it governance: insourcing, outsourcing and offshoring

NACCO Materials Handling Group -- Information Technology Management Meeting 1

IT Governance:IT Governance:

Information Technology Management Meeting

presented bypresented by Ben BerryBen BerryChief Information OfficerChief Information OfficerOregon Department of TransportationOregon Department of Transportation

[email protected]@odot.state.or.ushttp://www.oregon.gov/ODOT/CS/ISB/cio_report.shtmlhttp://www.oregon.gov/ODOT/CS/ISB/cio_report.shtml

Insourcing – Outsourcing – Off ShoringInsourcing – Outsourcing – Off ShoringAT&T Building - 19801 SW 72nd Ave, Tualatin, Oregon


State of Oregon GovernmentOregon State Legislature 3D Rendering


Shared

Vision

ITGovernance

ODOT LOB Communities of InterestODOT LOB Communities of Interest Enterprise IT GovernanceEnterprise IT Governance State Data Center – State Data Center – Leadership Beyond TechnologyLeadership Beyond Technology


Ok,Ok,So what is IT Governance?So what is IT Governance?


IT Governance:IT Governance:A unified stakeholder A unified stakeholder decision making process decision making process between business focus and IT managementbetween business focus and IT management..

Structure

ValuedDecisions

People

Regulation

Involved

Partnership

TechnologyPlanning Priorities

Trust Colleague

Participation Strategic

Communicate

Goals

Process

Interests Seek inputPortfolio

Align


ODOTODOTIT GovernanceIT Governance


““IT GovernanceIT Governance is the is the decision rights and decision rights and

accountability framework for accountability framework for encouraging desirable behavior encouraging desirable behavior

in the use of IT.” in the use of IT.”

In plain English, it’s putting structure In plain English, it’s putting structure around how we align IT strategy with around how we align IT strategy with business strategy, ensuring we stay on business strategy, ensuring we stay on track to achieve organizational strategies track to achieve organizational strategies and goals. and goals.


Intelligent Transportation SystemsIntelligent Transportation Systems

RegionalTOC

TOCSystemReports

Weather, Travel & Incident Data

Public

Trav

eler

Info

Phone Inquiries

Report Incidents

Other States(WA, ID, CA)

Location (AVL) / Status*

Dispatch*

Networked TOC Data

Remote User Access (RAS or VPN)

Historical Archive Data

Cities & Countiesand Other Agencies

As Required

Management &System Control

ResearchD

ata

ODOT REGIONAL TOC CONCEPT OF OPERATIONS V IEW

Statewide EOCRemote Terminal

Adjacent Regional TOCNetworked Terminal

Page

Noti

ficati

on, V

ideo S

tream

Media

ODOT HeadquartersTOC Data Archive

And Permit Database

Wire

less

Acce

ssOSP Troopers

Incident Response Vehicles Incident Info

Highway AdvisoryTelephone

RampMeters

Crew assignments, Availability, Contact infoLocation, Status / Dispatch*

Location, Status/ Dispatch*

District HQ Module

Maintenence Rigs

NOAA / WeatherServices

RoadMaintenance

Personnel

Weather Data

When Connected to

ODOT Local Master

HighwayAdvisory

Radio

ODOTSignals

Other AgencySignals

Dynamic Message Signs

ACCIDENT5 MILES AHEAD

RWIS CCTV TrafficMeteringSystem

(Road Loops)

Inci

dent

Dat

a an

d M

essa

ges

Oregon State Police(OSP) }Common InterfaceCounty 911/ EOC's

(TOC Contact forLocal Police and Fire)

Dispatch*

Dispatch / Paging and Safety Check*

<<<Roadside Device Control

Incident, Road-Weather, DeviceControl or Service Request

Location, Status and Road Weather data , Safety Check-in*

RoadsideWarningSystems

HIGH WINDSFLOODS &SIESMIC

Law Enforcement Data(LEDS)

