DEPARTMENT OF COMMUNICATIONS (DOC) - ACMA/media/Legal Services/FOI logs/FOI log 27... · Department...

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DEPARTMENT OF COMMUNICATIONS (DOC)

DOC & ACMA ICT Cost Comparison

26 June 2014

Department of Communications DOC & ACMA ICT Cost Comparison

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Table of Contents

Page

1 Executive Summary .................................................................................... 1

1.1 Overview ...................................................................................................... 1

1.2 Expenditure .................................................................................................. 2

1.3 Summary of Observations ............................................................................... 4

1.3.1 Observations .................................................................................... 4

2 Background ................................................................................................ 7

2.1 Department of Communications (DoC) .............................................................. 7

2.2 Australian Communication and Media Authority (ACMA) ....................................... 17

2.3 Methodology ................................................................................................ 17

2.4 Agency Financial comparison .......................................................................... 18

2.5 Service Tower Analysis .................................................................................. 18

3 Comparative Analysis ............................................................................... 20

3.1 Resourcing .................................................................................................. 20

3.2 Service Tower Breakdown (Original and Revised) ............................................... 20

3.2.1 ICT Management .............................................................................. 21

3.2.2 Applications .................................................................................... 21

3.2.3 Midrange ........................................................................................ 22

3.2.4 Storage .......................................................................................... 23

3.2.5 WAN .............................................................................................. 23

3.2.6 Gateway ......................................................................................... 24

3.2.7 LAN and RAS ................................................................................... 24

3.2.8 End User Infrastructure ..................................................................... 24

3.2.9 Voice Services ................................................................................. 25

3.2.10 Help Desk ....................................................................................... 25

3.2.11 Facilities ......................................................................................... 26

3.2.12 Carriage Cost Element ...................................................................... 26

3.2.13 Services Outsourced to External Providers ............................................ 27

3.2.14 Others ............................................................................................ 28

4 Shared Service Opportunities ................................................................... 29

Attachments ..................................................................................................... 30

Attachment A. Consultations .............................................................................. 31

Attachment B. Departmental Systems.................................................................. 32

Attachment C. Cross-Agency ICT Benchmarking Definitions ..................................... 38


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1 Executive Summary

1.1 Overview

Introduction

In late May 2014, Galent Management Consultants (Galent) were commissioned to analyse the Information and Communication Technology (ICT) costs of the Department of Communications (DoC) and Australian Communication Media Authority (ACMA).

It is understood that DoC and ACMA are considering the opportunity of implementing a shared services arrangement. Whilst the preliminary analysis undertaken by the two organisations of Cross-Agency ICT Benchmark returns indicated potential financial

benefits, this preliminary analysis also indicated inconsistencies in the returns of both organisations. Decisions based on these apparent inconsistencies could potentially result in the financial benefits either being overstated or the incorrect decision being made.

Considering the criticality of this, Galent approached both agencies for clarification on the results which are analysed throughout the report.

The purpose of the review was to align the cost information to enable DoC and ACMA to make informed decisions on the relative financial benefits which may arise from shared services, whilst allowing identification of services that may be able to be shared more

easily than other services. As appropriate, the analysis will also identify the drivers of cost for the respective elements of the ICT services to further inform the decision making of the respective organisations.

During the course of the analysis, a number of observations were made for potential improvements which have been included in the report for the information and appropriate consideration of DoC and ACMA Executives.

In undertaking this review, Galent interviewed a range of stakeholders comprising both DoC & ACMA CIO’s, Deputy CIO’s and ICT Directors. A full list of interviewees is listed in Attachment A.

DoC runs a hybrid insourced/outsourced model with around 34% of ICT outsourced while ACMA outsources 9% of its ICT budget.

With the exception of the Gershon review findings, technology offerings within each agency were not evaluated i.e. A desk phone was considered a phone whether this was a soft phone with inbuilt video conferencing or a conventional desk phone.

The Gershon submissions provided to Galent were used to provide the size of agencies,

ICT environment demands as well as high level costs for Operating and Capital. Both

Gershon documents had discrepancies which required intensive investigation to ensure

Galent was able to compare ‘like with like’.

This review was based on one financial year only and some costs may be higher in one agency than another due to scheduling of capital purchases i.e. a mature asset

management programme or a technology refresh.


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1.2 Expenditure

Whilst DoC and ACMA ICT environments have differing levels of complexity and they provide different services to end users/clients, the agencies’ expenditure on ICT ranged

between 9-13% of their total agency expenditure. During the course of the review there were several areas that required adjustment of the submitted Cross-Agency ICT Benchmark reports. Details of the adjustments and the associated justification are

detailed throughout Section 3.

For the purpose of comparison and to facilitate the assessment of opportunities for shared ICT services which could offer overall benefits, adjusted expenditure under ICT Service Towers was analysed.

The following table summarises the original and adjusted expenditure, including the details of the adjustment and cross references to the relevant sections of this report.


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DoC ACMA DoC ACMA Adjustment Details Report Cross Reference

Service Towers

Original Submission Original Submission Revised Submission Revised Submission

Operating Capital Total Operating Capital Total Operating Capital Total Operating Capital Total

ICT Management

$3,728,627 $44,354 $3,772,981 $790,179 $472,339 $1,262,518 $533,2511 $44,354 $577,605 $790,179 $472,339 $1,262,518 Reviewing the Service Package with ASG, DoC’s operating expenditure was amended to reflect the

correct allocation of the service package. This was

further confirmed via email from DoC relating to the

proportion breakdown of each package. The total revised expenditure for DoC, does not include any costs

associated with the CIO or administrative support staff.

Observations 1-2

Applications $6,058,397 $2,343,263 $8,401,660 $2,633,976 $11,311,405 $13,945,381 $6,058,397 $2,343,263 $8,401,660 $2,633,976 $2,996,4052 $5,630,381 To achieve a standardised comparison, the costs

associated with ACMA’s capital initiatives were reviewed. A large portion of these were deemed to be

similar to the NBN rollout undertaken by DoC and were

therefore removed.

Observations 3-4

Midrange $392,438 $1,193,359 $1,585,797 $185,813 $63,582 $249,395 $2,071,4703 $1,193,359 $3,264,829 $185,813 $63,582 $249,395 Reviewing the Service Package with ASG, DoC’s

operating expenditure was amended to reflect the correct allocation of the service package. This was


proportion breakdown of each package.

Observations 5-6

Storage $57,331 $249,909 $307,240 $0 $0 $0 $57,331 $249,909 $307,240 $0 $0 $0 Not adjusted Observation 7

WAN $381,483 $0 $381,483 $493,780 $0 $493,780 $556,7754 $0 $556,775 $493,780 $0 $493,780 Reviewing the Service Package with ASG, DoC’s operating expenditure was amended to reflect the




Observations 8-9

Gateway $1,010,113 $301,278 $1,311,391 $248,708 $0 $248,708 $288,0005 $301,278 $589,278 $248,708 $0 $248,708 Transition costs for DoC were removed as per CIO request. This equates to $728k for DoC.

Observation 10

LAN and RAS $82,672 $336,348 $419,019 $0 $0 $0 $82,672 $336,348 $419,019 $0 $0 $0 Not adjusted Observation 11

End User

Infrastructure

$466,554 $50,191 $516,745 $2,865,016 $0 $2,865,016 $466,554 $50,191 $516,745 $2,865,016 $0 $2,865,016 Not adjusted Observation 12-13

Voice Services $489,752 $389,209 $878,961 $162,938 $0 $162,938 $236,1226 $389,209 $625,330 $162,938 $0 $162,938 Reviewing the Service Package with ASG, DoC’s operating expenditure was amended to reflect the




Observation 14

Help Desk $124,215 $0 $124,215 $518,225 $0 $518,225 $1,718,8987 $0 $1,718,898 $518,225 $0 $518,225 Reviewing the Service Package with ASG, DoC’s operating expenditure was amended to reflect the




Observation 15-16

Facilities $199,887 $0 $199,887 $0 $0 $0 $199,887 $0 $199,887 $0 $0 $0 Not adjusted Observation 17-18

TOTALS $12,991,469 $4,907,910 $17,899,379 $7,898,635 $11,847,326 $19,745,961 $12,269,356 $4,907,910 $17,177,268 $7,898,635 $3,532,326 $11,430,961

1 The Operating Expenditure for DoC was altered to reflect the correct proportion of the outsourced Service Package allocation as per email advice

2 The Capital Expenditure for ACMA was altered to allow a like-for-like comparison by removing the NPP and Government initiatives similar to NBN



5 Transition costs relating to gateway for DoC have been removed. There were no identifiable costs for ACMA for this activity as ACMA’s change represented a change in contract only




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1.3 Summary of Observations

Whilst no customer satisfaction survey was undertaken as part of this review, the assumption was that both the outsource provider was meeting service levels and ACMA ICT met user expectations. Analysis determined that the operating costs for the DoC hybrid ICT model do appear to be a more expensive when compared to ACMA costings.

