GTA Assessment Initiative Kick-off August 14, 2007 August 14 and 16, 2007.

GTA Assessment Initiative

Kick-off

August 14, 2007

August 14 and 16, 2007

© 2005 GDEcD©2005 GDEcD Georgia Technology Authority

Assessment Kickoff | 8/14-16, 2007

Agenda

• Introductions

• Transition Vision

• Sourcing Assessment Team

• Governor’s Intent

• Assessment Objectives

• TPI Overview of Assessment Data Gathering

©2005 GDEcD Georgia Technology Authority


Governor’s Intent

• IT enterprise managed well

• Technology leadership

• Best managed state

• Best value



GTA Transition

Vision• Superbly manage IT infrastructure services for the state

of Georgia• Ensure Georgia’s IT investments create business value

for state agencies and state taxpayers

Mission• Work collaboratively with agency partners to define the

best solution for IT service delivery to Georgia’s state government

Guiding Principles• State’s interests come first• Work as partners• Earn trust

2



Sourcing Assessment Team

Derek ReynoldsBusiness Owner

Charlie SasserProject Director

Sue ArmstrongTeam MemberProcurement/

Financials

Marcia PartinTeam Member

Communications

Jeff SentsTeam Member

Enterprise Architecture

Tom FrumanProject Manager

Brenda ParkerTeam MemberAdministrative

Support

Crystal ArmstrongWorkforce

Liaison

Terry NordinWorkforce

Liaison

Steve NicholsTechnical Advisor

Rory McClureTeam Member

Contracts

Kevin StanfordTeam Member

Financials

Patrick MooreExecutive Sponsor



Our Approach to IT Assessment

• This is a GTA-led initiative ― TPI is a resource to assist

• TPI will:▪ provide an objective view ― “solution agnostic”▪ draw on its experience to recommend executable

strategies▪ work with agencies in a “sleeves rolled up,”

collaborative way

• Information collected can be used in subsequent phases

4



Sourcing Assessment Objectives

• Ensure all sourcing decisions of state IT Infrastructure Services are in the best interest of the State of Georgia for the long term

• Ensure all sourcing decisions and resulting implementations support the State of Georgia in being the best managed state

• Develop a best practices Service Management Organization for GTA



Why are we doing the Assessment?

• GTA faces unsustainable financial losses• GTA’s IT operations do not meet industry

standards• GTA lacks processes and automation to operate

effectively• State’s IT enterprise has not been managed well



Sourcing Assessment Outcomes

• Retain state service delivery but make improvements

• Outsource services: GTA manages vendor and state owns IT assets

• Outsource services: GTA manages vendor and vendor owns IT assets



Scope of Sourcing Assessment

• Covers IT processes, assets and facilities▪ Data Center services▪ Desktop services▪ Telecommunications services

▪ Support functions

• Determines how services compare to minimum standards▪ Service delivery and service level targets▪ Business continuity and disaster recovery▪ Condition, life cycle, cost to refresh and maintain IT assets



Scope of Sourcing Assessment, cont.

• Methodology will provide framework criteria, including:▪ ITIL process implementation assessment for IT

functions and processes▪ IT business continuity and disaster recovery

process assessment▪ IT assets and data center facilities assessment

• GTA will work with agencies to define scope of operational assessment

Copyright © 2006, Technology Partners International, Inc. All Rights Reserved. No part of this document may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval devices or systems, without prior written permission from Technology Partners International, Inc.

GTA Assessment Initiative – Orientation / Kick-off

14

Copyright © 2006, Technology Partners International, Inc. All Rights Reserved

TPI role and qualifications

What are we planning to do?

How do we plan to do it?

Importance of the information

Scope of the Assessment

Overview of Data Gathering Templates

Don’t panic – typical problems, issues and solutions

Review and confirmation

Outcomes / Value

Next Steps

Q&A

Agenda


TPI role and qualifications

16


TPI’s Project Team

TPI’s has assigned a very experienced team blending Public and Private Sector experience, experience of similar engagements and deep subject matter expertise.

