From cloud migration to mission enablement: The next phase of SLED Modernization

Fifteen years have passed since the first government cloud mandates, and for most of that time, public sector technology strategies have been dominated by a simple imperative: move to the cloud. In recent years, however, that directive has evolved into a more complex reality. Today, state, local and education (SLED) leaders face a completely different technology landscape defined by hybrid environments and increasing AI-driven compute and cybersecurity demands.

Beth Howen, Executive Managing Director of state, local and education at NTT DATA, has seen this development play out from both sides. After beginning her public sector career in the Indiana State Government, rising to CIO for several large state agencies and the Consolidated City of Indianapolis/Marion County, Howen transitioned to working with SLED organizations from the private sector. That dual perspective, having lived the budget cycles, procurement constraints and uptime pressures of public service before advising on them, gives her a grounded view of what modernization actually requires.

As she’s helped organizations through the cloud evolution, Howen has seen the utility and purpose of cloud expand far beyond its original scope.

“The biggest change is that the cloud has evolved so much from being viewed as a technology destination to becoming an enabler for broader transformation or broader modernization,” she said.

From cloud migration to mission enablement

While the initial cloud migration efforts focused closely on contraction — data center consolidation, cost reduction, centralizing to a cloud-only approach — today the conversation is about acceleration and expansion.

“What does the cloud enable?” Howen said. “Better constituent experiences, faster access to data, greater resilience, stronger security, and increasingly the ability to take advantage of AI.”

It doesn’t have to be all or nothing. While at first the expectation was the elimination of physical infrastructure in favor of the cloud, today’s approaches are more about flexibility, agility and options. This is particularly key for SLED organizations that manage highly complex and varied environments. 

Across the SLED sector, thousands of states, counties, school districts, cities and universities operate with very different funding models, technology maturity levels and workforce capabilities — a more fragmented landscape than the federal government.

“The right answer may be public cloud, it may be private cloud, it may be on-prem infrastructure, but for most, it's a combination of all of those three,” Howen said. “That's a much more mature conversation than we were having 15 years ago.”

And while private organizations often have more leeway to pause certain services or operations during major digital overhauls, government services require continuous delivery. Benefits must be issued, taxes processed and students educated. Transportation systems can’t tolerate downtime. 

Moreover, government budget cycles and procurement requirements aren’t designed around the fast pace at which technology is now changing.

“That's why successful modernization isn't just about technology; it's about governance and change management, workforce enablement and partnerships,” Howen said. 

Escaping pilot purgatory

As SLED organizations navigate complex operating environments, growing public expectations and emerging technologies it’s critical that they focus on the fundamental building blocks of success: the data.

“You can have tremendous compute capacity, sophisticated AI models, but if your data is fragmented, inaccessible, poorly governed or untrusted, you're going to struggle to create meaningful outcomes,” Howen said. “And agentic AI raises the stakes even further.”

Agentic AI marks a significant shift, from AI that was largely used to provide information to AI that can potentially take action. Agentic AI is a fundamentally different tool than the AI of just 12 or 18 months ago. 

This shift introduces new challenges around identity, permissions, security, governance and human oversight. AI strategy, cloud strategy, data strategy and cybersecurity strategy should no longer be independent concepts or conversations but pillars of an overall modernization strategy.

While SLED organizations can vary in terms of technological maturity, many face a similar struggle in operationalizing new capabilities such as AI: they become stuck in pilot purgatory. Launching individual proofs of concept (POCs) helps IT teams grasp new solutions in the early stages, but transitioning a POC to enterprise-scale adoption is much more challenging. Success depends on having that comprehensive modernization strategy in place.

“Organizations that can ultimately get the greatest value from AI aren't necessarily going to be the ones that launch the most pilots, they'll be the ones that build a foundation that includes data and governance and security, and that will allow them to scale,” Howen said. “The biggest hurdle isn’t the technology, it’s really the data.”

Cybersecurity basics drive outcomes

Cybersecurity must also be integrated throughout this foundation, rather than a separate workstream or function. Previously, infrastructure, applications and security were different initiatives often managed separately. Today, “if cybersecurity isn't treated as part of the design structure from the very beginning, your transformation and your modernization will not drive the outcomes that you want,” Howen added.

Once again, advancing cutting-edge technologies begins with a return to the basics — strong identity and access management, multi-factor authentication, zero trust principles, asset visibility, segmentation, data protection, testing backup and your recovery capabilities. Then AI layers on an entirely new dimension. 

“Organizations need to understand what data AI systems can access, who and what is authorized to take actions, which models to use, how agents are being used and how those activities are monitored, and they have to be really transparent in their use of AI,” Howen said. 

In the public sector, cybersecurity isn’t an IT issue. It supports mission continuity and public trust and should be treated as an enterprise leadership responsibility.

Partnerships that deliver public impact

In a rapidly changing world, no organization has all the answers and partnerships are critical to success. To navigate the interconnected challenges across hybrid and multi-cloud, data governance, cybersecurity and AI, SLED organizations need true partners — collaborative rather than transactional.

NTT DATA combines global scale, innovation and a broad technology partner ecosystem with localized, hands-on mission expertise. From strategy and roadmap development through cloud, data, AI and cybersecurity implementation to ongoing managed services, NTT DATA helps SLED organizations turn modernization ambitions into measurable public outcomes. 

However, capabilities alone aren’t enough when SLED missions directly impact essential services and human lives every day. 

“Our role is not simply to bring technology to government,” Howen said, “it's to help our clients determine where technology can make the greatest difference, help them modernize at a pace that they can actually absorb, help them reduce the risk along the way and ultimately deliver better outcomes for the citizens and the communities they serve.”

Learn more about how NTT DATA helps SLED organizations enhance public service delivery through technology.