CIO

Protecting Your Assets

If your organization is one of the many that need to do some remedial work in the area of lifecycle management, here’s a look at some of the things you need to know.

Ninety-nine per cent of companies her organization comes across don't have a proper asset management process in place, according to Elisabeth Vanderveldt, VP of business development, with Canada-based IT services and consulting firm Conamex International Solutions. That's a staggering number, considering the value that lifecycle management can bring to an organization. And it's indicative of the widespread lack of respect for this important aspect of IT operations.

If your organization is one of the many that need to do some remedial work in this area, here's a look at some of the things you need to know.

The ideal time to start considering an asset management program is before the business and its IT infrastructure is even up and running, but the common scenario is that corporations look to asset management after they've encountered a problem running the infrastructure. This is the view of Don Barry, associate partner in global business services in the supply chain operations and asset management solutions with IBM.

But he allows that businesses' mentality around asset management is evolving. Companies used to solely consider reliability, availability and overall equipment effectiveness in that equation. But now, he said, there is recognition of factors like continuing pressures on cost and green technology.

"It really requires a mature organization to understand what's going to be needed to assess and execute a lifecycle management strategy," he said.

Why is a lifecycle management program important? For one thing, it puts IT in much better control of its assets, and this can have a number of benefits.

"IT can make really intelligent decisions around what they should get rid of, and they might even find they have more money in the budget and they can start taking a look at newer technology and see if they can bring it in-house. Without that big picture, they just end up spending more and more money than had they been proactive," said Vanderveldt.

Lifecycle management also has value as a risk management tool and it aids in the disaster recovery process as well, she added. "It's also beneficial for those moments that are just completely out of your control, like mergers, acquisitions, and uncontrolled corporate growth, either organic or inorganic," said Darin Stahl, lead research analyst with Info-Tech Research Group. "IT leaders without this toolset are now charged with pulling all this information together on short notice. That could be diminished considerably in terms of turnaround time and effort for IT guys if they have a holistic asset management program in place."

What's the best way to introduce a lifecycle management program? "In the end, a real holistic way takes into account the procurement side - ordering and who's actually doing the ordering, vendor management, standardizing on the vendors," said Stahl. And then it needs to go down into finance, which determines if the company is taking into account any leasing management, depreciation, residual values, and tax issues, he said.

"Once these things are in the door, that's when the real costs start to pile up for assets because it's about running them, configuration and control, maintenance and tracking, licenses, integration with security, standardized images, what's on the machine, what's running. That kind of stuff will allow you from an IT perspective to become process efficient and lower your costs," said Stahl.

"Lastly, you want to be able to look at all of this data in a holistic fashion to do budget reporting, performance analysis, and strategic planning not just from an asset and financial capitalization perspective, but really from business value."

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Common Mistakes

What are the most common mistakes companies make when it comes to asset management? "One mistake is lack of ownership - someone dedicated to starting it up," said Vanderveldt. She also pointed to a lack of program maintenance. "If you don't maintain it, things start to slip in. That includes policies and procedures where, for instance, people aren't keeping new employees in-tune with computer guidelines, or checking in and out hardware. All that gets taken care of under an asset management program."

Stahl cited a lack of comprehensiveness, "Often, they only will include their laptops and PCs. They won't include their LAN gear, but they should," he said. "The biggest mistake is to only consider things that are obvious and that are immediate pain points."

Each one of those domains - PCs, printers, equipment on the LAN - have very different refresh cycles. "On LAN equipment, we've seen gear running for nine years. That's probably too long," said Stahl. "Typically IT isn't looking at that stuff in a lot of shops within asset management yet those are a big driver of their SLAs and service delivery; they're focused so much on their PCs and printers because that's where they get their helpdesk calls.

"Secondly, when they get a program in place and work with procurement or purchasing, IT will over-specify what they want from a technical requirements list and that ties procurement's hands from getting the best product. There has to be an idea of 'just good enough' for the business value. At the end of the day, procurement is trying to buy off the standard catalogue."

Stahl also cautioned against getting hung up on hard refresh dates. "We've seen refresh dates change on different domains over the years. It was every three years for desktops for the longest time. Some of that was just tied to the fact that it was being leased, and now we're seeing that the average has increased to five to six years. That tells you a lot about extending the investment and getting the most out of that spend. So whether it's market forces or Web 2.0, all those things have to be considered."

What Comes First?

When establishing a process, do you tackle hardware or software first? According to Stahl, you want to talk about software first because that's really going to drive your hardware requirements, especially on the desktop; those are the tools that people use to do their jobs and drive business value, not the hardware. Hardware, such as desktops and laptops, should come next, followed by LAN infrastructure and printers.

But Vanderveldt suggests a different approach. "It's a simultaneous process of hardware and software. And in addition to that, it's the policies and procedures for utilizing the systems, especially if your employees or colleagues are abusing or misusing them, like bringing things into the office they shouldn't and accidentally corrupting your system. The whole plethora of day-to-day operations also gets covered in an asset program."

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What's the right tool?

Should companies use lifecycle software? What about an Excel spreadsheet? Our commentators agreed that although Excel spreadsheets are a ubiquitous and relatively inexpensive tracking tool, managing assets with them can be messy and difficult.

Vanderveldt flatly warns against using an Excel spreadsheet. "Whether it's internal or you're working with an IT outsourcer, you need a central repository for all that information," she said. She added that a key issue is the ability to cleanly collaborate on setting up the process with departments and vendors?

Her company uses Microsoft Office Groove, which she said is an easy and robust tool for things like software asset management, allowing you to get the process going with little training and setup. "It's a collaboration tool that lets the IT department work internally with other staff members from which they might need to gather information, like procurement. You can share this workspace with any of your vendors and they never have to pass into your firewall," she noted.

IBM's Don Barry agreed on the need for a more sophisticated tool. "You don't want to go manual, which is really what a spreadsheet is. The systems out there today allow you to manage workflow and incidence records. It forces businesses to write plans, and the number one thing I find is people don't write plans to schedule their people, or integrate with the maintenance and procurement."

But in whose budget does the program fall? According to Vanderveldt it belongs in the IT budget because they're the ones who are making sure things run. They're the mechanics.

"In reality it's not a big expense, it's an upfront cost," she said. "You implement it once, then it becomes basically a maintenance tool, but also a risk management tool. You can foresee what your needs are going to be and budget for them accordingly."

Evaluating the Process

How does an organization evaluate their lifecycle management process? The best indicator of value, according to Stahl, is whether or not you can reveal costs that enable some accurate measurement of your IT investment. Is the decision-making and the cost justification done with real numbers or is it back-of-envelope and intuition?

He offered some other key indicators: Are you getting to the point where your change control is being driven not just by helpdesk tickets, but by forecasts so that you're moving ahead and tying into other business cycles? Can you demonstrate true and tighter cost management? Are you mitigating risks so that you're helpdesk tickets and your failure rates have dropped? "There are some leading practice indicators, but ultimately you know because you're getting your overall equipment effectiveness," said Barry.

"The ultimate maintenance person should be rewarded when things don't break, not because he's good at fixing them when they do break."