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The Enterprise IT Economic Model Blueprint for the Cloud

Standardizes 5 key components of an organization’s operational model into a pipe and filter process

The Economic Model for Enterprise IT can be thought of as the Business & IT linkage of demand and supply. In particular, it is the interactive dynamics of consumption of IT resources by the business and the fulfillment behavior of processing by IT.

An economic model blueprint for Enterprise IT must orientate service delivery (people, process and technology) as a digital supply chain. This supply chain must adhere and be managed against the IT economic model.

The blueprint for an enterprise IT economic model - standardizes 5 key components of an organization’s operational model into a pipe and filter process that creates a continuous loop system that generates an objective and agile mechanism to drive change. The 5 key components are:

Demand Management – the continuous identification, documentation, tracking and measuring of day in the life of the business, what they expect, where there are problems today, and understand sensitivities to cost, bottlenecks, and timing constraints. In particular, service contracts defined in natural language that identify users, entitlement, expectations, geography, critical time windows, special business calendar events, and performance defined in terms of user experience.

Supply Management – the continuous identification, documentation and tracking through instrumentation to capture “objective” factual data of which users, using what applications, consume what app, server, network bandwidth, network QoS and storage resources for how long. Ensure you trend this over a period of time to accurately identify peaks, valleys and nominal growth.

Fit for Purpose Policies – It is essential that organizations trying to build a real time infrastructure or at least a more responsive IT platform and operation, incorporate an operating level of policy management of how the IT platform matches supply and demand at runtime. This should include factors of wall clock, trends, and service contract requirements matched optimally against runtime supply management trends. It is this operating level discipline that can radically reduce waste, unnecessary costs, lower capital investment WHILE improving service levels. It is here that most organizations fail to implement, execute or adopt such a granular discipline, instead firms standardize infrastructure from bottom up, use rule of thumb sizing and define service levels in terms of recovery time objectives or availability only.

Role of ITIL/ITSMF – ITIL 3.0 and the IT Service Management Framework are excellent guides for creating consistent end to end processes related to delivery IT as a service. They are not in themselves the sole answer to resolving IT service problems or quality of delivery. Firms must still resolve issues of alignment and strategy, define sound architectures, implement dynamic infrastructures BEFORE ITIL can have its ultimate impact on end to end process delivery.

Sustaining Transparency - Many IT organizations miss the mark when it comes to meeting and exceeding business expectations due to lack of transparency. The key components outlined above can contribute significantly to creating transparency with the business related to IT delivery of service on their behalf.

It is critical that IT organizations institute a discipline of tooling, data capture, reporting procedures and intelligent blueprinting that consistently and accurately communicate to the business a complete transparent view of what, how, who related to the consumption of IT by the business and the delivery of service by IT.

It can’t be emphasized enough how important it is that this kind of playbook must be instituted by the CIO’s office and executed by the leaders of the IT organization – if they want to enhance the collaboration with the business and become a more strategic and integral part of building the business.

More Stories By Tony Bishop

Blueprint4IT is authored by a longtime IT and Datacenter Technologist. Author of Next Generation Datacenters in Financial Services – Driving Extreme Efficiency and Effective Cost Savings. A former technology executive for both Morgan Stanley and Wachovia Securities.

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