Process and Functional Champions

TPI Market Research Team

The overall TPI team can be segmented into three integrated sub-teams:

• Strategic Leadership Team coordinates overarching objectives

• Project Team leads day-to-day activity

• Service Management and Governance Team works in parallel during all Phases

17


Creating Substantial and Sustained Improvements

How do we implement change for long-term success?

How are we performing?

What are our alternatives for improvement?

What competencies are required for managing to results?

Technology-enabled Business Support Functions

Shared Services Insourcing

Captive Offshore Outsourcing

Operational Assessments

Strategy and Business Case for Change

Service Management & Governance

TPI ServicesEnterprise Business Support

Function Challenges

TPI assists with complex challenges related to improving the cost/capacity/capability of business support functions through the integration of data, knowledge and expertise.

18


Foundation for Success

370+ Highly-Experienced Practitioners, Each Accomplished in Sourcing Strategies,

Implementations and Operations

Financial Data Repository – The Industry’s Deepest Source of Outsourcing Pricing and Contract Term Intelligence

Financial Modeling ToolsContracting Templates and

ToolsIndustry-Defining

Methodologies

Market Intelligence & Research / TPI Index

Prevalence DatabasesGovernance Excellence

BenchmarkService Provider Profiles

Sourcing Leadership Exchange Sourcing Industry Conferences

TPI’s global team of advisors is supported by the industry’s deepest foundation of knowledge-based resources, all aimed at empowering “most informed” status.

19


2


Sourcing Strategy Framework

PortfolioBundling

Alternatives

Development /Maintenance

SourceIt All

ERP –Package –Custom

BusinessProcess

TechnologyPlatform

DevelopmentLifecycle

DiscreetNon-Strategic

Geography

Operating & Organization

AlignmentCentralized Center-Leading Center of Excellence

Operating Model and Organization Alignment

Strategies

InSourcing SelectiveSourcing

StrategicSourcing

ValueBased

Single Function Value SharingBroad ScopeInSource Optimization

Supplier Joint Venture Subsidiary

Sole-Sourced Multi-Sourced

Portfolio for Less Portfolio Rationalization Portfolio Modernization

Tactics

Single Geography

Sourced Competencies, Functions & Roles Retained Competencies, Functions & Roles

Assumed Risk

Multi-Geography

Shared Risk Source the Risk

Onshore OffshoreNear Shore HybridOnsite

OperatingModels

StaffAug.

ExtendedCenters

ProjectBased

BuildOperateTransfer

TraditionalSourcing

Fixed TimeFixed Price InsourcedShared

ServicesCaptiveVirtualCaptive

Insourced ModelsOutsourced Models

CoE

20


Sourcing Assessment Design: Map of Essential Deliverables

We employ a structured, outcome-oriented approach towards uncovering the spectrum of transformational opportunities, and their related virtues/risks.

21


TPI: Reputation MattersStrategic decisions require the expertise of the market leader.

TPI exclusively concentrates on helping enterprises make lasting improvements to their business support functions.Focused

Possessing practical experience in global operations, TPI’s roster of colleagues appreciate the significance of interconnected economies.Global

The sourcing advisory industry founder and innovator, TPI has grown with its clients. We employ advisors in regions that include the Americas, EMEA and Asia Pacific.

Leading

TPI is the advisor on more than 50% of the transactions that use an outsourcing advisor and on more than 25% of the total contract value awarded each year.

Experience

The outcomes that TPI recommends are entirely driven by the client situation and meaningful understanding of market realities.Objective, Informed

TPI advisors share a genuine conviction for the value that we help clients achieve.Passionate

TPI is the largest sourcing advisory firm in the world focused on a broad range of business support functions and related research methodologies.Largest

22


Key Messages on the TPI approach

This is a GTA led initiative – TPI is your resource to assist

TPI is tasked with providing GTA with an objective view – solution agnostic

TPI will draw on its experience to recommend executable strategies

Recognizing the scale and complexity of the task ahead, we will work with Agencies – ‘sleeves rolled up’ collaborative approach

The information collected during the assessment phase can be used in subsequent phases should the alternative call for continued movement forward


What are we planning to do?

