Michigan Department of Information Technology
E-mail Consolidation Project
The tangible benefits of e-mail consolidation have been well documented for years in the private
sector. Indeed, the Michigan Department of Information Technology (MDIT) has reaped the
dividends of its investment in messaging:
• Saving over $600,000 this year alone, with a total estimated over 11 million in 4 years
• Increasing services levels and response time by more than 50%
• Making the entire enterprise more secure and resistant to virus attacks
• Reaping staffing efficiencies by allowing a reallocation of over 1.8 million in personnel costs
• And the list goes on and on.
But, perhaps the most compelling reasons for addressing electronic mail do not come from hard
dollars or efficiencies. For over three years MDIT has strived to align its technology planning with the
statewide business priorities of its agencies. Michigan’s planning process pointed out that e-mail is a
key element (perhaps THE key element) of a framework that binds state government together. It is a
citizen’s common gateway to State services, the foundation for a mobile workforce and an essential
tool for collaboration and communication. In Michigan e-mail is used to manage financial
transactions and enables nearly all self-service applications from driver’s license renewal to starting a
business. In a disaster situation, e-mail is second only to basic voice communications as the most
heavily relied upon system during recovery operations. In short, e-mail and its reliable use is one of
the most important functions any government IT organization undertakes.
However, the very popularity and increased demand for electronic mail have been at the heart of
government’s messaging challenge. E-mail has become a “given” in our society so rapidly that much
of the discipline and rigor typically attached to an application of its importance has been overlooked.
After years of scrambling to meet the increasing expectations of individual departments, Michigan
found itself in the same situation many state’s face; aging infrastructure, a complex maze of
messaging solutions that impeded communication and unnecessarily high costs. Through the E-mail
Consolidation Project MDIT enabled strategic priorities, brought stakeholders together, defined a
common messaging platform and implemented a cost effective solution that has been a foundational
element in our governor’s efforts to transform state government into a collaborative enterprise.
MICHIGAN’S E-MAIL CONSOLIDATION 2 8/28/2006
E-mail is the most extensively used application worldwide. It has evolved from a convenient tool to a
basic necessity that has become part of the very fabric of our society. In State government, e-mail is
a citizen’s gateway to services, a department’s primary tool for collaboration and (where fully
leveraged) a method for increasing productivity and transforming the very definition of the workplace.
Since its creation, the Michigan Department of Information Technology (MDIT) prioritized its e-mail
consolidation as one of its top organizational imperatives. With a clear alignment driven from MDIT’s
planning process, this project answered the Governor’s call for more efficient use of resources, met
the demand from state departments for greater service levels and moved MDIT further toward its
goal of centralizing technology in its primary hosting centers. All while saving significant dollars and
creating a firm foundation for the e-workplace in Michigan.
In the wake of the 2003 multi-state power outage, Governor Jennifer Granholm coordinated a review
of all applications critical to Michigan’s citizens. Across nearly every agency, one application topped
the inventory time and again: e-mail. The Dept of Community Health’s Disease Surveillance System
generates e-mail to track and prevent the spread of health related issues (avian influenza, SARS,
bioterrorism). Aside from basic voice communications e-mail is the most heavily relied upon tool in a
disaster situation. In Michigan, the Departments of Human Services. Community Health, State
Police, Military and Veterans Affairs, Agriculture, Environmental Quality, Natural Resources and
Education all employ e-mail as the focal point for Crisis Management Centers.
Michigan’s Department of Information Technology (MDIT) formalized e-mail as a critical business
application for our 55,000 users and planned its redesign accordingly. In the year 2000, a business,
citizen or state employee in Michigan had a daunting task traversing the state’s e-mail systems
across its’ 19 Agencies. Everything from contacting a case worker to confirming a meeting was
disjointed and confusing. The state workers themselves could not send messages to each other
consistently and were still relying on paper forms and inter-office memos to transact the state’s
business. The problem lay in the disparate and complex messaging technologies implemented over
time. Michigan’s agencies were the home for more than 40 undocumented versions of e-mail
solutions. The hardware running those systems was obsolete (servers ranged from 4-7 years old)
and in many cases replacement parts were no longer available. The e-mail servers themselves were
geographically spread over 600 locations in 83 counties; requiring staff to physically travel throughout
the state when issues occurred. Substantial data loss in the event of an outage and consistent
“undeliverable” mail were realities agencies and citizens lived with every day. Complete e-mail
system failures were a monthly occurrence for the Department of Military and Veteran’s Affairs as
well as Michigan’s Attorney General. Obsolete and undersized servers at the Department of Natural
Resources and the Department of Environmental Quality caused persistent delays where e-mail took
hours to successfully send, hampering those agencies’ ability to track and communicate outbreaks of
diseases affecting Michigan’s natural resources (Emerald Ash Borer, Chronic Wasting Disease, etc).