Based on the analysis undertaken, there appears to be evidence that DoC and ACMA

could achieve an overall reduction in the cost of ICT service delivery (with potentially improved service levels) through either a “shared services” or “centres of excellence” delivery model. It is also noted that whilst DoC and ACMA networks do have different security classifications, the enclave based security model already implemented within ACMA would support DoC to utilise the same network.

The following observations provide an indication of the potential opportunities and cross reference to the respective service towers in Section 3.

1.3.1 Observations

1.3.1.1 Observation 1 –DoC CIO Cost Attribution

Service desk costs for the large number of service desk calls within ACMA is relatively cost effective when compared with DoC.

Whilst it appears that DoC are less expensive for the overall ICT Management, if the costs associated with the CIO and administrative staff were allocated to this service tower, the costs would be comparative to ACMA. The costs associated with the DoC CIO

and administrative support staff has not been included in the revised table. The DoC Enterprise Agreement does not capture the salary range for SES Level staff and Galent were unable to obtain financial information about the actual costs of these staff to allow a revised ICT Management expenditure to be facilitated.

1.3.1.2 Observation 2- Expanded Responsibility

If a shared service model was adopted, a review of the organisational structure including responsibilities is likely to enable the better allocation of resources to address key pressures within both organisations.

1.3.1.3 Observation 3 –Ability to share Web based services

Both organisations have a significant and modern web presence - there appears to be

opportunities to realign the technical capability across both organisations including support personnel. DoC appears to offer significant capability within this area.

1.3.1.4 Observation 4- Financial & Human Resource Systems

Both organisations utilise enterprise financial and Human Resource systems with specific licences and support personnel. The rationalisation of the systems could contribute to

cost savings (noting the investment required for transition).

1.3.1.5 Observation 5 – Outsourcing Agreement

In consideration of an alternative service delivery model, it would be timely to review the outsourcing agreement between DoC and ASG, taking into consideration both adjusted volumes and scope of service. It is noted that 45.84% of the outsourcing contract

relates to Midrange operations, where the analysis indicates ACMA’s cost of delivery is lower. (DoC expend $2.07m on Midrange services whilst ACMA expend $0.185m.)


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1.3.1.6 Observation 6 – Server utilisation

Average monthly server utilisation across DoC servers was reported as 55% while ACMA server utilisation was 10% for the same period. There could be cost savings across both organisations if infrastructure was load balanced to increase the average server utilisation and bring down the number of physical servers required.

1.3.1.7 Observation 7 – Shared Storage

ACMA recently purchased large storage holdings including some designed to host transaction intensive systems. There would appear to be sufficient capacity to

accommodate relevant DoC systems.

1.3.1.8 Observation 8 –Shared support arrangement of WAN

ACMA have an in-house capability of managing WAN services. Professional services costs associated with this capability could be reduced if a shared support arrangement with DoC was established.

1.3.1.9 Observation 9 –Non-ICON Link oversubscription

It may be possible to reduce costs of DoC’s Non-ICON links given the WAN utilisation is significantly low.

1.3.1.10 Observations 10 –Shared support arrangement for Gateway Services

Comparing the operating financials submitted by both agencies indicates that DoC expends $0.288m whilst ACMA expend $0.248m. Noting the overall costs of gateway

services are similar, in preparing the observation, only the annual maintenance costs of the gateways (DoC -$0.288m; ACMA -$0.063m) were used and indicate that there may be financial benefits in DoC leveraging ACMA’s capability and capacity.

1.3.1.11 Observations 11–Shared LAN and RAS Infrastructure

Through the implementation of a single pool of spares for LAN and RAS infrastructure, it

is likely that some reduction in costs could be achieved.

1.3.1.12 Observations 12 – Sharing End User Infrastructure

Based on the submissions, it would appear that there are a significant amount of spare desktops and laptops within both agencies. Currently DoC have 735 desktops against a total agency FTE of 628 with ACMA reporting 675 desktops with an agency FTE of 540. If

a shared arrangement was implemented, the requirement for a large surplus stock could be reduced. This is also likely to result in a reduction in software licences.

1.3.1.13 Observations 13 – Shared Service Operation Staff

A benefit to implementing a shared service model for the delivery of End User Infrastructure would be the reduction in risk to both agencies. The consolidation of

service operation staff would facilitate the backing up of key personnel supporting a particular technology. Sharing a pool of resources across both agencies would also allow for better capacity management.


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1.3.1.14 Observation 14 – Difference in Voice Systems

It was noted that each agency has different desk-based phone systems and different requirements for mobile devices (blackberry or satellite phones). Accordingly, it would appear that a shared service arrangement is unlikely to deliver reduced costs for voice services.

The transition costs associated with converting to a similar environment and/or system may exceed the benefits that could be achieved through a shared arrangement.

1.3.1.15 Observation 15 – Help desk and Switchboard efficiencies

Both agencies performing similar activities within their ICT help desk and there may be cost efficiencies if a combined help desk was delivered by a single agency (as part of an overall integrated service ICT service delivery model). Similarly, switchboard operations across both agencies may also result in reduced costs from a combined switchboard

function.

1.3.1.16 Observation 16 – Help desk reporting tools

DoC exhibited a capability to accurately report the details associated with the help desk calls. This tool has reached effective maturity and if a joint ICT Help Desk was established consideration should be given to utilising this tool as the support product.

1.3.1.17 Observation 17 – Co-location of Primary Data Centre

ACMA has purpose built facility, with ample capacity for addition servers and there would appear to be an opportunity for ACMA to host both agencies primary systems in Belconnen.

1.3.1.18 Observation 18 – Co-location of Disaster Recovery Site

If both agencies are paying commercial contracts for separate Disaster Recovery sites,

there would appears to be benefit in consolidation of the capability. Alternatively, it may also be an option for the hosting of the Disaster Recovery site at DoC’s office (with appropriate measures implemented).


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2 Background

2.1 Department of Communications (DoC)

As the portfolio lead agency the Department of Communication (DoC) reported a total agency FTE of 628 with 41.4 of these FTE allocated to the ICT.

Department of Communication has been classified as a medium insource policy agency, who recovers minimal revenue.

DoC have recently consolidated office locations within Canberra and now reside at 38

Sydney Avenue, Forrest. DoC have additional premises in New South Wales and Victoria. The primary data centre is also located at 38 Sydney Avenue. This data centre holds most, but not all primary systems. The Disaster Recovery (DR) site is located out of the Canberra CBD at leased facilities. It is noted that some primary systems are also located in the DR facility.

Through its managed services to outsource provider ASG, the below service packages are provide to DoC and encompass the following services:

1: End User Support Services (28.69%)

2: Midrange (45.84%)

3: Voice (3.33%)

4: Network Services (4.33%)

5: Cross Platform Services (10.16%)

6: Switchboard Operations (6.97%)


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The (%) allocated next to each Service Package is reflective of the proportion of total

Outsourcing costs that have been attributed to the respective service towers and is based on advice from DoC. Reviewing the service package agreement, ASG indicate that SP5 (Cross Platform Services) is to be attributed across all other Service Packages.

Attachment B provides a list of systems that DoC support.

2.2 Australian Communication and Media Authority (ACMA)

As a portfolio partner in the Department of Communications portfolio, ACMA reported a total agency FTE of 540 with 57 of these FTE allocated to ICT.

