Sustain business performance transformation with IT service management.

Transcription

1 Service management solutions White paper Sustain business performance transformation with IT service management. Adopt a disciplined approach to business design to enable continuous business innovation. July 2005

2 2 Contents 2 Executive overview 2 Defining business performance transformation services 3 IBM enables on demand business performance transformation 4 Strategy and change consulting services 5 Engineering and technology 6 Business transformation outsourcing services 7 Business innovation and optimization solutions 9 IBM IT Service Management solutions help organizations optimize IT processes to support business priorities 10 IBM solutions integrate with existing heterogeneous business management applications 13 Innovative IBM solutions help clients optimize business performance 13 ebay 15 NIBCO 16 Campbell Soup Company 18 For more information Executive overview Highly competitive markets make it difficult for many companies to sustain advantages. And accelerating user demands and financial pressures create faster business cycles and increased risks. As a result, leading businesses are looking into business performance transformation services. What does business performance transformation services mean? And how is it relevant to your enterprise? When you read this white paper, you ll learn how an engineering-like approach to business design helps businesses enable rapid innovation and sustain competitive advantage. You ll also learn about the industry and business-process expertise as well as the technology that IBM offers to help clients make the most of their investments in business performance transformation services. Case studies provide clear examples of how companies already use IBM technology and services to optimize key business processes. Defining business performance transformation services Recent changes in the architecture of computing have given rise to a new way of conceptualizing and managing business activity. Deep insights into industry dynamics and business models can now be combined with powerful technologies to merge what were traditionally distinct spheres. Companies are now taking a disciplined, structured approach to understanding their business component by component and thereby enable business innovation.

3 3 This is business performance transformation services. Across domains such as supply chain management, product life-cycle management and engineering services, HR processes, finance and administration, sales, customer service, research and development, and IT service management, companies use innovative information technology solutions from IBM to continually optimize their business processes. They deliver the integration, responsiveness, flexibility, resilience and efficiency needed to sustain a competitive advantage. And they measure their success based on the value of ongoing performance improvements not one-time savings. IBM enables on demand business performance transformation Because business performance transformation services involves the combination of industry expertise, advanced business models and leading technology, it s not something that a company can undertake on its own. Companies need a partner that can deliver: Deep expertise in the company s industry or in the domains that it seeks to optimize. Technologies to model, restructure and optimize core activities. Economies of scale in supporting IT infrastructure and in expertise that elevate the performance of the enterprise and its extended business ecosystem.

4 4 That s why business leaders turn to IBM. By leveraging IBM s expertise and technologies, a company can successfully execute business performance transformation initiatives. And by adopting the IBM vision of IT service management whether by outsourcing business processes, optimizing core business processes, tightening the integration between core business processes and IT processes, or both companies can make their transformation goals into realities. IBM has identified the following four enablers that a business can leverage to support its business performance transformation initiatives and, ultimately, adopt an actionable way to manage IT as a set of services in support of its business objectives. Strategy and change consulting services IBM Business Consulting Services frames industry issues into client-specific points of view. Then formulates actionable business and IT strategies to address these issues and the client s specific business pains. To help a client transform business performance, IBM Business Consulting Services applies its consultative capabilities and unique intellectual property in industry-specific business models. IBM Business Consulting Services draws on the expertise of IBM integrated technology services to align IT architecture solution designs to the business requirements.

5 5 Highlights Examples of IBM strategy and change consulting services includes process modeling and measurement, role-based dashboard development, data mining and integration, and implementing service-level management. IBM helps companies align their IT projects with industry-specific business components As companies attempt to transform business design, they are turning to IBM for expertise in applying the engineering and scientific method of breaking a complex problem into modules, analyzing them individually and reassembling them. IBM calls this component business modeling. IBM consultants use this technique to help companies align their IT projects with industry-specific business components, so that IT investments drive revenue growth while helping minimize the labor expense associated with the management of IT. Engineering and technology IBM also offers the range of enabling technologies needed to model, restructure and optimize business activities: Highly secure, scalable, open software, including: IBM DB2 information management software IBM Lotus collaborative software IBM Rational application development tools IBM Tivoli infrastructure management software IBM WebSphere application infrastructure and integration software IBM hardware, including: A complete range of servers, from the Intel processor based IBM xseries and UNIX -based IBM pseries servers to midrange IBM iseries and mainframe IBM zseries servers The wide array of IBM TotalStorage products IBM Research, including IBM On Demand Innovation Services in: Technical disciplines such as computer science; electrical engineering; materials science; mathematical sciences; physics; and services sciences, management and engineering. Cross-disciplines such as communications technology, deep computing, display technology, online commerce, personal systems, semiconductor technology, storage, and server and embedded systems.

