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ENTERPRISE CIO DECISIONS • FEbRuaRy 2012 1

EnterpriseCIODecisions

february 2012 volume 12

Guiding technology decision makers in the enterprise

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InsIdE:

The Many Meanings of shared services

The secrets of shared services success

Put Your Own stamp on shared services

CIOs Make the Call on Cloud

The dark side of service Catalogs?

Building Blocks for a Shared Services StrategyLearn how CIOs are launching and managing shared services in the enterprise environment.

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1 editor’s letter

One Of the first technology news stories I ever worked was titled some-thing like, “Mainframe at your server.” The phrase, unfortunately, gives some idea of how long I’ve been around. It also reinforces the notions of bygone days of client/server, when hardware was king. In the beginning and the end, there was hardware.

Today’s adage might be “mainframe at your service” because everything is becoming a service. Get it?

The planning for this edition of Enterprise CIO Decisions Ezine was particularly challenging. The topic of shared services is an important one as the promises of virtualization, cloud computing and even centralized IT become fully realized in enterprise computing. yet IT executives do not have a set definition of what shared services are.

SearchCIO.com News Director Christina Torode may have captured it best in her interview with Jake Hughes, chief technical architect at Seattle Children’s Hospital: It’s all about moving from “the server to the service.”

Management of a shared services model may be more of a challenge than getting the technology part settled. Sharing shared services can become more difficult when both pri-vate and public clouds are involved,

explains SearchCIO.com Senior News Writer Linda Tucci in her piece on the dark side of service catalogs.

“People make it overcomplicated,” warns Pierre bernard, manager at burlington, Ontario-based consul-tancy Pink Elephant and former chief examiner for IT Infrastructure Library (ITIL). “They try to cover everything to excess. They try to identify each service individually and pretend they are different services, when they are simply a different flavor of that ser-vice.”

Experts agree that the goal of a services-oriented IT environment is to make services readily and eas-ily accessible to end users. That, in itself, is what will really revolutionize IT. “The days of IT controlling tech-nology are gone or are going very quickly,” said David Johns, CIO at Owens Corning Corp. “We want to get to a place where employees don’t have to rely on the IT organization to provision a piece of hardware. Lots of people would refer to this as consum-erization. I think it’s real, and I think it’s the direction we need to go.” ■

scot PetersenEditorial Director, CIO/IT Strategy [email protected]

At Your (shared) services

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1 news, views and reviews for senior technology managers

ON THE JOB

The Many Meanings of Shared Services

edie May reMeMbers when shared services had a fairly straightforward definition. Once upon a time, noted the IT manager of Charleston, S.C.- based insurance provider Johnson & Johnson Inc., “companies would get together and get IT and share that cost.”

but, as with most things in the world of IT, that story has changed and continues to evolve. Take May’s own company.

“Our company doesn’t work that way. We have one IT department, and we acquire other businesses and that one core IT department takes care of all the acquisitions and other depart-ments that we service,” May said. “Our charge is by department, by

business, so there’s kind of a shared service in that.”

Drue Reeves, an analyst at Stam-ford, Conn.-based Gartner Inc., as-serts that shared services’ place in the IT taxonomy has shifted, falling beneath the umbrella of what Gartner refers to as blended services.

“Shared services is any sharing of IT resources or the underlying infra-structure necessary to run IT services by a provider,” Reeves said.

For example, colocation is a shared services environment, he said. Some colocation service providers will bleed into hosted services, which are also shared services, one level up on the stack. Instead of sharing such ele-ments as space, power or cooling, there is a sharing of physical servers, networks and/or rack space. The next level on the stack is cloud sharing, obtaining physical services through virtual means.

“Those are what shared services are, and a provider offers different

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levels,” Reeves said. “When we say blended services, the provider is of-fering a plethora of services, maybe colocation or cloud or all of the above. Within cloud, you have different levels, such as a platform, in which you’re sharing the application plat-form. With Software as a Service, it’s completely turnkey, so you’re actually sharing the application itself.”