ACMA has office locations within Melbourne, Sydney, Parramatta, Brisbane, Hobart and Canberra and is considered as having enforcement activities across broadcasting, telecommunications and internet regulation which include the investigation of suspected breaches.

ACMA is a licencing agency and as such collects a substantial amount of revenue annually.

ACMA’s office location in Canberra was a purpose built facility and has been designed to accommodate both high and low side ICT capabilities within their data centre.

ACMA uses an Enclave based security model to manage appropriate controls around its information of different classification across its network.

The ICT area does not provide Operating Level agreements for the services they offer to their clients, however some “Guarantees of service” exist for a number of internal business areas.

Attachment B provides a list of systems that ACMA support.

2.3 Methodology

The process used to assist in understanding the ICT costs and the viability of either a full or partial shared service approach was through the commissioning of an analysis of each

agencies original Cross-Agency ICT Benchmarking report for the 2012 – 2013 financial period. This analysis identified inconsistencies across each of the reports which required further clarification and/or backing documentation be supplied by each of the agencies.

The erroneous data within both agencies submissions mostly related to interpretation of the questions although there were a few that have been described as ‘typographic’

errors. Upon the discovery of the inconsistencies, Galent performed a ‘deep-dive’ into the expenditure to not only better understand the items that each agency believed should be included in the overall submission but also the subsequent Service Towers and

Cost Elements. This ‘deep-dive’ allowed Galent to better understand the individual agencies, the general operations as well as the ICT environments and challenges that each ICT divisions is exposed to. To ensure a consistent methodology across all Service Towers, when this data was jointly mapped, any variances (+/- 30%) were investigated further and formed the detailed analysis under Section 3.

The investigations consisted of personal interviews, email questions to each agency and regular phone discussions. Documents including the ASG Statement of work (Department of Communications) and both Annual Reports were also reviewed to adopt a more holistic understanding of the departments.


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Comparisons were made against the Department of Finance (AGIMO) Cross-Agency ICT Benchmarks 2012-13: All FMA Act Agencies report.

Follow up meetings with the Agency’s CIO and their Deputies were conducted to seek clarification to support the analysis.

2.4 Agency Financial comparison

Following the amendments to the Cross-Agency ICT Benchmarking submissions, the total ICT expenditure (Operating and Capital) against the overall Agency’s expenditure was:-

• DoC ($17.1m, 12%); and

• ACMA allocating ($11.4m, 8.8%).

As part of the Cross-Agency ICT Benchmarking report, both agencies were categorised as “Medium, Insourced / Policy (IP)”. On average, during the 2012-13 financial year medium insourced/policy agency’s spent $20.6million.

2.5 Service Tower Analysis

The above graph illustrates the combined operating and capital expenditure across all service towers for both agencies.

As represented, there are some key areas demonstrating significant variance which are outlined in Section 3. The analysis conducted in Section 3 will focus on the financial

$120,316,063

, 88%

$17,177,266 ,

12%

Figure 1: DoC - Operating & Capital Expenditure

Total Agency Expenditure

(Opex & Capex)

Total ICT Expenditure

(Opex & Capex)

$118,972,803 ,

91.2%

$11,430,961 ,

8.8%

Figure 2: ACMA - Operating & Capial Expenditure

Total Agency Expenditure

(Opex & Capex)

Total ICT Expenditure

(Opex & Capex)

ICT

ManagementApplications Midrange Storage WAN Gateway LAN and RAS

End user

infrastructureVoice services Helpdesk Facilities Non BAU-ICT

ACMA $1,262,518 $5,630,381 $249,395 $- $493,780 $248,708 $- $2,865,016 $162,938 $518,225 $- $6,885,691

DoC $577,605 $8,401,660 $3,264,829 $307,240 $556,775 $589,278 $419,019 $516,745 $625,330 $1,718,898 $199,887 $5,220,252

$-

$2

$4

$6

$8

$10

$12

$14

$16

MIL

LIO

NS

Combined Operating & Capital by Service Towers


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comparison of service towers and identify the linkage to the corresponding cost elements.


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3 Comparative Analysis

To better understand the viability of implementing a shared service approach, either fully or partially, across DoC and ACMA, Galent analysed the full ICT expenditure at the Service Tower level and where appropriate reviewed and explored components of the cost elements. The information detailed below is the main Service Towers where there

was a +/- 30% variant. It should not be viewed that this is the only factor when considering the benefits of a shared service facility.

3.1 Resourcing

Whilst both agencies provided ICT support to its clients, the way in which this support is

provided was quite different. DoC provided a predominantly outsourced model with an in-house management structure, while all ICT support staff within ACMA are in-house FTE. Both agencies have a Chief Information Officer (noting that DoC have reported this

to be only a 0.75FTE) with subordinate EL2’s. It is understood that the additional .25 FTE is allocated to the management of facilities.

Both agency have components of ICT outsourced to external providers that encompass both cloud and non-cloud services. These resources are not included in the following table:

Agency APS3 APS4 APS5 APS6 EL1 EL2 SES1 Ext. TOTAL

DoC 0.10 2.10 2.50 8.30 14.65 7.00 0.75 6.00 41.40

ACMA 0.00 2.00 2.00 15.00 19.00 3.00 1.00 15.00 57.00

TOTALS 0.10 4.10 4.50 23.30 33.65 10.00 1.75 21.00 98.40

Variance8 0.10 0.10 0.5 -6.7 -4.35 4.00 -0.25 -9.00 -15.60

3.2 Service Tower Breakdown (Original and Revised)

To facilitate a ‘like for like’ assessment of expenditure and to highlight possible areas that may benefit from a shared service concept, clarification was sought on discrepancies. Based on justification provided, service towers were adjusted accordingly as reflected in the above table. These adjustments related mainly to the distribution of

the 6 Service Packages that are outsourced by DoC to ASG and removal of ACMA NPP initiatives.

Detailed analysis of the service towers and key observations follow.

8 The above variance highlights the difference in resourcing levels between DoC and ACMA. This does not include the outsourced component.


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3.2.1 ICT Management

The disparity between both agencies relates mainly to the interpretation of the guidance documentation. Guidance documentation9 indicates that this Service Tower should

include “the costs of 100% of the CIO even if the incumbent is only acting in that role or works across shared function e.g. Finance / HR and associated costs of any administrative staff that support the CIO e.g. EA’s or PA’s”.

Clarification from ACMA revealed that whilst they did attribute the costs of the CIO to

this service tower, it would appear that there were no costs associated with any direct administration staff included in their submission. In contrast, DoC have attributed only 0.75 of the CIO under the FTE component but have not included any expenditure costs

towards this service tower.

It was further revealed that the original submission from DoC had attributed portions of the outsourcing to the ICT Management which to facilitate a comparison has been adjusted according to the proportion allocation previously mentioned.

Observation 1- DoC CIO Cost Attribution

Service desk costs for the large number of service desk calls within ACMA is relatively cost effective when compared with DoC.

Whilst it appears that DoC are less expensive for the overall ICT Management, if the

costs associated with the CIO and administrative staff were allocated to this service tower, the costs would be comparative to ACMA. The costs associated with the DoC CIO and administrative support staff has not been included in the revised table. The DoC

Enterprise Agreement does not capture the salary range for SES Level staff and Galent were unable to obtain financial information about the actual costs of these staff to allow a revised ICT Management expenditure to be facilitated.

Whilst it appears that DoC are less expensive for the overall ICT Management, if the

costs associated with the CIO and administrative staff were allocated to this service tower, the costs would be comparative to ACMA.

Observation 2- Expanded Responsibility

If a shared service model was adopted, a review of the organisational structure including

responsibilities is likely to enable the better allocation of resources to address key pressures within both organisations.

3.2.2 Applications

Expenditure under Applications Service Towers should include programs and other

software that perform ‘user or business related processing functions’. Software does not include the actual tools or utilities used to deliver the service. Software that relates to specific hardware such as Midrange servers should not be attributed to this Service Tower but should be included in the overall Midrange costs.

Of the total 41.4 ICT BAU FTE, DoC have confirmed that 29.2 ICT BAU FTE are correctly attributed to this tower as DoC include Web Services, Information Management, Mapping and Systems Development and Procurement and Finance Systems in this category.

