There’s also fear of major disruption, particularly in the case of application consolidation. “We decided to consolidate at the height of the refinance boom, when people were very busy,” First American Title’s Godec says. “The idea went over like a lead balloon.” First American Title’s experienced escrow officers had prided themselves on their efficiency in getting documents produced in a timely manner. “Now they would no longer do that work. I think they felt outsourced.”
Resistance escalated during the rollout. “They were screaming bloody murder.” It didn’t help that the more experienced employees were having a harder time adjusting to the new system than those on staff for two weeks, who were more productive sooner. “Two weeks later, though, they were all thrilled,” says Godec, who adds that some quit but many have come back. Godec emphasizes that a big success factor in application consolidation is focusing heavily on the human element. “Make sure you overtrain and are right there with the end-users during the change.”
Resistance can also come from IT, but it’s often not as serious as one might expect. “There was the usual fear of job loss, and we worried that we’d lose key skills too early,” says John Carrow, vice president of strategic client development and former CIO at Unisys, which has been consolidating in waves since the late ’90s. “We thought about retention programs, but it turned out we didn’t need them. The techie work culture got caught up in the technology and understood the learning opportunities it created.”
Nonetheless, consolidating soon after a company merger can exacerbate tensions, as it did at Advantage Sales and Marketing, a leading marketer of consumer packaged goods. “It was really tough,” says William Hiatt, the company’s national technology director. “We were the big, bad evil corporation coming in and changing everything. A lot of IT left so we had to hire new people even while we were cutting to reduce the budget.”
Many companies make a concerted attempt to redeploy IT workers. At KMD, a Danish software developer for local governments that used VMware’s ESX Server to consolidate three datacenters to one, many of the same staff continued managing servers and applications remotely in virtual teams after the consolidation. “We needed to make sure each of the three departments was well represented on the technical side,” says Alan Madsen, a systems engineer at KMD.
But cuts are often inevitable. “If you’re going from 5,000 servers to 2,500, you’re obviously not going to need all those system administrators,” IDC’s Bailey says.
Taking Baby Steps
Just about everyone cautions against being overly ambitious. Tackle consolidation in small to medium chunks, they say, and use what you learned for the next wave. “We worked with Dell to migrate one ERP application from Unix to a Dell cluster running Linux. Once that pilot was successful, we decided to take out a blank sheet and really try to re-architect,” TRW’s Drouin says.
Yet TRW left PeopleSoft running on HP-UX. “We had thousands of users running those applications,” Drouin says. “Changing those platforms in the middle of a transition was just too big a bite for that first stage.”