John Hancock Financial Services IT executive discusses the firm’s plans to better track IT assets, services and costs with in-house processes and products from HP.
The brutal economic recession of the previous year forced many IT departments to consider changing their approach to IT financial management processes, and despite tight budgets, companies like John Hancock Financial Services will be focusing their attention this year on IT cost management, chargeback and other best practices that put a financial value on IT services.
Industry watchers have been speculating on when IT departments would take on cost transparency and better align their processes to be service providers with chargeback capabilities. The economic crisis served this purpose as companies looked to cut costs and wanted to do so without crippling their internal IT service provider organization, but the same recession caused many projects to be put on hold.
“While IT has been busy maturing in all areas – technology, process, business standing – the discipline of IT financial management has moved forward sluggishly until quite recently,” reads the May 2009 Enterprise Management Associates report “IT Financial Management: Business Decisions for IT.” “Certainly, IT has been making progress aligning with business needs, but not necessarily operating itself as a business. Broader IT financial requirement and associated transparency have now become imperative in this economic climate.”
Overhauling an enterprise company’s processes around IT financial management isn’t a small undertaking and John Hancock Financial Services recognizes it will be 2011 before the project is complete, but Donna Alexander, vice president of IT finance at the firm, says providing customers visibility into IT costs and assigning financial value to IT assets is key to future success as an organization.
“It really boils down to visibility to our customers and proper planning,” she explains. “We already do a good job of presenting our costs and we want to become more efficient, enhance our decision-making capabilities and perform better capacity and resource planning functions. We have a large infrastructure group, and we want to have visibility into how we are doing operationally and our clients also need that visibility.”
For Alexander, the decision to evolve its IT financial management practices meant investing in more software from HP. Already a customer of HP products such as Service Manager, DecisionCenter, Project and Portfolio Management, and Asset Manager, Alexander says the company worked with HP as a lighthouse customer on the vendor’s IT financial management software available in its HP Financial Planning and Analysis (FP&A) application.
Currently in the process of discovering and inventorying IT assets, Alexander says the company will streamline its procurement process and integrate workflows for customers to introduce efficiencies and eliminated duplicate requests. With many legacy systems in place, one of the largest challenges Alexander says she faces is moving groups from disparate tools onto a platform that can offer shared services. That will be necessary to ensure the data the IT financial management system uses in the future has integrity and the reporting based on the data can be trusted as accurate, she says.
“Unless you know what it is you are spending, you can’t know what you are trying to drive down in terms of costs,” Alexander says. “We see a potentially huge benefit in being able to drive this system to do accounting and chargeback, and to set the standard for establishing those unit rates that we can model for our clients. The business, partners and customers would have visibility into this information and we could deliver on the objective of more efficient IT services we have promised since day one of the project.”
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