Reports and Traffic Impact Events

Lice

nse

Pla

te C

heck

Req

uest

and

Adm

in M

sgs

Location (AVL), Status, Sensor and Road Weather data*

Road-WeatherReports

AutomatedDe-icing

VariableSpeedLimit

SPEEDLIMIT45

VMSCMS

Roadside Sensor Data > Video > Status > Location >>>

Incident Response CoordinationGIS Mapping

IncidentDetection

Media & PersonnelPaging

ODOT Motor Carriers Division

Current Restrictions, Device Status, Weight Station Status

Tow Rotation Data

WeatherForecast Data

Travel Time

*Wireless Connection Network Connection Telephone or NetworkConnection

Reports

Road Status data

Even

t Per

mit

Req

uest

ODOT Information Systems: Technology Business Decisions


ODOT’s IT Governance FrameworkODOT’s IT Governance Framework


IT Governance FrameworkIT Governance Framework

A structure set up to enable decision A structure set up to enable decision making at the appropriate level making at the appropriate level

regarding IT decisions for:regarding IT decisions for:

Defines the role of IT.Defines the role of IT. Architects technical standards.Architects technical standards. Delivers applications over IT Infrastructure.Delivers applications over IT Infrastructure. Develops project requirements.Develops project requirements. Makes IT investments & priority decisions.Makes IT investments & priority decisions.

ODOT IT

Principles


Concept DevelopmentProject Definition

ImplementationProject Oversight

OperationsProgram Oversight

STATE CIO

DAS DEPUTY

CIO COUNCIL ASMG

ENTERPRISE IT GOVERNANCE FRAMEWORK

Project Initiation B

usiness Case D

evelopment &

Implem

entation Strategy

Investment P

ortfolio Decisions and B

udget Approval

Project Closeout

Business C

ase Refinem

ent and Portfolio A

ssessments

Project C

loseout and Transition to Operations

Ongoing P

rogram E

valuation and Operational A

ssessment

DAS DIRECTOR

DRAFT DOCUMENT

* CNIC* E-Gov* OWIN* Security* OGIC* Other

DAS DIRECTORDeputy Director, State

CIO, SDCAAgency

Directors(Advise)

DAS Division Administrator or

Designee(SCIO, SDCA,

Agency Lead, etc.)

Agency Directors*(Advise)

Steering Committee

(Advise)

Project Manager QA * Sub -

Committee

Sustained agency director involvement and major IT project portfolio oversight and reporting

* As necessary, a special subcommittee of subject matter experts or other key individuals may be formed

* As necessary, a special subcommittee of subject matter experts or other key individuals may be formed

* Sub * Sub

* Sub * Sub

DAS DIRECTOR

Agency Directors(Advise)

DAS Division Administrator or

Designee(SCIO, SDCA,

Agency Lead, etc.)Advisory Committee

Program Manager Audit * Sub -

Committee

* Sub * Sub

* Sub * Sub


Less time to decide(time efficient)

Leader decides

More time to decide(more developmental)

Group decides

L1 L2 LF1 LF2 M

No group Self or written information

Gather info and then Leader decides

Leader meets with people one on one Collects info Leader makes decision

consultative

Leader meets with group in open forum Prompts ideas and considers input Leader still makes decision

assumes Goal Congruence

Group participation Group Decides

autocratic consensus

Art of Decision – MakingArt of Decision – MakingLeadership that shapes the future!

Legend: L = Leader F = Followers M = Mutual

Art of Decision – MakingArt of Decision – MakingLeadership that shapes the future!


