Microservices vs. Monoliths: Government Pushes for Microservices Architecture

In a recent address at the Tech in Gov conference in Canberra, Peter O’Halloran, the Chief Digital Officer of the Australian Digital Health Agency (ADHA), outlined a significant shift in the technological landscape of the Australian government. He emphasized the agency's transition from a traditional monolithic tech stack to a more agile, microservices-based architecture. This change is aimed at enabling quicker, more flexible responses to the evolving demands of digital governance and the pressures imposed by modern challenges, including artificial intelligence (AI) and rising citizen expectations.

O’Halloran's remarks reflect a broader trend within Australian government agencies to abandon large-scale IT projects, which have historically been complex and costly. He noted that the era of multi-billion-dollar IT contracts is effectively over, stating, “The days of the multi-billion-dollar IT projects are dead... and that’s probably not a bad thing.” Instead, agencies are now focusing on simpler, more manageable technologies that can be quickly implemented, allowing them to operate more efficiently despite tightening budgets and increasing cybersecurity threats.

The need for modernization is urgent, as many government systems suffer from significant technical debt accumulated over the years. O’Halloran highlighted the importance of reducing this debt by incrementally modernizing systems, with an approach that involves breaking down legacy implementations into smaller, reusable microservices. This strategy not only streamlines the development process but also facilitates the sharing of functionality across different government agencies. For instance, core functions like authentication and user management can be built and improved over time, leading to a more cohesive and effective IT ecosystem.

As the ADHA prepares for its next several procurements, O’Halloran indicated that these steps are critical for the agency's future capabilities. The goal is to continuously chip away at outdated systems while integrating new technologies that align with the agency’s objectives. By adopting this incremental approach, O'Halloran believes that the agency can significantly reduce its reliance on monolithic systems, transforming its technological foundation in the process.

This evolving IT landscape is also opening doors for smaller, agile firms that previously struggled to compete for government contracts. According to IT industry analysts at Gartner, Australian governments are expected to invest up to $27 billion in IT this year, with around 60 percent of that coming from federal sources. O’Halloran expressed a commitment to broadening the supplier base to include smaller, innovative companies that possess specialized technological knowledge. By collaborating with both small and large firms, the government can harness diverse expertise to drive innovation.

Natalie Legg, CEO of the Canberra-based systems integrator A23, supported O’Halloran’s view, highlighting that tighter budgets could lead to more opportunities for smaller Australian businesses. She cautioned against the traditional focus on a limited number of large suppliers for significant projects, advocating instead for a more diverse approach that prioritizes proven capabilities. Legg emphasized the importance of evaluating suppliers based on their actual delivery of projects, urging government buyers to ensure they engage firms that have a strong track record.

Looking ahead, Gartner identifies several emerging technologies that are gaining traction among government buyers, including adaptive security, digital identity, digital platform agility, programmatic data management, and AI. While AI holds considerable promise for enhancing public services through applications such as chatbots and improved cybersecurity, O’Halloran noted that successful implementation requires a skilled workforce. To address this, the ADHA is focused on reskilling individuals with frontline healthcare experience for digital roles, cultivating talent that understands the unique needs of the sector.

Marcus D’Castro from Nomura Research Institute echoed this sentiment, highlighting the public sector's proactive approach to data management as a crucial advantage in preparing for an AI-driven future. He underscored the importance of data quality, stating, “If you feed GenAI rubbish data, you’re going to get rubbish results.” The public sector's efforts in data management and archiving position it well to leverage future opportunities, ensuring that the right data is accessible and ready for advanced analytics and decision-making.

Overall, the shift towards microservices and the embrace of smaller, innovative firms signal a transformative period for the Australian government’s IT landscape. By moving away from outdated monolithic systems and fostering a culture of collaboration and agility, the government aims to enhance its operational capabilities, better serve its citizens, and prepare for the challenges of a rapidly changing technological environment.