Having a shared services environ-ment cuts down on unintended er-rors, makes software better and more accurate, and is an important way to ensure that business policies are enforced the way the business in-tends, said Judith Hurwitz, president and CEO of Needham, Mass.-based consulting firm Hurwitz & associates LLC. It’s beneficial but by no means simple. a services catalog is required to promulgate what is available, and IT must be certain those services of-fered are error-free.

“you’re saying, ‘use this service every time you’re doing this particu-

lar business process,’ so you have to make sure it’s correct and adheres to the rules and that you’re not re-cre-ating a mistake 5,000 times—there’s a big responsibility that the service is what you want it to be,” Hurwitz said.

On the touchy subject of charge-back, Hurwitz suggested avoiding it if possible, so users don’t feel they’re being “penalized” for using a shared service. Some organizations have gone the opposite route, she said, offering incentives for using the ser-vices.

Creating and enabling a shared services environment is beneficial—almost necessary—but doing so should not be taken lightly, Hurwitz said.

“Companies really see the benefit from the business perspective of go-ing this way. It’s hard, because orga-nizationally you have to get people to understand what you are doing and why you’re doing it,” Hurwitz said.

—KareN GoularT

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By THE NumBErs

Most In-Demand Deployment Models

SOURCE: TEChTaRgET 2012 IT PRIORITIES SURvEy, whICh POllEd IT aNd BUSINESS PROFESSIONalS ON ThEIR PlaNS FOR 2012, wITh 1,359 RESPONSES TO ThIS qUESTION.

On-premise software/hardware 59.2%On-premise appliance 23.3%Public cloud infrastructure with own software 16.3%Private cloud infrastructure with own software 26.0%Software as a Service 34.7%Platform as a Service 19.7%Mobile 17.3%

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ONE ON ONE

The Secrets of Shared Services SuccessnaMe: David JohnstitLe: CIO tiMe in this rOLe: Two yearsOrGaniZatiOn: Owens Corning Corp.headQUarters: Toledo, OhioeMPLOyees: 15,000

as CIO of fiberglass manu-facturer Owens Corning Corp., David Johns has a laser focus on the customer experience. If an aspect

of the organization doesn’t directly touch the customer, he wants it simplified and standardized to cut costs and gain efficiencies. Shared services, or what is called centralized IT by some, is a means to that end. Johns recently described to Enterprise CIO Decisions Ezine Owens Corning’s shared services model, and why end-user self-service provisioning is his ultimate goal.

Some consider shared services to be pooled, virtualized resources; oth-ers consider it to be a centralized IT model. What shared services model do you follow at owens Corning?I would say we might be considered a combination of both those defini-

tions. We have run IT “centralized,” or we have operated as one single global organization, for 10 years now. We do have resources in asia, Europe, Latin america and in the u.S., but we oper-ate as one global organization. We have a set of principles where we look for opportunities to leverage solutions and services across the enterprise. We have one set of global infrastruc-ture standards that is the same for all of our 133 locations around the world. We have a single standard for and set of enterprise-wide applications.

I think you would term it centralized, but I don’t like that term because it comes with a lot of baggage. I think it means centralized decision-making, which is not what we do. In addition, we’ve included the operational aspect of many of our corporate systems. So accounts payable and receivables, for example—services that would typi-cally be in a shared services bPO cen-ter in a finance organization—we’ve moved those into our IT organization as well. So when we say shared servic-es or business services, we include both IT and much of the operational aspect of many of the systems we have.

you don’t look at shared services as a multi-tenant environment, like a private cloud?I would say that our network and the way we’re organized today is a private cloud, but do we look at provisioning [services] to the business? We don’t need to because we have a set of

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standardized applications that every-one uses.

Is your data center virtualized?We have virtualized 60% of our data center. We’ve also done a significant amount of virtualization in our desk-top environment. Virtualization is a big part of our go-forward strategy and a big part of our cost play.