9 AGIMO Cross-Agency ICT Benchmarks 2012-13


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ACMA have 17 ICT BAU FTE (out of 57) allocated to the Applications service tower. ACMA initially had a significantly high capital expenditure ($11.3m) but upon further

explanation approximately $8.3m of this related to government specific initiatives or NPP’s which have been removed from the capital expenditure.

These initiatives included:

• Australian Internet Security ($0.471m)

• Spam Intelligence Database ($0.277m)

• Cybersmart Website ($0.118m)

• New Licensing System (Project HELM) ($2.7m)

• New Industry Media Reporting Systems (Project MICE) ($1.08m)

• Case Management and Information System (DNCR/SPAM) ($1.4m)

• Online Content Investigation System (PACMAN) ($1.43m)

• Quarterly System Enhancements ($0.839m)

Both DoC and ACMA have specific government initiatives and for the purpose of a comparison, these costs have been removed. Without obtaining an itemised expenditure reports the assumption has been made that the staffing and supplier costs have been

correctly attributed.

Observation 3 –Ability to share Web based services

Both organisations have a significant and modern web presence - there appears to be

opportunities to realign the technical capability across both organisations including support personnel. DoC appears to offer significant capability within this area.

Observation 4- Financial & Human Resource Systems

Both organisations utilise enterprise financial and Human Resource systems with specific

licences and support personnel. The rationalisation of the systems could contribute to cost savings (noting the investment required for transition).

3.2.3 Midrange

Midrange is considered to be the services, hardware, software, functions, personnel and

activities involved in running server applications and capacity. The initial submission from DoC indicated that they attributed $0.392m to this service tower. Upon discussions with DoC and further analysis of the service packages it was uncovered that this figure was not correct as a portion of the service packages should have been attributed to

Midrange. Galent reviewed the high level agreement with ASG and following advice from DoC relating to the portion to attributed, the operating component for DoC was amended to $2.07m accordingly. Midrange services are currently outsourced by DoC and advise is that approximately 46% of the total outsource expenditure relates to these services

against only $0.185m for ACMA.

During 2012-13 DoC expended $1.1m in Capital for Midrange which included Cloud Offering for Dev Test. As Capital is an ad hoc arrangement it has not been considered in

the overall evaluation of this service tower.


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Observation 5 – Outsourcing Agreement

In consideration of an alternative service delivery model, it would be timely to review the

outsourcing agreement between DoC and ASG, taking into consideration both adjusted volumes and scope of service. It is noted that 45.84% of the outsourcing contract relates to Midrange operations, where the analysis indicates ACMA’s cost of delivery is lower. (DoC expend $2.07m on Midrange services whilst ACMA expend $0.185m.)

Observation 6 – Server utilisation

Average monthly server utilisation across DoC servers was reported as 55% while ACMA server utilisation was 10% for the same period. There could be cost savings across both organisations if infrastructure was load balanced to increase the average server

utilisation and bring down the number of physical servers required.

3.2.4 Storage

ACMA have confirmed that they did not incur any costs associated with Storage during the 2013-14 FY. ACMA have further indicated that they have available storage and

would be willing to allow DoC access to this.

Observation 7 – Shared Storage

ACMA have recently purchased large storage holdings including some designed to host transaction intensive systems. There would appear to be sufficient capacity to

accommodate relevant DoC systems.

3.2.5 WAN

Based on the breakdown provided by DoC, this tower was adjusted to cover the proportion of the Service Package that is outsourced. Along with the operating finances

being adjusted, DoC further revised their Total WAN Capacity from 440 Mbps to 49,672Mbps. This figures appears to be magnitudes larger than ACMA (3,282 Mbps) but the expenditure for both agencies is similar with only an 11% variance.

ACMA have advised that due to the accounting convenience, they include all the LAN costs within this service tower. Despite this, they still appear to be able to provide both a WAN and LAN service for less costs then DoC have reported for WAN and LAN.

Non-ICON Link average utilisation 1% compared to ACMA’s 75%. An explanation of this low utilisation may relate to over capacity links. This would also increase the operating costs of such links.

Observation 8 –Shared support arrangement of WAN

ACMA have an in-house capability of managing WAN services. Professional services

costs associated with this capability could be reduced if a shared support arrangement with DoC was established.

Observation 9–Non-ICON Link oversubscription

It may be possible to reduce costs of DoC’s Non-ICON links given the WAN utilisation is significantly low.


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3.2.6 Gateway

It is understood that DoC outsourced the consolidation of their gateways to Verizon as per the AGIMO panel through ASG during 2012-13. Advice received indicates that this

costs was approximately $0.722m which has been removed for comparison purposes, as ACMA gateway transition costs were nil during the period being reviewed. ACMA have confirmed that the annual cost of their Gateway is $0.063m and that during 2012-13 the balance of their operating costs were to cover the Secure Gateway component.

Observations 10 –Shared support arrangement for Gateway Services

Comparing the operating financials submitted by both agencies indicates that DoC expends $0.288m whilst ACMA expend $0.248m. Noting the overall costs of gateway services are similar, in preparing the observation, only the annual maintenance costs of the gateways (DoC -$0.288m; ACMA -$0.063m) were used and indicate that there may

be financial benefits in DoC leveraging ACMA’s capability and capacity.

3.2.7 LAN and RAS

ACMA’s submission indicated no costs were allocated to this service tower. Following discussions with ACMA it was confirmed that as the costs are minimal, they do not

distinguish between LAN and WAN and therefore costs associated with LAN have been captured in the WAN service tower.

Observations 11 –Shared LAN and RAS Infrastructure

Through the implementation of a single pool of spares for LAN and RAS infrastructure, it

is likely that some reduction in costs could be achieved.

3.2.8 End User Infrastructure

Given the environment that DoC operate in, the expenditure attributed to EUI appears significantly low. It is appreciated that the expenditure under this service tower can be

dependent on many elements including whether the agency has completed a technology upgrade during the previous financial years. The review determined that both DoC and ACMA’s expenditure are outside the average for medium agencies (13%). DoC currently

spends 3% and ACMA 31% against this service tower. Advice from ACMA is that the expenditure during 2012-13 financial year was mainly associated with Peripherals and others ($1.05m), Handover and PIR ($0.5m), Desktops ($0.38m), Printers ($0.17m) and Analysis ($0.16m).

Contributing to the significant variance, is 1 FTE for DoC compared to ACMA having 18

FTE (16 internal and 2 external) allocated. DoC have advised that most of their staff are attributed to Applications service tower which may explain some of the variance in this service tower.

Observations 12 – Sharing End User Infrastructure

Based on the submissions, it would appear that there are a significant amount of spare

desktops and laptops within both agencies. Currently DoC have 735 desktops against a total agency FTE of 628 with ACMA reporting 675 desktops with an agency FTE of 540. If a shared arrangement was implemented, the requirement for a large surplus stock could be reduced. This is also likely to result in a reduction in software licences.


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Observations 13 – Shared Service Operation Staff

A benefit to implementing a shared service model for the delivery of End User

Infrastructure would be the reduction in risk to both agencies. The consolidation of service operation staff would facilitate the backing up of key personnel supporting a particular technology. Sharing a pool of resources across both agencies would also allow for better capacity management.

3.2.9 Voice Services

DoC outsource this component under Service Package 3. The proportion that is attributed to this tower was revised based on their advice. The Operating costs across both agencies are comparable but benefits may be forthcoming from sharing services

and equipment. Both agencies have indicated that there are surplus desk phones and mobile devices which, depending on the specific requirements of each agency may be able to be shared as a pool.

Whilst surplus mobile phones are identified, it is noted that both agencies appear to use different types for examples, DoC use Blackberries whilst ACMA utilise a majority of iPhones with some Satellite phones for some field staff.

Observation 14 – Difference in Voice Systems

It was noted that each agency has different desk-based phone systems and different requirements for mobile devices (blackberry or satellite phones). Accordingly, it would appear that a shared service arrangement is unlikely to deliver reduced costs for voice

services.

The transition costs associated with converting to a similar environment and/or system may exceed the benefits that could be achieved through a shared arrangement.