6 6 IBM Global Services the global leader in business services draws on these and other resources to help enterprises implement customized solutions. Examples include IT services such as IT service management, security and privacy, storage optimization and Information Lifecycle Management, and IT performance and business resiliency. Business transformation outsourcing services Outsourcing may or may not be part of adopting a component-based approach to business design and optimizing core business processes. That said, businesses frequently decide to leverage IBM business transformation outsourcing services for business processes that are not central to driving revenue growth and client satisfaction or are a low risk to manage externally, such as human capital management, payroll, healthcare benefits and so on. Business transformation outsourcing services represents a partnership between IBM and the client. IBM transforms and operates business processes for the client, and commits to deliver a set of defined business outcomes that represent substantial gains in business value continuous improvement and innovation that enable growth and sustained benefits. Clients that select IBM business transformation outsourcing services have immediate access to IBM expertise, skills, global scale and technology: A track record of driving sustainable results within IBM s own organization and for top-tier clients in a variety of industries IBM business transformation outsourcing services currently includes finance and administration, human resources, customer relationship management, supply chain management, procurement, banking back office, insurance claims processing, integrated service management and road user charging. Unique business insight and technical capabilities. Substantial investments in developing process expertise and operational infrastructure.

7 7 Together, these capabilities enable the operation and transformation of business processes to be effective and cost efficient. Business performance transformation outsourcing increases a company s business effectiveness and strengthens its core competencies by transforming processes and, where it makes sense, having a partner manage and operate them. Sam Palmisano, Chairman, IBM Corporation, address to investment analysts, May 19, 2004 This sample IBM business transformation outsourcing services framework was created for managing HR processes. Business innovation and optimization solutions The core of business performance is cross-organizational optimization and innovation. When everyone throughout a business has the information they need about how the key performance indicators in their business domains correlate with overall business goals, then the enterprise has enabled its employees to make insightful decisions that deliver optimal results.

8 8 Business innovation and optimization solutions from IBM combine leading software, industry expertise and best practices to provide a platform that helps clients enable continuous business improvement. The power of the IBM platform lies in the benefits of a number of key activities and in the additional benefits of performing the activities in combination: Activities required for continuous business innovation and optimization. In aggregate, these activities enable continuous improvement and innovation creating the opportunity for a business to see and understand what truly impacts its success and, ultimately, grow the business.

9 9 Highlights Understanding IT processes and performance in terms of business processes and performance is a crucial part of business performance transformation initiatives IBM IT Service Management solutions help organizations optimize IT processes to support business priorities A crucial part of business performance transformation initiatives is to understand IT processes and performance in terms of business processes and performance. IBM IT Service Management solutions enable clients to leverage innovative technologies to: Manage IT as a business. Automate and integrate both IT and business processes. Proactively optimize IT services. Integrate and share information across the enterprise and throughout its business ecosystem. At the heart of IBM s vision for IT service management are key technologies that help organizations optimize IT processes in support of their business priorities: IBM Tivoli Process Managers outline ways to create IT processes that are repeatable, measurable and efficient. These predefined, customizable automation packages help companies integrate people, resources and information. IBM Tivoli Change and Configuration Management Database delivers a federated view of an enterprise s IT data about hardware and software, and the relationships between them. It integrates IT service functions into a unified, automated infrastructure management platform to provide a consolidated view of information between disparate IT environments. A suite of end-to-end IT infrastructure management products enable clients to model, deploy, monitor, analyze and act to ultimately deliver innovative, differentiated solutions for the business. IBM best practices and IBM Global Services consultants with IT service management expertise help clients apply the above technologies in their businesses.

10 10 IBM IT Service Management software supports every phase of the IT process life cycle. IBM solutions integrate with existing heterogeneous business management applications Companies frequently manage one or many core and noncore business processes with heterogeneous blends of technologies and off-the-shelf products they use to build custom business applications. Examples include: SAP R/3 for ERP and a mysap Business Suite application for supply chain management. Siebel for customer relationship management. Dassault CATIA and ENOVIA for product life-cycle management engineering and design.

