Energy company optimizes post-acquisition IT estate

Acquisition resulted in complicated, inefficient IT

When the energy company finalized its purchase of another energy company, it found that it had doubled all the inefficiencies of its aging, on-premises legacy IT systems.

Both of the companies had on-premises legacy systems that already had duplications within their existing portfolios. And neither had strong processes in place around how to manage those portfolios. The acquisition accelerated the need to deal with such inefficiencies. The company needed to rationalize applications to work across the organization and it needed to drive out unnecessary costs. Neither of the companies had had a formal application portfolio management practice in place. The integrated company did not have the resources to manage the initiative on its own nor did it have a strategy on how to go about such a project.

The company turned to SoftwareOne’s accredited APM experts to help it better understand its business.

SoftwareOne embarked on a data collection initiative, gathering a list of all the applications each company had been using – which had been stored in spreadsheets and on shared drives – to create a consolidated list, tagging each application to indicate which company had owned it. Having compiled this list, SoftwareOne's next step was to identify and meet with the individual application owners – more than 100 in total.

 

Easy wins and hard work add up to success

It took several weeks to collect and consolidate application data, and analyze application use data. At the end of the analysis, SoftwareOne produced a report that ranked the applications in multiple categories. These categories indicated how often the application was used, how easy it would be to remove it from the company’s IT environment and how great the resulting benefit would be.

The purpose of this analysis was to optimize the application portfolio and find cost synergies, while standing up a centralized in-house APM practice with the skills, mindset and information to decommission applications that were no longer needed. This was important because, without an in-house APM practice, there was no centralized oversight, which led to waste. For example, when software licenses came up for renewal, the company renewed systems that had already been identified as ready for retirement. That was because there was no communication between the department that paid invoices, the department that made strategic IT decisions and the staff members who actually decommissioned IT resources.

Among the business benefits delivered:

• USD 4M saved in year 1: Savings on licensing and maintenance fees were quickly realized.
• Reduced complexity: The company reduced its number of applications by 55%.
• Established a process and governance framework: The project has introduced an APM culture to the organization that is better able, with the help of a ServiceNow APM implementation, to maintain the gains made.
• Software license cost avoidance: Cut unnecessary licenses and optimized remaining applications to save costs.
• Increased visibility of IT landscape: Including improved insights into IT costs.
• Helped prepare company for cloud migration: The project documented the company’s IT environment and optimized it so that it can be more easily migrated to the cloud.