Would you say that virtualization is a key piece of your shared services strategy?We don’t have a “shared services strategy,” per se. What we have is a low-cost, high-value delivery strategy, of which shared services—or organiz-ing in a shared services manner—is a tool in the tool belt to go make that happen. We look at shared services more from a business perspective than an IT perspective. any activity that doesn’t touch our external end customer, we believe, provides no value—and don’t take that literally, because there are things that have to happen in corporations, but if it doesn’t touch our customer, we be-lieve it provides no value. Therefore, we want to simplify it, standardize it, take out as much cost as we possibly can. and if applicable, we’ll outsource it because, again, that’s a way of lowering the cost. So that’s our broad definition of shared services.

We’ve run IT as centralized for probably 10 years. We have two data

centers: a main one, and a backup one for disaster recovery. Those are the only data centers we have around the globe. Everything operates out of that data center. We have a couple of instances of SaP, and the only rea-son we have a couple is that there’s no reason from a cost perspective to combine them, but the configurations are exactly the same. We have one big HR system, and on and on.

What are the benefits to the business of shared services?We started with infrastructure 10 years ago. We felt that one common infrastructure was the way to run a global company. It was the most cost-efficient and effective way to operate. So all of our employees operate off one network [and] have one single image to use. We locked down our environment very tightly. The primary reason behind that was cost. It was a much more cost-effective way to op-erate: one data center as opposed to 10, one set of infrastructure standards and devices as opposed to 10 or 12. So initially, it was a cost play. Today, it’s driven by productivity. It’s much more productive for employees since everyone has the same environment, the same tool set.

That’s changing as technology con-tinues to change. We’re starting to open up our environment for employ-ee-owned smartphones, tablets and PCs. but I think the fact that we’ve been in the consolidated, centralized

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space for so long [makes it] very easy for us to open it up now.

What do you have in shared services today?I would consider IT as a shared ser-vice. There are also multiple account-ing functions—corporate services that would include global travel and supporting functional organizations. We’re moving some of our HR func-tions into a shared services environ-ment. From a pure bPO, shared-services point of view, I think we’re pretty industry-standard in terms of what we’re moving in. We should be able to standardize it, simplify it and move it into a shared service environ-ment.

Did you change how you charge for services as a result of having a shared services environment?We’re not big into the cross-charge game. We allocate costs indirectly to the businesses, and that is dependent on the size and scope of the busi-ness. That’s how those allocations get determined. So there is no by-service or by-usage type of chargeback. Personally, I think that’s a waste of time. What value does that provide to our end customers? you can spend an enormous amount of time going through a massive exercise, and you can have a whole organization of people focused on the proper cross-charge or service charge to the busi-ness. That provides no value to the customer. —CHrISTINa ToroDe

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ON THE AGENDA

Heads in the CloudWhich of these external cloud services do you plan to use in 2012?

Storage as a Service

disaster recovery/business continuity

Platform as a Service

Software as a Service

Infrastructure as a Service

database as a Service

Security as a Service

all others

SOURCE: TEChTaRgET 2012 IT PRIORITIES SURvEy, whICh POllEd IT aNd BUSINESS PROFESSIONalS ON ThEIR PlaNS FOR 2012, wITh 707 RESPONSES TO ThIS qUESTION.

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0 20 40 60 80 100


1 Put your own stamP on shared services

ask it execUtives what a shared ser-vices model is, and each will give you a different answer.

For Wes Wright and Jake Hughes of Seattle Children’s Hospital, a shared services organization moves the focus from “the server to the service.”

“It’s a fundamental shift,” said Hughes, Seattle Children’s chief tech-nical architect. “Instead of HR say-ing, ‘That is my server and that is my storage’, it is their service, and they have no idea what’s on the back end. It is no longer any one person’s or any one business unit’s storage because we may move that storage 10 times in one week depending on the needs of the overall organization.”

