IT Consolidation Update

1. IT Consolidation Update Office of State Budget And Management Annual Conference October 17, 2007 Jim Dolan Associate State Budget Officer – IT Kathy Bromead Enterprise Program Manager – Information Technology Services

2. Agenda • Consolidation Goals • Other States’ Interpretation of Consolidation • Focus Areas for NC • IT Consolidation Activities / Approach • Phase I (Pilot) Summary • Phase II Status • Opportunities via IT Consolidation- Geographic locations- Server consolidation  Virtualization Technology- Enterprise services offering example • Summary

3. Consolidation Goal  Shared Services Pooled Experience Lean Flat Best Practice Independent of Business Unresponsive No accountability Inflexible to Unique Requirements Remote From Users Common Support Economies of Scale Critical Mass of Skills Redundancy Costly Lack of Standardization Business Focus Responsive Partners Decentralized Centralized Shared Services

4. Other States - Consolidation • Virginia • 10 year, $2 Billion, partnership, Northrup-Grumman • Year 1, New Data Center, 90 Servers consolidated to 16, 6000 Desktops replaced • Texas • Consolidate 31 Data Centers into 2 • Missouri • Combine 14 executive branch departments IT divisions • Colorado • September 2007, Consolidation all IT into central organization

5. Five IT Infrastructure Assessments Network – Connects everybody together Data Center (Servers) – business applications and common functions (E-Mail, Web) Security – Protect technology and data Service Desk – single point of contact for problems or requests Desktops – helps customers with hardware and software

6. IT Consolidation Key Activities / Approach

7. Phase I (Pilot) Summary • DOA, OSP, OSBM, Governor’s Office & Lt. Governor’s Office • Project kick off January 2006; 90% completed December 2006 • 5 remaining server migrations complete October 2007 • Scope • 54 IT FTEs including 10 enterprise IT ‘infrastructure’ FTEs • 80 Servers; ~1100 PC’s; ~1200 switch ports; 31+ locations • Findings • Equipment out of date, with no warranty • Lack of standardization of technology and processes • Actions Implemented • Moved 10 IT infrastructure personnel to ITS • Consolidated/migrated 17 servers • On boarded agencies to managed desktop, LAN and Server Services • Lessons Learned • Consistent, recurring spending is required to keep IT equipment up to date. • More focus is needed on IT banding • Splintered IT organization structures sub optimize IT strategy rollouts, skill transfer and IT training and employee development.

8. IT Consolidation Phase II - Project Status

9. Phase II Implementation 2007 2008 4th quarter October 1st quarter January 2nd quarter April 3rd quarter July 4th quarter October Org Service Desk Industrial Commission October 1 – January 31 Org Service Desk Juvenile Justice and Delinquency Prevention November 1 – June 30 Org Service Desk Cultural Resources March 1 – December 31 Org Service Desk Office of State Controller June 1 – October 31 Service Desk Org Commerce August 1 – December 31

10. Opportunities via Consolidation • Geographical Locations • Server Consolidation  Virtualization Technology • Enterprise services example  Managed Desktop Services

11. IT Infrastructure Inventory Scope Phase I & II 3.8x 3.4x 9.3x 7.8x 4.0x 2.2x Scope and Magnitude of Work

12. Phase II Geographical Locations Alleghany Northampton Ashe Surry Stokes Warren Gates Camden Rockingham Caswell Person Currituck Hertford Granville Vance Pasquotank Watauga Halifax Wilkes Perquimans Yadkin Davie Orange Chowan Forsyth Avery Bertie Franklin Guilford Alamance Mitchell Durham Nash Caldwell Alexander Edgecombe Yancey Madison Iredell Martin Washington Tyrrell Davidson Wake Burke Randolph Chatham Wilson Dare McDowell Rowan Catawba Buncombe Pitt Beaufort Haywood Johnston Greene Swain Lincoln Hyde Lee Rutherford Harnett Cabarrus Mont- gomery Wayne Graham Cleveland Henderson Stanly Polk Moore Gaston Jackson Mecklenburg Lenoir Transylvania Craven Macon Cherokee Pamlico Richmond Cumberland Clay Jones Union Anson Sampson Hoke Duplin Scotland Carteret Onslow Office of State Controller Robeson Bladen Locations OSC = 4 Commerce = 46 DCR = 63 DJJDP = 126 Ind. Comm. = 2 Total = 241 Pender Dept. of Commerce Dept. of Cultural Resources New Hanover Columbus Dept. of Juvenile Justice and Delinquency Prevention Brunswick Industrial Commission Overlapping areas could be candidates for workload synergy. Opportunities via Consolidation

13. Opportunities via Consolidation IT Consolidation – Phase II Server Summary

14. Opportunities via Consolidation What is virtualization? In computing, virtualization is a broad term that refers to the abstraction of computer resources. One useful definition is "a technique for hiding the physical characteristics of computing resources from the way in which other systems, applications, or end users interact with those resources. This includes making a single physical resource (such as a server, an operating system, an application, or storage device) appear to function as multiple logical resources; or it can include making multiple physical resources (such as storage devices or servers) appear as a single logical resource." source Wikipedia

15. Opportunities via Consolidation Benefits of Virtualization • Rapid hosting growth • Power demands • Cooling demands • Floor space • Disaster Recovery • Provisioning improvements • Consolidation plans

16. Opportunities via Consolidation ITS Results to Date on Virtualization • Reduction in hardware cost • Smaller power and cooling requirements • Enhanced availability • New possibilities around capacity planning • Greatly enhanced flexibility around provisioning of new servers • Fewer network ports required • Fewer SAN connections required

17. Opportunities via Consolidation Managed Desktop Services Offering • What is it?Highly scalable “end to end” IT infrastructure shared service that ensures a reliable, predictable, and secure client computing environment. • What is included? • Standard PC hardware, network-attached printers, and a suite of commonly used software • Full life cycle support – cradle to grave • Scheduled refreshes & upgrades, and emergency patches • License compliance • Technical support, break/fix, and maintenance • Security protections • Anti-virus, personal firewall, spyware protection, etc. • User ID administration • Service Desk – problem reporting and dispatching service • What is not included? • Other ITS managed services are offered separately • E-Mail, network connectivity, server/hosting, etc.

18. Opportunities via Consolidation Value Proposition to State • A formal desktop management program will significantly reduce security and financial risks, increase reliability, reduce downtime, and provide a predictable application delivery mechanism by: • Standardizing hardware and software components • Ensuring legal software license compliance • Keeping hardware and software refreshed, updated, and well maintained • Providing a timely and effective response to incidents and outages • Protecting users from computer viruses, malicious software, and network attacks • Maintaining an accurate physical inventory of IT assets assigned to end users

19. Opportunities via Consolidation Value by Managing Services @ Enterprise Level Examples of other statewide shared services… • Beacon HR/Payroll • Statewide eMail • Statewide Procurement • State Capital Police • State Property Management • Motor Fleet Management Enterprise programs drive reduced risks, reduced costs and increased efficiencies.

20. Opportunities via Consolidation Spend Analysis Summary • Model optimized at State level • Agency compares must include all indirect and hidden cost • Smaller agencies or under funded agencies may require increased funding • Recurring funding streams required versus one time funding

21. IT Consolidation Summary • Phase II is moving into execution mode. • Many opportunities exist to optimize IT investments via consolidation. • Focus on consolidating your areas to get the biggest bang for the buck!