IT Benchmarking. Chris Pick CMO. Why You Don't Do It But October 2, 2014
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1 IT Benchmarking Why You Don't Do It But Should! Chris Pick October 2, 2014
2 Who s Apptio? SEATTLE SAAS COMPANY TBM = IT ECONOMICS CIO S BUSINESS SYSTEM 5 SAAS APPLICATIONS INDUSTRY STANDARDS All Rights Reserved 2014
3 Standard Benchmarking Enabling Performance CIO Technology CFO CMO? EXECUTION AGILITY INNOVATION All Rights Reserved 2014
4 CIO s Changing Landscape Brokering Services All Rights Reserved 2014
5 Creating the Standard For Benchmarking All Rights Reserved 2014
6 80% Running the Business (RtB) 20% Changing the Business (CtB) All Rights Reserved 2014
7 Running & Changing Your Business How can we help bridge the divide between our business and IT leaders? FINANCE What are my service options? How much do they cost? Are we investing IT dollars in the right things? BUSINESS IT What do our BUs need? How do their needs translate into our resource plans? Are we spending IT dollars in the right things? All Rights Reserved 2014
8 Without That CIOs Can t Shift to CtB While Optimizing RtB Keep Pace With The Agility of Their Business Partners Deliver Technology as a ( Product ) Service Become Brokers With Build vs Buy Expertise All Rights Reserved 2014
9 IMPACT
10 IMPACT
11 Why Has That Been So Difficult? SPREADSHEETS CUSTOM BI CONSULTANT PPM, SERVICE MGMT RETROFITTED REPORTING TOOLS MANUAL BRITTLE, HIGH TCO POINT IN TIME SILOS NEED PERFECT DATA PROCESS Ad hoc analysis not operationalized?????? DECISION SUPPORT Too many simple questions require studies, & are not actionable SPREADSHEETS & HOMEGROWN MODELING Cost & metric models are hard to build, maintain and defend Labor Hardware Software Vendors Consumption Utilization Cost Resources Apps Projects Services DATA Financial & IT data are in many silos GL/ FIXED ASSETS BUDGET HR ASSET/ CMDB PPM SERVICE DESK MONITORING VENDORS PROVISIONING All Rights Reserved 2014
12 What We ve Learnt Serving 40% F100 RETAIL TELCO FINANCIAL SERVICES PUBLIC / EDUCATION HOSPITALITY TRANSPORT/LOGISTICS MANUFACTURING CONSUMER GOODS ENERGY HIGH TECH AEROSPACE INTERNET / MEDIA INSURANCE HEALTH / LIFE SCIENCE All Rights Reserved 2014
13 Purpose Built System for the CIO IT Expertise Data ETL Self-Serve Analytics Adaptive Data Management Visual Business Modeling Common Services Model All Rights Reserved 2014
14 Technology Business Management (TBM) End-Users (OCIO) CIO/CTO BUSINESS IT OPS/STRATEGY FINANCE SaaS Applications Apptio Cost Transparency Apptio Business insights Apptio IT Benchmarking Apptio Bill of IT Apptio IT Planning SELF-SERVICE ANALYTICS SaaS Platform TAXONOMY VISUAL BUSINESS MODEL DATA MODEL ALLOCATIONS KPI & METRICS ADAPTIVE DATA MANAGEMENT Data Sources GL/ FIXED ASSETS BUDGET HR ASSET/ CMDB PPM SERVICE DESK MONITORING VENDORS PROVISIONING All Rights Reserved 2014
15 The Standard Business Model For IT What to Measure? How to Measure? What Data Required? Cost Categories Cost Model Data Model Standard management categories (aka taxonomy) Standard costing rules to map and apportion GL costs to Business Model categories Pre-defined source data elements, formats, and relationships needed by Cost Model Endorsed TBM Unified Model (ATUM ) All Rights Reserved 2014
16
17 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Show your costs by business units Analyze cost, quality, and utilization Automate planning and forecasting All Rights Reserved 2014
18 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Reduced reporting time from 60 hours per month to less than 10 hours Accelerated plan variance reporting from about 1 week to just 2-3 hours Move From RtB to CtB Find Inefficiencies Accelerate Reporting All Rights Reserved 2014
19 At-A-Glance YTD Variance & Cost Projection
20 Costs, Trends & Outliers By IT Resource Tower & Sub-Tower
21 Apples-To-Apples Comparisons To Industry Peers
22 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Reduced reporting time from 60 hours per month to less than 10 hours Discovered 2X more apps, used App TCO to retire 120 apps for $1.4M/year OpEx Accelerated plan variance reporting from about 1 week to just 2-3 hours Bus agreed to retire 25 applications after seeing even-spread App TCO Prioritize Spend By App Rationalize IT Utilization Discover Underused Apps All Rights Reserved 2014
