You can't manage what you can't measure.
Complexity in IT is like the national budget deficit. It just keeps growing. And every urgent project that IT assumes just adds to it. It's no wonder then that a CIO Insight October 2004 study shows 74 percent of respondents find increasing complexity has stretched the technical capabilities of their IT staff. And 81 percent of companies say reducing overall infrastructure complexity is a top priority. Despite their efforts, however, IT shops are still wasting as much as one-third of their annual budgets on unnecessary IT equipment, maintenance fees and unused software licenses. And as the economy slowly improves and companies are again spending on new projects, simplifying systems remains a Sisyphean goal.
The reasons for all the complexity are, well, complicated. First, the rampant pace of mergers and acquisitions has left many IT shops inundated with disparate, dysfunctional systems, cobbled together out of necessity. Second, IT hardwarewhich includes not just servers and desktops, but PDAs, mobile phones and laptopsis getting cheaper, making items easier to acquire but no easier to track. "In the old days, everything that was important was bolted to the data center floor," says Jack Heine, an analyst at Gartner Inc. "Today, there are an awful lot of assets that have very vital information and provide the heartbeat for the organizationand they are scattered all over the place." Third, says Forrester Research Inc. analyst Andrew Bartels, Web-based technologies and software suites for CRM, supply chain and ERP are wonderful at addressing a wide range of business needs, but do nothing to simplify life in IT. "Complexity doesn't arise spontaneously," he says. "It arises because of business demands."
Even as companies struggle to trim fat from their budgets, the complexity issue is often overlooked. "When it comes to reducing costs, the first step is generally people, because it's easy. You cut them, they're gone," says Heine. But simplification creates many other benefits beyond reducing the complexityand therefore the costof IT architecture. Fewer systems means better security, with fewer entry points for hackers. And simpler systems can even boost performance.
Attempting to reduce complexity, however, "is not a short project, nor is it for the faint of heart," says Heine. It can take as long as 18 months just to get a good handle on everything in your IT shop, and cost up to 3 percent of your annual IT budget. And sadly, some CIOs are terrified to open a Pandora's box and find out how bad things really are. But the first step is always going to be the same for any company: IT asset management.
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