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Controlling IT waste and redundancy through recentralization

A typical decentralized organization has many different departments such as accounting, HR, and manufacturing -- all are defining and building IT infrastructures to support applications. In a decentralized environment, there is a structure in place within each of these departments to evaluate and purchase IT equipment and support. This leads to redundant purchases from different departments for similar systems and software.

Mark Loehr

The biggest beneficiaries of this type of structure are the vendors—not you, not your customers. The biggest losers in this approach are the organizations themselves, often faced with costly multiple-year maintenance agreements for these redundant systems.

More and more it is becoming commonplace to find IT organizations purchasing software from multiple vendors to complete one simple task. T here continues to be demands on operations to maintain different applications for different groups. How many man hours in each department are spent on simple operational tasks, like job scheduling or backups?

In the 70s and 80s, it was common for organizations to centrally control all IT functions within one department, under one leader, with one direction for the entire organization. In the 90s, with the explosion of distributed processing on MS, Unix and, subsequently, Linux, IT functions became more departmentalized or decentralized.

Today, IT directors are faced with an ever expanding demand to keep up with the changes. In order to keep departments satisfied, it often requires overtime and the use of consultants. As hardware becomes more and more affordable, organizations are planning for 50% to 100% IT growth rates over the next two or three years, which will only compound the control issue.

As these new demands are placed on IT, more organizations need to standardize the operational activities in order to get the problem of decentralization under control.

With the decentralization of IT operations, many companies find themselves with multiple software packages, from different vendors, all performing the same task. Take, for example, job scheduling. When one department within a decentralized operation acquires a new application, they often require certain operational software to support the new application. The new application may already be in-use in another department. This decentralized approach has given rise to multiple job scheduling solutions being deployed within one organization.

Software redundancies are not the only fiscal drawback to a decentralized environment. Costly man hours and the costs of miscommunication increase as companies implement redundant systems.

To deal with ever-changing application software introductions without increasing costs, it would be more efficient for companies to automate and standardize the tasks that are repetitive, no matter what systems or applications are running. Call it recentralization or "right sizing" of the IT department, this centralization could save thousands of dollars, if not hundreds of thousands in departmental budgets. This also introduces the control of operations back to the IT department.

Recentralization does not mean moving hardware and software to one physical location. Recentralization refers to the realigning of operational needs to service the entire organization by eliminating all the redundant software. Ultimately, the process of recentralization streamlines and consolidates resources to eliminate waste and reduce labor costs.

If an organization decides to recentralize, they do not have to face the challenge alone. There are numerous vendors available to assist in the recentralization process. It is advisable to work with vendors who "integrate to consolidate" versus those that "rip and replace." The IT staff knows what processes work and what processes are ineffective. When you are in the process of consolidating software packages and applications, those that integrate allow companies to improve upon the effective processes while eliminating costs associated with the ineffective—making the transition easier on the organization as a whole. Unfortunately, there are vendors who want to replace everything and "start fresh." Few companies find this process beneficial. By definition, starting over means that companies lose everything, both the good and the bad. The stress of working in a new and unfamiliar IT environment can be difficult. This "rip and replace" method tends to cause undue anxiety that can lead to failure.

The "right sizing" of the IT environment appears to be the apex of the of IT pendulum. Originally, all IT operations were centrally controlled from one point. As departmental needs diversified and increased, central control became unreasonable. The pendulum shifted and the extremes changes; companies separated all IT process by department. Now at the apex of the pendulum, multi-platform and multi-application integration is creating a balance. By controlling distributed environments and eliminating redundancy, companies are beginning to "right size" and reduce costs.

Mark Loehr is the chief operations officer, UC4 Software, a job scheduling software provider based in Broomfield, Colo.

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