23 View Services Costs, Trends, & Outliers
24 Individual Application TCO With Drivers & Strategic Objectives
25 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Show your costs by business units Reduced reporting time from 60 hours per month to less than 10 hours Discovered 2X more apps, used App TCO to retire 120 apps for $1.4M/year OpEx Automated self-service billing to 7,000 employees (product mgrs, app owners) Accelerated plan variance reporting from about 1 week to just 2-3 hours Bus agreed to retire 25 applications after seeing even-spread App TCO Saved $10M by persuading BU to migrate to a lower cost platform Show Accurate Consumption Adopt Fair & Trusted Model Drive Finance, IT & BU Collab. All Rights Reserved 2014
26 Business Unit Costs Trends
27 View Service & App Costs For Individual Business Units
28 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Show your costs by business units Analyze cost, quality, and utilization Reduced reporting time from 60 hours per month to less than 10 hours Discovered 2X more apps, used App TCO to retire 120 apps for $1.4M/year OpEx Automated self-service billing to 7,000 employees (product mgrs, app owners) Eliminated mainframe jobs flagged as decommissioned for $5.4M/year OpEx Accelerated plan variance reporting from about 1 week to just 2-3 hours Bus agreed to retire 25 applications after seeing even-spread App TCO Saved $10M by persuading BU to migrate to a lower cost platform Used peak utilization and TCO to resize VMs for $15M/year optimization Reduce Existing Spend Avoid Unnecessary Costs Optimize Infrastructure All Rights Reserved 2014
29 View Cost, Utilization For Individual IT Towers
30 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Show your costs by business units Analyze cost, quality, and utilization Automate planning and forecasting Reduced reporting time from 60 hours per month to less than 10 hours Discovered 2X more apps, used App TCO to retire 120 apps for $1.4M/year OpEx Automated self-service billing to 7,000 employees (product mgrs, app owners) Eliminated mainframe jobs flagged as decommissioned for $5.4M/year OpEx Cut capital asset estimation process from 2 days to 20 mins Accelerated plan variance reporting from about 1 week to just 2-3 hours Bus agreed to retire 25 applications after seeing even-spread App TCO Saved $10M by persuading BU to migrate to a lower cost platform Used peak utilization and TCO to resize VMs for $15M/year optimization Cut planning cycle 25% by streamlining spreadsheetbased budgeting process Create Annual Budget Explain & Forecast Reduce Total Cycle Time All Rights Reserved 2014
31 Planning & Budgeting
32 TBM Roadmap Designed For Value Creation Understand and compare your IT costs Know your application and service cost Show your costs by business units Analyze cost, quality, and utilization Automate planning and forecasting Reduced reporting time from 60 hours per month to less than 10 hours Discovered 2X more apps, used App TCO to retire 120 apps for $1.4M/year OpEx Automated self-service billing to 7,000 employees (product mgrs, app owners) Eliminated mainframe jobs flagged as decommissioned for $5.4M/year OpEx Cut capital asset estimation process from 2 days to 20 mins Accelerated plan variance reporting from about 1 week to just 2-3 hours Bus agreed to retire 25 applications after seeing even-spread App TCO Saved $10M by persuading BU to migrate to a lower cost platform Used peak utilization and TCO to resize VMs for $15M/year optimization Cut planning cycle 25% by streamlining spreadsheetbased budgeting process All Rights Reserved 2014
33 CIOs Now Have A Business Management System CFO VP Sales VP Manufacturing VP Human Resources Chief Marketing Officer CIO All Rights Reserved 2014
34 TBM The Market Landscape TECHNOLOGY BUSINESS MANAGEMENT Cost Transparency Benchmarking Chargeback/Showback Business Insights Planning SERVICE MANAGEMENT Service Management Project Management Asset Management INFRASTRUCTURE / APPLICATION MANAGEMENT Automation Monitoring All Rights Reserved 2014
35 20% 80% 80% Running the Business 20% Changing the Business All Rights Reserved 2014
36 JOIN October 28-30, 2014 Fontainebleau Miami Beach tbmconference.org All Rights Reserved 2014
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