Enterprise Management Systems and the Big Win
Posted by Rick Pandolfi on Thu, Feb 03, 2011 @ 11:46 AM
Enterprise Management Systems and the Big Win
In my last post I relayed some statistics that are inescapably compelling even if they are only half way accurate:
● More than 60% of annual IT cost is IT Staff. The next highest cost contributor at a rate at or above 25% is System Downtime. Combined these two items total over 85% of annual IT costs. Let me emphasize that: IT Staff costs and System Downtime account for 85% of IT costs.
● Combine this with the fact that neither Network Automation, nor Fault Automation crack the 25% threshold.
This means we have tremendous headroom to reduce IT Staff costs through automation – and we can start with the simple basics. And in so doing we can substantially accelerate Root Cause Analysis (RCA) and compress Mean Time To Repair (MTTR).
Structuring a compelling Business Case
Even with these compelling facts and straightforward logic, many IT shops still can’t get themselves moving fast enough in the right direction. This is typically a result of failure to present a compelling business case. So, I offer the following structure for consideration:
Identify Opportunities for Improvement: There are so many. Let choose Customer Churn Rate. I always recommend a dynamic easily linked to top line performance. I consider cost reductions secondary to inspiring KPI’s like market share, attrition rate, revenue by (sector, geo, product).
Contextualize your choice: In other words, align the Opportunity for Improvement to an accepted and well understood corporate goal, like Market share, Revenue from the Customer Base or Cost of Revenue.
Identify Potential Projects: We hate projects with IT only impact. In our example, link Customer Churn Rate to hard metrics, like MTTR, Downtime Rates, System Capacity and Availability statistics, etc.
From here it’s a matter of assembling some readily available statistics and correlated facts. This need not be overly labored. The fact is that the greenfields of Enterprise Management Systems (EMS) are largely behind us. Almost everyone has something nominally serviceable. The gap is in the quality of the deployment. And the quality of an EMS deployment can be materially improved for less than six figures – with demonstrably enriching results.
Let’s remember our base line statistics: 85% of our IT costs are related to people (who are typically doing a large proportion of work that could be automated, while being distracted from work that only they can do) and Downtime; which is a function of misdirected resources and under leveraged automation.
This is neither Rocket Science or Brain Surgery. This is a brief exercise in connecting the dots and lining them up for a big and easily attainable win.
Rick Pandolfi