Large Enterprise Forum
A service frame of mind
Successful IT initiatives require CIOs to streamline their
processes and functions, and have IT adopt a service-oriented approach with
the business as its customer. by Soutiman Das Gupta
It is not the strongest of the species that survives, nor the most intelligent,
it is the one that is most adaptable to change, said Charles Darwin. And
true enough, in the current business environment which is constantly changing
and evolving, any organisation has to keep adapting itself to the current scenario,
and be prepared for future shifts.
Country Sales Manager
HP Software India
In this dynamic business environment, CIOs who treat IT as
a service rather than a commodity are those who will be successful in the long
Mission-critical business processes and the applications that support them are
closely entwined. Few executives can perform their work without the support
of IT serviceswhether they directly interact with the applications, or
act on the basis of information derived from application services. It is thus
necessary for CIOs to move to a system of IT Service Management (ITSM) in order
to achieve the objective of delivering IT as a service.
ITSM is a methodology that helps the IT department to deliver a better
customer experience. It is a holistic approach, encompassing people, processes
and technologies that deliver IT services, explains Amit Chatterjee, Country
Sales Manager, HP Software, India.
The Present Scenario
Senior VP & Research Fellow
If you look at the IT management process maturity model,
most enterprise IT departments are now moving from a reactive to a proactive
state. They need to move further up the maturity model into a service-oriented
state, says Bob Hayward, Senior Vice-president & Research Fellow,
In the proactive state, the IT departments objectives are to introduce
efficiency and effectiveness. The IT operational processes are relatively mature,
and the company uses tools that support defined processes.
These processes include incident reporting, operational change, asset management,
real-time monitoring, performance management, data warehousing, back-up/recovery
and configuration management. In most cases these tools and applications run
in silos and are managed in a distributed environment.
The companies have defined process managers in each area, but they still focus
inwardly upon individual components rather than on delivery of business-oriented
services, process metrics and reporting.
The Service-Focussed Scenario
In a state where the IT departments are service-focussed, the primary
objective is alignment with business. CIOs will aim to bring in service delivery
process engineering, and define services to improve service quality, says
The processes will focus on IT service definition and delivery. There will be
functions such as activity-based costing, service benchmarking, end-to-end IT
service configuration management with policies, and relationship and dependency
There will be service capacity management based on business demand. Enterprises
will be able to provide end-to-end service level reporting, enhanced proactive
processes based on business impact, process integration, and automation.
The management tools in this state will be able to offer service definition,
IT service configuration, dependency mapping, end-to-end service level reporting,
capacity planning, business service management, and activity-based costing.
Management Tools & Expectations
In this new state of being service-focussed, CIOs will have certain expectations
from their management tools. Chatterjee explains, The tools should be
able to perform functions such as automatically discovering the IT infrastructure
and understanding which resource is where. Event consolidation and correlation
processes should be centralised.
The management tools in service-driven infrastructure should also be able to
automate mapping of services to underlying infrastructure. By doing this, CIOs
can examine service status indicators in real time. With the help of these advanced
functions, CIOs can take proactive action, conduct performance trending, and
make updated reports.
Outsourcing For Efficiency
Many organisations which want to shift to an IT service delivery model can use
outsourcing as a strategic means to achieve the desired benefits.
One such organisation that has used strategic outsourcing to its benefit is
Hindustan Lever Limited (HLL). This FMCG giant has a turnover of around Rs 11,000
crore and a nationwide presence of manufacturing units, warehouses and offices.
It has more than 250 servers and a mix of VSAT links, leased lines, ISDN and
international links. Information Technology is extremely business-critical to
HLL since operations, management information and business controls are heavily
dependent on it.
HLL decided to go ahead with outsourcing for a number of reasons. Previously,
it had a decentralised IT infrastructure managed by different support teams
and several local vendors providing IT support services. This led to multiple
contracts with multiple vendors, and resulted in duplication of work and wastage
of resources, limited service levels, and a lack of co-ordination. Accountability
was also a key problem area. Says S Narayanan, the companys Corporate
Information Security Manager, We wanted to improve IT service quality
and reliability, and reduce the cost of IT operation management.
Seeking Other Benefits
Additionally, HLL was looking for a number of other benefits from an outsourcing
relationship with HP. The company wanted to streamline and standardise IT processes
by optimising the existing processes and interfaces. This would help to concentrate
on strategic IT goals that support the business. The outsourcing relationship
would give access to new technologies to improve efficiency and productivity.
Corporate Information Security Manager Hindustan Lever
Outsourcing the services of such a complex environment presented
many challenges. These were overcome with cleverly-devised strategies. To keep
prices transparent and predictable, HLL entered into a five-year contract from
October 1, 2002. In order to maintain flexibility, the company defined a baseline
for servers, clients and helpdesk seats. Delivery tools were provisioned on
a pay-per-use basis, along with exit options.
We decided to adopt ITIL (IT Infrastructure Library) processes and tools
that were ITIL-compliant, says Narayanan.
Actual Benefits To HLL
The company was able to reduce its head-count and cost due to an inflation-proof
flat pricing. There was scope to handle large changes to the infrastructure
and support new technologies.
This relationship with HP has provided consistent service levels across
the units, and adherence to ITIL processes has made business more efficient,