24


Overview of Assessment activities

The timeline focus is on good information early

The assessment will be presented to Senior Managers

Individual reports provided to each Agency Head

The recommendations will include a Business Case

25


Who participates?

Agency nominated representatives plus … GTA account representatives will work with you to identify who

CIO

CFO or nominee

Business Representative

Other stakeholders – Application leads

Subject Matter Experts (SME) – different per Agency

Mainframe

Servers

Managed Network Services (MNS)

End User Computing (EUC)

Help Desk

Cross-functional

26


Data Gathering & Interview Logistics

Each Data Gathering Pack – at least 2 and maybe more than 6 involved

1st Round interviews = co-ordination of 50+ interviews (1 – 3 hours in length)

Separate submissions of information - data gathering and following interviews

A 2nd round of interviews will focus on areas of complexity and data queries

‘Question and Answer’ established to support agencies

Discoveries will establish the agenda for second round interviews and follow-on data requests

27


Key activities - 1st round of information gathering

Orientation August 14 & 16

Training August 22 & 23

Data Collection commences August 23

GTA support – Q&A process August 23 through completion

Appointment window for interviews August 28 – October 3

1st Submission of data forms September 28

1st Submission of interview requests September 28

28


Key activities - 2nd round of information gathering

Data Collection continues

GTA support – Q&A process continues

Appointment window for interviews October 10 – November 6

2nd Submission of data forms (final) October 26

2nd Submission of interview requests October 19

3rd Submission of interview requests (final) October 25

29


Key activities - Validation and confirmation

Agency confirmation of data collected from October 7 to 30

Agency commentary on observations from October 9 to 30

GTA validation window November 5 - 12

Completion of validation November 13

30


31


32


33



How we plan to do it ….

35


28


IT Infrastructure Services Analysis Inputs

Baseline Data Categories & Selected Examples

Selected Inputs

Baseline Data

Financial data (inc. in

Baseline)

State Strategy Considerations

Service and Financial

Objectives

Organization data

Operational Metrics

Performance Metrics

Current Contracts / SOWs

Prior reviews (reports i.e.

customer satisfaction /

performance reviews etc.)

Operational AssessmentData

Performance Data

Any additional data required in addition to that collected during the Baseline and Operational Assessment activities will be identified early in Phase 1. TPI will not require additional data to be collected but will gather further insights through interview and documentation review of available sources of additional information.

Infrastructure Financial Data

State Strategy, Operational, & Contractual Data

Organization Data

36


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Base Year 1 Year 2 Year 10

Mainframe - CPU Hours 0 0 0 0Mainframe - DASD 0 0 0 0Mainframe - Tape Mounts 0 0 0 0Mainframe - Print Pages 0 0 0 0

Apps Servers - Wintel High Complexity 0 0 0 0 Medium Complexity 0 0 0 0 Low Complexity 0 0 0 0

Apps Servers - UNIX High Complexity 0 0 0 0 Medium Complexity 0 0 0 0

Base Year 1 Year 2 Year 10

Mainframe - CPU Hours 0 0 0 0Mainframe - DASD 0 0 0 0Mainframe - Tape Mounts 0 0 0 0Mainframe - Print Pages 0 0 0 0

Apps Servers - Wintel High Complexity 0 0 0 0 Medium Complexity 0 0 0 0 Low Complexity 0 0 0 0

Apps Servers - UNIX High Complexity 0 0 0 0 Medium Complexity 0 0 0 0

Resource Baselines

The Resource Baselines establish the basis for

the long-term projections

The Resource Baselines establish the basis for

the long-term projections

Data CollectionBaseline Volumes and Base Year Expense

Base CaseCategory Base Year Year 1 Year 2 Year 10

Direct Staff - Overhead 0 0 0 0Direct Staff - Countable 0 0 0 0Consultants - Countable 0 0 0 0 Total 0 0 0 0

Salary 0 0 0 0Fringe Benefits 0 0 0 0Other (salary related) 0 0 0 0Contractors 0 0 0 0Facilities / Premises 0 0 0 0Training 0 0 0 0Telecommunications 0 0 0 0Furniture 0 0 0 0Equipment 0 0 0 0Travel and expenses 0 0 0 0Data Center 0 0 0 0Other ______________ 0 0 0 0Other ______________ 0 0 0 0

0 0 0 0

Grand Total 0 0 0 0

Category Base Year Year 1 Year 2 Year 10



0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0

Baseline Volumes are the drivers of the financial cases for both GTA and the Service Provider and drive variable cost

Baseline Volumes must be reconciled with Base Year expense and align with the pricing methodology

Volumes must be collected for each discrete function – not all are pricing units

38


TPI Mark to Market (M2M) Comparison Process

Once data has been collected the actual M2M comparison and analysis is performed by normalizing the client data for specific Client environmental factors and comparing to market data.

