Abstract: Global Data Center Consolidation and Outsourcing Assessment

Project Abstract: IT Assessment & Strategy: Baseline and needs assessment, cost, benefits and risk analysis

Background

The world’s largest gold mining corporation had doubled in size over the past 24 months through global acquisitions of other mining operators. The lack of rationalized and consistent business processes across the enlarged organization was increasingly straining the business and was a risk to continued growth and profitability. Responding to this challenge, management began to implement common computer applications and infrastructure platforms across the enterprise to support processes such as mine management, safety, succession planning, finance, HR, etc. Complicating factors were the decentralized company management style and the lack of normal business interaction between business units.

Questions of data center consolidation vs. global outsourcing, local desktop support, global and local application development and maintenance and a supporting network had to be addressed. TBI developed a balanced sourcing and consolidation strategy to address the needs for cost reduction, improved local and global support that fit into the culture of the client environment.

Problem Summary

The client’s global operations spanned 15 countries on four continents, yet the data and voice network that supported these operations had grown piecemeal. Each in-country mine operation was responsible for its own IT. Some of these IT units were very small – a couple of people – and some were quite large. At the smaller sites the needs for local support were greater than the ability of the local site staff to supply; at the larger sites each IT organization had developed its own applications or package versions. The result was a sub-optimal IT function from an enterprise wide perspective. There was significant duplication, (particularly in countries where the client had multiple operations resulting from separate acquisitions), cost inefficiencies, no common technology platform(s), and low reliability. Investments were not consolidated or managed centrally and overall enterprise wide costs were significantly higher than they should have been for the functionality delivered. Clearly a new approach was needed.

Successful Business Solution

At the conclusion of this six month project, TBI delivered the following to the client in a presentation suitable for the senior management committee:

Options for data center consolidation and outsourcing
Options for desktop support in-house and outsourcing
Options for telecommunications in-house and outsourcing
Options for application development and maintenance in-house and outsourcing
A business case for each option with ROI calculations
An assessment of risks and issues unique to the client
A recommendation for moving forward
A high level implementation plan for moving forward
A recommended conceptual model for the future state of IT
Organization structure

Roles and responsibilities
Budget requirements
Governance approach