Indeed, the hospital has created a virtualized infrastructure from the server to the desktop. all server,

storage and network resources are pooled and moved around as needed depending on business project needs, said Wright, vice president and chief technology officer at the hospital. ap-plications are also virtualized, provid-ing physicians with a standard set of services.

Virtualization also figures heavily into consultant Chris Ward’s defini-tion of shared services. an organiza-tion has to be at least 80% virtualized in the data center or the ability to shift and share IT resources and ser-vices is “a nonstarter” said Ward, vice president of consulting and integra-tion at Kittery, Maine-based systems integrator GreenPages Technology Solutions.

The other building blocks needed for a shared services environment—

Put Your Own

Stamp on Shared Services

definitions and approaches may vary, but it executives are forging ahead in an effort to cut costs

and better serve customers. BY CHRISTINA TORODE

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also called a “private and internal cloud” by Ward—are a virtualization management layer and monitoring, automation and orchestration tools.

“The ability to cost-effectively create a multi-tenant environment is now a reality because the technical pieces—the management, monitor-ing, automation and orchestration—are now in place,” he said.

creatinG shared services OrGaniZatiOnsDavid Johns, CIO at fiberglass manu-facturer Owens Corning Corp., has virtualized 60% of his company’s global data center. He considers his IT organization to be a shared service organization, but virtualization and even shared services are a means to an end, he stresses.

Johns is on a constant hunt to leverage solutions and services eco-nomically across the enterprise. To that end, Owens Corning has one set of global infrastructure standards that are the same for all of its 133 loca-tions around the world. The company has a single set of set of enterprise-wide application standards and road maps, including one human resources system and only a few instances of SaP worldwide. With standardization driving out costs, IT is better able to apply itself to strategic business ini-tiatives such as customer experience transformation—an area Johns plans to focus on this year.

Some may call this, as Johns does,

both a shared services model and what is traditionally called centralized IT.

yet another variation on the shared services model is combining internal service offerings with those of third

parties, positioning IT as more of a services broker. This can help internal IT better compete against external offerings, said Jeff Kaplan, founder and managing director of ThinkStrat-egies Inc., a consulting firm in Welles-ley, Mass. by combining private and public operations, this model also positions the business to extend its operations by forming collaborative partnerships with other companies and customers in the cloud.

but whether an enterprise chooses centralization or virtualization as its

“ The ability to cost-effectively create a multi-tenant environ-ment is now a reality because the techni-cal pieces—the man-agement, monitoring, automation and orchestration— are now in place.” —ChriS ward Vice president of consulting and integration, GreenPages Technology Solutions

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primary shared services approach, or an internal or hybrid cloud, the goals are the same, Kaplan said: to distrib-ute, simplify and standardize so not only resources, but also knowledge and best practices, can be shared.

“by sharing best practices and out-comes, organizations don’t have to reinvent things. It’s the idea of crowd-sourcing, making enhancements and sharing it with the rest of the group,” he said.

LOck in On the bUsiness benefitsWhile CIOs have different views of what shared services mean, they are pretty much in agreement on why they have moved to a shared services model: Cost comes first. Many CIOs also talk about improving the end user experience and the consumer-ization of IT. but shared services is almost always seen as a means to an end rather than an end in itself.

For GreenPages’ enterprise cus-tomers, cost and improving service to both internal end users and external customers are the primary reasons for adopting a shared services model.

“They don’t want to manage indi-vidual silos of IT for different business units when they can pool together resources and become an internal service provider to various lines of business,” he said. “In terms of cost, it makes a ton of sense. you’re not over-buying or under-buying resources. you can pool and burst and contract as the business needs change.”

as for the future of shared shared services? Self-service is the ultimate goal in a shared services environ-ment, or under any IT services model, as far as Owens Corning’s Johns is

concerned. The company is already providing self-service to end users for PCs, and is moving in the self-service direction in general to make employ-ees more productive, he said.

