1. IT Asset Management
the foundation of all IT Success
Cora L. Carmody
John R. Warburton
Office of the CIO
Litton PRC
2. 2
In general…
• Decentralized IT spending in the
absence of standards leads to
– inefficient spending without volume
purchase agreements
– lack of insight into what we possess
– severe interoperability problems
– low ability to implement modern
technological solutions
3. 3
Areas of common concern
- Process inefficiencies
“we spend too much and wait too long”
lack of standard processes
- Lack of asset insight
still paying taxes on assets long gone
- Lack of uniform support and supportability
help desk, back-ups
dueling DLLs...uninformed installs
- Lack of technological agility
migration planning
migration implementation (manual software
distribution)
5. 5
IT Asset Management
The Policies, Processes, Systems
and Controls for the Orderly
Planning, Acquisition, Entry, Use,
Insight, Refresh, and Retirement
(Reallocation and/or Disposal) of
all IT Assets
7. 7
A s s e t
E n t r y
U s e
I n s ig h t
T e c h
R e f r e s h
A s s e t
R e t ir e m e n t
AssetUsefulLife
A c q u is it io n
C o n f ig u r a t io n
S e t U p
T r a in in g
A c c o u n t s /
P a y a b le
A s s e t
R e g is t r y
P r o b le m
R e s o lu t io n
A p p lic a t io n
S u p p o r t
M o v e s , A d d s ,
C h a n g e s
B a s e lin e
I n v e n t o r y
I n v e n t o r y
M o n it o r in g
A s s e t
R e c o n c ilia t io n
F in a n c ia l A n a ly s is /
R e p o r t in g
A s s e t R e f r e s h
S W L ic e n s e
M a n a g e m e n t
T e c h C h a n g e
M a n a g e m e n t
U p g r a d e
A s s e t
R e d e p lo y m e n t
A s s e t
D is p o s a l
E n t e r p r is e
I n t e g r a t e d
A s s e t M g t
S y s t e m
A s s e t
R e p o s ito r y
D e p lo y m e n t
A s s e t
P la n n in g
I T C a p it a l
P la n n in g
F o r w a r d
P r ic in g
S o f t w a r e
B u ild /
D is t r ib u t io n
C o n t r a c t
M o n it o r in g
P r o g r a m
T e c h
R e f r e s h
C o n t r a c t
M o d s
L e a s in g
M a n a g e m e n t
I T A s s e t
M a n a g e m e n t
S u p p o r t C e n t e r
S t d D s k t o p
P o lic ie s
Enterprise IT Asset Management MacroPatent pending
8. 8
A s s e t
E n t r y
U s e
I n s ig h t
T e c h
R e f r e s h
A s s e t
R e t ir e m e n t
AssetUsefulLife
A c q u is it io n
C o n f ig u r a t io n
S e t U p
T r a in in g
A c c o u n t s /
P a y a b le
A s s e t
R e g is t r y
P r o b le m
R e s o lu t io n
A p p lic a t io n
S u p p o r t
M o v e s , A d d s ,
C h a n g e s
B a s e lin e
I n v e n t o r y
I n v e n t o r y
M o n it o r in g
A s s e t
R e c o n c ilia t io n
F in a n c ia l A n a ly s is /
R e p o r t in g
A s s e t R e f r e s h
S W L ic e n s e
M a n a g e m e n t
T e c h C h a n g e
M a n a g e m e n t
U p g r a d e
A s s e t
R e d e p lo y m e n t
A s s e t
D is p o s a l
E n t e r p r is e
I n t e g r a t e d
A s s e t M g t
S y s t e m
A s s e t
R e p o s ito r y
D e p lo y m e n t
A s s e t
P la n n in g
I T C a p it a l
P la n n in g
F o r w a r d
P r ic in g
S o f t w a r e
B u ild /
D is t r ib u t io n
C o n t r a c t
M o n it o r in g
P r o g r a m
T e c h
R e f r e s h
C o n t r a c t
M o d s
L e a s in g
M a n a g e m e n t
I T A s s e t
M a n a g e m e n t
S u p p o r t C e n t e r
S t d D s k t o p
P o lic ie s
Some Qualitative Benefits
•Reduced Process
Time
•Reduced Product
Costs•Avoiding Costs
Incurred Through
Shadow Support
•Quicker Resolution
Time
•Reduction of Redundancy
•Ability to Standardize
•Obtain Volume Pricing
•Reduction of Liability Incurred Through Illegal Licenses
•Cost Avoidance Through License Reuse
•Decrease of
Taxes Paid on
Absent
Equipment
•Cost Savings Through Better Utilization of Existing Assets
•Enhanced Employee Satisfaction and
Productivity
‘nuff said
Patent pending
9. 9
Enterprise IT Asset Management Architecture
Desktop
Systems
Network &
Systems
Management
Asset
Management
Business
Systems
Software
Build
(OS, OA,
Custom Apps)
SW Metering
Discovery
Client
Electronic
Software
Distribution
IT
Asset
Registry
Decision
Support
Support
Center
Procurement
Accounts
Receivable/
Accounts
Payable
Fixed Asset
Management
Software
License
Management
IT
Asset
Registry
Asset Repository
Human
Resources
Inventory
Manager
Network
Monitoring
Web Enablement
Web Enablement
Seat Management Dashboard
Patent pending
10. 10
Worst case Costs
2,500 PC Wkstns.
over 12 months
% Costs Reduced
With Asset Mgmt.
