Next evolution of virtualization: EMC transforms IT service delivery

USA: EMC Corp. is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service. At the helm of IT within this innovative organization sits Sanjay Mirchandani, a CIO with a vision to transform the IT organization from a cost center to a nimble, value-added contributor across the enterprise.

To achieve this goal, Mirchandani recognized a broad transformation would be required. EMC’s IT operating costs were climbing year over year, threatening to carve into the company’s bottom line. This complexity was also creating challenges and impacting employee productivity and efficiency.

In 2009, Mirchandani formulated a plan to address these challenges by virtualizing EMC’s IT service delivery model. This strategy pushed the envelope on the traditional concept of virtualization, which transitions infrastructure or application management to the cloud or a third-party provider.

For EMC’s IT Transformation, Mirchandani envisioned virtualizing a portion of the organization’s human capital by separating business engagement from solution delivery. The next step would be to develop three solution delivery capability centers--program management, functional support and testing—for more than 30 of EMC’s most critical, client-facing IT applications. The final step would be to move a few of these capabilities centers to a global location.

Mirchandani believed this virtualization approach would deliver a sustained cost savings and leverage the innovation of a global workforce, while also providing a structure that would allow senior IT resources to specialize their skill sets and increase their contribution to the business. EMC’s longtime strategic business partner, Accenture, concurred with the approach, and helped to define the targeted outcomes of the IT transformation.

Accenture’s ongoing high performance business research initiative, coupled with recent research into major IT trends, indicates that virtualization will become pervasive for business processes that are dynamically provisioned or outsourced. This trend is made possible by advances in delivery networks and collaboration technologies.

Transitioning to a virtualized delivery model
To execute the IT service delivery virtualization, EMC engaged Accenture in a multiple year agreement to provide the outsourced services in a global model. The two organizations kicked off the IT transformation with a three-month transition phase to define the operating model and procedures, and to staff trained resources into the capability centers.

EMC’s new operating model consisted of two separate teams that collaborated to serve the organization’s IT needs. The first was a small customer-facing Business Technology Group, which interfaced directly with the EMC business to handle day-to-day IT needs. The remainder of the IT organization formed the Service Delivery Group, which focused on a range of IT services critical to the enterprise.

To provide this competence, the two companies built a global team combining EMC and Accenture resources working in a co-sourced model.

EMC relied heavily on tested Accenture methodologies to create detailed processes, define deliverables, and outline handoff procedures for both onshore and offshore resources. EMC and Accenture leveraged knowledge and technology from the Accenture Global Delivery Network to establish the three IT capabilities within EMC’s center in Bangalore, India. Accenture’s network offers more than 50 delivery centers across the globe and is staffed with more than 116,000 highly trained resources.

Once the new IT service delivery model was in place, the team worked to transform the composition and mandate of the program management, functional support and testing teams. This phase included transitioning some of these capabilities to global resources using the Accenture Rapid Transition Suite, a methodology and set of tools designed to speed the establishment of service delivery while minimizing risk.

This six-month operational phase allowed the co-sourced team to refine and optimize functions such as design documentation, requirement tracking, project reporting, deliverable tracking, test automation and risk-based testing. During this period, EMC continued to roll out detailed procedural training to ensure that all IT employees correctly followed the new processes.

After finishing the operational phase, EMC and Accenture moved into ongoing operations and optimization for the remainder of the multiple year agreement. The goal was to achieve continuous improvements through innovation.

Realizing the results
EMC’s IT Transformation is producing value in innumerable ways. The enterprise now has a virtualized IT service delivery model with core competencies in program management, functional support and testing. The flexible and adaptable operating model delivers IT projects quickly and efficiently with higher quality while also handling surges or incremental activity.

For example, EMC has achieved close to 20 percent quarter over quarter efficiency gains in testing. Likewise, the virtualized service delivery model is enabling 40 to 50 percent more release functionality with fewer defects.

“Together, EMC and Accenture built an advanced IT service delivery capability, infused with Accenture’s methodology and process rigor, to significantly reduce EMC’s IT operating costs while enhancing core IT functions,” said Mark Bruni, a senior executive with Accenture’s Communications & High-Tech Group. “I commend Sanjay on his vision.”

“From day one, EMC’s IT Transformation was about investing in our IT people and building their capabilities,” said EMC’s Mirchandani. “By virtualizing a portion of ongoing IT activities, our team has time to focus on what they do best. Now IT is operating in a smarter, more agile mode—with considerable cost savings to EMC.”

Perhaps, most importantly, Mirchandani has transformed the IT organization into a professional services business. EMC’s program managers and functional analysts are developing and utilizing deeper skills that can be leveraged across more of EMC’s projects and applications. The result is an agile and cost effective IT function that is helping EMC to achieve its strategic objectives.