Johnson & Johnson Had A Problem
I’m sure that when you picture yourself becoming a CIO in the future you see yourself sitting at the corporate strategy table with the CIO using your deep understanding of IT to help the company move faster and do more. Umm, one problem with that vision – you’re not going to make it to the big table if you don’t solve the problem of run-away IT costs. Johnson & Johnson’s CIO had this very same problem and she tackled it using the ITIL framework. Maybe this would be a good time to look into that ITIL thing…
Just What Is the ITIL?
You’ve probably heard about the IT Infrastructure Library (ITIL); however, do you really understand what it is? First off, it’s an old (10 years is old by IT standards) set of best practice guidelines for how to do IT service management. It was originally developed by the U.K. government in order to help them do a better job of modeling their outsourced IT projects. It’s quite popular in European IT shops and is only now starting to pick up steam in the U.S.
What makes the ITIL so attractive is that it allows a CIO to run the IT department like a business. This is exactly what Johnson & Johnson’s CIO was looking for back in 2001. J&J was going gang-busters from a business point-of-view; however, their IT costs were going through the roof – they were going up by over 10% every year.
J&J had previously tried the old stand-by CIO trick of pulling together IT operations from all around the sprawling company into a single centralized organization in order to get on top of their costs. However, even though now they knew where the money was going, they still were seeing out-of-control growth on infrastructure tasks. Something had to be done!
J&J’s CIO decided to implement a program based on the ITIL. Now mind you, this is not some silver-bullet magic cure-all. Instead, the ITIL can help with specific parts of running an IT shop. Specifically if you go about implementing ITIL correctly, your IT department can boost the quality of service that it is providing to the rest of the company.
J&J’s IT department was able to use ITIL to decrease how long it took to resolve problems. This in turn resulted in J&J’s systems having more uptime and therefore allowing more work to be done quicker. Needless to say, end users were very happy about this.
Sure happy customers are nice, but what about the money? J&J says that if you count both cost savings and costs that they were able to avoid, then starting in 2005 they believe that they’ve been able to save at least $30M a year.
Why Did This Solution Work
ITIL is not the only way to standardize the way that a CIO runs his / her IT department. Other methods include the Capability Maturity Model (CMM), Control Objectives for Information and Related Technology (COBIT), Six Sigma, and Lean Manufacturing. However, ITIL has been around the longest and its been shown to work.
Taking the ITIL path was the right choice for J&J for a number of reasons. Not the least of which was it provided J&J’s CIO with a way to both quantify and measure the quality of the service that J&J’s IT department was delivering. Who was the wise man who said “If you can’t measure it, you can’t improve it”?
What All Of This Means For You
When you become CIO you’ll be facing the same twin set of conditions that can keep you from doing all of that strategic stuff that you want to be doing: rising IT costs and ever increasing user demands for more service. You are going to have to deal with this issue and do it quickly.
ITIL is not a new “flavor of the day” approach to solving the challenges that an IT department faces. In fact, it’s a rather old approach. However, if you’re willing to make the investment in time and energy that it can take, ITIL just might be the solution that you are looking for.
Knowing that there is a solution framework out there that works is what allows most CIOs to be able to sleep at night. Actually implementing a solution and saving the company, well that’s a job that will be waiting for you when you become the CIO.
Question For You: Would ITIL work at your company or do you think that a different approach would be better?
What We’ll Be Talking About Next Time
Just when you think that you’ve got this Internet thing figured out, it goes and changes on you. There are some fantastic tools out there for you, but will you know what to do with them when you are the CIO?