Lack of IT integration and workload interoperability is pushing big enterprises such as Royal Dutch Shell to collaborate with IT providers and launch initiatives to develop IT standards to help them simplify IT management, cut integration complexities and save costs.
Shell, BP and PriceWaterhouseCoopers (PwC), along with IT suppliers Microsoft, IBM and HP, have launched the IT4IT Forum – a supplier-neutral consortium that provides enterprises with a reference architecture to simplify their IT management, cut costs and improve IT efficiency.
The IT4IT initiative is aimed at helping companies’ IT departments address the strategic challenges brought about by the changing IT landscape. The reference architectures will support management and execution across the IT value chain and will allow enterprise CIOs to deliver services faster and with reduced cost and risk, according to The Open Group, the consortium working to develop IT standards.
The forum launched as analyst firm Gartner published research to suggest many IT functions struggle to contain costs. Gartner said many organisations report the basic costs of running and maintaining their IT estates rising, leaving less budget for innovation and investing in business applications.
Initiatives such as IT4IT hope to identify opportunities for cost reduction, freeing up funding for innovation. Gartner estimated that, for an IT department’s budget of $1bn per annum, the initiative could save between 5% and 20% of the total.
Other members joining the IT4IT Forum include Achmea, AT&T, University of South Florida, Logicalis and Munich RE; and service providers Atos, Capgemini and Accenture.
Why big customers are in the game
“Like many other companies, Shell faces challenges around matching IT capabilities to core business needs, and reducing IT spend while delivering IT solutions faster,” said Shell CIO Alan Matula.
New technologies such as cloud, IT consumerisation and big data are adding further complexity to Shell’s substantial IT infrastructure and its IT team is increasingly stretched to respond to rising demand and the need for greater agility.
At the Open Group conference, Hans van Kesteren, Shell’s vice-president and CIO for global functions, admitted the company has multiple end systems in place and faces huge integration challenges.
“Standards will help us to mature our industry,” he said.
Shell spends millions on IT every year and its infrastructure comprises 140,000 desktops, 25,000 networks, 10 datacentres and more than 35 petabytes of storage every year.
“We also have about 8,000 IT applications – 500 of which are absolutely business-critical. These applications cannot experience downtime,” Kesteren told delegates at the conference.
“The forum will create a common language to share best practices and we will have common platform so when we buy apps or services it will all fit in and we don’t have to worry about integration.”
Enterprises stand to benefit from this work in various ways, such as “by enabling crucially needed interoperability in multi-supplier ecosystems and gaining a much deeper insight into what is happening in the IT function”, Matula said.
“We believe the emerging IT4IT standard will drive a change in the market that will enable us to consume IT management capabilities as a service and to streamline future sourcing decisions by including adherence to the standard in relevant contracts.”
According to Matula, the forum is “on the verge of seeing an open standard for IT management come into place”.
Move to streamline IT
Shell’s efforts to develop IT standards and improve IT integration can be traced back to 2011, when it changed its approach and started talking to HP – its IT estate was invested heavily in HP – to jointly design a comprehensive and integrated model for managing its systems and deal with the challenges identified. Shell wanted to share its experiences with other customers facing similar challenges at that time.
“The IT function in many of our member organisations is under constant pressure to provide improved capabilities to the enterprise, while at the same time lowering total cost,” said Allen Brown, president and chief executive of The Open Group.
The IT4IT standard will enable IT departments to achieve the same level of business discipline, predictability and efficiency as other business functions. It will also embrace and complement existing processes and methodologies (such as CoBIT, ITIL and TOGAF), by taking a data-focused implementation model perspective across the entire IT value chain.
One conference delegate told Computer Weekly she welcomed the initiative. “I do a lot of IT contract work for the public sector in the UK and the government will benefit hugely by this,” she said. “Government uses TOGAF and CoBIT and other frameworks and will benefit hugely from a common single standard.”
According to the enterprise customers at the event, a lack of cooperation across IT systems results in sub-optimal use of IT resources. “It also makes it impossible for users to tackle complexities such as cloud, agility, mobility and BYOD,” said Chris Davis, chair of IT4IT Forum.
Rick Ancona, CTO at PriceWaterhouseCoopers LLP, said IT departments need to evolve to meet the needs of the business while managing IT services provided internally and externally. “By driving an industry standard at the reference architecture level, we will truly achieve interoperability among our software suppliers providing the strongest IT environment available, thus allowing us to focus our energies on differentiating the business services instead of focusing on how best to manage IT,” Ancona said.
Meanwhile European health insurance company Achmea said it supports the IT4IT initiative because it is a community-driven, open-standard initiative. “In our industry, control of the end-to-end IT value chain is mandatory. That particularly includes effective and dynamic management of a multi-sourced landscape, which can only become a cost-efficient and high-quality reality with the right level of standardisation,” said Ton van der Linden, its CIO.
Enterprise customers hope the forum will define a new operating model for IT and drive IT providers to deliver toolsets optimised to support the new IT4IT industry open standard.
For service provider Accenture, the forum is in line with its objectives of developing integrated automation that uses a common framework across its IT operations.
“Hybrid architectures, new sourcing models and new delivery models mean the IT environment is more complex than ever, making it challenging for CIOs to maintain control while maintaining the agility and flexibility they need in today’s digital environment. Tools are available to help, but so far tend to be point solutions, developed in silos,” said Daniel Benton, global managing director, IT Strategy, Accenture.
“It is not about having a new firewall product with 37 different lock systems on it. Today, IT is about understanding the complicated IT ecosystem and understanding the risks,” Benton told delegates.
He warned that, in today’s digitised enterprises, CIOs are not driving the digital agenda anymore: “Someone else in the business is,” he said.
According to HP, IT infrastructure in large enterprises are so fragmented and lacking in unified standards, that IT just cannot be optimised. “Customers are spending millions in integrating one IT system with another,” said Georg Bock, HP’s senior director of IT management software portfolio strategy.
According to Bock, customer-driven standards will make interoperability measurable. “It will give all types of users a proper mechanism to get interoperability in workloads and end silos.”
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