39


Infrastructure Scenario Comparison – Impact SummaryTransition Risk, Change Management, X-Year Savings

GTA/Agencies Risk & Accountability

Shared or Supplier Risk & Accountability

Amount of Change

Transition Risk

Low High1 53

SavingsLow High1 53

-$0M $10M

Scenario #1

Amount of Change

Transition Risk

Low High1 53

SavingsLow High1 53

-$0M $10M

Scenario #2

Amount of Change

Transition Risk

Low High1 53

SavingsLow High1 53

-$0M $10M

Scenario #3

Amount of Change

Transition Risk

Low High1 53

SavingsLow High1 53

-$0M $10M

Scenario #8

Note: all savings are based on the X year model.

40


50


Year 1 Year 2 Year n

Mainframe Base Charge 0 0 0Storage Base Charge 0 0 0Servers Base Charge 0 0 0

Total Service Provider Base Charge 0 0 0

Service Provider Transition Charge 0 0 0

Service Provider's Total Charges 0 0 0

Alternative ScenariosTotal Base Case




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0

Retained andPass-thru Costs Net New Costs Recommended Scenario

+ + = Business Case

Assumed replaced

by cost of alternative scenarios

Alternative Scenarios are Normalized to

Enable Comparison

Mechanics of Developing the Business Case











Category Base Year Year 1 Year 2 Year n



0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0




0 0 0 0

Grand Total 0 0 0 0







Importance and relevance of the information to be gathered

42


Importance & Relevance

The focus upfront is to understand the complexity of each agency

Detailed data points are only relevant when they are placed in the right context

Different sources of information need to be mapped to bring the quantitative and qualitative together

43


What is the scope of the Assessment

“we are going to bite the apple from the outside and work to the core, …. not the other way ‘round”

44


What is the scope of the Assessment

Mainframe

Computer Operations support for all mainframe hardware, peripherals and application processing

Physical Database administration for Mainframes

Servers

Computer Operations support for all servers, associated peripherals and production application processing

Physical Database administration for Servers

Application Servers

Utility Servers

End User Computing

Help Desk

Managed Network Services

Network Data

Network Voice

45


What is the scope of the Assessment … cont’d

Cross Functional

Enterprise Change Management

Disaster Recovery Planning, test co-ordination and execution

Contract maintenance and vendor relations

Information Security Management

Security Engineering, Consulting and Architecture

Security Policy and Guidance

Information Security Administration

Project Management and Administration

Configuration Management

Asset Management

Hardware Asset Management


A deeper dive – an overview of Data Gathering Templates

47


Key Components of the Templates

Instructions

Overview of each template

Definitions of key terms and fields

Drop down menus for input standards

Formatted fields as appropriate

Cross References and maps

Field for “Comments” when additional data would be useful or judgment calls need to be made

48


FTE Mapping to Functional TowersTower Allocation

Print

IBM Unisys and Mail

IT Employees (Full Time Equivalents) - - - - - - - - -

Employee or Contractor Name(Last Name, First Name)

(Note "Vacant" if position is open)

BudgetedPositionNumber

Full Time (F) orPart Time (P)

Agency (2)Job Title

(See Drop Down List)Mainframe

Location (3)

INFRASTRUCTURE RESOURCES

Resource Description Skills TypeExperience Level

Senior Manager / Project Director Proficient across multiple operations process areas, has both Functional/Process and Technical Skills

8-10+ years

Project Manager / Project Leader Proficient across multiple operations process areas, has both Functional/Process and Technical Skills

6-8+ years

Junior Project Manager / Team Leader Proficient across 1-2 process areas, has both Functional/Process and Technical Skills

4-6 years

Senior Systems Engineer Proficient across multiple operating systems, hardware platforms and integration between disparate systems. Extensive architecture and implementation background

8+ years

Junior Systems Engineer Proficient across 2-3 operating systems and hardware platforms. Some architecture and implementation background

3-5 years

Storage Engineer Specialized in mass storage solutions and data backup systems. Extensive experience designing and integrating storage solutions with multi-platform environments.