3.2.10 Help Desk

Both DoC and ACMA do not appear to have the traditional “ICT Helpdesk” with both

agencies utilising this capability as a first point of contact for enquiries. ACMA receive

calls relating to field staff needing assistances (i.e. – flat tyre) with DoC covering

business aspects including calls relating to Facilities (i.e. – toilet needs cleaning).

ACMA operate a fully in-housed Help Desk whilst DoC operate a fully outsourced first

point of contact although there appears to be management oversight of the contract.

A review of an agency’s Helpdesk calls often indicates the technical ICT health of the agency. DoC reportedly had 38 calls logged for every FTE (updated figures) while ACMA reported 25 support calls for each FTE. Interestingly, ACMA indicated that the high

volume logged was due to the significant helpdesk scope that ACMA provides to its client base. i.e., some staff would log a service call through the helpdesk to purchase tyres for ACMA transit vans. Closer analysis of DoC helpdesk reveals a similar service delivered to

clients but this is definitely a more thorough service as DoC’s service provider also logs calls for Facility maintenance (i.e. – toilet cleaning, blocked toilets, air conditioner issues).

Given the out of the norm scope of both agencies helpdesk activities, it would appear viable for a single help desk to be formed with the primary triage undertaken by the

level 1 and with the use of a matrix, calls would be forwarded to ‘resolver groups’ for each agency.

This would however require the use of one service desk tool across both agencies or configuration of a connector to allow support calls to traverse the separate systems.


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On reviewing the breakdown of DoC support calls, it was noted that there was an inconsistent approach to the classification placed on calls. i.e. – this has flow on effects

when a major incident occurs or when problem management activities are being performed.

It would appear that ACMA are able to operate a fully ‘in-housed one-stop shop’ for approximately 30% of what it appears to cost DoC for the equivalent out-sourced

concept.

Observation 15 – Help desk and Switchboard efficiencies

Both agencies performing similar activities within their ICT help desk and there may be cost efficiencies if a combined help desk was delivered by a single agency (as part of an

overall integrated service ICT service delivery model). Similarly, switchboard operations across both agencies may also result in reduced costs from a combined switchboard function.

Observation 16 – Help desk reporting tools

DoC exhibited a capability to accurately report the details associated with the help desk calls. This tool has reached effective maturity and if a joint ICT Help Desk was established consideration should be given to utilising this tool as the support product.

3.2.11 Facilities

It was reported that DoC operate a primary data centre from within its head office in Forrest.

ACMA also run its primary data centre from its head office which is based in Belconnen. A personal visit to the site revealed a purpose built facility that holds systems of various

classifications. There appeared to be ample capacity to host additional hardware within this secure environment.

Both DoC and ACMA utilise separate commercial facilities to host their Disaster Recovery site.

Observation 17 – Co-location of Primary Data Centre

ACMA has purpose built facility, with ample capacity for addition servers and there would

appear to be an opportunity for ACMA to host both agencies primary systems in Belconnen.

Observation 18 – Co-location of Disaster Recovery Site

If both agencies are paying commercial contracts for separate Disaster Recovery sites,

there would appears to be benefit in consolidation of the capability. Alternatively, it may also be an option for the hosting of the Disaster Recovery site at DoC’s office (with appropriate measures implemented).

3.2.12 Carriage Cost Element

AGIMO define carriage as “a service for carrying communications by means of guided and/or unguided electromagnetic energy”. Carriage services are attributed to two main Cost Elements being:-

• WAN – costs relating to data services and volume; and

• Voice Services – costs relating to voice, video services and volume.

The information summarised in the below table highlights the difference between both agencies and has been based on the revised details provided by DoC.


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Key points relating to the Carriage information are:

• Despite both agencies having costs attributed to the service tower and cost

elements, neither agency indicated any dedicated FTE (either whole or in part) that is assigned to ensuring these functions are completed. In the case of DoC, “Schedule 3 Statement of Work” indicate that Voice, LAN and WAN costs are outsourced to ASG.

• Along with the costs indicated below, DoC also have reported Capital expenditure for Voice Services totalling $389,208

Service Towers DoC ACMA

Total Costs $68,830 $895,288

WAN

Costs $381,483 $493,780

Capacity (Mbps) 49,67210 3,282

Links 1811 21

Voice

Fixed Users 735 625

Fixed Devices 735 680

Mobile Users 88 10

Mobile Devices 88 (Blackberry) 10 (Satellite Phones)

SmartPhone Users 10512 215

SmartPhone Devices 165 215 (iphones)

Costs $489,752 $162,938

3.2.13 Services Outsourced to External Providers

For the purpose of the ICT Benchmarking Comparisons, agencies are required to report on the Services Outsourced according to four categories:-

• Services Outsourced to external providers (cloud)

• Services Outsourced to external providers (non-cloud)

• Services Outsourced to FMA Act agencies (cloud)

• Services Outsourced to FMA Act agencies (non-cloud)

Neither agency identified costs (either Operating or Capital) for Services Outsourced to

FMA Act agencies (cloud) with ACMA only reporting Operating expenditure against Services outsourced to external provider (non-cloud) as identified in the table below.

10 Revised figure from DoC. Original figure was 440Mbps.

11 Revised figure from DoC. Original figure was 6 Links.

12 DoC report that some SmartPhone users have multiple devices but this appears to be a reporting discrepancy.


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Cost Elements DoC ACMA

Operating Capital Operating Capital

Services outsourced to

external provider

(cloud)

$187,560 $0 $0 $0

Services outsourced to

external provider (non-cloud)

$5,464,244 $90,000 $1,789,946 $0

Services outsourced to FMA Act Agencies (non-cloud)

$379,821 $0 $0 $0

Total

Outsourced

$6,031,624 $90,000 $1,789,946 $0

3.2.14 Others

ACMA have reported $0.763m against this cost element which is significantly higher than

DoC who only reported $0.004m. ACMA have confirmed that they included services relating to Postage, Recall & Document Storage, Stationary, Subscription Services (including VUM and Research), Ink, Couriers and Library within this expenditure. Some of these services relate more to Information Management and appear that they would be better placed against other specific elements. Further advice from ACMA is that they expend a large amount annually on postage.

Whilst this is not identified by the Gershon review definitions as ICT, ACMA included this in its costs as Information Management is part of ICT in its agency.


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4 Shared Service Opportunities

Traditionally there are two arguments for sharing services across agencies being ‘less of a common resource’ and ‘efficiency through industrialization’ with most agency undertaking this as a ‘less of a common resource’ perceptive which simply means that through amalgamation you will require less managers, less resources and thereby

reduce costs.

Service delivery to clients generally can be implemented easier as this usually involves ‘Back-of-House’ services such as HR, finance, payroll and ICT. DoC and ACMA, while

both operating in a complex environment and having vastly different responsibilities to the Australian Public and Australian Government, have some services and system where operating a joint shared service model may prove beneficial to all parties.

Galent have reviewed all documentation provided by DoC and ACMA and based on the

environmental awareness that has been able to be drawn from these have identified some areas where a shared arrangement may prove valuable to both parties.

Both agencies utilise similar infrastructure to support their respective business domains.

Whilst this isn’t unusual in a Federal Government context, there are technology platforms that could be supported by one agency on behalf of the other, to reduce the overall cost of ownership to each agency.

To deliver a shared services arrangement, a full costing model would need to be developed to ensure all parties are in agreement to the scope, costs, impacts, benefits,

duration and service level obligations. A shared services arrangement should also be used to mature existing processes and reduce risk to agencies through greater ICT functional resilience.

As indicated in the Summary of Observations, Galent has identified 18 key areas where

either a fully or partially shared arrangement could prove beneficial to finding efficiencies, reducing risk and enhancing ICT functional capability.


