When IT Asset Management initiatives receive executive sponsorship and support, the first couple of years tend to produce a number of successes. Initial projects tend to focus on license compliance, cost reduction/avoidance, internal IT financial accountability, risk mitigation, and reporting. In addition to substantial soft dollar savings and process improvements, fairly large hard dollar savings are generally realized as well. It would seem these initial successes should build the foundation needed for a long-term ITAM program, but this often does not happen. Instead, ITAM programs fail to transition from the short-term remedial project mode into a long-term sustainable best practice operational program.
How do things end up going off the rails just when they seem like they are going so well? Before we can answer this, we need to look at how companies get there in the first place. Certainly, this scenario is far from universal but I have seen variations of it a number of times.
The Rise and Fall
Getting Executive Support for ITAM
ITAM advocates within a company frequently struggle to be heard. They fight an uphill battle to engage other parts of the organization and explain why ITAM is even relevant. If there is a staff tasked with ITAM, much of their time is spent just trying to keep basic hardware and software inventory data accurate. Opportunities and risks are widespread, but they are largely unknown and unidentified. Worse, the data needed to prove the case for either is usually unavailable or too “soft” to be compelling. The status quo persists and the unfortunate truth is often nothing changes until a big enough triggering event occurs.
The First Year
Something big enough, scary enough, and/or expensive enough has happened and suddenly the spotlight is on ITAM to help solve the problem. This is usually a highly tactical year, mostly spent on solving the problem(s) which were thrust into the spotlight. In the process of doing so, ITAM will hopefully have gained quite a bit of traction with other groups, collected a lot of information it has needed and generally increased its overall credibility.
Even better, it is likely over the course of this first year, significant side savings may have been realized outside of the spotlighted focus area from the triggering problems. At worst, there will now be enough solid data to show a number of potential areas for savings. Either way, ITAM now has the executive attention it needs and a compelling case for moving forward. The focus looking forward tends to be on initial process creation and quantifying the worst known problems.
The Second Year
ITAM is now talked about seriously. Building on the credibility and momentum from the prior year, a number of projects get proposed and funded. Initial projects target the proverbial “low hanging fruit” and look for demonstrable hard dollar savings. In some ways, this scenario is almost a case of “be careful what you wish for, you just might get it” since there are not enough people in the group to do everything and new resources take time to come up to speed.
By the end of this year, everybody on the ITAM team is most likely exhausted and knows that they did too much too fast over the past year, but it is also amazing how much was accomplished. Real progress was made on key high priority issues, and in the process a number of other high value targets were also likely identified. Many projects carry forward with a Phase 2 and some new high value projects are also proposed and funded.
All is not perfect. Various tools related to ITAM (Portfolio, Discovery, etc…) may also be starting to have issues, either from new demands or the stresses of rapid change and development. What worked for the needs of the ITAM group two years ago may no longer be sufficient. Longer-term ITAM projects, without the quick ROI of many of the recent projects, may have been deferred or only partially funded. Similarly, while there may have been a number of contract resources brought in, baseline ITAM operations budget and staff increases may not have been approved or are deferred to next year.
The Third Year
Even when successful, new projects and the continuations of prior projects rarely generate the same kind of ROI as those from the prior two years. The initial high-ROI remedial projects are over, but the ongoing operational work to sustain the new processes must be done or the environment will return to chaos. The short-term ROI of the first two years is not sustainable, and in many ways this is a good thing. It means we have been able to stop a lot of the bleeding. Unfortunately, an expectation has often been created based on them. It is in this area where an ITAM program can become its own worst enemy.
The roadmap for moving ITAM forward is largely composed of longer-term efforts without the short-term return of prior years. These efforts require organizational changes and cross-functional process improvement. Few of these projects get funded and, again, there is little or no increase to the baseline ITAM operations budget or staff.
Where did it go wrong?
How have three years of excitement, success, and momentum suddenly stalled and begun to stagnate? Typically people in ITAM make an implicit assumption creating substantial savings initially means the company will invest back into the program for ongoing operations and longer-term improvement. Unfortunately, most companies seldom have the multi-year memory this assumption requires.
Somehow, the notion that a project must pay for itself within a year has become fairly standard, but I believe this is a toxic concept. Spending $3 to get $2/year return fails to produce a one year ROI, but would certainly be a tremendous investment. While this is damaging across all parts of the organization, it can be lethal to building a solid ITAM function since ITAM practices often take several years to put into place and to realize benefits.
Taking a Different Approach
Think of a company’s IT Infrastructure in terms of the deployed capital it represents. Generally, no other area with as substantial a budget has less oversight or financial accountability. ITAM is a key, perhaps THE key, component to establishing any real degree of financial stewardship over the organization’s investment in IT infrastructure. From this perspective, the whole mission of ITAM changes to a governance/oversight function that requires an overarching, multi-year vision and plan.
Funded By Success
Whether or not ITAM can be recast as a governance function, consider making the case for ITAM to be self-funding. ITAM teams tend to be understaffed and overworked, but there are many areas where they could identify and realize savings if they had the bandwidth and mandate to go after it. What if the ITAM budget was able to capture a portion of the tangible savings generated by the group?
If, for every $100 in savings found by the ITAM program, you could allocate half or even just a quarter of it to your ITAM budget, how much could you get done? It is crucial to start making this case as soon as possible since it is in those first “easy” years where building credit is so critical to ITAM. Even if you do not succeed, you will have started to socialize the concept of funding being related to the savings created for the ITAM program.