Data CenterConsolidation

13Long-term SavingsGovernance

Server Consolidation

CollaborationMaintenance

NetworkConsolidation

UtilityComputing

System Integration

ValueProposition

InfrastructureManagement

Storage Mainframe

State Data CenterLeadership Beyond Technology

NACCO Materials Handling Group -- Information Technology Management Meeting 14 14

• Network Consulting• Network Design• Installation Mgt.• SW Support• Performance Analysis/Rpts.• Capacity Planning• Problem Management• NOC support 24x7

(Network Operations Center)

• Interface Engine• Data Integration

SystemIntegration

Network Services

SINGLE INFRASTRUCTURE MANAGED

A G

E N

C Y

B

U S

I N E

S S

V

A L

U E

CNIC Key Concepts

• Internet or E-Government

• Line of Business Systems

• Process Control Systems

• Web-based Employee Services

• Supply Chain Mgt Linkages

• Customer Care applications

• HR & Finance Applications

Strategic Planning

Applications

Highest Customer Visibility

Highest Customer Visibility

Hardware & MaintenanceServices

Lowest Customer VisibilityLowest Customer Visibility

• User Devices• Servers• Disaster Recovery• Cabling Services

• Consolidation• Server Mgt.• Database Mgt.• Email /

messaging• Imaging/

Archiving

Data Center

Help Desk• Call Mgt.• Trouble Tickets• 1st Tier Resolution

• Tools Admin.• Alerts Mgt.• Critical Call Mgt.

IT Monitoring Security• Internet Mgt.• Intrusion Detect.• Content

Inspection- Email- Internet- FTP

Utility Value Proposition

Utility Value PropositionUtility Value Proposition

• Allocation of resources to areas of greatest business value for the enterprise

• Technology guarantee; optimizing network backbone performance

• Service Level Agreements

• Constant predictable infrastructure budgeting Statewide: capital/operating

• State Data Center Single-point responsibility for Infrastructure Mgt. & Risk

• Flexibility to leverage State with single infrastructure contracts


What a Consolidated State Data Center Enables!What a Consolidated State Data Center Enables!

ITDesign

Services

Physical & Cyber Security

7/24 Onsite Operations Support Troubleshooting

Support Data Center Controls Documentation

Systems Implementation

On-site Engineering

Customized Agency Charge back/ Assessment

Server Management and Back up

Service Delivery Management

Staff Education & Training

Project Management

Support

Service Level & Performance Reports

7/24Network Monitoring

Data Storage Management

Network Reporting

Technology Staff Certification

SystemsProvisioning

IT Infrastructu

re Utility

1

13

15

16

17

18 23

4

5

6

101112

8

7

9

14


Program & Customer Relationship Management

Development & Testing Environment

E-Gov and Line-of-Business Applications

Agency-Specific

State Data Center Infrastructure Utility

Shared

CNIC Roles & Responsibilities CNIC Roles & Responsibilities

WAN Switches LAN Switches Routers Internetworking

Software Management

Software Distribution

SLA Mgt. Change Mgmt. Process Reporting Security Charge Back

Performance

ManagementData

GatheringSurveillanceCapacityPlanning

Data Cable Infrastructure

End User Help Desk


Oregon Consolidates Oregon Consolidates for Virtualization for Virtualization ((Video)Video)


Shared

Vision

Transformation Transformation SourcingSourcing

InsourcingInsourcing OutsourcingOutsourcing Off ShoringOff Shoring


State Data CenterState Data CenterInsource Functional Service ModelInsource Functional Service Model

This Functional Service Model represents a functional design for the SDC. It is not meant to depict areas of operation for staff. This model is designed to be representative of the data center functions required to execute data center processes and deliver services to SDC customers.

SDC Management & Governance

General Administration

Network Administration

System Administration

Planning and Administratio

n

HR / Personnel

Management

Security Oversight

Remote Access

Video Services

Network Security

Server Computing

System Security

Storage

Security

Identity and Access

Management

Back-up / Recovery

Management

Directory Administratio

n

Facilities / Environmentals

Customer Service

Management

Mainframe Computing

Business Services

Financial Management

Availability Management

Capacity Management

SDC Policy and Strategy

Service Support

Service Desk /

Incident Management

Change Management

/ Release Management

Problem Management

Configuration Management

Service Level Management

IT Service Continuity

Operations Services

Project Management

24/7 Shift Management

Print Services

Production Control WAN

LAN DBA

Consulting Services

Security Monitoring

Transformation Insourcing


Operations ServicesOperations Services

Facilities / EnvironmentalsPhysical security, HVAC monitoring, cabling and wiring, and level 3 dispatch, emergency power

