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IBM CIO transforms hybrid cloud
Intentional hybrid cloud adoption leads to successful transformation and continuous innovation. With this objective in mind, the Chief Information Officer (CIO) at IBM initiated an effort to comprehensively analyze business costs and spending optimization. This initiative aimed to reallocate the IT budget toward transforming the hybrid cloud environment. Previously, when the CIO encountered a cost challenge, it made decisions from a financial perspective. By taking an evenly peanut butter spread approach, the organization risked making business decisions without having the broader picture.
The CIO organization relied on multiple data sources and tools to have complete visibility on how resources aligned to initiatives, objectives and key results. The organization pulled ledger data and could tie out with great accuracy but missed visibility to the overall finance, IT and business view. To make the right decisions, the CIO needed information and details to invest in high-priority initiatives like application modernization, rather than investing in stranded assets and lower priority applications.
The challenge called for a solution that could provide insights into the overall USD 2.5 billion IT stack and help address the following:
1 Application TCO includes software licenses and expenses, labor cost for development and support, infrastructure, infrastructure labor support and data center lease expense.
The CIO organization selected Apptio® to transform IBM’s hybrid cloud environment and deploy the Technology Business Management (TBM) model. The journey started in 2021 with a proof of concept (POC). The scope included the Apptio Costing (formerly ApptioOne) (link resides outside of ibm.com) implementation in the US with a primary focus on its CIO Hybrid Cloud Platform organization. The initial scope included USD 1.5 billion of IT cost. The POC results provided justification to expand the scope and include the remaining USD 1 billion of IT cost to deliver a global view of the CIO IT cost.
IBM acquired Apptio in August 2023. This gave the CIO a unique opportunity to scale the Apptio initiative that started in 2021, adopt the Apptio integrated suite and showcase its impact in an enterprise environment by being Client Zero. The Apptio integrated suite included Targetprocess (link resides outside of ibm.com) and the Apptio Planning (link resides outside of ibm.com) capability available in the existing Apptio Costing model.
The augmented Apptio initiative increased cost transparency and enabled the CIO organization with application TCO2 visibility by supporting data-driven decisions based on true costs of applications and real time business insights.
2Application TCO includes software licenses and expenses, labor cost for development and support, infrastructure, infrastructure labor support and data center lease expense.
Apptio Costing provided cost transparency and data to analyze, optimize and plan IT spend by providing insights into existing pieces of information (e.g., general ledger, vendor data, human resources data) to determine applications’ TCO, identify stranded or IT cost waste and execute IT benchmarking to improve productivity.
Targetprocess provided an enterprise agile planning view and the ability to perform portfolio and resource management. It facilitated strategic planning by having visibility on how resources align to initiatives, objectives and key results. Additionally, it helped understanding the cost and value associated to the initiatives.
Apptio Planning offered an integrated labor resource planning and budgeting view, information primarily used by the finance and business operations teams.
The foundation behind the products is TBM, a framework that offers stream lenses into different views and creates a common language amongst those views. The financial, IT and business views help cross-functional teams to obtain information related to their business units and display data by cost pools, towers and solutions, respectively.
The cost and consumption transparency achieved through the Apptio integrated suite has enabled the identification of key optimization opportunities. The Apptio transformation journey has also provided insights to:
Insights and application TCO data have helped rationalize the CIO portfolio, make more informed decisions about applications criticality, consumption and spend. It has also helped reinvest in transformation initiatives and establish performance optimization targets.
3Application TCO includes software licenses and expenses, labor cost for development and support, infrastructure, infrastructure labor support and data center lease expense.
The Chief Information Officer (CIO) organization leads IBM’s internal IT strategy and is responsible for delivering, securing, modernizing and supporting the IT solutions that IBM employees, clients and partners use to do their jobs every day. The CIO strategy encompasses creating an adaptive IT platform that makes IT easier to access across the enterprise, accelerates problem-solving and serves as an innovation engine for IBM, catalyzing business growth.
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Client examples are presented as illustrations of how those clients have used IBM products and the results they may have achieved. Actual performance, cost, savings or other results in other operating environments may vary.