3-5 years

UNIX Systems Administrator Specialized in the installation and execution of daily operating tasks associated with UNIX

2-3 years

Intel Systems Administrator Specialized in the installation and execution of daily operating tasks associated with Windows, Linux, and Novell

1-2 years

Cross-Functional Across Operations Areas

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Points to Remember

This data collection process may at times yield only a close approximation

The more accurate the data the more reliable the solution and pricing in the long run

Assets are generally a point in time count

Volumes and Service Levels are monthly to provide trend information

50


Resource Baseline Volumes

Key

Must Have

Will Use if Available

Units Agency Managed Volumes GTA Managed Volumes

CPU UtilizationMVS - IBM - Application CPU Hour CPU HoursMVS - IBM - Installed MIPS MIPSMVS - IBM - Average Monthly Utilized MIPS MIPSMVS - IBM - Monthly Peak MIPS MIPSUNISYS - Installed MIPS MIPS

Disk StorageMVS - IBM - Allocated Application DASD GBMVS - IBM - Installed DASD GBUNISYS - Allocated Application DASD GBUNISYS - Installed DASD GB

Tape StorageApplication Tapes in Storage (Active) CartridgeApplication Tapes in Storage - Virtual Tape Storage Disk GBApplication Tapes in Storage - Archived CartridgeBackup Retention - DR Offsite Cartridge/Media

Other Resource UnitsPrint Images (000s) ImagesMailing Insertions (000s) EnvelopesMicrofiche - Originals/Duplicates (enter as one number) FicheCD - Creates/Re-creates (enter as one number) CDsOptical Storage GB

Resource Baseline Units

Resource Description

Mainframe Services

Assessment Base Year Volumes

51


Application Profile

52


Application Profile (cont)

53


Service Levels

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Additional Information

Some data (Resource volumes and Service Levels) will need to be gathered on a monthly basis to provide trend information to providers

Some data (Hardware Counts) may need to be refreshed during the process

There is additional non-template data required:

Network Topology depicting links into each of the major processing facilities w/circuit capacity

IT Org Chart with Name and Budget Position Number

Agency Overview - Narrative of the processing environment

55


We acknowledge that there will be issues to reconcile …

Agency resources – time to commit limited

Information not available – e.g. server inventory date of service

Conflicting information, concern for accuracy

Segregation of services between GTA and Agency

Complex organizational structure of some Agencies

56


Financial Data – Challenges

Identifying costs for performing infrastructure services

Cost for FTEs in remote locations performing multiple tasks including some infrastructure activities

Cost for FTEs in Agency functional areas performing infrastructure activities

Identifying volumes for infrastructure services with Agency functional areas

57


Headcount Data - Challenges

Identifying # of people performing infrastructure services

# of people in remote locations performing multiple tasks including some infrastructure activities

# people in Agency functional areas performing infrastructure activities

Allocation of all people to appropriate towers

Assumptions regarding tasks performed and time utilization

Collected using templates and interview process of key managers

Assumptions regarding benefits and estimated percentage of direct compensation

Employee benefits

Overtime

Other compensation

58


Asset Data - Challenges

Alternative data sources may need to be used

Agency “off-line” inventories and fixed asset listings

Purchase order and procurement information

Electronic discovery of network attached devices

Lease agreements, schedules and associated records

Outside suppliers

Agency subject matter experts

Annual expenditure will be reviewed for reasonableness

Review current year expenditure with prior years to determine trends

Asset volume growth and technology refresh rates will need to be considered

Adjustments may need to be made for major transformation or refresh activities

59


Baseline Profile Considerations

Most of the time, the IT budget/actuals do not represent the true cost of IT to the organization

Human resource, asset, resource baseline volumes and service levels are linked and inseparable from the financials

The overall success of the assessment project is dependant on the quality, accuracy and integrity of the initial data collected

60


QA & Validation Approach

TPI will use its extensive experience in undertaking similar engagements to test the quality and integrity of the data being collected.