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Attachments


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Attachment A. Consultations

Department of Communications (DoC)

Lee Di Berardino, CIO

Tonina Staunton, ICT Manager, Web Services

Russell Wentworth, Manager, Infrastructure & IT Security

Henry Tabisz, Manager, Information Management

Australian Communications and Media Authority (ACMA)

Carsten Larsen, CIO

Karl Maftoum, Deputy CIO


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Attachment B. Departmental Systems

DoC ACMA

System Function System Function

TM1 Finance Reporting tool that

supports SAP Technology One

Used Technology One

mainly for Financial Reporting

Promaster Financial management iTM1

Budgeting and reporting

application used in conjunction with Technology One finance system

Corporate Directory

Front end application that provides identity management to corporate systems

Insync/SharePoint/Lync In house web application that acts as a corporate directory

Entry/Exit system Manages onboarding and offboarding of staff and contractors

Insync

In house web application that includes staff on-

boarding movement and exit workflows

MS FAST (Search)

Enterprise search capability

across multiple data stores, network drives, IMS, SharePoint, Intranet and TRIM

SharePoint Enterprise 2013 Search

The ACMA is currently trialling this platform

Information Management System

Electronic documents and records management system

TRIM, SharePoint COTS Document / records management system

Legal Point Management of legal matters and legal precedents

RecordPoint

Document Compliance

solution for SharePoint 2010 add-on solution

enabling Archives Act-compliant records management of documents and items stored in SharePoint

MS FIM (Forefront Identity Manager)

Workflow for Identity Management

MS FIM (Forefront Identity Manager)

The ACMA is developing its FIM environment and process, currently used for SSO for Aurion (ESS)

Cab Tracker System to manage documents above PROTECTED classification

eRecruitment

Hosted cloud base service from NGA.

Users have single sign-

on access to eRecruitment

ExecCorro Parliamentary liaison system Aurion HR system used to

record personnel details for staff

E-Recruit ArcGIS, Google Earth,

Spectra, ChirPlus

Graphical Information System (GIS) tools include ARCSDE Server and desktop client, and ARCGIS server


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DoC ACMA


Aurion HR system used to record personnel details for staff

Microsoft System Centre Service Manager (SCSM), SharePoint & Intranet

SCSM is used as

knowledge management

system for ICT related material. SharePoint and Intranet is used to host other knowledge related material.

Mapping Enterprise mapping

capability Aruba/Cisco/HP

Wireless access to the Internet; Network connectivity back into ACMA from ACMA

monitoring sites

Known

Information Management System (KIMS)

Red Hat, Solaris Midrange – mixture of Sun/Oracle and Intel hardware

Exchange Email, Voice mail, U/C, Link, Outlook web access

EMC/HTC/Synology/HP Tape Library

EMC storage to be replaced/augmented by HTC hybrid storage solution starting next FY

Protected Network

Internal: Transport of all

data across enterprise,

inter-floor, inter-site, Phones, Voice Ext: Email, data transfers, remote access, Communication between agencies through Secure Internet Gateway or Fedlink.

Inbound access for the public to Department websites.

Covers infrastructure at 2 data centres.

PACMAN (Protected ACMA network)

Gateway services

outsourced to VzB. (Verizon)

FedLink used in the Finance area.

Internal Network is not protected. HP hardware for LAN connectivity.

Mixture of HP and Cisco hardware for WAN connectivity.

DR data centre is a Layer 2 connected site so is treated as an extension of the primary data centre.

ACMA operate a separate network for its Protected applications and data.

UNCLASSIFIED Network

Ext: wireless internet access for mobile devices. No

Gateway or Fedlink access. Available across interstate sites.

Commvault Provides a partial backup of corporate data.

Private Cloud

Development and Test environments with full

automation and self-provisioning

AirWatch

Enterprise-grade mobile

device management, mobile application management and mobile content management


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DoC ACMA


Midrange

WINTEL and UNIX server infrastructure, both physical and virtual, located across multiple zones (PROTECTED & UNCLASSIFIED/DMZ)

Citrix XenApp

On-demand application

delivery solution that

allows apps to be virtualized, centralized, and managed in the datacentre

Storage Centralised storage location that backup, managed with appropriate access control.

Thales/Cisco

ASA/XenApp

Encryption for the

ACMA’s WAN links.

Backup

Tools to provide back up and restoration of data across all enterprise systems

Microsoft Lync 2013

The Lync system is a

fully integrated unified communications system including voice and

video.

Good For Enterprise

Mobile access to the email,

documents and shared drives on portable devices

IOS Airwatch supporting Apple iOS devices only.

The ACMA no longer has

a blackberry fleet. iOS devices are the only supported fleet.

Citrix Remote access to thin client desktop

Google Search

Direct access

Creates and encrypted comms channel between

trusted remote device and internal protected network

JTracker, TFS & SCSM

Java and .Net activity (including defects) tracking tool.

Infrastructure members use SCSM.

Unified comms

Instant message, voice, video, document collaboration and desktop

sharing with internal and external parties

Sitecore & SharePoint Sitecore is ACMA main CMS, SharePoint is also

used in some cases.

Video conferencing

Ability to video conference internal and external stakeholders; point to point, via a bridge or multi-party events with managed layouts.

AIMS

ABA information management system.

Used for managing broadcaster compliance with Aus content and children’s TV requirements, and for

investigating broadcasters.

Active Directory Manages authentication and security access controls for compatible systems

Active Directory

Manages authentication

and security access controls for compatible systems

Software patching

Automated deployment of application and security updates to servers and desktops

AISI

The Australian Internet Security Initiative (AISI) system to help mitigate the risks of malicious software (malware)

infections for Australian internet use


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DoC ACMA


Security Monitoring

Consolidated logging system

of security events of network devices, servers and workstations

Children's Television

Part of AIMS

Content assessment

management for children's TV program classification

Software deployment

Rebuild workstation and

deploy application to workstations on request.

Conference attendance request

An application for registering conferences, manage the approval processes and produce costing reports on conferences

Blackberry Mobile access to the email

and documents on portable devices

APL Apparatus Licensing

Part of the CAS suite. APL is used to calculate

apparatus licence fees and as intermediary

between CFM and licence management (RADCOM).

Facilitates the creation of financial documents and manipulation of licence

records to support licence issue, renewal, surrender, transfer and variation.

Google Search Appliance

Enterprise Search tool for departmental website

BizTalk

Microsoft messaging middleware. Used to sync data between Dynamics CRM and CAS suite/SmartNumbers. No additional services

will be developed on this platform, with functionality to be migrated to Oracle SOA when possible.

JIRA Bug tracking tool CFM

The CFM system is a set of bespoke applications written for the ACMA in 2000. The Part of the

CFM system tightly integrates with the CAS suite of application tools. CFM is a critical part of the ACMA’s financial management system:

Interfaces between Bpay, Lockbag and OPG

MediaWiki Internal WIKI to staff CHIRPlus

Engineering Tool for

Broadcast Planning

assessment. CHIRPlus is part of the LS Telcom suite of products


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DoC ACMA


SharePoint 2010

(Submission Management System)

Processing and publishing public submissions onto DoC website

COGNOS

The corporate Business

Intelligence (BI) tool

used for reporting and data analysis functions by various ACMA business streams

phpBB Forum software for online

collaboration of internal staff and General public

Conference attendance request

An application for registering conferences, manage the approval processes and produce costing reports on

conferences

Silverstripe CMS Mapping system for public CyberSafety

Web site to protect

children on the internet. Built with SiteCore content management system

Squiz Matrix CMS Serves main public facing websites

Enterprise Project Management

The Project Server 2010 platform used for Enterprise Project Management. Currently not in use and it will be

re-deployed soon.

WordPress Content Management

system that serves public facing websites

Customer Relationship Management (CRM)

Core application for

storing customer data at the ACMA (Microsoft Dynamics CRM 2011).

Currently the CRM system data is synchronised used to update into the existing CAS customer database,

and will also synchronise data into other systems being developed including as HELM and MICE

Do Not Call Register

Externally hosted

application used to maintain public database of persons not wishing to

receive telephone calls from telemarketers. Telemarketers are required to submit a copy of their databases for comparison 'washing' against the main Do Not

Call database. Outsourced to Service Stream.


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DoC ACMA


Field Survey Management System

Used to record and analyse signal strength

measurements as part of the analogue to digital TV switch-over

FSMS is a custom written application using a combination of .NET and Silverlight technologies.

FSMS integrates with the CAS suite for licensing data

HELM

Replacement for

Radcomm to manage radio-communications and broadcasting licences.

Online Payment

Gateway

Externally provided (ANZ) gateway allows allowing customers to

make real time credit card payments to ACMA without ACMA needing to record the card details

RADCOM

Radiocommunications Licence Management System used to construct radiocommunications licence/technical records,

and for Broadcast technical planning.

