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• Over 25 years working in technology as a CIO, SVP IT Operations, Enterprise
Architect, Management Consultant and Managing Partner
• Knowledge of utilizing People, Process and Technology to expand IT service
delivery, improve service levels, increase speed to market and drive cost
efficiencies
• List of clients includes: Nestle, Caterpillar, GE Aircraft, Quaker, Nielsen, Northern
Trust, Bank of America, LendingTree, RCCL, Budget, Ocwen, UOP, Duke, Royal Sun
Alliance, Monsanto, ATT, SeaLand, FamilyDollar, St. Jude, US Air Force, ManTech
• Responsible for $120 M IT budget while at Tracfone Wireless
• Responsible for $150 M in services revenue while SVP at Pomeroy
• Won IBM outsourcing deal to provide 800 plus resources to IBM
• Started 3 consulting companies during his career
• Graduate of Society Information Managers Leadership Program
MARK DeMEO
• More Systems and Applications
• More Complexity (data, connectivity, internet of everything)
• New skills required
• Higher demand from business (Revenue, Profit, Costs)
• Resourcing
• Project Risks
• Customer Satisfaction
• Shadow IT
• Security and Compliance
• Disaster Recovery and Continuity Planning
• Support and Maintenance for Legacy applications
CHALLENGES FACING IT ORGANIZATIONS
IT Budgets Under Attack
CHALLENGES FACING IT ORGANIZATIONS
HW Costs14%
SW Costs12%
Employee Costs19%
Consulting Costs9%
Network Expenses2%
Telecom Expenses24%
Compliance Costs4%
Maintenance Costs 16%
Training
IT BUDGETS UNDER ATTACK
• What do we own and why
• Is this a fair price
• Length of time to get resources in place and trained
• Employee costs increasing but value not increasing
• Can you show the value for where the money was spent
• Business is not happy with IT
• Dealing with Incidents and Problems versus Strategy
• Acting as a Hero or as a Leader
• Keeping the business running
LEAKAGE POINTS
• Identifies most likely places that cost inefficiencies exist
• Measures where you are at versus where you want to be
• Input from IT Management, IT employees and Business
• Based on COBIT and Maturity Model
• Scores from 0 to 5 on 58 questions covering 4 Main Areas
• Areas Covered
• Leadership
• Strategy and Planning
• Service Design
• Service Delivery
• Provides roadmap for improving quality and maturity ofIT Organization
• Drives action plans to address most critical areas
OVERVIEW OF LASER ASSESSMENT
Leadership
• Organization
• Relationship Management
• Culture and Orientation
• Skills and Competencies
• IT Performance Management
Strategy and Planning
• Planning Process
• Governance
• Innovation
• Business Enablement
• Sourcing Strategy
• Products and Services
AAJ LASER ASSESSMENT AREAS DEFINED
AAJ LASER ASSESSMENT (CONTINUED)
Service Delivery
• Application Development
• Infrastructure and Operations
• Sourcing and Vendor Management
Service Design
• Portfolio Management
• Service Orchestration
• Security and Risk
• Enterprise Architecture Data
• Undefined - No process or inherent knowledge in organization
• AdHoc - unshared knowledge and quality is dependent upon
resource
• Repeatable - usually characterized by senior people performing
more junior level tasks to guarantee quality, of defined
processes
• Defined - existence of documentation and methodologies but
no measurements to indicate if used or improving delivery
• Measured - dashboards and statistics exist (uptime, project
schedules, KPI's) but no understanding how to improve them or
what influences them
• Optimized - ultimate goal of creating feedback loop for
continuous improvement
MOVING UP THE MATURITY MODEL
RELATIONSHIP OF SCORE TO LEAKAGE
Example:
Low Score in Sourcing and Vendor Management
means potential opportunity to lower costs of
sourcing and improve quality
Example:
Low score in Portfolio Management will impact
customer relationship and project delivery and
planning
Example:
Low score on Innovation will impact on value
business partners see in IT organization and
means potential to improve IT alignment to
business goals and service levels
Example:
Low score on Performance Management will drive
business units to blame IT for issues and result in
more senior IT resources fire fighting
• Identify critical areas that business and IT need to mature to deliver higher satisfaction
• Identify ways to reduces costs, timelines, resourcing constraints
• Identify ways to increase performance and project delivery
• Identify ways to leverage employee expertise and knowledge
• Identify ways to expand capacity
• Identify ways to increase velocity of delivery
• Identify opportunities for immediate cost savings in licensing and expense
HOW THE ASSESSMENT DELIVERS ROI
• Create Competition
• Consolidation of solutions
• Sunset or replace high maintenance items
• Identify compliance issues that can carry large capital hits
• Leverage employee knowledge for higher skills
• Historically we can usually drive 10-20% cost reduction
REDUCTION IN LINE ITEM COSTS
• What people are needed, for how long and who will support it?
