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Managing IT Operations Dr. Merle P. Martin
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Transcript of Managing IT Operations Dr. Merle P. Martin
Managing Managing IT OperationsIT Operations
Dr. Merle P. MartinDr. Merle P. MartinMIS DepartmentMIS DepartmentCSU SacramentoCSU Sacramento
AgendaAgenda What is IT Operations?What is IT Operations? IT Operation TrendsIT Operation Trends Data Center OperationsData Center Operations Improving Center OperationsImproving Center Operations Data Center EconomicsData Center Economics OutsourcingOutsourcing Managing NetworksManaging Networks Contingency ManagementContingency Management
Deloitte & Touche StudyDeloitte & Touche Study US and Canadian firmsUS and Canadian firms Late 1995Late 1995 431 CIOs431 CIOs Abbreviated “Abbreviated “DTDT””
What is IT Operations?What is IT Operations? OrganizationOrganization Budget emphasisBudget emphasis FunctionsFunctions
IT DepartmentIT DepartmentCIO
OperationsSystems
Development Support
Computer Computer facilities facilities operationsoperationsData entryData entry
Systems Systems analysis and analysis and designdesignProgrammingProgramming
Data Data administrationadministrationInformation Information centercenterInformation Information technologytechnology
CIO TurnoverCIO Turnover DT Study, 1995DT Study, 1995 1991 14%1991 14% 1992 17.5%1992 17.5% 1993 18.8%1993 18.8% 1994 15.5%1994 15.5% 1995 17.0%1995 17.0%
Why CIOs LeftWhy CIOs Left Why predecessors leftWhy predecessors left Dismissed / demoted 34%Dismissed / demoted 34% New position 23%New position 23% Left voluntarily 18%Left voluntarily 18% Lateral move 10%Lateral move 10% Retired 19%Retired 19% Promoted Promoted 5%5% 44% dismissed from old position44% dismissed from old position
IT Operations BudgetIT Operations Budget 33% Systems and 33% Systems and
ProgrammingProgramming 85% maintenance85% maintenance 15% new development15% new development
decreasingdecreasing 10% Administration / Training10% Administration / Training 57% IT Operations57% IT Operations
Budget by PlatformBudget by Platform DT Study, 1995DT Study, 1995 Mainframe 44%Mainframe 44% Client / Server 36%Client / Server 36% Other 20%Other 20%
IT Operations IT Operations FunctionsFunctions Systems operatorsSystems operators
operate hardwareoperate hardware schedule application runsschedule application runs input / output preparationinput / output preparation
Data-entry operatorsData-entry operators Maintenance techniciansMaintenance technicians
IT Operations TrendsIT Operations Trends Decreasing Decreasing
hardware costshardware costs ““Lights Out” computer Lights Out” computer
roomsrooms Increasing PCs / workstationsIncreasing PCs / workstations Expert System (Expert System (ESES) technology) technology
maintenance troubleshootingmaintenance troubleshooting
Trends Trends Increasing use of Increasing use of
automated toolsautomated tools Increase in complexityIncrease in complexity Blaab’s Law:Blaab’s Law: ““Old technologies persist inOld technologies persist in the face of new technologies”the face of new technologies”
Improving Data CentersImproving Data Centers Application functional Application functional
qualityquality how it meets user needshow it meets user needs
Technical qualityTechnical quality how easy to maintain?how easy to maintain? how efficient (how efficient (MIPSMIPS))?? tension between these goalstension between these goals
Improve Centers Improve Centers Application ageApplication age
legacy systemslegacy systems NNC study (1987)NNC study (1987) inefficient centers - 8.7 yearsinefficient centers - 8.7 years efficient centers - 4.2 yearsefficient centers - 4.2 years
Legacy SystemsLegacy Systems DT Study, 1995DT Study, 1995 65% legacy systems 65% legacy systems
slated for replacement slated for replacement were to be replaced over were to be replaced over next 2 yearsnext 2 years
Legacy systems still a problem, Legacy systems still a problem, but not as significantbut not as significant
Improve Centers Improve Centers Portfolio coveragePortfolio coverage
what % potential what % potential applications are applications are actually developed?actually developed?
beware of “hidden backlog”beware of “hidden backlog” NNC study:NNC study:
inefficient centers - 24%inefficient centers - 24% efficient centers - 40%efficient centers - 40%
Improve Centers Improve Centers Mix of Center staff:Mix of Center staff:
NNC study:NNC study: inefficient centers - inefficient centers -
more employeesmore employees greater % of them were greater % of them were
“hands on”“hands on” User feedbackUser feedback Problem detection / correctionProblem detection / correction
IssueIssue17% CIO turnover rate 17% CIO turnover rate
per year per year ANDAND 44% were 44% were dismissed or demoted.dismissed or demoted. Why would you want Why would you want
to be a CIO?to be a CIO? How can you be a How can you be a
“CIO Survivor”?“CIO Survivor”?What do you think?What do you think?