Spam Intelligence

Database

Database used to store

and manage spam e-mails to support handling by ISPs

Station Management and Apparatus Licensing

Electronic lodgement facility for Accredited Persons to submit technical information associated with

Apparatus Licensing (APL) and Spectrum Licensing Device Registration. Lodgement may be via a Web Forms interface or Business to Business

systems interface process

There were a number of other systems that were not added to keep this list to the main applications


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Attachment C. Cross-Agency ICT Benchmarking Definitions

Term Definition

Services

outsourced to external provider - Cloud Only (cost element)

Expenditure on Cloud services provided under a non-government third-party’s

responsibility Includes: * Full function outsourcing to a third-party provider or vendor in the market providing services defined as: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined)

-Infrastructure as a Service (IaaS) (as defined) Excludes: * Full function outsourcing to a third-party provider or vendor in the market for services other than: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined)

-Infrastructure as a Service (IaaS) (as defined)

* Services provided by the internal ICT organisation (these must be allocated to the ICT cost types (e.g., hardware, software, internal personnel, external personnel, other) NOT to outsourcing). * Carriage costs for telecommunications, such as WAN and voice carriage * Payments for services provided by other Agencies (as defined)

Services

outsourced to external provider - Non

Cloud Only (cost element)

Expenditure on Non Cloud services provided under a non-government third-party’s

responsibility Includes:

* Full function outsourcing to a third-party provider or vendor in the market for services other than: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined) -Infrastructure as a Service (IaaS) (as defined) Excludes:

* Full function outsourcing to a third-party provider or vendor in the market providing services defined as: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined) -Infrastructure as a Service (IaaS) (as defined) * Services provided by the internal ICT organisation (these must be allocated to the ICT

cost types (e.g., hardware, software, internal personnel, external personnel, other) NOT to outsourcing). * Carriage costs for telecommunications, such as WAN and voice carriage * Payments for services provided by other Agencies (as defined)


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Term Definition

Services

outsourced to FMA Act agencies - non Cloud only (cost element)

Expenditure on Non Cloud services provided under the responsibility of Agencies (as

defined) subject to the Financial Management and Accountability Act 1997 (Cth) (FMA Act); Includes services other than defined as: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined) -Infrastructure as a Service (IaaS) (as defined)

Excludes services defined as: -Software as a Service (SaaS) (as defined) -Platform as a Service (PaaS) (as defined) -Infrastructure as a Service (IaaS) (as defined) This also covers full function outsourcing to FMA Act agencies (e.g., data-centre operations, WAN operations, end user infrastructure services, application management

services etc). This specifically excludes expenditure on services provided by non-FMA Act agencies (e.g. Commonwealth Authorities and Companies Act 1997 (Cth) (CAC Act) agencies, State Government agencies or other Government entities), or from ICT vendors in the market.

Capex (Capital Expenditure)

Capital expenditure is defined in Australian Accounting Standards. It is expenditure on non-financial assets. The following Framework and AASs are most relevant in determining the recognition and valuation of Capital assets: * Framework for the Preparation and Presentation of Financial Statements [1] * AASB 116 Property, Plant and Equipment [2]

* AASB 117 Leases 2 * AASB 136 Impairment of Assets 2 * AASB 138 Intangible Assets 2

Carriage Carriage' refers to Carriage Services and is a specific cost element in two service towers:

1. WAN Service Tower; and 2. Voice Service Tower Carriage Service means a service for carrying communication by means of guided and/or unguided electromagnetic energy. Data carriage service costs and volumes should be allocated to the WAN Service Tower, and Voice and Video carriage service costs and

volumes should be allocated to the Voice service tower.

External FTE FTEs who provide services on a time and materials basis (e.g. "body shopping"). These staff are generally contractors, but may also be described by agencies as consultants (see note below). Number of external FTE is an annual average measure rather than a point in time measure; defined as the average of the number of external FTE (see definition of FTE) employed on the first day of each month for the reporting period (as defined). Note: "Consultants" should be captured as part of "Total external FTE" only if they

provide their services on a time and materials basis and are under the direct control of an agency. If consultants provide their services on a "fixed price" basis to achieve a set

outcome and are not under the direct control of an agency, they should be excluded from any external FTE numbers. The Commonwealth Procurement Guidelines (Financial Management Guidance No 15) may be of assistance to agencies in determining whether consultants should be captured as part of external FTE. [See http://www.finance.gov.au/Publications/fmg-series/15-guidance-on-procurement-

publishing.html]

Hardware

expenditure

Expenditure on purchasing, leases, maintenance and repair for all physical ICT

equipment, such as servers, PCs, terminals, printers, peripherals, printing equipment, networking and telecommunications equipment, materials/accessories and disaster recovery hardware.

Internal FTE Direct employees of an agency defined as permanent full time, permanent part time,

temporary and casual APS FTEs, including FTEs on leave.


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Term Definition

Non-BAU ICT

Expenditure

Non-BAU ICT expenditure is defined as the subset of ICT expenditure that relates to

significantly extending or enhancing an organisation’s current ICT capabilities. These efforts are typically run as projects with a defined start and end date and include: * Developing major new functionality (i.e., end-user functionality) within an existing or new application * Providing significant new technology capability (e.g., server virtualisation) * Significant upgrade/refresh of application software or operating systems (i.e., SAP version upgrade; Upgrade to Microsoft Vista).

Non-BAU ICT

FTE

Non-BAU FTE are those full time equivalent staff, or a proportion of a FTE if that FTE

performs both BAU and non-BAU functions, (including permanent full time, permanent

part time, casual, and contractors) that undertake Non-BAU ICT activities (as defined) and contribute to Non-BAU ICT expenditure (as defined).

Other expenditure

Expenditure on occupancy, facilities, utilities and other ICT spend not captured in hardware expenditure, software expenditure, internal personnel expenditure, external personnel expenditure, expenditure on services outsourced to FMA Act Agencies (as defined) or to other third parties, carriage expenditure (in WAN and Voice service towers only).

Software expenditure

Expenditure on licences, as well as repair and maintenance for external and standard software, systems software, and standard office productivity applications as they apply to each service tower and the total agency level. Excludes internal personnel expenditure for software maintenance (see internal and external personnel cost) as well as external

services, expenditure on services outsourced to FMA Act Agencies (as defined) or to other third parties, carriage expenditure (in WAN and Voice service towers only).

Applications Programs and other Software (including the supporting documentation, media, on-line

help facilities and tutorials) that perform user or business related information processing functions. Application Software does not include the tools, utilities, or System Software used to deliver it. Applications include database management Software. Note: Specific applications may be allocated to the Applications service tower or relevant infrastructure service towers. For example:

* Office Productivity Applications and licences should be allocated to the End User Infrastructure service tower * SAP licences (including client licences) should be allocated to the Application service towers * Expenditure related to operating systems for midrange servers should be allocated to the Midrange service tower * Desktop operating systems expenditure should be allocated to the End User

Infrastructure service tower


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Term Definition

End user

infrastructure

Services, hardware, software, personnel, functions, activities and responsibilities that are

provided directly to end-users in an Agency (as defined). Hardware includes desktop and laptop computers, thin clients, PDAs, and support of these activities, software (including SOE and client software), distributed file, email and print servers, peripherals such as printers and scanners, and Level 2 and Level 3 support and maintenance for these devices. Excludes Blackberry devices which are captured in Voice services. Includes all processes, procedures, tools and resources necessary to support the complete lifecycle of desktop technologies and the end user computing

environment, including procurement of assets, IMAC, configuration management, troubleshooting, repair and refresh of all computing hardware, peripherals, operating systems, software, client connectivity and access necessary for end users to perform required business functions. Includes: * Desktops, laptops, handhelds and associated services, hardware, software and maintenance costs

* Peripherals, including personal storage devices and associated services, hardware, software and maintenance costs * Printers and associated services, hardware, software and maintenance costs * All Directory Servers (e.g. Active Directory servers), Email Servers (e.g. Exchange Servers), File Servers, Print Servers and their related operating software and CALs and associated services, hardware, software and maintenance costs. Note that this includes ALL email, file and print servers - whether they are physically centralised in a data

centre, or physically distributed at offices and branches

* All Terminal servers, thin clients (including stateless clients) and associated services, hardware, software and maintenance costs * Ongoing software licence charges for SOE packaging costs, Windows server and client operating systems, Office productivity software and other end user software ongoing licence costs and associated services and maintenance costs Excludes:

* LAN equipment and services * Blackberry devices and services * All storage charges for SAN, NAS and External FAS storage - For practicality, internal FAS storage for End User Servers should not be artificially decoupled from the server costs itself * All Gateway servers and services, including DNS, Proxy, Intrusion Detection and Firewall servers

* All Remote Access Services servers (should be allocated to LAN and RAS service tower)

Facilities Physical facilities, including raised floor space, power supply, air conditioning, and associated utilities, as well as security and facilities monitoring and maintenance services, personnel, activities, hardware and software.