“The days of IT controlling tech-nology are gone or are going very quickly,” Johns said. “We want to get to a place where employees don’t have to rely on the IT organization to provision a piece of hardware. Lots of people would refer to this as consum-erization. I think it’s real and I think it’s the direction we need to go.”

shared services bLOcks and bLOckadesOne of the trickiest parts of shared services offerings is how to charge for them. Wright and Hughes have yet to start down the road of IT chargeback,

while CiOs have different views of what shared services mean, they are pretty much in agreement on why they have moved to a shared services model: Cost comes first.

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which is considered by some a nec-essary component of a multi-shared services environment. For now, the pair is sticking with a central budget within IT for project resources.

IT chargeback is outright “a waste of time” Johns said. Instead, he relies on a traditional model of allocating costs based on the size and scope of a given project. “What value is there to the end customer if you spend an enormous amount of time going through a massive exercise focused on service charges to a business [unit]?” he said.

GreenPages’ Ward said some customers are finding the shift to a chargeback model in a multi-tenancy environment to be a painful one. With the old way of measuring IT costs out the door, some will have to change business processes and introduce new reporting tools.

“you’re not buying a specific piece of anything anymore, but using re-sources from a pool,” Ward said. “yet the auditing side of the house wants to still know how the money was spent on a given project and on what, exactly.”

The mentality of being a server or solution “superhero” also needs to be put to rest, said Wright. “Our CIO, Drexel DeFord, keeps saying, ‘I want more Clark Kents and fewer Supermen.’

“When you move to a services-based organization where design is standardized, the [people] build-ing the server or the engineer—who like to be the heroes that create a

solution—are no longer making that solution on their own,” and they feel diminished, he said.

Kaplan recommends taking a page out of bechtel Group Inc.’s playbook. The global engineering, construction

and project management company began touring cloud providers’ data centers years ago, and today has built a well-known private cloud. Those IT heroes of yore should be encouraged to become cloud builders and cham-pions of standardization.

“I think what’s going on is that many companies want to emulate the best practices of the leading cloud and SaaS companies, which are focused on standardization, automa-tion and simplification, and, for some, agility,” Kaplan said. ■

christina torode is news director for SearchCIO.com. write to her at [email protected].


“ what value is there to the end customer if you spend an enormous amount of time going through a massive exercise focused on service charges to a business [unit]?”—daVid jOhnS CiO, Owens Corning Corp.

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2 cios make the call on cloud

JUst abOUt every organization I know—including my own at this very mo-ment—is faced with a vexing ques-tion: What do we do with the cloud, and when? While we sit and ponder, we risk having the decision made for us. The rapid expansion and adoption of Software as a Service (SaaS), Plat-form as a Service (PaaS) and Infra-structure as a Service (IaaS) mean we must quickly but correctly figure out our cloud strategies, be they public, private or hybrid.

On the upside, cloud strategies lend themselves to projects that build on past work and previous experienc-es, such as virtualization and small-scale forays into the cloud. CIOs have to stay acutely aware of the lessons they’ve learned and position them-selves as the key leader prepared to take the organization to cloud’s next level.

My organization recently replaced one of our mission-critical, highly in-terconnected, on-premises tools with a cloud application. The only place this application runs is in the cloud, but because it has to connect with many of our on-premises applica-

tions, our SaaS effort was more hybrid cloud than pure public cloud. Through such implementations, nonetheless, we are preparing ourselves to replace other legacy applications and eventu-

CIOs Make the Call on Cloud

given the growing number of cloud strategies, cios must drive this cultural shift—or risk obsolescence.

BY NIEL NICKOLAISEN

what do we do with the cloud, and when? while we sit and ponder, we risk having the decision made for us.

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ally take advantage of a more purely public cloud strategy.

Several years ago, we moved major portions of our on-premises infra-structure to an external data center. an element of this move was the wholesale use of virtualization. This combination of external data center and virtualization became our current private cloud. Moving to a private cloud required that we be good at configuring remote systems and up-grading software (as well as good at recovering data, patching, deploying software and so forth). We also had to be good at remote administration because we then extended our cloud by moving some systems to an additional external data center. In effect, our private cloud has three nodes: the central office and two external data centers. We have deployed the full range of vir-tualization and management tools so we can respond better to the dynamic na-ture of our organization and projects.