Center EconomicsCenter Economics ““CCharge-backharge-back” mode” mode
no operating budgetno operating budget charge clients for servicescharge clients for services clients can shop elsewhereclients can shop elsewhere centers can spend centers can spend
what they collect - what they collect - NO MORENO MORE!! Increasing quality Increasing quality
at decreasing costat decreasing cost
Center EconomicsCenter Economics Economies of scale Economies of scale
BIG IS BETTER!BIG IS BETTER! Gorch’s LawGorch’s Law
IP = IC ** 2IP = IC ** 2where:where: IP = increase in computer powerIP = increase in computer power IC = increase in computer costsIC = increase in computer costs
Used as barrier to PCs in 1980sUsed as barrier to PCs in 1980s
Center EconomicsCenter Economics Gorch’s Law works with Gorch’s Law works with
Data Centers because:Data Centers because: Mainframes more efficient Mainframes more efficient
than PCs for large volumesthan PCs for large volumes 3GL more efficient than 4GL3GL more efficient than 4GL Telecommunications value =Telecommunications value =
n (n - 1) where n = # nodesn (n - 1) where n = # nodes Larger network more effectiveLarger network more effective
Center EconomicsCenter Economics Typical efficiency measuresTypical efficiency measures Use Millions of Instructions Use Millions of Instructions
per Second per Second (MIPS)(MIPS) Hardware Costs per MIPSHardware Costs per MIPS Storage Costs per MIPSStorage Costs per MIPS Software Costs per MIPSSoftware Costs per MIPS Teale Data Center “Real Decisions” Teale Data Center “Real Decisions”
study - large IBMstudy - large IBM
Center EconomicsCenter Economics HardwareHardware
Total Group $31K / MIPSTotal Group $31K / MIPS Comparable Size 27K / MIPSComparable Size 27K / MIPS Govt. Industry 29K / MIPSGovt. Industry 29K / MIPS Teale Data Center 12K / MIPSTeale Data Center 12K / MIPS
Center EconomicsCenter Economics Storage costs - Teale 76% Storage costs - Teale 76%
of Comparable Size groupof Comparable Size group Software costsSoftware costs
Total Group 10.0K /MIPS Total Group 10.0K /MIPS Comparable Size 9.3K /MIPS Comparable Size 9.3K /MIPS Govt. Industry 11.4K /MIPSGovt. Industry 11.4K /MIPS Teale 8.7K /MIPSTeale 8.7K /MIPS
Center EconomicsCenter Economics Teale Quality goals:Teale Quality goals:
> 99.9% availability> 99.9% availability 4 hour network Mean 4 hour network Mean
Time to Repair Time to Repair (MTTR)(MTTR) Subsecond transaction responseSubsecond transaction response Immediate Help Desk assistanceImmediate Help Desk assistance
Center EconomicsCenter Economics StrategiesStrategies
Upgrade to latest Upgrade to latest equipment / softwareequipment / software
ConsolidationConsolidation OutsourcingOutsourcing
Center ConsolidationCenter Consolidation Chase Manhattan BankChase Manhattan Bank
100 data centers into 58100 data centers into 58 Saved $58 million in 2 yearsSaved $58 million in 2 years
First Interstate BankFirst Interstate Bank 13 data centers into 213 data centers into 2 reduced staff 2300 to 700reduced staff 2300 to 700 lowered overall budget by lowered overall budget by
$93 million$93 million
Center ConsolidationCenter Consolidation JC PennyJC Penny
20 data centers to 420 data centers to 4 Save $11 million a yearSave $11 million a year
State of WisconsinState of Wisconsin 12 data centers into one12 data centers into one Goal: save $1 to $3 million a yearGoal: save $1 to $3 million a year exempted from state exempted from state
procurement lawsprocurement laws
Outsourcing IT Outsourcing IT FunctionsFunctions WHY?WHY?