24/7 Shift ManagementOperational personnel management of shifts

Print ServicesMainframe print

Production ControlBatch processing, production control, job scheduling, system monitoring

Facilities /Environmentals

OperationsServices

24/7 ShiftManagement

Print Services

ProductionControl


General AdministrationGeneral Administration

Planning and AdministrationArchitecture, Device Management, project planning, architecture planning

HR / Personnel ManagementHR-related issues, recruiting & staffing, position descriptions, labor relations

GeneralAdministration

Planning andAdministration

HR /Personnel

Management


Network AdministrationNetwork Administration

Remote AccessVPN

Video ServicesVideo conferencing, video scheduling, audio conferencing

Network SecurityNetwork monitoring, intrusion detection, DOS, install and monitor anti-virus and anti-mal-ware

WANWAN connectivity, operations, integrity, performance, availability, log and report administration, DNS administration

LANLAN connectivity, operations, integrity, performance, availability, log and report administration

NetworkAdministration

RemoteAccess

VideoServices

NetworkSecurity

WAN

LAN


SecuritySecurityIdentity and Access ManagementAccess control, authentication, LDAP

Back-up / Recovery ManagementResponse to failed hardware or other event

Directory AdministrationDirectory services, LDAP

Security OversightMonitor and audit virus and mal-ware

Security MonitoringAudit operators, DBAs, SAs, and firewall administrators

SecurityOversight

Security

Identity andAccess

Management

Back-up /Recovery

Management

DirectoryAdministration

SecurityMonitoring


System AdministrationSystem Administration

Server Computing (long term - WinTel, Linux, AIX, short term - Solaris, Netware)Hardware installation, logical computing, transaction systems, shared applications, performance tuning

Mainframe Computing (iSeries, zSeries)Hardware installation, logical computing, transaction systems, shared applications, performance tuning

StorageProvide SAN, RAID, disk, tape, back-up services

System SecurityProvide host security, configuration management, intrusion detection, and install and monitor anti-virus and anti-mal-ware

DBASystem DBA services, application DBA services

SystemAdministration

ServerComputing

SystemSecurity

Storage

MainframeComputing

DBA


Business ServicesBusiness ServicesFinancial ManagementRate setting, invoicing, budgeting, chargeback development and management, accounting and planning, asset planning, procurement,

Availability ManagementMonitor IT components for availability

Capacity ManagementPlanning, sizing, and controlling IT capacity

Customer Service ManagementCustomer account planning

Service Level ManagementService level monitoring and reporting, service level agreements, service issue resolution, SDC scorecard

IT Service ContinuityEnsure that any IT service can provide value to the customer in the event that normal availability solutions fail

Project ManagementInternal and external project management, planning, execution, and delivery

Consulting ServicesApplication analysis and configuration, problem resolution, integration, technical advice

CustomerService

Management

BusinessServices

FinancialManagement

AvailabilityManagement

CapacityManagement

Service LevelManagement

IT ServiceContinuity

ProjectManagement

ConsultingServices


Service SupportService SupportService Desk / Incident ManagementSDC service desk services (Single Point of Contact), optional tier 1 help desk services, incident related customer communications, alert communications

Logging, classifying, prioritizing, assigning, tracking, investigating, and resolving incidents and routine service requests.

Change Management / Release ManagementStandardized methods and procedures for handling of changes, includes a change scheduling and coordinator function

Protection of live environment through the formal procedures and checks through changes

Problem ManagementMinimizing the adverse impact of incidents and problems on the business that are caused by errors within the IT Infrastructure, and to prevent recurrence of incidents related to these errors.

