Asset management moves beyond tracking inventory

With an eye toward the bottom line, solutions emerge to help you run IT as a business

Shyam Ramachandran, IT manager at Viking Range Corp., knew things were out of control. "If someone left the company and HR called to ask what equipment they had, we had no idea," he says. IT kept tabs on hardware and software through a help desk system, but the data was unreliable.

"My people didn't always keep track of what was removed or replaced," Ramachandran says. "Many people had laptops at home. We had mobile salespeople and satellite offices all over the country. And there were lots of IT wannabes installing their own hardware and software and breaking things. We were in no-man's-land."

Patch management was particularly chaotic. "Patching was a way of life, with 10 different sets of patches for 10 different operating systems," Ramachandran recalls. "Invariably something would break."

Control came in the form of Computer Associates' UAM (Unicenter Asset Management) software. "UAM does a thorough, ongoing inventory over the network that keeps us up-to-date on the hardware and software installed on all our systems, including our mobile laptops, which it queries when users connect," Ramachandran says.

UAM's reports have helped IT get control over patch management and IT wannabes, and its software-usage metering information has allowed IT to cut some software licenses in half. "We discovered there were a lot more people with Adobe Illustrator installed on their systems than were actually using it," Ramachandran says.

UAM has also helped Viking compare its existing inventory with its leasing information to determine which systems are nearing expiration. The result: better control, less downtime, and significant savings from reduced licensing costs, fewer lease overruns, and fewer IT staff devoted to patch management.

A new world order

IT asset management software has been around for years, but until recently it's been one of those categories that sounds good but is rarely implemented. "Asset management has always been a good tool for making IT run more efficiently," says Patricia Adams, research director of IT asset management at Gartner. "But it was one of those things you could always put off and nobody would die." The common scenario was for a company to start an asset management initiative and then divert dollars and resources to more pressing concerns soon after.

In the past three years, however, IT has been besieged by stricter regulatory compliance requirements, tighter budgets, mounting security concerns, and outsourcing competition. Meanwhile, senior managers are demanding that IT get its house in order and run itself more like a business. This means clear returns on IT investments, tighter controls, better visibility into its processes, clear lines of responsibility and accountability, consistent ways to measure success or failure, predictable customer service, and projects and goals aligned tightly with the business goals of the larger organization. In many cases it also means charging the business units for the services IT provides.

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"Right now there's a strong perception in most business users groups that they're not getting their money's worth from IT," independent consultant Malcolm Ryder says. "Companies are boiling mad. They want it simple: Here's the asset, here's the business value, in a straight line from a to b, not a to d." Meanwhile, the asset management category is heating up, and much of the growth is coming from companies anxious to find ways to quickly get compliant with Sarbanes-Oxley and other recent regulations.

IT departments are also increasingly implementing established quality control and best practices frameworks such as ITIL (Information Technology Infrastructure Library) for IT service management and operations; CobiT (Control Objectives for Information and Related Technology), a set of guidelines for auditing IT processes and controls; and CMMI (Capability Maturity Model Integration) for software development. Asset management vendors have noticed and designed their packages to fit in nicely with ITIL.

Asset management provides one of the key building blocks for running IT as a business: a thorough, accurate knowledge of your IT assets and resources. Asset management suites from companies such as BMC, Computer Associates, LANDesk, MRO Software, Novell, Peregrine Systems, and others have extensive discovery and inventorying capabilities that gather detailed information on a company's PCs, notebooks, peripherals, and network equipment, including components, operating systems, software, configuration and identification information, location, and personal settings. Many come with both agentless and agent-based discovery and inventory capabilities: The agentless module finds everything on the network, and then, if your security policy allows, the agents go out and report back more detailed information.

Inventory data is continually updated to keep up with changes and upgrades, and all the data is stored in a single central data repository that can also be used for generating analyses and integrating with other corporate applications such as ERP. BMC, Peregrine, and other vendors actually use a database that conforms to ITIL's CMDB (configuration management database) specs and use the same data for their asset management and service management/help desk solutions. "One of the first requirements of ITIL is to have one single central source of the truth," says Dave Wilt, senior solutions marketing manager at BMC.

Most asset management packages have workable discovery engines, but context and relationship awareness is what separates the men from the boys. "The way you buy software is obviously not the same as the way it is discovered on the network," says Allan Andersen, director of Unicenter product management at CA. "You may deploy lots of different versions of the same software or several packages as a suite. You want a solution that is good at linking the licensable entity with the discovered entity."

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There's also the question of relationships. "Ideally the solution should be able to tell you that this database on this server and that other server and these two application servers are all related to this one module of Siebel, so you can see assets and components as parts of a business service," BMC's Wilt says. "That way if server A is running low on memory, I know right away that it runs a piece of software that's vital to my order-entry service." BMC's Atrium CMDB stores more than 80 different relationship types. Many packages also have reconciliation engines that compare and reconcile data from several different discovery engines.

