Navy CIO Details IT Cost Cuts

The Navy will consolidate applications and data centers, mandate enterprise licensing, improve IT governance, pursue cloud computing, and take other steps to cut IT costs 25% over five years.

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In order to meet an order to cut its business IT budget by 25% over the next five years, the Navy will look to application consolidation, data center consolidation and optimization, mandated enterprise licensing, improved IT governance, and perhaps cloud computing, according to Navy CIO Terry Halvorsen.
Halvorsen had said in June that Navy IT managers would see ruthless internal cost cuts due to orders from the top, and Navy undersecretary Robert Work earlier this month revealed that the plan was to cut IT spending by a quarter in the coming years. Such a drastic cut, Halvorsen said, will require that the Navy do IT in a fundamentally different way than it has in the past, and to take risks where previously it may have been risk averse.
We will not hit that target by doing the same things we do today more efficiently, Halvorsen wrote in a
blog post
published Wednesday. A cut of this magnitude requires a fundamental shift in our IT business model. It will require taking risks and doing things that would have been considered too risky or too controversial in the past.
Consolidating and optimizing the Navys data center and software strategies and improving governance, Halvorsen wrote, will reduce complexity and cut costs.
All told, the Navy is now running more than 2,000 applications on its current enterprise networks, including multiple versions of the same software. For example, the Navy has between seven records management systems alone. We must look at these applications and question whether a unique requirement is worth the cost of multiple applications performing the same function, or whether an application is worth keeping if its not widely used, Halvorsen wrote. A number of those apps, he added, will be eliminated.
Along with the app consolidation effort, the Navy also will mandate enterprise licensing. The Navy has set up enterprise contracts for Microsoft software, and more are on the way. We must require purchasing via enterprise licenses with no waivers granted, he wrote. Allowing waivers led us to where we are today with multiple versions of software. In concert with the enterprise-licensing mandate, the Navy also will look to prevent customization of software and even possibly change business processes rather than customizing software to fit pre-existing processes.
Apps arent the only thing that will be consolidated and managed better under the Navy plan: Data center and storage consolidation and optimization will form a key part of the savings. Currently, the Navy has between 140 and 150 data centers that Halvorsen said are not optimally located. The Navy has closed seven data centers this year, and plans by the end of 2013 to have fewer than 100 data centers, with more cuts planned after that.
Earlier this year, Halvorsen said that the first data centers likely to go would be mid-sized data centers that service only one command or function. Improvement of the Navys data standards will be another piece of this effort.
In order to make that happen, though, the Navy will have to stop data center growth. Last week, Halvorsen
placed a moratorium
on the purchase of new data storage capacity with limited exceptions, building on the White Houses
Federal Data Center Consolidation Initiative
and an
earlier order
from the deputy chief of naval operations for naval dominance to stop spending on new data centers and servers.
Halvorsen wrote that hell also be placing increasing emphasis on improved and more centralized IT governance in order to enable the department to act more like an enterprise, but he admitted that this plan might run up against some cultural resistance. Not everyone will like the result, he wrote.
The four prongs of Halvorsens strategy dont stand alone, and the Navy is looking for other savings opportunities as well. For example, its considering commercially provided email, creating a public-private venture to operate Navy data centers, client virtualization, and increased use of cloud computing.
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Navy CIO Details IT Cost Cuts