creating networks and
consolidating servers.
North Carolina’s enterprise approach includes the following:
• Enterprise common payment service
• Central e-mail service
• A statewide area network
• Enterprise identity and access management
• Centralized mainframe operations
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
North Dakota
Consolidation Initiative
In 2003 North Dakota passed IT legislation consolidating e-mail, file/print servers, database
administration, data storage, application servers, and hosting services.
• The state believes efficiency is improved, although an expected $1.4million in savings
did not materialize.
In January 2005 North Dakota University Systems connected universities and government into
a common software platform of management applications.
The Ohio Office of Information Technology (OIT) was created by executive order in 2004 and
by law in 2005. OIT is to use a shared-services approach to consolidate and coordinate IT
functions statewide where it makes sense to do so.
The state intends to develop a next-generation network to aggregate the communications needs
(voice, data, video) of Ohio state government, which includes 120 agencies, boards, and
commissions, and also allow other governmental entities, such as courts, local governments,
public libraries, and schools, to leverage the service and/or pricing derived out of the state
telecommunication investment.
Ohio Admin Knowledge System (OAKS) will integrate five major statewide business
functions: capital improvements, financials, fixed assets, human resources and procurement.
• Cost: $158 million
• Benefits: The state expects $251 million in savings over five years, as follows:
o Leveraging the state's purchasing power, up to $45 million
o Increasing the use of vendor payment discounts, up to $26.2 million
o Reducing potential federal penalties, up to $18.6 million
o Eliminating payments to ineligible participants in benefits plans, up to $3.1
o Additional benefits from the opportunity to replace a number of stand-alone
computer systems with a single integrated solution
o Up to an additional $195 million in maintenance and replacement costs for
current, redundant systems
Consolidation initiatives include the following:
• E-mail (hardware, software infrastructure, and support)
• Unified messaging (calendaring, resource scheduling, faxing, wireless PDA’s, instant
• E-mail administration and storage-related services
• Directory services
• Message protection (Spam, content filtering, and virus prevention) and e-mail
integrated applications
Oregon has undertaken a Computing and Networking Infrastructure Consolidation (CNIC)
initiative for data center consolidation:
• Consolidates three major data facilities and 11 data centers (representing 80 percent of
the state’s data) into a single data center.
• It projects a potential second data center for disaster recovery.
• Focuses on reducing the cost of IT services by consolidating the state’s mainframes,
servers, storage, and networks.
• Annual savings are estimated at $20 million to $40 million.
• Projected to save 30 percent to 50 percent of current costs.
Oregon has already consolidated procurement through its “Smart Buy” program.
A new IT transition plan was implemented 10 June 2005.
The state’s previous IT plan saved $270 million in infrastructure.
• Pennsylvania was the first state to consolidate and outsource data centers across all
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Consolidation Initiative
state agencies. The Data Powerhouse Project, a $527 million outsourcing project,
established a new state of-the-art facility that replaced 17 separate state-run data
centers. During the contract’s initial five-year term, the state saved more than $127
• The Keystone Communication Project, the largest transition to competitive
telecommunications in the country, consolidated all services from various incumbent
providers to a single competitive provider, expanding the state’s network capacity and
saving an estimated $100 million in telecommunications costs.
• The Commonwealth Connect Project, in which Pennsylvania state government
partnered with Microsoft, moved 65,000 users to a common e-mail platform and saved
more than $18 million in its first three years.
Rhode Island
In 2004, an executive order created the information technology division on the recommendation
of the Governor’s Fiscal Fitness team.
• The IT division will centralize management of dozens of consultants, hundreds of
computer applications, 250 servers, 280 employees, and more than 8,000 desktop
computers throughout state government
• IT staff are working to consolidate executive branch e-mail servers.
• A new CIO was appointed in March 2005 to plan and carry out this centralization.
• The state expects savings of $6.3 million.
South Carolina is engaged in enterprise architecture. Its “Business One-Stop,” which will be
fully operational by 2009, will allow businesses to register and pay fees online.
• In 2006 a data center task force will begin its work.
• Data center construction will begin in 2007.
The Tennessee Information Infrastructure (TNII) uses existing assets to create an interoperable
“networks of networks,” including telecommunications.
The state provides 110 online services through the e-Tennessee portal, including the following:
• Driver's license renewal (one of the most popular Web applications, averaging 4,500 to
5,000 renewals per month)
• For businesses, the TennCare Eligibility application
• Felony offender information lookup
• Unclaimed property search
• Department of Personnel’s online job application
• Consolidated data center / data resource management
An IT reorganization bill passed on 21 June 2005.
• Over 200 agencies must turn over authority to the Department of Information
Resources (DIR) by 1 September, 2005.