overall business trendoverall business trend global competitionglobal competition value-added criterionvalue-added criterion
Would customer pay for thisWould customer pay for this?? need for technical specialistneed for technical specialist employee costs (employee costs (fringe benefitsfringe benefits))
Outsourcing TypesOutsourcing Types Professional services Professional services
((consulting)consulting) Services (Services (training / data entrytraining / data entry)) Temporary employeesTemporary employees
contract programmerscontract programmers Transactions (Transactions (credit reportscredit reports)) Systems integratorsSystems integrators
When to Outsource When to Outsource Activity not strategicActivity not strategic Save at least 15%Save at least 15% Need technology specialistsNeed technology specialists Increase financial flexibilityIncrease financial flexibility
capital to operating expensescapital to operating expenses free personnel for developmentfree personnel for development acquire new technologies quickeracquire new technologies quicker
Consolidate,Consolidate,Transfer Transfer InternallyInternally
Consolidate,Consolidate,Transfer Transfer InternallyInternally
Improve,Improve,LeverageLeverageImprove,Improve,LeverageLeverage
OutsourceOutsourceOutsourceOutsource RedesignRedesign(Reengineer)(Reengineer)
RedesignRedesign(Reengineer)(Reengineer)
Non - CriticalNon - CriticalNon - CriticalNon - Critical CriticalCriticalCriticalCritical
““Best-Best-of-of-
Breed”Breed”
““Best-Best-of-of-
Breed”Breed”
NeedsNeedsImprove-Improve-
mentment
NeedsNeedsImprove-Improve-
mentment
QualityQualityQualityQuality
ImportanceImportanceImportanceImportance
What What NOTNOT to to OutsourceOutsource Strategy (Strategy (IT PlanIT Plan)) ArchitectureArchitecture
tied to firm’s culturetied to firm’s culture Portfolio (Portfolio (What / WhenWhat / When)) Vendor managementVendor management
Outsource TendenciesOutsource Tendencies DT Study, 1995DT Study, 1995 Disaster recovery 75%Disaster recovery 75% Network management 50%Network management 50% Application development 44%Application development 44% Application maintenance 40%Application maintenance 40% Data center operations 30%Data center operations 30% Data entry 26%Data entry 26%
Outsource FailuresOutsource Failures DT Study, 1995DT Study, 1995 Vendor expertise and Vendor expertise and
sophisticationsophistication Cost reductionCost reduction Improved delivery qualityImproved delivery quality Increased focus on Increased focus on
core competenciescore competencies Balance sheet improvementBalance sheet improvement
IssueIssueWhat IT functions in your What IT functions in your
company company havehave been been or or should beshould be outsourced? outsourced? Why?Why? What obstacles were there What obstacles were there
(or are there) to outsourcing? (or are there) to outsourcing?
Network Mgmt ScopeNetwork Mgmt Scope Fault handlingFault handling Performance monitoringPerformance monitoring Change (Change (project)project) management management Tactical (Tactical (futurefuture) planning) planning Cost controlCost control
Network Mgmt TrendsNetwork Mgmt Trends Emerging standardsEmerging standards Integration as a goal:Integration as a goal:
different networks (different networks (LAN / WANLAN / WAN)) different vendorsdifferent vendors
Combine with management of Combine with management of computerscomputers ““finger pointingfinger pointing””
Network (Network (Cont.)Cont.) Distributed applicationsDistributed applications
client / serverclient / server Oracle’s Lotus NotesOracle’s Lotus Notes
Increased automationIncreased automation Increased outsourcingIncreased outsourcing
Contingency MgmtContingency Mgmt NOTNOT disaster recovery disaster recovery
reactive, not proactivereactive, not proactive Worst case scenarioWorst case scenario
all our eggs in one basketall our eggs in one basket natural disasternatural disaster human error / sabotagehuman error / sabotage
Contingency Mgmt. Contingency Mgmt. Methods Methods Disaster Recovery firmDisaster Recovery firm
outsource strategic function?outsource strategic function? Off-line storageOff-line storage Data redundancyData redundancy
replicated databasesreplicated databases fragmented databasesfragmented databases
Off-line StorageOff-line Storage Teale Data CenterTeale Data Center
Airfreight data twice a Airfreight data twice a year to Florida (Colorado)year to Florida (Colorado)
Send an operator alongSend an operator along Electronic switchingElectronic switching Simulate switchover in OaklandSimulate switchover in Oakland
State of AlaskaState of Alaska At least 10 miles from siteAt least 10 miles from site
Contingency Methods Contingency Methods Back-up power generators Back-up power generators ““What ifWhat if” scenarios” scenarios
military war gamesmilitary war games EDSEDS
Scaled-down manual systemScaled-down manual system Back-up / recovery proceduresBack-up / recovery procedures Martin, figure 15-12Martin, figure 15-12
TransactionsTransactionsTransactionsTransactions
EntryEntryEntryEntry
OnlineOnlinelog fileslog filesOnlineOnline
log fileslog files
End End of of dayday
End End of of dayday Off-lineOff-line
log filelog fileOff-lineOff-linelog filelog file
Record Record contentscontentsRecord Record contentscontents
Backup Backup recordsrecordsBackup Backup recordsrecords
File File recoveryrecovery
File File recoveryrecoveryRecoveredRecovered
record record contentscontents
RecoveredRecoveredrecord record
contentscontents
Contingency Methods Contingency Methods Parallel systemsParallel systems Processing backup facilityProcessing backup facility
Foundation HealthFoundation Health Contingency Management PlanContingency Management Plan
How will IT outages affect your firm?How will IT outages affect your firm?
IssueIssueTell us a Contingency Tell us a Contingency
Management war storyManagement war story What happened?What happened? How did the firm recover?How did the firm recover? How could the situation have beenHow could the situation have been
averted?averted? mitigated?mitigated?
Points to RememberPoints to Remember What is “IT Operations”?What is “IT Operations”? IT Operation trendsIT Operation trends Improving Data Center operationsImproving Data Center operations Data Center economicsData Center economics Outsourcing IT functionsOutsourcing IT functions Managing networksManaging networks Contingency managementContingency managementThese are management issues!These are management issues!