E-mail is a powerful tool, but when implemented inconsistently it can become an easy target for cyber
attacks. In 2000 spam and virus traffic volume began to trend upward sharply, by 2004 volumes had
increased by more than 800%. This flooded e-mail boxes with erroneous, inappropriate and harmful
content that made a difficult situation untenable. In short, the situation for email in Michigan added
up to unnecessarily high costs, less than optimum services, increased risk exposure and lost
opportunities for what was possible and necessary in an e -workplace.
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PHASE 1 Bringing Stakeholders Together
Solving the problem required a deep understanding of the business value e-mail provides for each
department and a strategy that supported individual departmental goals and mandates while
maintaining an enterprise focus. By showing the alignment of the e-mail consolidation to business
priorities outlined in the Governor’s Cabinet Action Plan and collaborating early with the various
departments, MDIT developed its plan with the assurance of agency support. MDIT invited a
“Deputy Level” representative from each agency and branch of Government to act as a technology
steering committee called the Michigan Information Technology Executive Council (MITEC). MITEC
in turn launched a subgroup to establish statewide policies for the email consolidation project.
These policies had an immediate impact on the project by defining that a future consolidated email
system was “mission critical” and should be designed with statewide guidelines such as redundancy,
disaster recovery provisions and a 100Mb mailbox default.
PHASE 2 Security and a Common Point of Entry (2000-2003)
The first hurdle to overcome was addressing security issues and the more external or “public facing”
aspects of e-mail. A unified gateway was developed whose purpose was threefold: 1) to present a
common e-mail “identity” (@MICHIGAN.GOV) to all external entities transacting e-mail with the state
2) create a “single point” filter to protect the State from SPAM and virus attacks and 3) allow the
State’s two predominant e-mail platforms to seamlessly co-exist.
PHASE 3 Improving Support, Citizen Accesses and Enabling the Mobile Worker (2003-2004)
This phase of the effort focused on improving MDIT support levels by eliminating all but the two most
widely used e-mail solutions (Microsoft Exchange and Novell GroupWise). Throughout the year
2003, over 700 email servers were upgraded or reconfigured to a standard configuration/version.
Although still aging and geographically dispersed, field technicians and clients alike would now know
exactly what they were dealing with in the event of an outage. This allowed MDIT to better respond to
trouble calls and raised our level of service. State workers saw the additional benefit of accessing
their mail from any workstation (via internet mail). Mobile working became a real possibility for ALL
agencies for the first time. Teams created a single authoritative source for all e-mail addresses in the
State. This effort spanned both email platforms, lowered costs by cleaning up thousands of unused
addresses and gave businesses, clients and state workers a single “look up” foundation that they
know is accurate and up to date.
PHASE 4 Transforming the E-mail Enterprise (2004-2006)
The final (and most impactful) phase of the e-mail consolidation is now in its final stages. With
success in standardizing the e-mail systems from over 40 variations down to two, the stage was set
for the physical migration of e-mail systems to a 24X7 enterprise solution. Over 30,000 of the State’s
e-mail users have already been successfully migrated. E-mail systems are now hosted in the State’s
premiere hosting center where support is carried out with increased discipline and rigorous
processes. Fully redundant configurations in the network, servers and storage ensure 100% uptime
and a powerful backup and recovery system guarantee that no data will be lost. This phase reduced
staff involved in e-mail support from 36 to 18 and brought the hardware requirement down nearly
90% (from 740 servers to 90).
Significance to the improvement of the operation of Government
The e-mail consolidation project has had a profound affect on Michigan’s government operations. It
has improved security, increased reliability, increased service levels, moved strategic goals of the
state forward and has been executed in a manner that could be repeated by other States.