Includes: * Rent and HVAC

* Racks and rack space * Data centre LANs.

Excludes: * Mainframe and midrange servers * WAN links between data centres


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Term Definition

Gateway Services, hardware, software, functions, personnel, activities and responsibilities that

securely connect and provide an interface between two different data networks (typically internal networks and external networks). Gateways must be capable of providing capability to convert one communications protocol stack into another. Includes: * Routers, firewalls, intrusion detection, DMZ, DNS, proxy servers and equipment and associated services, hardware, software, labour and maintenance charges that are

involved in logically interconnecting a LAN and a WAN. Excludes: * Switches and equipment within the LAN. Also excludes internet bandwidth costs (should be included in WAN).

Helpdesk Buildings, infrastructure, associated technologies and fully trained staff who respond to

Level 1 helpdesk calls (as defined) from end users, co-ordinate incident management, problem management and request management activities, and act as a single point of contact for agency end-users in regard to all service towers.

Includes: * Internal Level 1 ICT help desks. Excludes: * All business-related centres for agency customers and general members of the public * Level 2/3 service desks (included within each tower).

ICT

management

Services, equipment, activities, personnel, functions and responsibilities providing cross-

service tower governance, controlling, security, architecture, finance and human resources services to the ICT organisation. Typically, ICT management would include, at

a minimum, all personnel with 2 or more layers of reports underneath them and all associated costs, including all the Executive Assistants or Personal Assistants and other administrative support staff directly reporting to the aforementioned personnel. Typically includes the following functions and activities: * ICT human resources, including payroll * Architecture, governance and controlling * Financial management and reporting

* Procurement * CIO functions * Strategic planning * Quality assurance * The IT organisation's portfolio management office. Note: The ICT Management Service Tower should include a 100% allocation of the CIO

(or person acting in that role, even if the role is shared with other functions such as Finance, HR etc, and even if the CIO undertakes work within another specific ICT Service Tower) and associated costs, including all the Executive Assistants or Personal Assistants and other administrative support staff directly reporting to the CIO or equivalent role. The CIO (or person acting in that role) should be included in the ICT Management Service Tower even if he or she only has one layer of reports underneath him/her.


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Term Definition

LAN and RAS Local area networks (LANs) comprise all network elements (LAN hardware, software,

transport systems, interconnect devices, wiring and cabling) inside buildings and campuses that are used to transmit data within or among LAN segments, as well as services, software, functions, personnel, activities and responsibilities to support operation of these. Remote access services (RAS) comprise all dial-in and VPN infrastructure services, hardware, software, functions, personnel, activities and responsibilities provided to

remote users in the business (e.g., telecommuters, field staff). Includes: * Switches and routers (including any VoIP enabled LAN switches and routers) * Fixed and removable wiring, cabling and LAN ports * Passive and active network hardware, such as switches, and associated services * Remote dial-in and VPN hardware and software

Excludes: * Local area networks in data centres * Internet related costs * Firewalls and gateways (all included in the Gateways service tower)

Midrange Services, hardware, software, functions, personnel, activities and responsibilities involved in running server applications and with typically high I/O processing capacity, which are typically housed centrally in data centres, but not mainframes. Includes:

* Servers (including associated services and maintenance costs) capable of running Unix (e.g., IBM eServer i5, Sun Fire, HP Integrity etc) and Windows server operating systems, and delivering application services to the business for Core Business applications, MIS applications, Corporate applications, Finance applications, HR applications and other business applications * Costs of licences and services for operating system software, middleware and virtualisation software, monitoring and reporting software running on the Midrange

environment * Search appliances (e.g. Google appliances), RSA appliances and other centralised servers performing specific appliance functions * "Teradata" equipment, software and associated services and maintenance costs * Supercomputers (e.g. for scientific applications, advanced data modelling and other non-input/output (I/O) intensive, but compute-intensive applications). Excludes:

* Mainframe servers and associated services and costs * All end user services, such as file, print, email, terminal services and directory services (whether the servers are housed centrally in a data centre or distributed across offices and sites) should be excluded from the Midrange Service Tower and included in the End User Infrastructure service tower * Maintenance, operations and support of physical data centre facilities

* Gateways and associated services and costs (e.g. Proxy servers, DNS servers, Intrusion Detection Servers, Firewalls etc should all be excluded from the Midrange

service tower) * Storage service tower costs * End user infrastructure servers regardless of if they run Windows or Unix operating systems


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Term Definition

Storage Services, hardware, software, functions, personnel, activities and responsibilities involved

in providing data storage services to the business. Includes: * Network attached storage (NAS) * Storage area networks (SAN) * Offsite storage devices (e.g., backups) * External fixed attached storage (FAS) on mainframe and midrange servers.

Excludes: * Internal fixed attached storage (FAS) on mainframe and midrange servers (these should be included in the Mainframe or Midrange ICT Service Towers as appropriate). This reflects the practical difficulty of decoupling the costs and volumes of internal fixed attached storages included within server boxes. * Internal and external fixed attached storage (FAS) on end user devices (e.g., end user servers, desktops and laptops).

Voice services All carrier and telecommunications services, carriage, hardware, software, activities, personnel, functions and responsibilities involved in providing voice services and non-IP

videoconferencing services to the business, including VoIP services. Also includes equipment and associated attachments, features, accessories, peripherals and cabling supported or used to provide standard voice services to the business, including PBXs and PBX rectifiers, Centrex, handsets, key systems, small office/home communications systems, voice mail systems, paging systems, ADA communications devices (e.g., TDDs, teletype, specially equipped handsets), VRUs, IVRs , CDRs, ACDs, voice communications management systems, backup battery systems, and associated diagnostic equipment).

Note: For IP-related voice and video services (e.g. VoIP and IP Videoconferencing) provided by your Agency, do not attempt to decouple the WAN-related charges for this IP-related service from the WAN service tower as this is extremely difficult and can lead to arbitrary decisions. Leave these costs in the WAN tower. However, if IP-related voice and video services (such as VoIP or IP Videoconferencing) are purchased as a managed service, all costs of the managed service should be included in the Voice service tower.

Includes: * Mobile telephones, services, carriage and associated costs * Blackberry devices, services, carriage and associated costs * Videoconferencing equipment, services, carriage and associated costs * VoIP services, equipment (excluding VoIP enabled LAN switches which should be in the LAN and RAS service tower), carriage and associated costs * PABX systems and all other telephony equipment, services, carriage and associated

costs * IVRs systems, services and associated costs * Satellite telephony costs * Business inbound/outbound call centre infrastructure (e.g. 13/1300/1800 phone number service charges), telephony equipment, hardware, software and associated services (excluding Business Call Centre staff - this is a business cost, not an ICT cost)

* Radio communications (e.g. Police radios).

Excludes: * LAN/WAN equipment and services


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Term Definition

WAN Services, hardware, software, functions, personnel, activities and responsibilities

provided to the business to achieve data connectivity across a long-haul, high speed backbone wide area transmission network. Consists of WAN equipment, software, transport systems, interconnect devices, carriage services and cabling services that transmit data between separate LANs or among non-Agency locations that do business with Agencies and for which the Agency is responsible for allowing connectivity

Includes: * Routers and associated costs * Trunks and associated costs * Carriage services and associated costs * Transmission lines and devices and associated costs * ICON network * Internet access and carriage costs

Excludes: * Analogue voice services * VoIP services * LAN equipment and services * Gateways

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