• A DIR store conducts volume purchasing.
The consolidation plans for a five-part, statewide information technology infrastructure:
1. A state data center system to optimize procedures for managing contracts and
maintaining data center facilities, servers, mainframes, and storage.
2. A statewide management structure to see that agencies' telecommunications
requirements are met as efficiently as possible.
3. Enterprise applications, consolidating applications that support the same or similar
business processes.
4. IT support services to deliver efficient technical support to users.
5. Governance development to establish effective decision-making and management
The state passed the Technology Governance Act in 2005.
• Under the act the Department of Information Technology Services (ITS) will provide
South Carolina
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
West Virginia
Consolidation Initiative
centrally managed IT services to the state.
• Consolidation initiatives are to start with procurement.
IT is already centralized and consolidated. The state Department of Information and Innovation
manages applications, the state data center, e-mail servers, procurement, and any other IT
needs. Its goal is to to build the information and technological infrastructure needed to support
all of state government.
Virginia hopes to save $100 million through a massive IT restructuring. Its 2002 strategic plan
initiated an overhaul of IT to provide centralized, consolidated administrative systems to
streamline payroll, accounting, personnel, and benefits processes and permit data collection,
data mining, and enterprise-wide reporting. However, the state maintains a federalized system;
it does not plan full consolidation.
In 2003 it established the position of CIO and an IT investment board.
It plans to coordinate strategic planning cycles of agencies, IT, and human resources.
It has developed technology management policies.
It is starting to use an enterprise architecture to consolidate business practices.
o 30 agencies issue licenses/permits,
o 39 agencies administer grants,
o 73 agencies perform budget formulation or strategic planning,
o 44 agencies collect user fees,
o 22 agencies collect debts,
o 18 agencies conduct retail sales.
As of 1 October 2004, statewide IT consolidation had reduced spending by more than
$30 million, including $16.5 million from direct cost cuts and $15.7 million through
new practices.
The state expected savings of $26.1 million in 2005 through cost cutting and $25.1
million because of better practices.
The planned overhaul is to be complete by 2009.
The state also reformed IT procurement through the Virginia IT Authority (VITA) to
consolidate contracts and use best-value purchasing.
The state consolidated contracts through the Department of Information Services’ TechMall. It
also has a consolidated data center, which is the third-largest in the state, behind those of
Microsoft and Boeing. Washington also maintains a centrally provided enterprise network,
telecommunications infrastructure, and other computing services.
The state legislature reorganized the Office of Technology as part of the Department of
Administration. The state also maintains a data center for state agencies.
• The reorganization will save $1 million per year.
Goals of the reorganization are the following:
• To reduce costs through centralizing, consolidating, standardizing, and integrating the
state's technical infrastructure
• To enhance public access to needed information via a Web portal
• To develop and deliver technical education to state employees, to ensure that technical
support is readily available
• To introduce emerging technologies
• To reduce risk to state IT operations through enhanced security and recovery programs
Wisconsin’s program is called the ACE (accountability, consolidation, efficiency) initiative.
• The state saves $8 million to $10 million operationally, as consolidation occurs, and
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
Consolidation Initiative
will save an expected $9 million annually.
• Currently, state agencies have more than 4,000 applications and 2,400 servers,
quantities that are too expensive to maintain.
• The state has six procurement, payroll, budget, and decision networks and three
accounting and human resource networks.
Its 2004 consolidation plan envisions “one enterprise architecture, one shared infrastructure,
one application base, one enterprise IT finance system and one management and measurement
The state merged 220 e-mail servers into 12.
It reduced server downtime from 22 hours (costing $2.7 million) to 1.6 hours (costing
$196,000) per year.
There is no real centralization of authority—agencies maintain control.
The Bureau of Infrastructure and Networks designs and administers statewide
enterprise data, voice, and video networks and infrastructure services.
The VendorNet system of enterprise procurement consolidates contracts.
The initiative resulted in savings of $40 million in 2004.
The Information Technology Division (ITD) maintains a state Web portal (EPortal) through
which constituents can access information and services.
• The state originally invested $250,000 and has already saved that much.
• Legislation requires common IT architecture and standards. This will be accomplished
through a modified enterprise architecture approach. Common infrastructure,
resources, security, and services will be provided in a consolidated manner, while
allowing agencies to maintain flexibility to meet their individual requirements.
• Wyoming plans to use electronic government to enable redesign of business processes
and to remove agency boundaries in the delivery of state services.
The Enterprise Architecture Work Group’s Info Tech Coordination Committee identifies
compatible and integrated IT services and promotes IT systems and practices that enable data
and resource sharing and cooperation among state agencies.
© NGA Center for Best Practices, 444 North Capitol Street, Suite 267, Washington, D.C. 20001
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