Delivering Value: NextGen Michigan IT Leaders Conference June 2012 1
Our Challenges • Steady reduc,on in support for public higher educa,on con,nues. • Research revenue has increased & is expected to double by 2017. • Compe,,on for students, faculty, grants, and donors is intense
Our Challenges • Pressure for accountability from the public is at an all ,me high. • Technology is driving unprecedented change. • Our business model is in flux.
Our Strategy • Increase quality of admiHed students. • Build on our breadth of programs. • Invest in faculty. • Reduce opera,ng costs by $235 million over 10 years. • Reinvest in the things that bring strategic, compe,,ve advantage.
Transforming IT
IT Central Services Michigan Informa,on Administra,ve Technology Informa,on Security Services Services ITS 6
Mission‐Aligned Governance
The Case for Change There is a high level of service redundancy at U‐M. 1 79 Security Services 60 Server 193 Desktop Hos,ng Support 131 Storage Services Services Services 125 Network Services 102 Help Desk Services Note: These counts represent the cumula,ve number of services delivered by all providers across the university. 1 Source: “IT Ra,onaliza,on Project Approach and Preliminary Findings ‐ Accenture Presenta,on to Provost and CFO”, 6/21/2010
University’s IT Spend Central 15% Administra,ve Units $300M 37% ITS Total UM IT Spend* 80% Academic Medical School, LSA, CoE Units 48% ISR, Ross, Libraries 79% * excluding Hospital, Dearborn, and Flint
Business Case Summary Execu,ng the recommenda,ons is es,mated to reduce the annual IT spend by $14M in Year 5 and by $25M in Year 10. Increase IT Spend $10 Conserva2ve Scenario 0.5 7.9 8.4 Poten,al Impact to IT Spend (in millions USD) 3.5 8.6 $5 7.0 5.2 0.6 4.9 4.7 4.2 Current 13.3 Baseline 0.7 ($5) 18.3 Reduce IT Spend (6.2) ($10) Total Savings $161M 22.7 23.5 24.3 22.2 25.1 Total Investment $34M ($15) CumulaKve Benefits $127M (14.1) Break Even Point Year 4 ($20) (21.6) (22.7) ($25) (23.5) (24.3) (25.1) Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Aggressive Scenario: Investment: $41M ‐‐‐ Savings: $235‐‐‐ Key: Investment Savings Annual Net Benefit Cumula2ve Benefits: $194 ‐‐‐ Breakeven point: Year 3
Recommenda,ons The IT rationalization recommendations are intended to create shared infrastructure and commodity services for the university. Consolidate central administration IT desktop 1. support 2. Rationalize central administration applications 3. Enhance high-performance computing (HPC) cyber infrastructure and related consulting 4. Enhance desktop and classroom support for academic units 5. Enhance academic and research administration application services 6. Unify e-mail, calendar and related collaboration tools 11
Recommenda,ons 6. Consolidate network support to allow anyone to access the campus network anytime and from anywhere 7. Virtualize compute services (build private cloud) 8. Build tiered storage offering 9. Migrate local server rooms to managed data centers 10. Establish common identity management and security services 11. Develop and implement a new IT funding and chargeback model 12. Improve ITS 12
MISSION ALIGNED IT Mission Mission Unique Unique Services Services Commodity Commodity Services Services
Goals • The goals of the NextGen Michigan are to • reduce costs • improve IT service quality • build a shared infrastructure and services • deliver mission aligned IT that enables Michigan to excel • Our ability to achieve the goals depends on how well we manage the transformation 14
Challenges • Becoming a shared service provider while also building NextGen services • Maintaining executive sponsorship during difficult transitions involving taxing deans • Leading change to shared services across distributed units with different cultures 15
Challenges • Delivering shared services in a “have it your way” culture • Maintaining the “NextGen” vision while delivering on IT Rationalization • Building trust in role of the CIO as the leader of IT for Michigan 16
Transforming IT 17
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