- By Brian Robinson
- Sep 22, 2003
Government agencies are no strangers to outsourcing elements of their information technology operations. For years, many have relied on contractors to provide services, such as running networks or tending to the upkeep of desktop computers.
Now, with the Bush administration's push for opening government jobs to increased competition, a greater share of agency IT work is expected to go to outside vendors. In fact, marketing firm Input predicts federal IT outsourcing will grow from $6.6 billion in 2002 to nearly $15 billion in 2007.
Agency officials will need to make sure they get what they pay for, a task that was never easy before and will only get tougher. With more outsourced services and as IT performance increasingly becomes a top-level management concern, the traditional bits-and-bandwidth metrics that IT organizations have used to manage service-level agreements (SLAs) can only be part of the solution.
"It used to be in the mid-1990s that the IT organization decided network service levels, and the business groups looked on IT as simply a cost center," said Bob Norberg, director of product management for Visual Networks Inc. The company has supplied monitoring tools to network service suppliers and government agencies since 1995. "Now the chief financial officer is becoming used to driving what the network needs to deliver, and that will happen even more as things such as [business-critical] Web services evolve."
As this trend develops not only in government but also in industry, many software vendors are hoping to profit by offering tools that can correlate performance to SLAs. Not all of them are ready.
The tools must become more intelligent about how business needs correspond to IT services, Norberg said. They must also provide real-time information about how services are performing relative to SLAs rather than simply issue a pass or fail judgment based on historical data.
Agencies demand more
A need for real-time notice about network conditions was one of the reasons the U.S. Postal Inspection Service finally decided to purchase Visual Networks' tools several years ago, said Ron Frazier, team leader of network operations for the USPIS. Until then, it had been relying on a historical trend analysis of network service provided by its vendor, Sprint.
Now the agency is integrating new technologies into its network. There are increasing demands on bandwidth for such uses as video-based training, he said, all of which require much closer management of outsourced services.
"The rest of the Postal Service relies on the vendor to manage the network, but we are a law enforcement agency, and we try to remain as tight as possible," Frazier said. "We do everything and manage everything, and now everyone wants the information immediately."
Navy officials needed to cater to different performance measures when they were defining the requirements for the Navy Marine Corps Intranet seat management contract. They had to account for customers' concerns, some of which were very technical and others less so, said Steven Ehrler, the Navy's program executive officer for IT.
One of the major yardsticks, for example, is customer satisfaction, and "there's no real good technical way of measuring that," Ehrler said.
So the Navy had to agree with EDS, the prime vendor on the contract, on a way to identify concrete qualities associated with satisfaction. They surveyed end users, then used the responses to build an incentive structure that measures and links to satisfaction.
To achieve greater efficiency across their operations, agencies are turning to outcomes-based procurement, Ehrler said. Although technical infrastructure measurements are old hat, he said, the same isn't yet true on the applications side.
"Tools are not really evolved yet to deal with all of this," Ehrler said.
Vendors are taking the first steps toward fielding such tools, however.
Managed Object Solutions Inc. officials, for example, describe their company as a business service management firm. Their software platform, called Formula, integrates data from a number of existing sources, interprets the relationships between the data and the business processes it affects and then displays the results in graphical views.
The goal is to enable managers to make business-oriented decisions about their IT services. If they find several servers are running slowly, for example, they can make a decision about which to fix first based on the most critical business processes that are affected.
By representing everything — servers, networks, network events or even services themselves — as objects, Formula can relate these objects to one another at any level, whether it's from a business perspective or a technical viewpoint, said Charles Manning, director of product marketing for the company.
"We find that these IT organizations certainly do care about what the business impact is of the services they manage," Manning said. "But they also need to address their own concerns from an operational perspective."
Digital Fuel Technologies Inc. is likewise focused on using data from existing IT management tools. Its ServiceFlow suite of tools will take data from Hewlett-Packard Co.'s OpenView and other e-services and asset management products to build a pyramid of relationships between IT services and their impact, said Kevin Faulkner, Digital Fuel's vice president of marketing.
From the top of that pyramid, a businessperson will be able to see how the services are flowing and even how particular service providers are performing.
"We want to push the way SLAs are defined all the way down to the process level," Faulkner said. "From the governance point of view, business people can see how such things as e-mail and human resource processes are working and how they are affected by service delivery. But IT administrators can also use ServiceFlow to drill down and see what problems are occurring at a specific network router, if they need to do that."
These tools could also be used to save money, vendors argue.
Agencies could set a limit on how much they spend to maintain a service contract, said Yuval Boger, chief executive officer of Oblicore Inc. They could use a tool such as Oblicore's Guarantee to compare the impact of several suppliers' services on business and IT operations.
"Typically, an agency would take a service from the outside supplier and then distribute it internally themselves, so Guarantee could also be used to show how that service could be optimized, what kind of bandwidth and staging would be needed and so on," Boger said.
Agencies could save money because they would be better able to accurately determine a pay-on-demand service, rather than contract for services wholesale, which would require them to figure out in advance what the demand might be, he said.
Tool vendors readily admit there's still a long way to go before this concept of service-level management (SLM) makes an impact.
"The evolution of SLM is still in its very early stages," said Peter Weber, chairman and president of SevenSpace Inc. SevenSpace sells a suite of service optimization and management tools and provides its customers with an extensive overview of the performance of their applications and infrastructure through its SpyGlass Web portal.
The logical evolution for SLM is toward judging service performance against the overall user experience rather than as a simple performance evaluation of the IT components, Weber said. One driver will be the change in the function of the chief information officer from a technologist to more of a business-oriented person.
"But I'm surprised we are not closer to that yet," he said.
Adopting SLM practices will require a cultural shift in most organizations, said Lisa Erickson-Harris, research director for Enterprise Management Associates Inc. Even though the concept of SLM and SLAs has been around for years, organizations are still unsure about how to implement it in terms of business priorities and objectives.
The business side of organizations is driving the move toward greater accountability and quality in IT service investments, she said. But the gap is still so great between the business and IT groups that they must meet to work out a common understanding of basic yet critical services, such as network capacity.
"The dialogue has to start well before these [SLM] tools are chosen," she said. n
Robinson is a freelance journalist based in Portland, Ore. He can be reached at email@example.com.