Government Technology - August 2008 - (Page 26)

1 DON’T BUY — When it’s time to implement a software application, the software-as-a-service (SaaS) model offers a way to spread the costs over the solution’s useful life and possibly reduce them. Under SaaS, instead of licensing software and installing and maintaining it in-house, the user pays a fee to access the application via the Internet. It’s like paying the city to pump water to your home instead of drilling your own well. SaaS is one of two models the North Central Texas Council of Governments (NCTCOG) is using to help small and medium-sized governments acquire software for basic business functions. NCTCOG signed a contract with Tectura of Redwood City, Calif., to provide three applications to interested government member. The applications are: Microsoft Dynamics GP for financials, StarGarden for human resources and payroll, and software from Cogsdale Corp. for functions including utility billing, permitting and work order management. SUBSCRIBE A government can opt to license one or more of these packages and host it internally. Or it can pay Tectura a subscription fee based on the number of users. Tectura arranges for a third party to host the system. STRATEGY: SOFTWARE AS A SERVICE WHO’S USING IT: NORTH CENTRAL TEXAS COUNCIL OF GOVERNMENTS WHY THEY’RE USING IT: SAAS MODEL ELIMINATES THE UP-FRONT COST OF PURCHASING AN ERP PACKAGE, AND USERS ELIMINATE INTERNAL SYSTEM MAINTENANCE COSTS. exceed the one-time cost to buy the software outright. Where the two lines cross depends on which packages the government buys and how many people use it, Barbee said. When weighing the benefits of SaaS versus licensing, governments also must consider the internal expenses they eliminate when a third party hosts the software, Barbee said. “You have the cost of your hardware. You have the cost of all the people who you have to run the system, the network administrators and those kinds of people,” he said. “And you may have additional security measures you have to take, depending on what kind of software you have.” TIM BARBEE, DIRECTOR, RESEARCH AND INFORMATION SERVICES, NORTH CENTRAL TEXAS COUNCIL OF GOVERNMENTS The latter approach builds an implementation fee into the subscription for the first three years. “And then the annual costs go down, of course,” said Tim Barbee, director of research and information services for NCTCOG in Arlington, Texas. Although the SaaS model eliminates making a major upfront investment, as the government continues paying the monthly fee, eventually the accumulated costs will Open source software offers another method to control IT costs. For tight budgets, the good news is that much of this software is available for free. Ben Berry, CIO of Oregon’s Department of Transportation (ODOT) and former chair of the CIO Council, has found that open source solutions can be just as effective as proprietary solutions, as long as they provide good value and meet one of the state’s seven different procurement rules. The council determined that obtaining an open source software package falls under Oregon’s rules for purchases with price tags up to $5,000; procurements THERESA PARDO, DEPUTY DIRECTOR, CENTER FOR TECHin that category don’t NOLOGY IN GOVERNMENT require competitive bids. The most significant instance of open source software at ODOT is the Linux operating system on the mainframe used to process drivers’ licenses. “We got the Linux AUG_08 2 KEEP IT OPEN environment for free, along with the IBM mainframe,” Berry said. Elsewhere in Oregon state government, there’s a push to use open source software where appropriate. For example, the state data center uses open source system software and monitoring tools. “One of their stated goals is to use more open source software to keep the cost down,” Berry said. Oregon’s Department of Human Services uses the open source SugarCRM solution for customer relationship management. But government officials must step carefully when assessing the cost of an open source solution, Berry cautioned. Although the software itself might cost little or nothing, if the agency needs help implementing it, that could push the cost into a different category. In Oregon, a procurement requiring integration services would hit a threshold if the integration services cost more than $5,000, which inevitably they would, Berry said. “Then the initial procurement should have been for the software and systems integration,” he said. Even though the software is free, the agency must conduct a competitive procurement — and the total price could, in some cases, come STRATEGY: OPEN SOURCE WHO’S USING IT: OREGON DEPARTMENT OF TRANSPORTATION WHY THEY’RE USING IT: FREE OPEN SOURCE SOFTWARE HELPS ODOT AVOID SOFTWARE COSTS IN SOME INSTANCES. out higher than the price for implementing a closed source software package. Similarly the use of open document format promises to cut costs for preserving government records in electronic form, said Theresa Pardo, deputy director of the Center for Technology in Government in Albany, N.Y. A government that archives materials in proprietary formats — such as Microsoft Word documents or Adobe Acrobat files — must buy the same software brand or convert files to new formats as the old ones become obsolete, she said. That wouldn’t be the case for a government that stored documents in an open format. “It essentially liberates a lot of the purchasing for today, tomorrow and beyond from these kinds of proprietary requirements,” she said. 26 http://www.govtech.com

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Government Technology - August 2008 Contents Point of View The Last Mile Big Picture On the Scene Four Questions for... Net Gains A Government Technology® Industry Profile: CA CA Contents IT Network Management: State and Local Governments Face New Challenges MyFloridaNet Arkansas Department of Information Systems Hartsfield-Jackson Atlanta International Airport Government Tightens Its Belt Rocking the Vote High-Speed Portal Project On Track Wi-Fi on a Shoestring From Paintball to Video Virtually Vulnerable How It Works Products signal:noise

Government Technology - August 2008

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