Data validation will be undertaken collaboratively between the Agency representative, GTA Agency Rep and TPI Advisor

Checkpoints will be included in the project plan to ensure ongoing data validation

Final baseline profiles will be electronically “traceable” back to source data

TPI advisors will follow QA checklists and conduct peer reviews of other Agency data and analysis


What are the outcomes – what is the value

62


2


Sourcing Strategy Framework

PortfolioBundling

Alternatives

Development /Maintenance

SourceIt All

ERP –Package –Custom

BusinessProcess

TechnologyPlatform

DevelopmentLifecycle

DiscreetNon-Strategic

Geography

Operating & Organization

AlignmentCentralized Center-Leading Center of Excellence

Operating Model and Organization Alignment

Strategies

InSourcing SelectiveSourcing

StrategicSourcing

ValueBased

Single Function Value SharingBroad ScopeInSource Optimization

Supplier Joint Venture Subsidiary

Sole-Sourced Multi-Sourced

Portfolio for Less Portfolio Rationalization Portfolio Modernization

Tactics

Single Geography

Sourced Competencies, Functions & Roles Retained Competencies, Functions & Roles

Assumed Risk

Multi-Geography

Shared Risk Source the Risk

Onshore OffshoreNear Shore HybridOnsite

OperatingModels

StaffAug.

ExtendedCenters

ProjectBased

BuildOperateTransfer

TraditionalSourcing

Fixed TimeFixed Price InsourcedShared

ServicesCaptiveVirtualCaptive

Insourced ModelsOutsourced Models

CoE

63


52


Example – Sourcing Alternatives Assessment Tool

Low Moderate Good

1 2 3 4 5

PRO Process 2.0 10% 0.2

PEO People 2.2 15% 0.3

INF Infrastructure 4.1 5% 0.2

ORG Organizational 1.8 10% 0.2

MEA Measurement / Metrics 2.6 7% 0.2

FIN Financial 2.2 10% 0.2

SOM Sourcing Management 0.0 0% 0.0

CON Contractual 0.0 0% 0.0

SEC Security 4.1 5% 0.2

BCP Business Continuity 3.9 5% 0.2

DEL Delivery 2.5 10% 0.3

SCA Scale 1.7 13% 0.2

TRA Transition 2.4 10% 0.2

100% 2.4

2.41

Operational Assessment Summary

Overall Score

Sco

re

Fil

ter

Val

ues

Fil

ter

Wei

gh

tin

g Operational

model has 13

key Filters and

120 Factors

that are ranked

and weighted

to develop the

operational

score

An operational assessment is required to determine how the current operation is functioning and identifying key gaps that need to be addressed by the sourcing strategy or operational improvement plan.

…..Scenario nScenario 1

Integrated Analysis

Separate

scenario views

Illustrative

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53


Example - Sourcing Readiness Filter Summary Illustrative

Not Ready

Moderate Ready

1 2 3 4 5

Org Organization Characteristics 2.3 20%

Com Organization Commitment 3.2 10%

Kno Knowledge Management 1.3 25%

Sou Sourcing Management 1.7 10%

Pm Process Management 2.2 25%

Inf Infrastructure Readiness 3.0 10%

2.1

Observations12 Significant work must go into preparing the 3 EAD operating groups operate in silos with minimal 4 Each EAD operating group works with XYZ EAD in 5 Support for the transformation at the Director level is

6Support for the transformation at the Manager level is mixed with some not understanding what it is

7Support for the transformation at the Staff level (based on interviews with the Managers) is low with limited trust in the real strategy

Note: Factors and Filters are scored based on experience using key observations with subjectively defined attributes. The results provide TPI a means of assessing if sourcing fits the clients strategic objectives and corporate needs.

