Beginning in early 2011, IBM will launch its Municipal Shared Services Cloud to a few municipalities in New York and Michigan before extending the package to other cities.
Some specifics of the shared service remain in progress, but company officials said the various IT systems that are currently used by the municipalities will be brought into the IBM cloud, and the arrangement will allow those systems’ vendors to conduct business independently of one another. During the pilot, IBM will incorporate the same applications into the cloud that the customers are currently using in their day-to-day operations. The participating governments in New York state and Michigan will continue to own their data.
The system will also provide analytics capabilities. IBM’s business intelligence suite is already used by several governments across the country.
“Local governments … interact regularly in terms of sharing data. There’s a constant stream of information that must go back and forth,” said Peter Baynes, executive director of The New York State Conference of Mayors, an association of 600 cities and villages in New York that will be participating in the pilot. “Up until this point, that interaction was stymied.”
IBM cited tax processing as one system among many that can be shared and integrated. Tax processing spans multiple departments, including building, assessment, tax and finance. Typically each department maintains its own applications, and information sharing is done manually by a clerk — a process that can be time consuming and potentially erroneous. IBM said the new cloud will integrate this data onto one platform, ensuring that the information in the separate applications is compatible and able to be shared with other applications.
During the pilot, IBM hopes to build a case for its product by validating that savings occur for customers and making sure that each user is comfortable with the software, said David Cohn, director of business informatics at IBM’s T. J. Watson Research Center, which helped create the cloud platform.
“We know the technology … and to be honest, it’s complicated to install it in a cloud,” Cohn said. That’s why IBM is taking an extra month or two to test the platform before the company even releases it to the pilot organizations.
One of the biggest concerns for all parties involved is ensuring that information would be secure. IBM officials said the company added an extra layer of “multi-tenancy protection,” said Cohn, which simply means that each municipality has its own private space on the platform — as a tenant would in an apartment — so there’s no cross-contamination and unwanted file sharing.
IBM asked the participating municipalities to make a contribution toward the project’s management expenses, said Cohn, but the company is paying all of the technical costs of the development. Cohn called the project an investment for IBM. Based on early estimates, the cost of creating the service will be “substantially less than the value of the clients,” Cohn said.
“Rather than just theoretically promising savings through consolidation of local governments, this offers practical ways by which local government could be more efficient,” Baynes said.
The platform can also benefit other public-sector organizations such as public safety. For example, linking together the clerk and assessor applications to public safety organizations would give emergency responders pertinent details about home schematics, registered weapons and pets.
Cohn said IBM won’t know how much savings the new platform can save local governments until the pilot ends in mid-2011, but the company projects it will save money through the composition of applications, the limited manual labor necessary to operate the system, and the ability to give software vendors a broader marketplace.
“There are things that [municipalities] could not afford to do on a one-by-one basis, but we can afford to do on the cloud because we’re serving a large number of clients at once,” Cohn said.
After a few months, IBM hopes to clearly identify the cost savings and increased efficiency, so it has a solid basis for constructing pricing.
