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Cost Optimization & Technology Uptake

– Help business leaders produce more value for your company

By: Signe Marie Stenseth

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Meter Usage - Optimize Value!

• Independent software vendor

• Meters usage of software applications and licenses, with globally deployed, dynamic use models including concurrent licensing and pay-per-use agreements.

• Meters hardware usage to support optimization and usage-based chargeback models.

3.

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Global Hub for Collection & Distribution of Usage Data

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Key Business Drivers Financial

• Cut Costs • Improve Cost Awareness • Create Scalability and Simplicity

Risk• Document Compliance

Productivity• Improve Asset Efficiency/User Productivity• Document Business Value of IT

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Top priority: Improving IT Efficiency“Which of the following initiatives are likely to be your IT organization’s top IT management priorities over

the next 12 months?”

Improve IT performance by adopting processes like CMM or ITIL

Market the IT department within the firm

Improve the sustainability and energy efficiency of IT opera-tions and infrastructure

Expand eBusiness or Internet initiatives

Define strategy for risk and compliance

Improve the measurement of IT's impact on business per-formance

Increase the scope of IT's centralized or shared services

Increase IT capacity/resources to drive business innovations

Improve our customer management capabilities

Improve or streamline business processes

Improve the efficiency of IT

36%

38%

40%

38%

47%

47%

47%

48%

49%

48%

50%

13%

13%

15%

23%

21%

22%

23%

27%

27%

29%

31%

High priority Critical priority

According to an independent survey of over 500 IT managers and CIOs in the U.K. (IAITAM & FASTIiS, 2011)

92% of managers had unused shelfware.77% of organizations have never reclaimedany unused software licenses.

“Proactive IT Asset Management can recover over 25% of the existing IT budget.” -- IAITAM “Executive Briefing Overview”

Market Research Facts – ITAM/SAM Waste

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Slice and Dice – Prepare for Multiple Views

Multiple views provide critical insights:

• By business unit/ location

• By application/ application suites

• By users/User-group

• By fixed vs. variable costs

• By vendor

• By project

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Software Usage Support Cost Optimization

IT Procurement: • Sizing & best terms

Cost Savings within IT• Identify opportunities to reduce costs within your current IT

Budget

Joint Business and IT Cost Savings• Implement cost-saving technologies that also help the business

be more productive

Enable Innovation & Business Restructuring• Get the right mix of software to support the business• Implement process improvements/technology uptake 9

What customers say…

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“$ 1.35 Million in documented first year savings.”

“47% annual savings on our engineering applications.”

“10 % cost reduction on overall software licenses.”

Meter Usage During Technology Uptake

• Monitor programs effectiveness.

• Measure key performance indicators (KPIs).

• Reduce the loss of productivity during the switch.

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Issues Considered Adopting New Technology:

• Data Conversion• License Costs• Features/Functionality• Usability• Required Infrastructure

Change• Support Costs

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• Building a user community with application champions to promote and mentor others.

• Minimizing productivity loss.

• Improving business performance through the effective use of the new core business technology.

Holistic Implementation Program Focus:

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• Deployment - Require the target user base to use the new technology by a set date.

• Adoption - Each user or organizational unit has the option to use the new technology or not.

Strategies for Holistic Implementation Programs:

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License User Metrics

• Needed to support Key Performance Indicators (KPIs), measuring the success of both program performance and business performance throughout implementation.

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• Total Unique Users – Named Users

• Concurrent License Usage

• Trend License Usage per Application (target growth rate

per product, feature etc.)

• Compare Active vs. Inactive Usage per Application

Sample Usage Metrics to Support KPI

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Support the Different Stages

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Monitor License Usage to:

• Identify Power Users

• Build a strong user community

• Identify users that are reverting to the old system to get their job done

• Reduce productivity loss during the switch.

Identify Power Users

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Identify Power Users – Customer Case

Document Weekly Progress

Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11

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40

60

80

100

New Version Usage By Region

WestEastSouthNorthCorporateCombined

Max

. Lie

nses

In U

se

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Conversion of Old-Version Users to New-Version Users

Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 20110%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Percentage of Total Usage Over Time - Old Versus New

New VersionOld Version

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0.00 h

200.00 h

400.00 h

600.00 h

800.00 h

1,000.00 h

1,200.00 h

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

100.00%

Usage Duration Versus Used Licenses - New Version

Elapsed TimeCumulative Percentage

Total Usage over Time for each License

Create Real-time Dashboard

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Improve Decisions w/ Objective Usage Data

Financial/ Cost Optimization• Reduce spending on underutilized SW and HW• Standardize versions and tools• Improve technology acquisition• Lower the costs of reporting and administration

Risk/ Compliance• Mitigate license compliance risk

Productivity/User Efficiency • Identify power users and product champions to support technology uptake

programs• Uncover training needs• More effective communication between and within units

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Burlington Resources – Business Goals• Improve team synergies and global sharing of information• Shortened project cycle time • Drill fewer dry holes • Find more reserves per well drilled and find more total reserves• Preserve analysis results• Continue reducing annual software costs

Summary: Improve the quality of the work being done.

Operations management “Raised the Bar”

Training

Standards

Independent Technology Enhancement Team budget

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3

Burlington Resources – Cost Optimization

.

Cost of Savings over $5 Million

Y0 Actual Y1 Actual Y2 Actual Y3 Actual

Maintenance New Software

Usage metering tool used: OpeniT

-36% software maintenance cost (Year 1)

-19% software maintenance cost (Year 2)

-3% software maintenance cost (Year 3)

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Business Value to Burlington Resources

Computed June 2005

0

2 0 ,0 0 0 ,0 0 0

4 0 ,0 0 0 ,0 0 0

6 0 ,0 0 0 ,0 0 0

8 0 ,0 0 0 ,0 0 0

1 0 0 ,0 0 0 ,0 0 0

1 2 0 ,0 0 0 ,0 0 0

Business Case 2002 Actual 2003 Actual 2004 Actual

Add reserves

Productivity

Finding costs

%dry holes

SW savings

+ savings in management time

+ opportunities for better long-range planning

+ opportunity to do even better

92%

255% 253%

Goal: 10X SW savings

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Q/A

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Thank You!Open iT, Inc.

Two Park Ten Place16300 Katy FreewayHouston TX 77094+1 281 599 3400

Karoline Kristensens v. 5N-0661 Oslo, Norway+47 22 20 40 50

Quellenstr. 2071229 Stuttgart, Germany+49 7152 3070900

PO Box 265 ForusN-4066 Stavanger, Norway +47 51 64 09 80

3rd Floor Insular Life Bldg.M.L Tagarao cor Granja St.Lucena City 4301Philippines +63 42 710 8566

www.openit.com

If you can measure IT, you can optimize IT!

Email me at:sms@openit.comSigne Marie Stenseth

OpeniT solves IT resource monitoring, reporting and optimization challenges to reduce the cost and complexity of managing assets in distributed and complex environments.

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About the Speaker

• Signe Marie Stenseth has worked for OpeniT since early 2000, first for two years in Europe, then in Houston, TX. Before starting full time for the company, she was Board member for OpeniT. Signe also has many years of experience working as an advisor for the Norwegian Government, EU Commission in Brussels, and Statoil.

• Signe holds an MBA from the Norwegian School of Economics and Business Administration, with additional studies in economics from the University of Mannheim in Germany, and the College of Europe in Belgium.

• Contact info: Signe Marie Stenseth, OpeniT, Inc., Two Park Ten Place, 16300 Katy Freeway, Houston, TX 77094. Email: sms@openit.com.

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