Tony Lester August 2011 Consolidating, optimizing and safeguarding available IT resources and services in Tax Administration 1

Purpose of Presentation In this presentation we will discuss: – Why IT consolidation and optimization makes sense. – How do you start a consolidation / optimization program of work. – What is happening with “ Shared Services” and – How do you look after your people– the most valuable resource of all. Discussion will be based on Best Practices. 2

Why IT consolidation and optimization makes sense. IT has traditionally grown in a haphazard manner as it responds to Business needs. There maybe: – unnecessary multiple Data Centres, – unnecessary voice and data networks, – hardware not being fully utilized, – different versions of software and different software license arrangements in place. All of us are challenged to deliver IT in the most cost effective and efficient manner possible. 3

Why IT consolidation and optimization makes sense (contd) Our Business Units are demanding a more responsive and agile IT service. IT consolidation and optimization is one step on the journey to creating centres of excellence and efficiencies leading to better Government. Organizations now recognise that an effective enterprise IT architecture is part of that journey. 4

Benefits of consolidation and optimization within a Tax Administration. Many examples of major cost savings from successful consolidation projects. People and system resource savings can be realised due to economies of scale achieved. Dollar savings can be released, or reinvested into further change projects. Consolidated environments are easier to maintain/upgrade. More responsive IT service delivery for the Business Units. 5

Benefits of consolidation and optimization within a Tax Administration (contd) Improved security due to reduced numbers of devices that can be “attacked”. Disaster recovery can be implemented more easier. May assist with planning for environmental disasters as well. Greater ability to understand what is happening in the IT environment– ensure priority is given to the highest Business requirement. 6

How do you start a consolidation and optimization program of work? Can be triggered by any event such as: – Government cutting Tax Administration funding, – major IT outage that stops Business functioning, – the addition of a new Tax line of business for the Tax Administration, – the need to create an IT Strategic Plan (ITSP). Steps to be taken, are/can be part of an overall ITSP: – establish the Current and Future State for IT. 7

How do you start a consolidation and optimization program of work (contd). Determine the Current State: – capture and document what you have already both hardware and software, – map what you have already against the Business needs and determine how effective these services are. Determine the Future State: – establish what the Business needs will be in the future, – what are the IT architectural principles you require, – how does your current environment fit with the future? 8

How do you start a consolidation and optimization program of work (contd). Most Tax Administrations are moving to use package solutions so there may be opportunities to partner with a key vendor(s). Start small, select an IT environment that is not too complex but can demonstrate payback. Do not try to “ boil the ocean”. 9

What is happening with Shared Services? To support consolidation efforts, many Government’s are working on Shared Services. Typically driven via E-government initiatives. There are a number of candidate services that could be considered: -- Networks-- Payroll systems -- HR systems-- Payment processing -- Sharing Servers-- Shared storage -- Single govt log on-- Enhanced Disaster recovery. 10

What is happening with Shared Services (contd)? Tax Administrations can take a lead with Shared Services as typically they interact with most citizens and may be better funded Shared services does not mean “physical” joining of Tax database with any other Agencies database. Ability to access and exchange taxpayer information where permitted by law is valid, but “physical” joining of databases is not recommended. 11

How do you look after your people – the most valuable resource of all? “ Information Technology solutions are only as good as the people who build, operate, support, maintain them and just as importantly, the users who use them” Tony Lester, February

How do you look after your people – the most valuable resource of all (contd)? Tax Administrations have traditionally struggled to retain their best people. Some employers are looking to retain staff by adopting some of the following: -- Variety of tasks-- Flexi time -- Working from home-- Performance Pay -- Training Opportunities-- Career planning -- Address non performance-- Treat staff respectfully -- Allow them to use the technology!! During all Change, take the people with you. 13

Summary Most Organizations have consolidation / optimization programs in place. There are genuine savings to be realized. IT will be recognised for being more responsive to the Business. Plan for the project properly– consider an ITSP. Tax Administrations can consider leading Government Shared Services initiatives. Don’t forget your people- the most valuable resource of all! 14