11 11 Highlights IBM solutions integrate with heterogeneous environments from global independent software vendors to help clients optimize existing business processes To help clients optimize existing business processes, IBM solutions integrate with heterogeneous environments that incorporate applications from global independent software vendors such as these. Using innovative technology from IBM, companies can transform their business processes to enable growth. Because all of these core business process applications depend heavily on IT resources such as servers, network switches, routers and firewalls, storage and more IBM can deliver incremental value by helping clients align their IT investments with business priorities. The open-standard Business Process Execution Language (BPEL) provides the key linkage between IT and business that facilitates this integration. IBM technologies support BPEL to help enterprises visualize existing business processes, identify components that support the processes, correlate data across the enterprise to measure how resource outages impact the business and optimize business decision making. For example, IBM WebSphere Business Integration Modeler draws on BPEL extracts of business models from the mysap business process platform and NetWeaver environment to create a visual model of an enterprise s business processes and make that model available to other business and IT management applications. IBM Tivoli Business Systems Manager can transform the BPEL code into XML and help the enterprise visualize IT resources in the context of business processes. The software correlates enterprise-wide IT-level data from IBM

12 12 Highlights Tivoli Enterprise Console and other IBM and leading non-ibm tools to help a business: Analyze the performance of both the overall business process and of the individual components that support it. Track dependencies between business processes. Identify the business impact of an IT outage. Drill down to the offending resource, rapidly identify the root cause and route the problem to the appropriate owner with contextual information intact when problems do occur. By minimizing the time required to identify the root cause of a problem that impacts the execution of a revenue-generating business process, a company can also minimize both the cost of fixing the problem and the revenue lost to downtime. IBM software helps businesses link strategic intent to business results The performance data from Tivoli Business Systems Manager can be made even more valuable when leveraged proactively with a leading business intelligence tool such as IBM DB2 Alphablox to facilitate intelligent business decisions. Fine-tuning the business model in WebSphere Business Integration Modeler, for example, creates a closed loop that drives ongoing enhancement of business performance. In other words, IBM software helps businesses link strategic intent to business results.

13 13 For more detailed information about a specific example of using the business process choreographer that is part of WebSphere Business Integration Modeler to integrate business processes, read the IBM Redbook Using BPEL Processes in WebSphere Business Integration Server Foundation Business Process Integration and Supply Chain Solutions.* Innovative IBM solutions help clients optimize business performance A wide variety of client experiences demonstrate how IBM services and solutions facilitate industry-specific, component-based approaches to business design. The following examples demonstrate the real business value that companies are already gaining by partnering with IBM for their investments in business performance transformation services. ebay With more than 100 million registered users, more than US$20 billion in goods and services changing hands, and more than 400,000 small business storefronts all on its online marketplace, ebay is a prime example of a company that must dynamically adjust its services to support rapidly changing demand. But to maximize the consistency, reliability and availability of the ebay Web site, the company needed to automate and streamline its service management and delivery processes.

14 14 Thanks to IBM services and Tivoli best practices, ebay implemented an integrated business innovation and optimization solution in under six months. By automating processes with IBM technology, the company can focus on its core business: delivering new features and functionality to users while ensuring the reliability of its service. The IBM on demand automation blueprint will help us move to full-auto and gain new levels of resiliency, efficiency, responsiveness and flexibility. Mark Hydar, Manager, Enterprise Management Systems, ebay ebay uses Tivoli software to automate monitoring of the operating environment, and predict and rapidly respond to service issues before they impact performance. Even as growth and user traffic continue to escalate, the company can maximize the availability and performance of its services. For example, Tivoli Configuration Manager software has helped reduce application downtime, cutting the time it takes to remove and reactivate a system from 20 minutes to just 4 minutes. Deployment of new antivirus software updates to more than 2,800 services takes less than 30 minutes. According to Mark Hydar, Manager of Enterprise Management Systems for ebay, Tivoli software is also crucial in helping the company cost-effectively maintain high service levels despite the fact that the number of systems under management more than doubled in one year. Our environment is constantly changing. New systems are put into service on a regular basis. With Tivoli software, we have maximized our availability and productivity levels with minimal interruptions, says Hydar. Furthermore, ebay leverages WebSphere technology and xseries servers to rapidly and reliably deliver new features and functionality to users. When the company activated its next-generation search engine which needed to be deployed across more than 70 systems it took less than 10 minutes.

15 15 IBM Software Services for WebSphere supported the implementation of these IBM solutions. We received help from every corner of IBM, explains Hydar. IBM is responsive to our needs and provides us with the support we need to be successful. NIBCO NIBCO, an internationally recognized leader of flow control products, faced a problem familiar to many large enterprises: multiple business units with their own computing systems and islands of information that were difficult to integrate. One of the primary reasons for picking the SAP and IBM solution was that we are a mid-size company that needs world-class performance. The company elected to start over with a leading enterprise resource planning (ERP) system and chose SAP solutions on an IBM infrastructure. The centralized system has generated multiple benefits for NIBCO and its customers: Gary Wilson, Chief Information Officer, NIBCO Faster customer order response times reduced from three days to ten hours, with on-time deliveries now at 99 percent. Improved information availability reduced stock-outs from 11 percent to 2 percent. Lower costs inventory savings of more than US$50 million. Furthermore, IBM Business Consulting Services pinpointed a cost-effective way for NIBCO to leverage its previous investment in SAP Business Information Warehouse to optimize inventory planning. The company s inventory reporting and planning processes were labor-intensive, and its efforts to reduce inventory levels had reached a plateau. IBM researchers delivered customized inventory optimization algorithms that NIBCO deployed to streamline inventory management and reduce inventory levels. NIBCO

