A State Moves Its Mainframe System to the Cloud

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With technicians retiring and fewer agencies using the state-run system, Washington state is turning to an outside vendor to provide mainframe computing services.

A number of Washington state agencies depend heavily on a state-run mainframe computer system located in the state capital, Olympia, to run critical software applications. 

These computer programs help support state accounting and budgeting, administering benefits for retired public employees and processing workers compensation claims for people who’ve been injured on the job. But, overall, demand among agencies for mainframe services has been declining and the state employees who oversee the computer system are reaching retirement age without new technicians available to take their places.

These shifts and other factors led Washington Technology Solutions, or WaTech, the state’s technology agency, to sign a contract earlier this year with Chicago-based Ensono to transition the mainframe system to a cloud computing service that the company will provide.

“In essence, what we’re doing is transferring the management of the hardware and software here in Olympia, to the management of the hardware and software in another location,” said Lance Calisch, one of the WaTech staff members involved in the transition project. 

Calisch said the move reflects a broader trend taking place in the IT world away from onsite management of hardware and software. “When I first got in this business 30, 40 years ago, everything was mainframe,” he said. “The transition now is to cloud computing.” 

“I think you will see local IT shops becoming smaller and transitioning to larger vendors who can draw more resources at a cheaper cost,” Calisch added. He likens the trend to local hardware stores getting displaced by Home Depots and other big box retailers that benefit from efficiencies that come with operating on a larger scale.

WaTech identifies a range of benefits in shifting to a vendor-managed cloud system. For instance, the system can be scaled up or down according to agencies’ needs without the state having to make major new capital investments in computer equipment. And the vendor, rather than the state, is responsible for maintenance and upgrades.

Data on the cloud system will be mirrored at a second site, providing redundancy in the event of a computer failure or natural disaster.

The state also anticipates cost savings from the project in the years ahead. WaTech estimates mainframe services have typically cost Washington state about $12 million annually in recent years. Under the new arrangement with Ensono, the cost going forward is expected to be closer to $8 million or $9 million annually.

Calisch said the new contract will help to reduce variable costs with the computer system. “We have an agreement, we know what our costs are going to be for the next 10 years,” he said.

Washington state chief information officer and WaTech director, Jim Weaver, said last month the project would cut costs by more than 30% for most agencies relying on the computer system.

About eight state agencies use the mainframe in a significant way, according to WaTech. Some of these agencies include the Department of Labor and Industries, Department of Retirement Systems and the Office of Financial Management. But upwards of 150 agencies, boards and commissions to some degree use applications running on the mainframe—mostly state accounting tools.

While people often think of mainframe computers as outdated technology, Washington purchased its current system only about six years ago. Ensono will be employing a newer IBM z14 system, which will be physically located in Omaha, Nebraska.

The state’s target for transitioning to the new system is this December. Ensono is taking the lead on the transition project, Calisch said. But state project management staff are working with the company. As of Oct. 20, the project was about 70% complete, according to WaTech.

Even once the new system is up and running, Calisch said WaTech will remain involved. “We can’t just give it away and say, ‘out of sight, out of mind,’” he said. “We have to ensure that Ensono is still managing the hardware and the software in the best interest of the state.”

Bill Lucia is a senior reporter for Route Fifty and is based in Olympia, Washington.

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