Rationalizing IT Investment

In doing so, many are redirecting their pitches away from the notion of selling anything new. Instead, they are positioning themselves as trusted partners whose experience can save clients money on technology they already own.

Take Keane, for example. With IT budgets expected to remain slow or even flat, the VARBusiness 500 veteran (2002 rank: 76) predicts that companies will look to reduce operating costs as a way to fund new developments. One obvious way is through IT outsourcing. Another way, the company predicts, will be through consolidation of legacy apps. That's why Keane execs are busy putting the final touches on a new offering they hope to unveil later this year called "Application Rationalization." The basic idea is that if you look deep enough inside a large corporation's operations, you'll find a bevy of end-of-life applications, redundant functionality and mongrel technologies that cost way more than they're actually worth. But because these perpetrators of waste often involve low-key, outdated applications, many of them have dropped off internal IT radar screens.

"CIOs kind of know, but don't talk about it," says Larry Vale, spokesman for the Boston-based solution provider, who gives the example of a large insurance company that, because of recent M&A activity, is running more than a dozen individual claims-processing systems.

"Every time you've got a regulatory change, you've got to pay to ripple that change through 15 systems," Vale says. "One of the big problems is that you don't know what those things are actually costing you."

That's where Keane wants to step in. The company would start with a study by its IT consulting division looking at a client's applications as a portfolio of assets, figuring out how much each asset costs and comparing that cost to the return it delivers. Then it would work up a plan to better manage those IT resources, either by eliminating redundant applications or decommissioning end-of-life systems.

Aside from creating a new line of business, Keane hopes to create goodwill among clients by showing them how to reduce costs, ultimately giving the company a jump on the bigger contracts as money starts flowing again.

Taking a Macro View
Then there's Sapient, another VARBusiness 500 solution provider (2002 rank: 120) that has been making moves of late to position itself less as a dealer of new technology and more as an expert in leveraging existing investments. Like Keane, the company is pushing the notion that it can help companies evaluate their existing IT infrastructures and figure out the best way to use them to meet their future goals. Sapient, which has set up new advanced research and technology teams to support the effort, has coined its new offering "Enterprise Architecture Planning."

"As people start spending again, they are not [going to rush to any one particular area," says Ben Gaucherin, vice president of technology of Sapient, Cambridge, Mass. "[Rather, they are going to look at what they have from an IT infrastructure standpoint, rationalize what they have and understand how much value they are getting from it."

The idea behind Sapient's new offering is to look at a company's IT infrastructure from a macro-view to figure out how well it supports the business and lets employees leverage technology to complete their work. The solution looks at specific user issues, including operational pain points.

"It's not just a question of rationalizing technology in the abstract or in a vacuum," says Maria Bezaitis, vice president of Sapient and leader of its advanced research team. "It's inherently a problem that relates to people and how they do their work. It's enabling the IT office and putting them in a position to be less reactive to the requests of the business organization and more proactive to the company's point of view on enterprise architecture,what makes sense financially and what makes sense from a business standpoint."

The first step in Sapient's enterprise architecture-planning solution is the visualization stage, or getting an accurate picture of a company's existing IT infrastructure and all of its components. Then the team will work with the client to create a "future state" based on how they see business processes evolving. Once those two metrics are established, the real work begins: deciding how to transform the existing resources to serve the company's evolving needs, redefining requirements and technology standards. "Our involvement in these conversations sort of creates the initial momentum," Gaucherin says. "It forces a dialog that, unfortunately, is not happening in the corporate context."

Sapient usually finds the CIO/CTO suite its best contact for these kinds of projects, because that's where accountability for the architecture usually lives. "But there are a lot more situations where the CIO directly reports to the CFO," Gaucherin says. "So when you have a conversation with a CIO, you're not that far from the CFO and the financial concerns there."

Because much of the conversation revolves around understanding integration strategies, enterprise application integration (EAI) platforms are at the forefront of most enterprise architecture-planning projects, Gaucherin says. He notes that many companies have purchased multiple EAI packages but are still having trouble making sense of them. Another big play is Web services, because so many companies are still trying to understand the full potential of the technology in the context of an integration strategy. "We use Web-services technologies, and we've built Web services within the firewall as an integration technology, but we look at this less as a technology development," Gaucherin says.

One of Sapient's most recent successes was with a large client in the energy-services space that was unhappy with the performance it was getting from a large SAP system that had cost the company more than $100 million and took more than five years to implement. "What they were finding was that the adoption level among some of their core groups, which included the executive team, was not exceeding 15 to 20 percent," Bezaitis says. "That raised some eyebrows, as you might imagine."

Using its enterprise-architecture-planning model, the solution provider took a closer look at the behaviors and work processes of the client's executive team and found a large gap between the provisions of the SAP system and the real-world needs of the executives. In most cases, the disparities were caused by poor user-interface tools and processes that made the system more complicated than it was worth. For example, because of a bad interface, a vice president of corporate planning, who on a weekly basis received paper reports for financial modeling, had to rekey all of that data into the SAP system itself before he could make use of the system's features. "So what did this person do? Instead of rekeying it, he did the analysis using alternative means," Bezaitis says.

Rather than scrap the system that already cost the company more than $100 million to install, Sapient helped create an executive dashboard interface for the SAP system that makes it much easier for executives to handle data. "Adoption management isn't just about developing new kinds of technology solutions," Bezaitis says. "It's often,particularly in today's market,applied in helping our clients deal with existing investments and existing solutions, and in helping bridge the gap between what those solutions can provide and the people who are actually using them on the client side."