Strategy
Estimated
Implementation
Costs
Net 12 Month
Savings**
1 Help Desk
Discovery Time
$420,000 57% $46,900 $192,500
Worst Case Desc.: End-user works 100 min. per year (@$30/hour) on support calls
Technical support analyst works 100 min. (@75/hour) to discover configuration
Assume six calls per user at average length of 17 minutes per call.
Implementation Cost : Auto-discovery software license @ $10 per workstation, plus labor for one year
(4 hours per server install; 2 man days/month maintenance)
Savings: Assume reduction in work by user at 75 percent and technology by 50 percent
2 Maximize HW/SW
Deployment
$375,000 55% $93,000 $113,250
Worst Case Desc.: Assume manual software distribution at 2 tech. hours (@ $75/hour) per wkstn. per year
Implementation Cost: Electronic software distribution software licenses plus labor; one major distribution job
($30/node; 4 hours per server install; four person-weeks configuration and test)
Savings: Assume automated software distribution eliminates at least 55 percent of manual costs
3 New Hardware
Acquisition
$2,860,000 10% $286,000
Worst Case Desc.: 715 new machines (at $4,000 each) purchased by multiple buying centers
from multiple vendors over 12 months; (Assume 42 months or 3.5 yr. average life of
machines, therefore 2500/3.5=715 new PCs per year)
Implementation Cost: None
Savings:
and installing machines purchased under same contract
Assume at least 10 percent improvement in cost associated with acquiring
4 Software Volume
Purchase
$500,000 25% $125,000
Worst Case Desc.: Assume multiple groups within enterprise buying software without discount
or at a minimal discount (i.e., 10 percent to 15 percent)
Implementation Cost: None
Savings: Assume groups buying software under same contract w/ higher discount (e.g., add 15%)
5 Software
Overbuying
$500,000 27% $46,900 $88,100
Worst Case Desc.: Assume strategy where enterprise buys one $200 software package for all machines
regardless of usage level
Implementation Cost: Software metering licenses plus labor for one year
($10/node; 4 hours per server install; two person-days/month labor)
Savings: Assume at least part of enterprise can license per usage
(i.e., 1000 users at 30 percent concurrent-use level)
6 Maintenance
Contracts
$150,000 17% $25,500
Worst Case Desc.: Assume flat rate on all desktops in enterprise
Implementation Cost: None
Savings: Differentiated service levels based on workstation criticality
instead of uniform service for entire enterprise
7 Property or Usage
Taxes
$312,500 20% $62,500
Worst Case Desc.: Tax calculation of 5% on 2500 machines with average value of $2,500
Implementation Cost: None
Savings: Assume average industry savings after only paying taxes on workstations
that have residual value.
TOTALS $5,117,500 $186,800 $894,050
** Net savings calculated by total savings less implementation costs
Source: Gartner Group
“Enterprise IT Asset
Management: Executing
the Vision”,
January, 1997
Some
Potential
Quantitative
Benefits
11. 11
Total Cost of Ownership
• Annual TCO for a Desktop averages
between $10,000 and $12,000 annually
• 74% of Annual Costs are spent in
operating a desktop
– potentially upwards of $8K a year
• Most is generally not accounted for
separately
12. 12
Exposing Key Metrics
• The defined processes of IT Asset
Management expose savings potential
– Software Licenses
• Dollars saved by transferring licenses rather
than buying new ones
– Shadow support
• Having an 800# to call for application support
instead of using the engineer next door
– Asset Reallocation
• Dollars saved by avoiding capital acquisition
through redeployment
13. 13
Examples of Early Problems and
Resolutions
• Biggest issues
– Communication and currency of
configuration information
– Rapid delivery of orders
• Problem Resolutions
– All processes now documented
– We provide manufacturers with changing
configuration baselines
– We post configuration info on web in real-time
– We provide manufacturers with monthly
forecasting data
14. 14
Some General Lessons Learned
• Now have enterprise-wise prediction of IT
capital spending
– We are using that knowledge to standardize and
obtain volume purchase agreements
• Team approach has greatly assisted a major
cultural change
• Taken a long longer to get to this point than
we thought
• Plummeting desktop costs and rapidly
improving technology provides challenges
16. 16
Summary -- Benefits of ITAM
• Accurate Prediction and Control of IT Funds
• Foundation of asset insight
– Necessary to continuously migrate our
information technology
– Increased decision-support ability
• Reduced expenditures. For example,
– process efficiencies
– elimination of redundancy,
– decrease of license costs,
– increase of volume discounts,
– decrease of unnecessary property tax
Main points -
(point out main phases - and for each we have defined the major processes
we have a lot of detailed process description under this
important to note the integration of processes through the shared IT Asset Repository
- one process we have already seen implemented and seen benefit from is the IT Capital Planning (describe CIO approval and 33” monitor bean joke)
- inventory reconciliation can save money
I think this slide recaps most the benefits that we think will be readily attainable
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I would be happy to answer any questions you might have.