We also can scale our private cloud up and down as needed to sup-port specific initiatives. Our separate nodes make disaster recovery a breeze—logistically and geographically, at least. and our private cloud experience has helped us be somewhat prepared for our new hybrid cloud. Why only

somewhat prepared? because we can exert a certain amount of control over our private cloud. Our hybrid cloud will require us to connect to,

share data with and rely on someone who isn’t us—a frightening prospect for the security performance- and

reliability-minded.at first, my team members—

who have spent their lives in an on-premises or private cloud en-

vironment they control—simply could not accept using the public cloud. They wanted to impose the same control on the SaaS environment that they imposed on our on-premises and private world. That

control, however, does not exist. Next, they

wanted to require that the software team engage

in a wide range of contortions (data encryption between the SaaS application and our legacy applications, databases in the demilitarized zone and who knows what else). Finally, they


we can scale our private cloud up and down as needed to support specific initiatives.

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tried to convince the organization to change its mind about the SaaS appli-cation and implement an on-premises application. When none of these worked, my team resigned itself to a life in a public-cloud world. They still had reservations, however, and really had no idea how to manage the data exchange between the private and public elements of our hybrid cloud.

So, I did two things. First, I gave everyone a copy of an article from my MIT alumni magazine, in which the author explains that security in the public cloud is better than the secu-rity of private or on-premises environ-ments. How can this be? because the entire cloud business model depends on superior security, and so it is a higher priority for people in the public cloud than it is for people in a private cloud environment. Secondly, I told them we didn’t have to solve how to manage the data exchange securely. Why? because others (in fact, lots of others) have figured it out already. We just need to learn what the others do. So, I sent them on a best practices tour with the goal of implementing whatever best practice they found.

We are now implementing our hybrid cloud. With this cloud in place, we can start to experiment with purely public cloud options.

This experience has taught me several things:

■ If we are using virtualization aggressively, we have already taken big steps toward a private cloud strategy.

■ If we are using an external data center and using virtualization aggressively, we have a private cloud.

■ Shifting to a hybrid or public cloud model is a shift in the culture, not in technology or security.

■ Given the increasing number and quality of cloud offerings, we CIOs had better be the ones driving this cultural shift—otherwise, we are on the path to obsolescence. ■

niel nickolaisen is CIO at western governor’s University in Salt lake City. write to him at [email protected].


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3 the dark side of service catalogs?

at Liberty diversified internatiOnaL inc., which owns businesses in places as far-flung as Taiwan that range from paper manufacturing and office sup-plies to advertising, every IT resource that can be virtualized is.

“The goal is to share as much of the systems as we can,” said alla John-son, CIO since June at the New Hope, Minn.-based holding company.

a Multiprotocol Label Switching, or MPLS, wide area network con-nects most of Liberty Diversified’s locations. ERP systems are delivered primarily via tools from Citrix Sys-tems Inc. Windows and Linux servers are on VMware. Johnson uses IbM bladeCenter technology to support that environment, and has a Dell Inc. Compellent SaN for storage.

One thing Johnson doesn’t use in her shared services shop? a tradi-tional service catalog. “There was an

attempt at a catalog about five years ago. The business didn’t buy into it,” she said.

Instead, she is developing a strate-gic plan that lays out the services that will be available over the next three years and when they will be imple-mented. These services are based on extensive discussions with each of the businesses.

Certainly, it’s challenging to build a service catalog for a shared services environment that relies on virtual-ized IT systems and perhaps a private cloud. Delivering pooled IT resources requires some fancy footwork on the back end for tracking usage and costs. In shared services environments that use a combination of internal and public cloud computing, tracing the linkages that create services can be even trickier, IT service management experts say. The business-facing

The

Dark Side of Service Catalogs?shared services in a virtualized cloud environment add complexity to developing a service catalog but

don’t change its basic purpose. BY LINDA TUCCI

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service catalog, however, remains the same.

