Paul Strassman Keynote Address

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Keynote Address given by Paul Strassman, former Director of Defense Information and current Distinguished Professor of Information Science at George Mason University, at Transformation and Innovation 2007.

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Paul Strassman Keynote Address

  1. 1. <ul><li>Paul A. Strassmann </li></ul><ul><li>Professor </li></ul><ul><li>George Mason University </li></ul><ul><li>SessionTitle: </li></ul><ul><li>Transformation of HP Information Technologies </li></ul>Welcome to Transformation and Innovation 2007 The Business Transformation Conference Welcome
  2. 2. HP Transformation Program <ul><li>-Reduce number of applications from 5,000 to 1,500. </li></ul><ul><li>-Reduce the number of servers from 19,000 to 10,000. </li></ul><ul><li>-Increase server utilization from 20% to 80%. </li></ul><ul><li>-Consolidate 100 world sites for IT development to 29. </li></ul><ul><li>-Consolidate 85 data centers to six. </li></ul><ul><li>-Build a data warehouse to be SOA accessible. </li></ul><ul><li>-Reduce I.T. workforce from 19,000 to 8,000. </li></ul><ul><li>-80% of staff on new projects, 20% on maintenance. </li></ul>
  3. 3. HP vs IBM Share Prices HP IBM
  4. 4. HP vs. IBM Revenues
  5. 5. Reduce Applications <ul><li>Application Simplification </li></ul>
  6. 6. Example of Application Simplification
  7. 7. Examples of Application Reduction <ul><li>Consolidate personnel information systems into a single data base to be accessible from a portal. </li></ul><ul><li>Retire 84 procurement transaction systems into five. </li></ul><ul><li>HP portal offers capabilities for user-initiated inquiries. </li></ul>
  8. 8. Standardize, Consolidate, Integrate 67 52 79 56 83 95 33 48 21 44 5 17 0% 20% 40% 60% 80% 100% Low Commonality High Commonality Marketing Ops Sales Ops Order Mgmt Supply Chain Finance HR
  9. 9. Improve the IT Infrastructure <ul><li>Reorganize the Information Infrastructure </li></ul>
  10. 10. Data Center Consolidation <ul><li>85 locations to three geographical zones; </li></ul><ul><li>Two sites per zone with total space ~400,000 sq ft; </li></ul><ul><li>Lower cost structure – eliminate redundant costs; </li></ul><ul><li>Each site designed for high availability, disaster recovery and business continuity; </li></ul><ul><li>Refresh to current technology. </li></ul>
  11. 11. Data Center Consolidation more capability less HP IT cost 30% more bandwidth half the cost of networking double the storage decrease in cost of storage 80% more processing power 30% fewer servers global applications 60% retirement of legacy applications Increases Reductions
  12. 12. Continuity and Disaster Recovery Zone A Site – 1 Site – 2 Active Dark Active Dark Active Dark Active Dark Active Dark Active Dark Zone B Site – 3 Site – 4 Active Dark Active Dark Active Dark Active Dark Active Dark Active Dark Business continuity Disaster recovery Business continuity Next generation data centers Next generation data centers
  13. 13. Backbone Network <ul><li>Servers connect to the network at 1 Gbps; </li></ul><ul><li>Network edge switches interconnect at 10 Gbps; </li></ul><ul><li>Routing handled at network level rather than at the host layer </li></ul><ul><ul><li>No need for host routing tables; </li></ul></ul><ul><ul><li>E-service networks will have a direct routed path to internal networks; </li></ul></ul><ul><ul><li>Host will be connected to either internal or external networks; </li></ul></ul><ul><li>Intrusion Detection System in front of e-services environment; </li></ul><ul><li>Intrusion Prevention System in front of internal networks. </li></ul>
  14. 14. Infrastructure Policies <ul><li>No dedicated IP addresses; everything is Direct Addressing </li></ul><ul><li>Standard naming conventions used for all servers </li></ul><ul><li>All storage is shared; No dedicated storage </li></ul><ul><li>Business Continuity and Disaster Recovery is standardized </li></ul><ul><li>No regional application. </li></ul><ul><li>40% increase in use of shared services </li></ul><ul><li>Development and Testing in shared environments </li></ul><ul><li>Equipment provisioning to plan, not to future. </li></ul><ul><li>Applications transformed to operate globally and centrally </li></ul>
  15. 15. Database Administration <ul><li>20+ ways to manage databases </li></ul><ul><li>20,000 database incidents/month </li></ul><ul><li>Dozens of weak monitoring methods </li></ul>Process Technology <ul><li>Global and standardized processes </li></ul><ul><li><850 database incidents/month </li></ul><ul><li>Two global monitoring solutions </li></ul><ul><li>3 database technologies </li></ul><ul><li>6 releases/year </li></ul><ul><li><1,500 database failures </li></ul><ul><li><4,000 databases </li></ul><ul><li>Pooled/virtualized IT resources </li></ul><ul><li>17+ database technologies </li></ul><ul><li>150+ point releases/year </li></ul><ul><li>5,830 database failures </li></ul><ul><li>14,292 databases </li></ul><ul><li>Standalone servers & storage </li></ul>Current Planned
  16. 16. Enterprise Data Warehouse Legacy applications = chaos Enterprise data warehouse = order Continuity Consolidation Control Collaboration Single version of the truth Data Warehouse Production Control MRP Inventory Control Parts Management Logistics Shipping Raw Goods Order Control Purchasing Marketing Finance Sales Accounting Management Reporting Engineering Actuarial Human Resources
  17. 17. Global Data Data is complete and detailed Define, model and map all data Ensure all data has integrity Provide complete access Flexibility and scale All data entered only once Integrated Global Views Worldwide Orders Data Worldwide Service Data Other Data Enterprise Data Warehouse Thousands of worldwide feeds daily Middleware
  18. 18. Standards Standard servers and storage Technology Standardization Technology version harmonization Increased virtualization Load balancing, clustering, database mirroring
  19. 19. Deliver Improvements <ul><li>Measure Progress in Transformation </li></ul>
  20. 20. IT Budget
  21. 21. Example of Project Savings
  22. 22. IT Portfolio Scorecard % Innovation vs. Sustaining % Projects On Quality Target Value-Added/IT Developer Annualized Benefit ($B) % On Time Delivery Target Performance Metric $2.5B $2B $1B $3B 2004 2005 2006 2007
  23. 23. Workforce Directions <ul><li>Build world-class IT workforce </li></ul><ul><ul><li>Predominately HP workforce with increased productivity; </li></ul></ul><ul><ul><li>Reduce contractors from 11,000 to < 5,000; </li></ul></ul><ul><ul><li>New skill-sets based on shift from sustaining to innovation focus; </li></ul></ul><ul><ul><li>Increased collaboration; </li></ul></ul><ul><ul><li>Increased co-location from 100 to < 29 sites. </li></ul></ul>
  24. 24. Summary <ul><li>HP Business Transformation case offers an opportunity to study performance improvement while costs are cut severely. </li></ul><ul><li>Cutting the number of applications becomes the driver for delivering performance and cost reductions. </li></ul><ul><li>Gains are primarily in freeing resources to shift from maintenance to innovation. </li></ul><ul><li>Case demonstrates the advantages of planned centralization. </li></ul>
  25. 25. HP vs. DoD Budget Allocations
  26. 26. DoD Transformation Comments
  27. 27. <ul><li>Paul A. Strassmann </li></ul><ul><li>Professor </li></ul><ul><li>George Mason University </li></ul><ul><li>Contact Information: </li></ul><ul><li>203-966-5505 </li></ul><ul><li>[email_address] </li></ul>Thank Y ou

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