Scalability, flexibility, efficiency, and innovation – more than mere buzzwords, they are requirements for state agencies grappling with unprecedented technology demand. In one of the largest U.S. states, the IT department provides a full spectrum of technology services to nearly 30 state agencies, but as time and technology advanced, department leaders realized its single-vendor contract limited agencies’ ability to access best-of-breed technology and expertise.

“When you have one vendor doing it all, you’re going to get the services that vendor has in its quiver,” noted a top IT department official. “And that made our customers question, ‘Is this really the best thing for me? How do I know that this is the latest and greatest technology?’”

To drive innovation and attract top-notch competition, the department broke IT acquisition into seven separate contracts: public cloud, private cloud, data center, networking, security, printing and digitization, and solution services. The solution services vendor evaluates agency needs related to cloud and applications, providing impartial guidance on the best fit for specific agency requirements.

State IT Department Embraces a New Public Cloud Model

The IT department awarded the public cloud contract to Rackspace Technology, a multi-cloud solution expert and managed service provider. The San Antonio, Texas-based company is a Gartner Magic Quadrant leader for public cloud infrastructure professional and managed services, worldwide. It brings experience with thousands of other public cloud customers to bear for state agencies.

“We’re bringing best practices in multi-cloud management and security, infrastructure savings, and the ability to cost optimize workloads so the IT department and its agency customers get the best value,” said Phil Fuster, senior director of public sector sales for Rackspace Technology.

Rackspace provides the expertise that the state needs to expand its public cloud program. The company manages all public cloud workloads, leveraging Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP). Rackspace is AWS’s largest managed service provider, one of Azure’s top managed service providers, and GCP’s first managed service provider. It is also the only managed service provider to establish a VMware Cloud in AWS.

To further the state’s public cloud expertise, the public cloud contract leverages a Cloud Center of Excellence (CCOE) that helps state agencies exploit the benefits of public cloud. The CCOE includes complex cloud engineers, administrators, and a senior cloud architect. In addition to public cloud expertise, the CCOE can offer advance knowledge of new services from AWS, Azure, GCP, and emerging public cloud technologies.

“It’s not just about Rackspace reselling us public cloud. It’s about scoping, designing, and deploying it as well,” the IT department official noted. “We also needed a manager to provide and audit security controls. To really shore up the security of the state, we needed the right capability and expertise in the public cloud program.”

Previously, cloud-savvy managers in state agencies were not able to leverage the public cloud extensively. They see the new contract as an opportunity to leap forward technologically. In addition, smaller agencies with less cloud experience are now able to take advantage of the public cloud.

State IT Department and Rackspace Enable Agency Missions on Ambitious Timelines

The IT department’s six-month negotiation-to-transition timeline was ambitious, and made even more so by the coronavirus pandemic. The typical in-person negotiation process suddenly became virtual.

“We use negotiations to validate all assumptions and establish agreements before setting a price,” the IT department official said. “We assess corporate cultures and the capability of the key personnel. We make sure our vendors understand our complex, best-in-breed model and what it means to be one of our shared technology service vendors. We also believe that planning should be complete before transition begins. We put all of these requirements on Rackspace, virtually. And we did it all, virtually. It was amazing.”

The transition came at a time of unprecedented technology change and demand, driven by the pandemic. Functions that were never considered for online services suddenly had to be put there, sometimes in a matter of days, from an unemployment insurance application to call center and motor vehicle services. State needs for technology services in the cloud skyrocketed.

“Agencies recognize that public cloud is critical to their mission and their future,” Fuster said. “Some are becoming fully cloud centric, and some are trying to figure out how best to leverage the cloud. We work with them through every step of the journey.”

Deployment and Pricing Challenges Are Solved With New Cloud Model

Agencies faced multiple challenges under the old contract that were quickly solved in the state’s new public cloud model. For example, the IT department wanted to give its agency customers the ability to self-provision and control their public cloud compute, but giving agencies access to all public-cloud consoles would lead to a loss of control and inability to ensure that service-level agreements were met.

A menu of provisioning templates now makes it easy for customers to request specific configurations and builds from the public-cloud catalog of offerings. In addition, reserved pricing is offered for the first time.

Security and cost-optimization tools are game changers for business leaders struggling to keep up with the ever-changing cybersecurity landscape. Now, Rackspace is configuring agency workloads securely and making sure those configurations don’t change. In addition, agency customers are getting a whole new financial view, and Rackspace is making recommendations that save them money.

Cost optimization programs have already resulted in dramatic savings. On one project, the agency saved 82 percent off of the retail cost, or $21,800 a month, by tapping into Microsoft Azure hybrid benefits and a Rackspace-negotiated cloud service provider discount. In addition, Microsoft Azure Migration Program, AWS Migration Acceleration Program, and Google State and Local Enterprise fixed-price programs have saved agencies up to 25 percent of their public cloud costs.

State Embraces a Future in the Cloud

The state’s new public cloud contracting model enables the IT department to deliver proven, secure solutions across the cloud lifecycle to its agency customers, from design and build to management and optimization. Currently, 23 state agencies are leveraging public cloud through the contract, and momentum is growing.

“We are getting ahead of the game on security and cost optimization, and preparing for a long-term future in the cloud,” the IT department official noted. “I’ve seen some states move applications to public cloud and do it well. But I haven’t seen states embrace a consolidated, intentional roadmap with security and cost optimization so strongly entrenched.”

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