Configuration ManagementIdentification, recording, and reporting of IT components

ServiceSupport

Service Desk/ Incident

Management

ChangeManagement /

ReleaseManagement

ProblemManagement

ConfigurationManagement


So Why Outsourcing?So Why Outsourcing?

Core vs. non-core Optimizing skills and delivery enables implementing tactical workload balancing and helps keep high-value employees focused on strategic initiatives.

Internal cost pressure Implementing a outsourcing delivery strategy can reduce overall costs and increase the productivity and efficiency.

Strategic advantage Leverage IT cost savings to invest in new strategic investments to help enhance business value.

Quality performance Utilizing the best skills—wherever they may be located—and applying proven methodologies and processes can help improve the overall quality of application and services.

Leverage skills where they exist Accessing a pool of resources can provide a flexible, cost-effective approach to addressing rapidly changing business conditions.

Because of…

Transformation Outsourcing


Three-Tier:Three-Tier: Outsourcing Service Delivery Model Outsourcing Service Delivery Model

Transformation Outsourcing

Enabling

Service

Growth2. Selective Outsourcing

1. Full-Scope Outsourcing

3-Tier Outsourcing

Model

Outsource a broad scope of IT

applications.

Partner with firm to assist in the development of

selective components of IT applications.

Perform in-house (Insourcing) development and partner with

firms to develop selective applications.

3. Hybrid Outsourcing


high

low

- Value of IT Uniqueness +low high

VALUEOFIT

SKILLS

Application Outsourcing Assessment Framework:Application Outsourcing Assessment Framework:How to address what to Outsource?

Strong Outsourcing Candidates

Grey Area: Outsourcing?

Perform In-house Services

Grey Area:Scarce Resources?

Customer Value?Retrain Staff?

Strong Outsourcing Candidates

Business-Specific

New Architecture

Trai

ning

Layoffs

NN

SSEEWW

Standardize

Mgm

t Sk

ills

Attrition

Moving Apps North: Increases the economic value of IT personnel. Perform in-house services.Moving Apps South: Financial burden of outsourcing arrangements; Need to benchmark industry.Moving Apps East:Creates unique applications, decreases outsourcing; Increase selective outsource.Moving Apps West: Standard applications & technical architectures. Selective/full-scope outsourcing.


China: Off-Shoring Pipeline to Xi’An CityChina: Off-Shoring Pipeline to Xi’An CityHow to harvest U.S. projects?How to harvest U.S. projects?

陕西加中 IT 培训学校ShanXi Sino-Canadian IT Training School

BusinessCluster

Resource Alliance Pool

UniversityStudents

Xi’AnTeam

Shared Team

U.S. Team

Core Competency

Transformation Off Shoring


Xi’An City: • 35 Public Universities• 401,000 students in school• 68 Private universities• 178 Training schools

Shanghai City: • 57 Public Universities• Undergraduate: 378,500 • Graduate: 59,100 each year

University IT Graduates Off-Shoring in University IT Graduates Off-Shoring in Shanghai and Xi’AnShanghai and Xi’An


Requirements

Analysis & Design

Coding & Unit Test

Test

Deployment

Requirement survey

Requirement Analysis

Requirement Definition

Integration TestSystem TestAcceptance Test

Peer review then set up baselineHigh Level DesignDetails Design

Peer review then set up baseline



CodingUnit Test

Requirement Management

SPTO

Risk management

Quality Audit

Configuration Management (CM)

Peer review

Project Execution

support workflow

Off-Shoring Process Workflow


Core Competency: Core Competency: Off-Shoring Capability Off-Shoring Capability of Application Developmentof Application Development

• Domain Knowledge• Technical Knowledge• Software Engineering

& Management• Resource

Resources

Domain Knowledge

Technology Management


IT Governance

Outsourcing – Insourcing – Off Shoring

presented bypresented by Ben Berry Ben BerryChief Information OfficerChief Information OfficerOregon Department of TransportationOregon Department of Transportation

[email protected]@odot.state.or.us