Federal IT spending for FY 2011 was an estimated $79.4 billion.

In a recent interview, Dave Powner, one of three IT directors for the US Government Accountability Office (GAO), said about $55 billion of the $80 billion spent on federal IT goes toward steady state systems, while $25 billion goes to new development. Of that $55 billion, Powner said there is opportunity for reduction in operations and maintenance.

At Uplogix, we couldn’t agree more — whether you are talking federal or corporate networks. For years, one of the standard industry stats has come from Gartner, stating that 60% of total worldwide IT expenditures goes into IT infrastructure and operations (I&O). Gartner goes on to present 10 suggestions for achieving 10% savings in a year and 25% savings in three years. The key actions in the list supported by Local Management from Uplogix are to “Consolidate I&O” and “Push Down IT Support” through network management automation.

Free up IT staff for innovation, not repetition
Gartners says that I&O accounts for about 50% of total IT headcount, with most involved in day-to-day and tactical operational processes. When it comes to managing networks, many of these talented professionals are spending their time on routine maintenance. While there are many competitors in the network management market, they rely on the network to perform their jobs. As a result, they are limited to monitoring, dashboarding and analysis. In short, they are useful tools for IT staff, but they don’t actually DO any of the tasks because of the reliance on the network.

Another Gartner stat is that about 40% of network problems can’t be addressed with in-band software tools.

With Local Management, select management functionality is moved to where it is needed most — right where users and managed devices are — on the other side of the WAN, satellite or cellular network or inside of a lights out data center.

This lets IT groups reduce management costs, maintain service levels and ensure secure management practices in the course of day-to-day operations. Uplogix provides the configuration, performance and security management automation functions that are best performed locally.

Virtualization savings = operations cost increases?
The widespread adoption of cloud and virtualized computing in the name of cost savings will have a profound effect on the network and on IT network operations groups. Customer expectations are changing. New requirements are emerging, service levels are becoming more stringent and some time tested strategies for managing costs and ensuring adequate service levels are being invalidated. Trying to use the same old network and network management strategies and tools without Local Management will cause virtualization and cloud initiatives to fail or to incur runaway costs.

In short, virtualization savings on the infrastructure side could simply shift costs over to operations through increased network complexity and the heightened service levels needed. Network management automation like Uplogix is needed to ensure that all devices (physical and virtual) are monitored in real-time with the ability to rapidly identify failures and issues, then automatically perform recovery actions.

Finding the ROI that the GAO is looking for
Obviously, when you are talking about $80 billion of federal IT spending, there is no single solution for savings. When you look at saving money on operations and maintenance, there is a spectrum of solutions to deploy across network applications as different as research labs and battlefields to congressional offices and public service organizations.

Understanding the business case for network support is based on a risk/return calculation that takes into account the cost of downtime compared to the mix of resources spent to avoid downtime. The following chart shows that how much you spend on your resource mix doesn’t always equate to the lowest risk.