XYZ’s EAD is not ready for large scaled outsourcing of EAD functions

Filt

er

Val

ues

Filt

er

Wei

gh

tin

g

Sourcing Readiness Summary

Sourcing Score

So

urc

ing

Rea

din

ess

Sco

re

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33


Current State Analysis and Opportunity ReportMark-to-Market

The Mark-to-Market analysis delivers comparative financial and operational metrics comparisons to comparable sourcing deals in the market today.

(1) Fully Loaded Associate FTE/Hr

Comparison of GTA’s internal cost per service unit to other companies

Result is an indication of cost competitiveness

(2) People / Service Ratio (PSR) Comparison

Total IT Infrastructure Services headcount / total service portfolio supportedandcomparison of support ratios

Result is an indication of IT Infrastructure Services efficiencies

(3) Service Level Comparisons

Comparison of current service levels against industry standard service level metrics and performance levels

(4) Mark-2-Market Comparisons

In-house

Outsourced with GTA retained Managed Service

Full outsource

(1)

(2)

(3)

(4)

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54


Example Output – Recommending Sourcing Alternatives

Servers are a weak candidate for outsourcing(1/ 3)

Financial analysis

Key facts: Total 2003 cost: $117 M Key support ratios:

Market range of x-yservers/FTE– Client ’03 – 13.7

servers/FTE– Client ’05 – 9.5

servers/FTE

Total cost$ millions

ClientMarket price range

2003 ($M) 2004 ($M) 2005 ($M)

(53)-(2) (18)-19 3-32Base

(79)-(17) (68)-(11) (65)-(7)Growth

(48)-1 (10)-23 12-37Contract-ion

Premium(<0%)

Low(<5%)

Medium (5-15%)

High High (>15%)(>15%)

Potential savings

Other sourcing costsAnnual governance cost: $4 M

Transition cost:$6 - 12 M

Net savings (premium)*

2003 2004 2005Cost ($000)/OSI

xx.xyy.yzz.z

Market highMarket lowClient

xx.xyy.yzz.z

xx.xyy.yzz.z

X

# of servers(monthly average during consolidation)9004 7820 6580

43-493219(8)-(2)Low

(12) –(6)181(31)-(25)Middle

(68)-(62)3(18)(53)-(47)High

3-yr. Total

200520042003Part of range

43-493219(8)-(2)Low

(12) –(6)181(31)-(25)Middle

(68)-(62)3(18)(53)-(47)High

3-yr. Total

200520042003Part of range

Assumptions incorporated into financial model and savings range Transition cost of $6-12 million incurred in 2003 and annual governance cost of $4 M Plan to reduce 110 FTE, phased from 2003 through EOY 2005

– Servers & storage (50 FTEs), Central operations (20 FTEs), security automation (15 FTEs); 3% annual productivity gains in rest of tower (25 FTEs) Exclusion of server consolidation project team from analysis – 20 FTEs Retained 110 FTEs (e.g., GAD aligned DBAs, business-aligned market data, QA)

Range of potential savings (premium)

Fall in supplier price assumes they perform a consolidation and charge based on reduced # of units

Client cost model assumes successful execution of a number of planned projects (e.g., 110 FTE reduction by EOY 2005)

Possible savings from outsourcing unclear based on range of market prices

Unlikely Client will get a price on the lowest end of market price range

$ millions

106117 111

50

100

150

200

* Net savings include considerations for transition and governance costs

IllustrativeIllustrative

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Session Recap

GTA led initiative

Detailed process with inter-dependencies

Good data, timely

Support from TPI and GTA Agency representatives

Reports for each Agency

Executable strategies

68


Next Steps

Training Next Week

Additional activities to address more complex agencies

Scheduling Interviews

Providing contact information and Q&A submission forms

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SharePoint site

http://sps.gta.ga.gov/sites/ISAP/Pages/Default.aspx

Collaboration site

Document Center

Templates

Data Repository

Announcements

Team Discussions

Contact Information

Calendar

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Questions ….

GTA Assessment Initiative Kick-off August 14, 2007 August 14 and 16, 2007.

Documents

Transcript of GTA Assessment Initiative Kick-off August 14, 2007 August 14 and 16, 2007.