IT Ops Modernization Helps Energy Powerhouse Exelon Master the Art of Mergers and Acquisitions on a Vast Scale
IT Ops Modernization Helps Energy Powerhouse Exelon
Master the Art of Mergers and Acquisitions on a Vast Scale
Transcript of a BrieﬁngsDirect podcast on how a large utility operation uses HP tools to get
better insight into IT operations.
Listen to the podcast. Find it on iTunes. Sponsor: HP
Dana Gardner: Hello, and welcome to the next edition of the HP Discover Podcast Series. I’m
Dana Gardner, Principal Analyst at Interarbor Solutions, your host and
moderator for this ongoing sponsored discussion on IT innovation and how it’s
making an impact on people’s lives.
Once again, we're focusing on how companies are adapting to the new style of
IT to improve IT performance and deliver better user experiences, as well as
better business results.
This time, we're coming to you directly from the HP Discover 2014 Conference in Las Vegas.
We're here the week of June 9 to learn directly from IT and business leaders alike how big data,
cloud, and converged infrastructure implementations are supporting their goals.
Our next innovation case study interview highlights how Exelon Corporation, based in Chicago,
has been employing a great deal of technology and process to improve their operations and also
to help manage a merger and acquisition transition period, as well as bring outsourced IT
operations back in house.
To learn more about how Exelon, a leading energy provider in the US, a family of companies
with $23.5 billion in annual revenue, accomplishes these goals we're joined by Jason Thomas, he
is a Manager of Service, Asset and Release Management at Exelon. He's based in Baltimore.
Jason Thomas: Thank you, Dana. Its a pleasure to be here.
Gardner: I gave a brief overview of Exelon, but tell us a little bit more. It's quite a large
organization that you're involved with.
Thomas: We are vast and expansive. We have a large nuclear ﬂeet, around 40-odd nuclear power
plants in three utilities, ComEd in Chicago, in the Illinois space; PECO out of Philadelphia; and
BG and E in Baltimore.
So we have large urban utilities center. We also have a large retail presence with the
Constellation brand and the sale of power both to corporations and to users. So there's a lot of
that we do obviously in the utility space, and there are some element of the trade, the commodity
trading side, as well in trading power in these markets.
Gardner: I imagine it must be quite a large IT organization to support all that?
Thomas: There are 1,200 to 1,300 IT employees across the company.
Gardner: Tell us about some of the challenges that you've been facing in managing your IT
operations and making them more efﬁcient. And, of course, we'd like to hear more about the
merger between Constellation and Exelon back in 2012.
Merger is a challenge
Thomas: The biggest challenge is the merger. Obviously, our scale and the number of, for lack
of a better word, things that we had to monitor, be aware of, and know about vastly increased. So
we had to address that.
A lot of our efforts around the merger and post-merger were around bringing everything into one
standard monitoring platform, extending that monitoring out, leveraging the
Business Service Management (BSM) suite of products, leveraging Universal
Conﬁguration Management Database (UCMDB).
Then there was a lot around consolidating asset management. In early 2013,
we moved to Asset Manager as our asset manager platform of choice,
consolidating data from Exelon from their tool, the Cergus CAArgis tool, into
Asset Manager in support of moving to new IT billing that would be driven
out of the data and Asset Manager in leveraging some of the executive
scorecard and ﬁnancial manager pieces to make that happen.
There was also a large effort through 2013 to move the company to a standardized platform to
support our service desk, incident management, and also our service catalog for end-users. But a
lot of this was driven last year around the in-sourcing of our relationship with Computer
Sciences Corporation for our IT operations.
This was to basically realize a savings to the company of $12 to $15 million annually from the
management of that contract, and also to move both the management and the expertise in house
and leverage a lot of the processes that we built up and that had grown through the company as a
Gardner: So knowing yourself well in terms of your IT infrastructure and all the elements of
that is super important, and then bringing in-sourcing transition to the picture, involves quite a
bit of complexity.
What do you get when you do this well? Is there a sense of better control, better security, or
culture? What is it that rises to the top of your mind when you know that you have your IT
service management (ITSM) in order, when you have your assets and conﬁguration management
data in order. Is it sleeping better at night? Is it a sense of destiny you have fulﬁlled -- or what?
Thomas: Sleeping better at night. There is an element of that, but there's also
sometimes the aspect of, "Now what's next?" So, part of it is that there's an
evolutionary aspect too. We've gotten everything in one place. We're leveraging
some of the integrations, but then what’s next?
It's more restful. It's now deciding how we better position ourselves to show the
value of these platforms. Obviously, there's a clear monetary value of what we did to in-source,
but now how do we show the business the value that we have done? Moving to a common set of
tools helps to get there. You've leveled the playing ﬁeld and you have that common set of tools
that you're going to drive to take you to the next level.
Gardner: What might that next level be? Is it a cloud transition? Is it more of a hybrid sourcing
for IT? Is this enabling you to take advantage of the different devices in terms of mobile? Where
does it go?
Automation and cloud
Thomas: A lot of it is really around automation, the intermediate step around cloud. We've
looked at cloud. We do have areas where the company has leveraged it. IT is still trying to wrap
their heads around how we do it, and then also how we expose that to the rest of the organization.
But the steps we’ve done around automation are very key in making leaner operations, IT
operations, but also being able to do things in an automated fashion, as opposed to requiring the
manual elements that, in some cases, we had never done prior to the merger.
Gardner: Any examples? You mentioned $15 million in savings, but are there any other metrics
of success or key performance indicator (KPI)-level paybacks that you can point to in terms of
having all this in place for managing and understanding your IT?
Thomas: We're still going through what it is we're going to measure and present. There's been a
standard set of things that we've measured around our availability and our incidents and whether
these incidents are caused by IT, by infrastructure.
