R. Scott Studham discusses his experiences building shared service models for IT at Oak Ridge National Laboratory and the University of Tennessee. At Oak Ridge, he consolidated 20 IT organizations into one shared service model, funding security and modernization efforts while decreasing costs. At Tennessee, he is in the process of building a shared service structure by centralizing necessary services, establishing independent service managers, documenting services and costs, and moving to a service-based budgeting model to give customers control over IT services.

1. experiences in building a shared service model R. Scott Studham APLU Panel Discussion on Shared Services November 16 2009

2. My background with shared services CIO - Oak Ridge National Laboratory $1.4B research organization Consolidated 20 IT organizations to one via shared service model Funded massive computer security effort and application modernization while decreasing overall IT costs because the customers decided what services were their priority CIO - University of Tennessee $1.7B higher education institution Nine months into building shared service structure

3. “Most IT organizations are not qualified to make hamburgers.” - UT executive during my job interview My first job – Burger King. Factoria Mall in Bellevue WA How many customers feel about IT organizations

4. Roadblocks to IT Shared Services Historically enterprise IT services did what they wanted and not what the customer wanted (distrust of IT) Everybody can do it better (entrepreneurial) False dichotomy of centralized vs. decentralized IT Budgeting processes based on organizational structure rather than services IT department that focuses on technology rather than services IT leadership that wants to control IT rather than giving customers control.

5. Steps to implement IT Shared Services Financial Services need to be in Shared Service model before IT Centralize as much of IT as necessary, but no more. Inside the IT organization; Establish IT Service Level Managers (SLM) that are independent from IT Technical Line Organizations. Give the SLM’s control over projects & budgets. Document IT Services and their costs. Determine the customer. Move IT budgeting process to “Service Based Budgeting”. Most higher education use “organizational based budgeting” Give “Customers” complete control over what services IT provides After credibility of central services is established work with customers to reduce duplications.

7. Inside the IT organization; Establish IT Service Level Managers (SLM) that are independent from IT Technical Line Organizations. Give the SLM’s control over projects & budgets.

11. Working with each customer to establish their priorities Will result in a change in what we do and in some cases who pays for what service. The next step will be to build customer IT plans

12. Customers have noticed the change Working with customers to document what they want us spending their money on has improved customer satisfaction Shared Services