Suites from CA, Peregrine, and others also combine discovery and inventory with software usage metering, which is an essential tool for ensuring software license compliance and preparing for an audit. As Viking's Ramachandran learned with Adobe Illustrator, it's also a great way to discover where a company may be overpaying for software. The resulting savings from reduced software costs is one of the quickest ways to show a return on an asset management investment. "Our customers often find that they're overpurchasing software by 20 to 25 percent, which is valuable information for negotiating with software vendors," says Craig Macdonald, vice president of product marketing and management at Peregrine.

Model for success

Knowing what you have and being able to access that information from a single, accurate data repository represents the Reactive or second stage of the asset management capability model used by CA, Gartner, Peregrine, and many other asset management vendors. The first stage is Chaos. A 2004 TechRepublic survey of member companies of all sizes found that 61 percent of respondents claimed they either had no knowledge of their asset base or used spreadsheets and rudimentary discovery tools to keep track, which puts most of them in the Chaos stage.

Getting to the Reactive stage is a relatively easy first step that accomplishes a lot. It provides essential information for managing patch deployment, planning hardware upgrades, consolidating servers and applications, reducing help desk costs, cutting spending and excess inventory, redeploying existing assets, ensuring compliance and proper asset disposal, allocating IT resources efficiently, and locating rogue hardware and software that cause security and compliance problems. "If someone comes to you and says they need a Sun server for the development group in India, you can find out pretty quickly that India already has a Sun server that's only running at 15 percent utilization," CA's Andersen says. It's also an important foundation for tighter processes and controls and better service and change management. It's valuable information during mergers and acquisitions.

Today, asset management suites go much further than inventory and software metering, storing financial and ownership information -- or integrating with existing financial, service management, and HR systems -- so asset data is associated with users, warranties, service contracts, leasing agreements, help desk calls, tax and depreciation information, and change management solutions. This gets you to the Proactive stage. "Proactive means you've started to build some applications and processes on top of the asset database to help manage the asset lifecycle," Peregrine's Macdonald says. "You can now do contract management so you can make sure you're in compliance."

This allows IT to get a better handle on support costs for each asset to determine true cost of ownership and to do better, more accurate budgeting (see "The Next Step: IT Portfolio Management," page 35). It also helps IT track leases, warranties, service contracts, and service-level agreements so they are better utilized.

"A few years ago it wasn't uncommon for companies to start a project, purchase software, and then kill the project without canceling the maintenance contract," CA's Andersen says. Andersen also points out that a high percentage of vendor invoices are incorrect.

"Salespeople get very creative with things like caps and prepayment options, but their invoicing systems are often inept at taking those things into account." Invoice reconciliation features help catch the ones that don't match contract conditions.

Most suites also get you to the Service stage, where you build automated processes on top of your asset management and other integrated systems. For example, you can set up an approval process for procurement and then have the asset information added to the database the moment it's deployed. Or you can set up an automated equipment requisition process when a new employee enters the HR system. Some asset management packages include their own bare-bones self-service procurement and catalog features that users employ to request hardware and services from IT. BMC ties its change management system to its asset management database so that all changes to hardware and software are recorded.

The last stage is Value. "Value-oriented is when you analyze your data, find opportunities to lower cost, and actually make recommendations back to the business units on a monthly basis," Gartner's Adams says. Some asset management vendors are starting to supply more extensive data analysis tools for this purpose. CA has a product called Unicenter Asset Intelligence, and Peregrine has its Asset Optimization module. You can also find vendors such as Blazent and Datastream that specialize in this kind of IT-based business intelligence and in analytics that analyze information across asset management and other systems as well. "We have a whole application layer around business-scenario-based analytics to slice and dice the asset data from many perspectives," says Gary Oliver, Blazent's president and CEO.

Slow and steady wins the race

Getting to the Value stage is a multiyear undertaking that may be too much for many organizations to handle. Most analysts and vendors advise starting an asset management deployment with small, manageable steps. "Don't try to boil the ocean," BMC's Wilt says. "Start with a single business unit or department, or a single asset management process. Pick the low-hanging fruit."

Ron Exler, service director at Robert Frances Group, agrees. "If you're doing this with a spreadsheet, move up to automated inventory," Exler says. "Then you can start thinking about integrating with financial systems or HR."

"You have to get used to what your asset information is and how to leverage it first," Peregrine's Macdonald says. "After six months, when you have a good process for keeping it intact and up-to-date, you can go to the next level." Asset management is as much about processes as it is about the software, and it will undoubtedly take time to refine those processes and overcome political hurdles. "One of the biggest issues with asset management is deciding where it will lie in the organization," Gartner's Adams says. "You have to get that out of the way first."

Most IT departments, however, will find that they can't meet the requirements of new regulations or run themselves anything like a business without knowing what they have. Having a handle on asset management is one of the most effective ways of getting there.

Copyright © 2005 IDG Communications, Inc.

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