We've done a lot better operationally. Now it's taking some of those operational aspects and
making them a little bit more business-centric. So for the KPIs, we're going through that process
of determining what we're going to measure ourselves against.
Gardner: Jason, having gone through quite a big and complex undertaking in getting your ITSM
and Application Lifecycle Management (ALM) activities, what comnes next? Maybe a merger
and acquisition is going to push you in a new direction.
Thomas: We recently announced the intent to acquire Pepco Holdings, which is the regional
utility in Washington, DC area, that further widens our footprint in the mid-Atlantic area. So
yeah, we get to do it all over again with a new partner, bringing Pepco in and doing some
elements of this again.
Gardner: Having gone through this and anticipating yet another wave, what words of wisdom
might you provide in hindsight for those who are embarking on a more automated, streamlined,
and modern approach to IT operations?
Thomas: One of the key things is how you're changing and how you do IT operations. Moving
towards automation, tools aside, there's a lot of organizational change if you're changing how
people do what they do or changing people's jobs or the perception of that.
You need to be clear. You need to clearly communicate, but you also need to make sure that you
have the appropriate support and backing from leadership and that the top-down communication
is the same message. We certainly had that, and it was great, but there's alway going to be that
challenge of making sure everybody is getting that communication, getting the message, and
getting constant reinforcement of that.
Organizational changes resulting from a large merger or acquisition are huge. It's key to show the
beneﬁts, even to the people who are obviously going to reap some of these immediate beneﬁts,
those in IT. You know the business is going to see some. It's couching that value in the means or
method appropriate for those actors, all of those stakeholders.
Gardner: Of course, you have mentioned working through a KPI deﬁnition and working the
executive scorecard. That makes if full circle, doesn’t it?
Thomas: Deﬁning those KPIs, but also having one place where those KPIs can be viewed, seen
easily, and drilled into is big. To date, it's been a challenge to provide some of that historiography
around that data. Now, you have something where you can even more readily drill into it to see
that data -- and that’s huge.
Presenting that, being able to show it, and being able to show it in a way that people can see it
easily, is huge, as opposed to just saying, "Well, here's the spreadsheet with some graphs" or
"Here’s a whiz-bang PowerPoint doc."
Gardner: And, Jason, I suppose this points to the fact that IT is really maturing. Compared to
other business services and functions in corporations, things that had been evolving for 80 or 100
years, IT is, in a sense, catching up.
Thomas: It's catching up, but I also think it's more of a reﬂection. It's reﬂection of a lot of the
themes of the new style of IT. A lot of that is that consumerization aspect. In fact, if you look at
the last 10 years ago, the wide presence of all of these, your smart devices and your smartphones,
We have brought to most people something that was never easily accessible. And having to take
that same aspect and make it part of how you present what you do in IT is huge. You see it in
how you're manifesting it in your various service catalogs and some of the efforts that we're
undertaking to reﬁne and better the processes that underlie our technical service catalog to have a
better presentation layer.
That technical service catalog will refer to what we've seen with Propel. It's an easier, nicer,
friendlier way to interact, and people expect that. Why can’t this be more like my app store, or
why can't this be more like X.
Is IT catching up or has IT become more reachable, has become more warm and fuzzy as
opposed to something that’s cold, hard, and stored away somewhere. You kind of know about it,
and perhaps the guys in the basement are the ones who are doing all the heavy lifting, and it's
Gardner: Humanization of IT perhaps.
Gardner: All right, one last area I want to get into before we sign off. We heard quite a bit
yesterday about The Machine, HP unveiling more detail from its labs activities. It’s not
necessarily on a product roadmap yet, but it’s described through a lower footprint, much more
rapid ability to join compute and memory, and then reduce the size of the data center down to a
size of a refrigerator.
I know that it's on the horizon, but how does that strike you, and how interesting is that for you?
Ramp up/ramp down
Thomas: It's interesting, because it allows you to get to bit more ability to ramp up or ramp
down, based on what you need, as opposed to you having x amount of servers and x amount of
storage that's always somewhere. It gives you a lot more ﬂexibility and, to some extent, gives
you a bit more tenability. It's directly applicable to certain aspects of the business, where you
need that capability to ramp up and ramp down much more easily.
I had a conversation with one of my peers last night about that. We were talking about how both
that and the Moonshot aspect and the ability to have that for a lot of the customer-facing
websites, and the ability to tie them, in particular, the utility customer-facing websites whose
utilization tends to spike during weather events.
While they don't spike all at the same time, there is the potential opportunity in the Mid-Atlantic
of all the utilities spiking at the same time around a hurricane or Sandy-esque event. There's
obviously a need to able to respond to that kind of demand, and that technology positions you
with the ﬂexibility to do that rather quickly and easily.
Dan Gardner: Well, great. I'm afraid we will have to leave it there. We've been talking with
Exelon Corporation, based in Chicago, about their journey towards a better handling of IT and
transitions through mergers and acquisitions as a result of having a much deeper sense of their
So a big thank you to our guest, Jason Thomas, Manager of Service Asset and Release
Management at Exelon. Thank you, sir.
Thomas: Thank you, Dana. My pleasure.
Dan Gardner: And also a big thank you to our audience for joining us for this special new style
of IT discussion coming to you from the HP Discover 2014 Conference in Las Vegas.
I'm Dana Gardner; Principal Analyst at Interarbor Solutions, your host for this ongoing series of
HP sponsored discussions. Thanks again for listening, and come back next time.
Listen to the podcast. Find it on iTunes. Sponsor: HP
Transcript of a BrieﬁngsDirect podcast on how a large utility operation uses HP tools to get
better insight into IT operations and monitoring. Copyright Interarbor Solutions, LLC,
2005-2014. All rights reserved.
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