Archstone Consulting recommends targeting a company's IT service delivery model to reduce IT costs more effectively than solely focusing on technology assets. A robust IT service delivery model has four key components: governance, organization, operational processes, and performance management. Archstone's rapid assessment identifies improvement opportunities within 5-7 days through workshops and a maturity model analysis to understand gaps and savings potential. The assessment delivers a comparative spend analysis and recommendations.

1. A better way toward IT cost reduction
An Overview
Discussion Document

2. Archstone
When executing IT cost reduction initiatives, most companies Consulting
IT Cost
typically target their assets – software, servers, and storage Reduction
Today’s
Focus
Definition IT IT Service Definition
The IT Technology Delivery The IT organization
applications, infrastruct and processes needed
ure , and associated
Assets Model to implement and
data needed to operate IT capabilities
operate a modern across the enterprise.
business.
Archstone Focus Areas: Focus Areas:
Consulting • Application consolidation • Service delivery strategy Lower
provides services • Storage consolidation • Service optimization
• Server virtualization • IT organization design
Total Cost of
to reduce Asset
and Delivery • Strategic sourcing • Business/IT alignment Ownership
(e.g., telecom software) • Performance management
Model costs
We believe that the IT Service Delivery Model itself represents the largest
“hidden pool of cost” within an IT organization
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3. Archstone
However, a better way exists – that is: Consulting
IT Cost
…… targeting the IT Service Delivery Model Reduction
If the Technology Assets are the “What,” the IT Service
IT Service
Delivery
Delivery Model is the “How.”
Model
Robust IT Service Delivery Models have four key components:
Operational Performance
Governance Organization
Processes Management
• Executive oversight • Organizational design • Portfolio management • Performance
• Explicit alignment of • Roles and responsibilities • Enterprise architecture management framework
business and IT strategy • Centralized vs. distributed • Infrastructure optimization • Cost and performance
• Project prioritization activities transparency
• Vendor management
• Budgeting and funding • In-house vs. outsourcing • Project / program • Common metrics/targets
definition
• Enforcement and • Staff competency models management
adherence • Alignment of service
• Integration across • Application development/ levels and business needs
• Proactive issue and risk technology platforms maintenance
management • Corrective action
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4. Archstone
When assisting our clients with their IT operating models, we Consulting
IT Cost
identify improvements that lead to significant value Reduction
Operational Improvements “Hard” Benefits
• Increased focus on application reuse, application • 15%-25% reduction in hardware
Technology
lifecycles, and the ability to sunset technologies and software costs (considers
Alignment when appropriate equipment, licensing, and
• Enhanced ability to identify “synergy targets” and support)
consolidate technologies during M&A activity
• More integration with the business and its goals • 25%-30% reduction in rework
and objectives • 25%-50% improvement in
Business
Alignment • A better understanding of how to apply disparate customer SLA compliance
technologies to specific business challenges and (internal and external)
opportunities
• Greater overall cost visibility, control, and • An average total cost of
Cost
management ownership (TCO) reduction of
Efficiency • Enhanced ability to identify savings 10% and 20%, and in some
opportunities, address them, and make them cases, much more
“stick.”
• Ability to adjust quickly to ever changing business • 15%-25% reduction in cycle
Speed /
priorities and needs (e.g., unforeseen business time
Agility events, changes in strategy, M&A) • 25%-50% improvement in
• Reduction in the proliferation of “Shadow IT” development request response
times
Proprietary and Confidential *Average savings based on Archstone Page 3
© 2009 Archstone Consulting LLC. All Rights Reserved Consulting client projects

5. Archstone
With our operating model experience, we are able to execute a Consulting
IT Cost
rapid assessment at minimal cost in as little as 5-7 days Reduction
Archstone Consulting Our “Rapid Assessment” includes:
IT Cost Reduction - quot;Rapid Assessment”  A workshop based approach to review current
capabilities and challenges
1 2 3
 A maturity model assessment to understand
Discover Analyze Report how the delivery model compares to leading
practices
*Key Activities: Key Activities: Key Activities:
 An analysis of gaps to identify focus areas and
1. Submit data request 1. Determine relative IT 1. Review and refine
2. Analyze available data maturity and identify key comparative spend improvement opportunities
improvement analysis
3. Conduct preliminary opportunities 2. Discuss maturity model
 A comparative spend analysis to identify
interviews with 3-5
stakeholders and subject 2. Analyze current IT spend rankings and key priorities savings opportunities
matter experts and compare to industry 3. Capture feedback and
averages summarize final
4. Schedule required IT
team working sessions
and briefings
3. Validate data / findings
with IT leaders
recommendations
4. Conduct final executive
Archstone Consulting
5. Clarify any data points 4. Provide initial feedback to briefing for key Project Timeline and Deliverables
project stakeholders stakeholders
Maturity
Model
Our “Rapid
Assessment”
can be Comparative
executed in as Spend
Analysis
few as 5-7 days
and includes
these
Recommendations
deliverables
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6. Archstone
How does Archstone Consulting differ from traditional IT Consulting
IT Cost
consulting firms? Reduction
• Our Foundation – We’re business people first; we believe that effective IT begins and ends
with the business, rather than “IT for IT’s sake”
• Our Industry Depth – We understand the pressures, the requirements, and the constraints
of the industries in which we work and can practically apply our industry experience to IT
• Our Focus – We focus on achieving tangible and sustainable results for our clients, rather
than merely executing yet another consulting study
• Our Approach – It is proven and has been tuned via the execution of many information
technology deployment and service delivery model projects
• Our Style – We work shoulder to shoulder with our clients – we believe that the best results
are achieved when client and consultant work together
• Our Flexibility – We recognize that business doesn’t stop just because we’re on the ground;
we accommodate our clients’ busy schedules to minimize the disruption to operations
• Our Independence – We are not owned, nor are we aligned, with any technology firm; as a
result, we focus on what’s right for our clients, rather than for a partner
We are excited at the prospect of working with you and stand ready to
begin immediately
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7. Archstone
Consulting
IT Cost
Archstone Consulting at a Glance Reduction
• A Strategy and Operations consulting firm DEFINING A NEW AGE IN CONSULTINGSM
• Provides independent advisory services that
help clients reduce their costs, grow their top
line, or transform their organizations
• Primarily serving the Consumer
Products, Retail, Pharmaceutical, Financial
and Manufacturing industry sectors
• Serve leading global organizations
(including 24 of the top 100 companies and
58 of the top 500 according to the latest
Fortune rankings)
• Archstone was founded by consulting industry
veterans is
• We have over 200 consulting professionals
worldwide in 6 offices in the U.S., Europe
and Canada
www.ArchstoneConsulting.com
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