“a catalog is a catalog. No matter how your services are provided—whether you are using Type 1 or Type 2 or Type 3 providers—the way you

present services should be transpar-ent to the business,” said Pierre ber-nard, manager at burlington, Ontario-based consultancy Pink Elephant Inc. and formerly chief examiner for the IT Infrastructure Library (ITIL) frame-work, which is widely adopted for the delivery of IT services.

unfortunately, the mistakes that IT inevitably makes with service cata-logs also remain the same, according to bernard. “People make it overcom-plicated. They try to cover everything to excess. They try to identify each service individually and pretend they are different services, when they are simply a different flavor of that ser-vice,” he said. “When you go to Mc-Donald’s, can you order a hot dog? No, because they don’t sell it.”

bernard advises CIOs to consider the services they use all the time—from restaurant menus to online air-line reservations—when they develop their IT service catalogs. If 10 people

go to a restaurant, they are unlikely to order the same dishes, but they order from the same menu. The ingredients required and processes involved in delivering the dish have been worked out in advance and are largely invis-ible to the diner. The same holds true for IT service catalogs, whether the catalog is developed for traditional IT environments serving a local business unit, for a centralized internal virtual environment providing services glob-ally, or for a hybrid cloud environ-ment, he said.

Instead of reinventing the wheel, CIOs should start with their compa-nies’ websites. Generally, a site lays out what the company does—its vari-ous lines of business, products and services. “We in IT take that and map it to the business processes and then list the IT services that support those business processes,” bernard said.

take cUes frOM MObiLe indUstryThe purpose of a service catalog “doesn’t really change,” whether or not it’s in a shared services environ-ment, agreed Sharon Taylor, formerly ITIL chief architect and now ITIL chief examiner. “The purpose is to depict to the customer what is available. Whether the services are shared for economies of scale, or whether they are virtualized, or if storage is done across a series of server farms—the customer doesn’t care about that, nor should they,” she said.


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Unfortunately, the mistakes that iT inevitably makes with service catalogs remain the same.


Go Boldly into the next FrontierseLf-service POrtaLs can be the CIo’s best friend—not only because they drive down costs, but also because they put the burden of the solution on the user.

“The more we are handling through self-portals, the better, because we don’t need to pay our expensive subject matter experts to do silly things like password resets,” said Pierre bernard, manager at burlington, ontario-based consultancy Pink elephant Inc. an added bonus is that the perception of service quality often goes up, said ITIl Chief examiner Sharon Taylor, because the users are probably getting service faster. “If there is technology that lets someone like me—who keeps locking myself out be-cause I can’t remember my password—reset without human intervention, I am happy.”

Portals should be built in conjunction with the service catalog, Taylor said, but com-panies can also have “lots of self-service provisioning without having a service cata-log. Self-service provisioning can be a service catalog.” (Indeed, Jack Santos, Gartner Inc. analyst and former CIo, goes so far as to say self-provisioning in a cloud-enabled shared services environment makes catalogs “passé.”)

of course, policies, permissions and access rights should be hammered out with the business, Taylor said, not by IT alone.

Zf Group’s mark Cybulski is a regional CIo responsible for about 20 of the global automotive supplier’s plants in North america. Shared services have been the norm for a long time, but the Zf Group plants are “relative newcomers” to self-service, he said. “We basically have trained a lot of our users to enter their own help desk tick-ets, but we have been slow to get into the portal business,” he added. In recent years, IT’s attention has been relentlessly on the company’s global expansion rather than on back-office nice-to-haves, such as portals. Now that the economy is looking better, “we will be looking at more of that.”

bernard recommends that CIos think “out of the box” when they do design their portals, and take advantage of powerful social media and search sites, from Twitter to facebook to youTube. rather than sending alerts through pagers and emails, CIos should use a portal and an app such as Twitter for corporate alerts. many universities are using facebook as a service management tool.