• What is all the hardware and software required?
• Do I have plan for ongoing software support?
• Do I need additional hardware support?
• Is this solution still viable in two years or will it be replaced?
• How many development environments do I need?
• What is the service level agreement on this application and do I have the staff to support it?
• Do I have the skill sets to support what is being requested?
• How does this impact my compliance efforts?
GAIN INSIGHT INTO WHAT IT REALLY COSTS
• Understand deal registration by VAR's
• Understand how Vendor marketing funds work
• Create competition at Manufacturer and at the VAR level
• Understand their pressure points
• Utilize ability of Enterprise Level Agreements
• Understand cycle of maintenance support costs
• Understand Moore's Law
NEGOTIATE FROM A POSITION OF STRENGTH
• Lowered hand and feet costs
• Created competition between multiple providers
• Negotiated new lease deals
• Went to bulk power purchases instead of per line
• Reduced fees for One time recurring charges for network
• Allowed client to stay at same Data Center with lower costs and additional services
SUCCESS STORY
• Client had Data center costs that
ballooned from 5% of IT budget
to 20%
• We were challenged to reduce
Data Center operational costs by
$1.8 Million per year
Challenge Solution
• Reduced consulting expense by $5,000,000
• Reduced capital outlay by $3,000,000 on planned projects
• Realigned PMO to portfolio management
• Automated SQA processes
• Utilized capacity resource management leveraging onsite and nearshore: cut cycle times and reduced costs & turnover
• Moved IT employees to more critical roles (PM, Architect)
SUCCESS STORY
• Client had over $180 Million in unclosed projects that were more that three years old
• Resources billing to old projects and not current projects they were working on
• 60 day timeline to identify and board new resources
• Average of 6 resources interviewed for an opening
• We were challenged to reduce time from Release to Production from 4 weeks to 1 week
Challenge Solution
• Led to series of negotiated enterprise software agreements totaling $10,000,00 to cover all compliance issues and provide new technologies
• Incentivized vendors to compete for new business
• Included training credits, new products and lower maintenance schedules
• Built strategy around tech refresh and software refresh
• Resulted in freeing up $25,000,000 in the capital budget for new projects
SUCCESS STORY
• Company had continually bought hardware but not purchased operational SW licensing
• Increased HW processors from 120 to over 800
• Had over $80,000,000 in exposed costs (Tealeaf, BEA, Oracle, CA, IBM, Microsoft, Citrix)
Challenge Solution
• Implemented solutions in SaaS model to remove burden and lower costs
• Implemented offshore support operations utilizing recovered budget from eliminating other consulting support charges that employees could now handle
• Reduced combined Contractor / Employee costs by $650,000 annually
• Reinvested saving to build an additional 14 resources for supporting applications
SUCCESS STORY
• Organization struggling with
application support for business
applications due to headcount
• Identified non core applications
that internal skill sets did not exist
for 7x24x365 coverage or
application development
Challenge Solution
• Business Insights via Analytics
• Integration
• Mobility Solutions
• Project Management and Agile Expertise
• Vendor Management
• Software Quality and Testing
• Creative Solutions
HOW AAJ TECHNOLOGIES CAN HELP
• CIO Advisory
• IT Governance
• Resource Utilization and Expansion
• Enterprise Architecture
• Collaboration
• Utilizing Cloud / SAAS solutions
• SmartSourcing
We Offer
• Set up a initial walk through of the Laser Assessment Process
• Determine what are the benefit outcomes that are important to your business
• Conduct the Laser Assessment
• Review the results and recommendations
• Build Action Plans for most critical areas
• Build Action Plans for largest gaps between Current State and Desired State
• Execute and Implement
NEXT STEPS TO IMPROVING IT