Software & Services

Tech Vendors Aim For Self-ImprovementTech Vendors Aim For Self-Improvement

CA's CIO makes it through a year of upheaval, while other companies focus on cost-cutting and integration.

September 16, 2005

9 Min Read

information 500 - Information Technology The first year of any CIO's job can be challenging, but Kevin Kern's initiation at Computer Associates was nothing short of turbulent. As Kern enters his second year, he sees things calming down.

Kern has been part of a complete corporate makeover the company has been implementing in the wake of a lengthy government investigation into its accounting practices. Over the past 18 months, CA got a new chairman, president and chief executive, and CFO, along with Kern, who joined the company in March 2004. A significant portion of Kern's effort has been in implementing what he refers to as a "business transformation" of the company that has included revamping its IT platform.

"We do want to have better financial integrity, but the result of this transformation will be that IT will be significantly simplified," he says.

Kern moved CA from a hodgepodge of applications, accumulated during 20 years of developing homegrown applications and integrating apps from numerous mergers and acquisitions, to a companywide SAP enterprise-resource-planning platform. As part of that effort, he rebuilt his IT team, dismissing about 100 workers and hiring 50 workers with SAP expertise. Kern was able to reduce IT costs by 15% compared with last year, and he will look to keep cutting the IT budget by 5% to 7% annually.

Intel hasn't gone through a management overhaul or a criminal probe, but its IT team has been engaged in an improvement program that last year let it reduce IT costs by 15%, despite an increase in the number of employees needing IT support and services from 80,000 to 91,000, says Marty Menard, director of platform capability in Intel's information services and technology group.

"Our focus is to make IT a competitive capability for Intel," Menard says. One program expanded communication with the creation of an official instant-messaging system. Intel has about 110,000 mailboxes within the company and handles about 4 million E-mails every day, Menard says. IM can be used instead of E-mails in many cases, can be deployed at less cost than E-mail, and doesn't need internal storage resources.

To date, about 50,000 Intel employees have IM. "If IT shops aren't proactive on IM, it will all be underground," Menard says. "Individual employees will be bringing in their own IM applications and loading them on their system, which will cause problems."

Ken LeBlanc, senior director of IT business operation and portfolio management for EMC Corp., says the internal focus for IT in the past several years has been "building trust and respect within the organization so that we move from business alignment to business partnership."

Part of the effort has been helping to integrate the IT functions of companies that EMC recently acquired, such as information-life-cycle-management specialist Legato Systems and virtualization software company VMware. "As a CIO or purchasing agent, you want to continue to do business, but you expect your experience to improve as a result of those mergers and acquisitions," LeBlanc says. "You want to receive one bill and not three separate invoices."