“you have all these stupid videos on youTube, but the site also contains a lot of good videos on how to do things,” bernard said. “Why not create a corporate account on youTube, where only your employees can go or create their own little videos?”

People denigrate Wikipedia, he added, but the site also contains “tons of valid infor-mation,” to which IT can direct employees with links on their intranet.

“a lot of working people are used to face-to-face contact. Not everybody pays bills on-line or even goes to the aTm machine,” let alone fixes their own PC, bernard cautioned.

—lINDa TuCCI

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That said, in cloud computing environments—where it is less clear which IT assets are owned by the company and which aren’t—it’s diffi-cult to track service consumption in a transactional or asset fashion. “What we have had to do is take a step back from thinking about things in terms of bits and bytes and transactions,” Taylor said.

Instead, many IT shops are offer-ing packaged services that accom-modate different business needs, like the bundled services offered by cell phone service providers, Taylor said. an example is email: a business divi-sion pays a certain amount per year for the “vanilla” service that is shared, but it can buy packaged services that are enhanced with more storage or multiple email accounts. “These are offered at different price points to customers willing to pay a premium for them,” she said.

The approach is “not an exact sci-ence,” but it’s perhaps the easiest way to get the most accurate information, Taylor said. “you don’t want to spend more money and time determining the cost of services than it actually costs to use them.”

Mark Cybulski, a regional CIO at ZF Group, a German-owned global automotive supplier with 121 plants in 27 countries, said his company offers some of the more standard IT services, such as help desk and net-works, as well as end devices, such as smartphone services, on a consump-

tion basis to its plants. asked if he uses a service catalog, the answer is “yes and no.”

“We have very tightly defined service definitions. Our auditors are sticklers to make sure that we are charging for services that have a clear definition,” Cybulski said. “We also have a lot of conversations with our controller about what the pricing models are going to be and the type of metering we are going to have. We regenerate our prices on an an-nual basis to tell our individual plant controllers what to expect. and we work collaboratively with them to budget the coming year for service volumes.”

all that exists, “but I have to tell you that once they are in place, they are rarely referred to. It is like one of those procedural manuals that sits on the desk and collects dust,” Cybulski added.

resPOndinG tO bUsiness vs. OPeninG it’s tOOLbOxJohnson, of Liberty Diversified, said she prices services based on each business’s historical use of IT ser-vices. also factored in are industry norms for IT spending as a percent-age of company revenue. Hard as it is to price services, the benefits out-weigh the pain, she said.

The holding company’s divisions include companies with fewer than 150 employees. With shared services, Johnson can negotiate deals that any


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one company in the Liberty stable couldn’t pull off, and hire subject experts the businesses couldn’t afford on their own.

One danger of a centralized ap-proach is that IT will become locked into certain services that don’t really

reflect the business’s needs.building her strategic plan for

the business is akin to developing a service catalog, Johnson said. Only this time, her shared services strate-gic plan, aka catalog, is starting with business buy-in, as opposed to open-ing up the IT toolbox and offering as a service whatever happens to be in it—or, as she put it, using the “I have a hammer; now show me where the nails are” approach.

“We are trying to step away from that mentality and ask, what is it we really need to build for the business, how do we need to build it, and what are the tools that we need to have,” she said. ■

Linda tucci is senior news writer for SearchCIO.com. write to her at [email protected].


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Enterprise CIO Decisions E-zine is a CIO/IT Strategy Media e-publication.

Jacqueline biscobing Managing Editor

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Niel Nickolaisen Contributing Writer

Scot Petersen Editorial Director

Christina Torode News Director

linda Tucci Senior News Writer

Karen Goulart Features Writer

Corey Strader Director of Product Management

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One danger of a centralized approach is that iT will become locked into certain services that don’t really reflect the business’s needs.


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