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Secure Data: The new enterprise system scans over 400,000 incoming e-mails each day. 60% of
those messages are flagged as SPAM or infected and are filtered out, never reaching the user’s
desktop. Although difficult to quantify, removing the current volume of inappropriate messages from
official, actionable correspondences increases worker productivity. Addressing the SPAM issue has
never been more urgent. Phishing schemes have taken SPAM from a significant annoyance to a tool
of deliberate attack for cyber-criminals that requires an enterprise approach to keep in check.
Alignment to the State’s Strategic goals: The consolidated e-mail project offered MDIT the
opportunity to meet gubernatorial goals to save money, retool for disaster preparedness and is part of
a major “shared services” initiative underway in the State. Also, the 2005 MDIT strategic plan
commits to either retire or consolidate 1000 servers this fiscal year. The e-mail consolidation will
bring MDIT 740 servers closer to that goal. As the enterprise e-mail servers have been installed in
our hosting centers, the additional volume has been a major factor in allowing MDIT to lower storage
and hosting charges for all State clients.
Increased Reliability: Recognizing the universal importance of e-mail and its need to be architected
for maximum uptime drove the requirement for an “always available” system. Since its first “go-live”
day in 2003 not a single department on the enterprise e-mail has lost any data or experienced any
significant interruption of service. In addition to the service improvements there are profound
“intangible” benefits as well. For the first time workers could search calendars and schedule
appointments with certainty. Inboxes are up and active—displaying incoming mail and sending mail
Faster Service: New capabilities implemented on the e-mail systems ensure that when
administrative issues arise (password resets, etc) MDIT is much quicker to respond. Prior to e-mail
consolidation only 15% of e-mail tickets were resolved on the first call; after moving 30,000 users to
the new environment, the number of first-call resolutions has more than doubled to 37%. Also, if
users inadvertently delete messages, the time required to restore those files has gone from 2-3
weeks down to 2-3 days. The service trend is continuing upward as the final users are moved to the
Transferability of Lessons Learned: E-mail consolidation is a hot topic and the MDIT approach
serves as a good baseline for other governments planning similar efforts. First, the outcome of
MDIT’s collaboration with stakeholders is immediately transferable; the formation of MITEC and that
group’s decisions can serve other States as an e-mail standards baseline from business units similar
to their own. Secondly, Michigan’s business case has been shared widely among the States
(through NASCIO) and its elements have been used to justify and benchmark e-mail consolidation
initiatives. Lastly, the technical architecture of MDIT’s unified SMTP gateway can be duplicated
anywhere there is a need to present multiple messaging systems in a single “statewide” view.
Benefits to Customers
The true customers of e-mail are the agencies who use it and the citizens who rely upon it as their
gateway to services. The e-mail consolidation project gave Michigan a common e-mail identity,
made getting the right state contact easier, enabled telecommuting and mobile workers and kept the
State’s e-mail from being the source of virus attacks.
Focal Point for Communication: With the advent of an enterprise e-mail solution, citizens,
businesses and stakeholders were given a common focal point for on-line communication and self-
service coordination (Michigan.gov). Today, the adoption of that focal point has been so successful
that the enterprise e-mail system boasts traffic volumes of over one million messages each day
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(incoming and outgoing). The highest volume of all incoming mail comes from Michigan’s
businesses applying for permits (environmental, liquor control, etc) and the highest volume of all
outgoing mail informs citizens of the status of their recreation licenses (hunting, fishing, etc). The
consolidated e-mail technology has enabled cross-agency meeting and resource scheduling. This
ability has been critical for a broad spectrum of gubernatorial collaboration efforts to move rapidly.
For nearly all cabinet plan commitments (from consolidating business permitting functions to focusing
a multi-agency response to struggling local governments) e-mail has proven the foundation for
scheduling collaboration sessions, communicating decisions, tracking commitments and bringing
state staff together in new and innovative ways.
Streamlined Addresses: The common address book significantly streamlined communication with
the State. Today vendors, citizens, government partners and other stakeholders can easily identify
state workers and services within state government from a common, up-to-date address book. This
has become even more critical as budget issues have meant less physical office locations available
for citizens to seek services “face to face”.
Enabling the Mobile Worker: The desire to allow case workers more time in the field and a
gubernatorial priority to consolidate office buildings fueled the need for a more mobile e-mail solution.
