CIOs Squeeze Costs And Grab Boardroom Attention By Deploying Automation Tools ¿ Forrester Research
More companies are taking the issue of enterprise infrastructure management more seriously these days ¿ and rightly so, according to two recent Forrester Research, Inc. (Nasdaq: FORR) reports. The first wave of service-level management (SLM) and business services management (BSM) implementations is now being followed by a large number of change and configuration management initiatives. What was once considered a boring topic for lower-level IT operations staff is now on the agenda of CIOs of $1 billion-plus companies. This is primarily driven by business executives demanding end-to-end service delivery from IT operations and higher levels of automation. Other key triggers are the threat of outsourcing and the decisions organizations face on which services to keep in-house and which to place with a third party.
Thomas Mendel, Principal Analyst at Forrester Research, comments on why companies are becoming more interested in this area: ¿These types of technologies form the cornerstone of more advanced IT services automation, as well a prerequisite for Organic IT* implementations. With more than 40% of the total IT budget of a $1 billion-plus company going to human labor and IT operations accounting for 80% to 90% of the budget, automating repetitive tasks will result in substantial cost savings.¿ Mendel continues, ¿A nice side effect is that organizations will be able to show cost savings simply by gaining a better understanding of the assets they currently use ¿ and comparing that with the ones they actually pay for. This will result in cost savings of around 15% to 20% of hardware and software licensing costs ¿ and in some cases up to 30%. Furthermore, higher levels of automation will lower downtime by reducing manual errors.¿
Another key driver identified by Forrester is that service-level delivery benchmarking is becoming commonplace. IT managers in large organizations are increasingly asked to deliver consistent service levels across the whole organization. The increased demand to benchmark external versus internal services has led to renewed competition and more outsourcing. Internal IT departments can no longer hide behind their internal status, but have to face the external competition head-on. The first step in doing this is to make their own capabilities transparent and comparable.
Jean-Pierre Garbani, Vice President Computing Systems at Forrester Research, explains, ¿The basic question that many senior decision-makers in IT and business face is: `Who should provide a particular service in our organization ¿ should we do it ourselves, or could this be done more effectively by a third party?¿ Too often, these decisions are influenced by existing vendor relationships, incumbent/preferred suppliers, recommendations by peers, discounts offered, or even `gut feeling¿. This is not the right way to go about it. One should base these decisions on facts. You have to `compare apples to apples¿ ¿ and automated infrastructure management tools make service delivery a measurable and comparable quantity.¿
The tools described in these reports create a technical map of the end-to-end service delivery process. A company can benchmark a planned service delivery against this map and thus determine if the service should be kept in-house or could be done more effectively by a third party. The map provides a factual framework in which to evaluate an offer proposed by an outsourcing company. Change and configuration management tools identify key IT components and assets on an ongoing basis ¿ there could be thousands of changes to the infrastructure each day. Service-level management takes these components and builds the services, thus enabling the whole system to be measured continuously.
The adoption of these types of technologies has really begun to take off in 2004; Forrester predicts that they will continue to gain momentum through 2006 and 2007. This goes hand in hand with ITIL¿s success in becoming the de facto standard for enterprise service delivery processes.
Mendel concludes, ¿I firmly believe that enterprise infrastructure management needs to be looked at holistically. To that end, service-level management and business services management form an essential part of infrastructure management architecture ¿ but they should not be viewed in isolation.¿
*Forrester defines Organic IT as ¿Computing infrastructure built on cheap, redundant components that automatically shares and manages enterprise computing resources ¿ software, processors, storage, and networks ¿ across all applications within a data center.¿
Forrester Research Reports