16 16 realized an additional US$400,000 in inventory asset savings within three months of implementation and projects enterprise-wide savings from decreasing inventory levels of 12.8 percent within one to three years. NIBCO also uses the combination of IBM and SAP technologies to handle the dramatic growth in its data storage needs. With SAP applications and IBM TotalStorage Enterprise Storage Server 800 fully integrated with Tivoli Content Manager and Tivoli Storage Manager, the company manages product data including the storage of CAD engineering files, which can be very large. The solution is also highly scalable the company currently uses only a fraction of the 27.9TB that can be installed in its IBM TotalStorage Enterprise Storage Server 800. Gary Wilson, Chief Information Officer of NIBCO, says, We now have a very homogeneous technology platform based on leveraging the IBM and SAP skill sets. The IBM hardware offers high performance at low cost, and that runs well from a NIBCO point of view. These two primary solution providers contribute significantly to our business results. IBM has a strong SAP practice, and helps us leverage the SAP application as much as they can, which is good for us and good for our customers. Campbell Soup Company The global manufacturer and marketer of more than 20 market-leading brands also faced disjointed IT infrastructure and business processes among individual businesses that evolved separately over time. At Campbell, the disconnected processes created internal inefficiencies and redundancies, led to ill-timed product promotions, delayed product availability, frustrated collaboration across the company and with partners, and stood in the way of enhancing the company s overall culture of knowledge management.

17 17 To create a more agile, responsive enterprise based on a business-oriented IT infrastructure, Campbell chose to build a robust, scalable IT foundation; transform and streamline employee-facing processes; and optimize marketfacing processes in the future. Only by becoming a more on demand company could we focus on our core differentiating capabilities. And that meant building a new IT foundation that enables each department to operate with clarity and decisiveness. The company worked with IBM Business Consulting Services to define and implement a standards-based IBM On Demand Workplace environment as a foundation for electronic work environments. IBM also helped Campbell build role-based electronic work environments, as well as implement new enterprise applications that employees access through the custom work environments. The integrated architecture and role-based work environments enable Campbell to: Doreen Wright, Chief Information Officer, Campbell Soup Company Quickly implement portals that facilitate collaboration across and beyond the company. Help maximize employee productivity by providing employees with access to real-time information and helping them work smarter. Drive responsiveness to employees, customers and suppliers while optimizing competitive positioning. Help maximize business agility by quickly implementing and changing applications and processes in response to market drivers. Campbell s industry standards based, global architecture extends the value of the company s existing IT investments to help the company minimize implementation risks and costs. The company was also able to address its budgetary realities when IBM wrapped its software and services together in a three-year IBM Global Financing package. In the end, Campbell could afford to implement a new system that helped it synergize its IT and business organization goals and processes.

18 18 For more information To help your enterprise adopt a disciplined, component-based approach to business design, turn to a partner with the expertise and technologies you need to succeed with business performance transformation services. Turn to IBM. To learn more about IBM solutions for IT service management and for business innovation and optimization including Tivoli software contact your IBM representative or IBM Business Partner, or visit any of the following Web sites for additional information: IBM Business Consulting Services: ibm.com/services/us/index.wss/gen_bus_cons ibm.com/services/us/bcs/html/bcs_strategyplanning.html ibm.com/services/us/bcs/html/bcs_casestudies.html Engineering and technology: IBM Systems Group: ibm.com/products/ IBM Software Group: ibm.com/software/ IBM Tivoli software: ibm.com/tivoli IBM IT Service Management: ibm.com/tivoli/features/it-serv-mgmt IBM Research: research.ibm.com

19 19 IBM Global Services IT services: ibm.com/services/us/index.wss/bus_serv_services/bcs/a ibm.com/services/us/index.wss/allservices Business transformation outsourcing services: ibm.com/services/us/index.wss/bus_serv/bcs/a ibm.com/services/us/index.wss/detail/bcs/a Business innovation and optimization services: ibm.com/software/info/topic/perform/ Case studies: ebay: ibm.com/software/success/cssdb.nsf/cs/schs-5zxvgk NIBCO: ibm.com/software/success/cssdb.nsf/cs/mfrh-5tllpj Campbell Soup Company: ibm.com/software/success/cssdb.nsf/cs/jsts-67ssr5

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