With the decision to focus efforts on two e-mail platforms, MDIT went to work architecting common
web interfaces to e-mail that could be accessed from anywhere at anytime. For the first time in the
state’s history, this capability has been extended from a handful of agencies to all departments
throughout the state. Mobile e-mail gives even the smallest departments the opportunity for
Virus Prevention and Detection: Prevention and recovery from virus attacks is a benefit to state
agencies and customers alike. E-mail is the most common mechanism used to propagate and deliver
viruses throughout cyberspace. Michigan’s unified e-mail gateway makes certain that all messages
leaving the state are clean and not inadvertently passing viruses or other security threats to
taxpayers, businesses or other government partners. Likewise, the standardization of e-mail
systems has secured the mail internal to the state’s network as well. Even with an 800 percent
increase in attempted virus intrusions in 2004, MDIT was able to remove 99.94% of all viruses before
harm was done. In the old environment infected workstations and e-mail servers would require the
on-site visit of a technician to diagnose and repair a virus related problem (a recovery time that
averaged 3.75 days in 2004). Today, the estimated recovery time for consolidated e-mail servers is
less than four hours. This recovery time has been difficult to validate because no enterprise e-mail
server has been infected since the new architecture was implemented (three years ago).
Return on Investment
In addition to the service benefits listed above, the Michigan enterprise e-mail solution was more cost
effective than a “siloed” approach. In terms of cost avoidance and hard dollar savings, the
investment in consolidation is paying dividends. Migration, training and analysis projects did not
require investment (these tasks were accomplished with the existing 18 FTE’s assigned). The
investment required by MDIT was restricted to the hardware procurement of 74 Mail Servers, 10
SMTP Servers and 6 Directory Servers; totaling $900,000.
Hardware Replacement Cost Avoidance: In early 2003, the servers running the State’s email
ranged from 4 to 7 years old. The average cost of replacing current equipment was quoted at $3,700
per server and the cost of an enterprise server was less than $10,000 each. The consolidated e-mail
approach drastically reduced the number of servers needed from 740 to 90. The total hardware
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cost avoidance= $1,838,000 with an additional $600,000 a year in hosting charges (assuming a 4
year replacement cycle).
Staffing Efficiencies: 36 FTE’s were supporting Michigan’s e-mail in 2002; today this count is 18.
The reduction in staffing needed to support the enterprise approach allowed MDIT the flexibility to
reallocate over $1,800,000 in resources (either reassigning unnecessary staff to priority projects or to
remove the resource as a direct cost savings).
“Per Mailbox” Pricing: The price per user/per mailbox for Michigan’s 2 platform solution is below
industry standards for a single e-mail platform and more competitive than other outsourced
alternatives explored. Below is a breakdown of price components as compared to Michigan’s
previous e-mail systems and a Gartner best practice study updated and validated for 2006.
Cost Gartner Best Old MDIT New MDIT Michigan Detail
Category Practice Costs Costs (New Solution)
(10,000 Users) (55,000 Users) (55,000 Users)
License Fees Includes e-mail, mailbox anti-virus and anti-
$458,000 $1,421,162 $1,421,162
Server breakdown: 74 Mail, 10 SMTP and 6
AD at an average of $10,000 each. A 4-year
Server Costs $180,000 $684,500 $225,000
replacement cycle is calculated into yearly
Administration Estimated actual costs for 18 State FTE’s
$400,000 $3,694,320 $1,847,160
and Staff (includes benefits, computers, cell phone, etc)
Hardware Includes monitoring, disk storage (5.5
Operations $170,000 0 $537,000 Terabytes @ 100MB per user), and hosting
Bandwidth $81,000 $1,332,000 $162,000 $150 per server per month (90 servers)
Planning *Planning and deployment functions are
Deployment $52,000 0 $27,000 included in the staff costs above. Training only
Training is reflected here.
$1,341,000 $7,131,982 $4,219,322
Monthly Includes costs for supporting and maintaining
Cost Per $11.18 $10.81 $6.39 both MS Exchange and Novell GroupWise.
TABLE 1: Costs Based Per Mailbox
The return on investment below is calculated using Table 1 above (The money saved using new “per
mailbox” costs over the old “per mailbox” costs). Projections are given for ROI once the entire user
base is converted and an estimated four year return is listed.
Total Investment Required: $900,000
Return to Date: $1,588,723.64 (30,000 users @ current mailbox costs)
Current ROI: $688,723.64
Estimated Return Once Complete: $2,912,660.00 (55,000 Users @ current mailbox costs)
Estimated 4 Year Return $11,650,640.00
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