1 IBM On Demand Automation The On Demand

1 IBM On Demand Automation The On Demand Operating Environment Driving Business Discipline into IT Sandy Carter On Demand Automation Executive Sponsor VP WW Tivoli Marketing © 2004 IBM Corporation © 2002 IBM Corporation

Today we are talking about… 1 The On Demand Operating Environment 2 On Demand

Where to Focus First? Where you start depends on YOUR organization’s priorities. ENTRY ess sin Bu On Demand Operating Environment ENTRY ses ces Pro Business Transformation Flexible Financial & Delivery Options § Increasing flexibility is the key—business models, processes, infrastructure, plus financing and delivery © 2004 IBM Corporation 3

On Demand Operating Environment Drives Measurable Business Value Integration Business flexibility through integration of people, processes and information within and beyond the enterprise. Infrastructure Management Reduce complexity and cost of IT management based on business policies through Automation and Virtualization technologies. © 2004 IBM Corporation 4

On Demand Automation Delivers Measurable Value Business Service Management Manage using business priority, manage service levels Sense, triggers, respond according to business goals § 40 -50% savings in SLA reporting § 15 -30% savings on time for root cause determination, downtime Availability Ensure Health and appropriate functioning of IT Infrastructure Orchestration IBM Infrastructure Management Blueprint § Increase resource utilization avg. from 20% - 50% § 30 -40% reduced admin time Security Protect information assets, confidentiality and data integrity Optimization Ensure most productive utilization of IT § 27 -32% savings triage time § 35 -40% reduced admin time § 20 -25% greater utilization § 25 -35% higher first call close § 35 -40% reduced access time § 40 -50% fewer batch restarts Resource Virtualization Single, consolidated, logical view of and easy access to all available resources in a network Provisioning Make available right resources to right processes and people § 15 -35% less capital outlay § 25 -30% reduced staff req’ts § 10 -25% saving in physical consolidation § Increased storage utilization up to 3 X - © 2004 IBM Corporation 5

On Demand Automation Delivers Measurable Value Business Service Management Manage using business priority, manage service levels Sense, triggers, respond according to business goals § 40 -50% savings in SLA reporting § 15 -30% savings on time for root cause determination, downtime Availability Ensure Health and appropriate functioning of IT Infrastructure Orchestration IBM Infrastructure Management Blueprint § Increase resource utilization avg. from 20% - 50% § 30 -40% reduced admin time Security Protect information assets, confidentiality and data integrity Optimization Ensure most productive utilization of IT § 27 -32% savings triage time § 35 -40% reduced admin time § 20 -25% greater utilization § 25 -35% higher first call close § 35 -40% reduced access time § 40 -50% fewer batch restarts Resource Virtualization Single, consolidated, logical view of and easy access to all available resources in a network Provisioning Make available right resources to right processes and people § 15 -35% less capital outlay § 25 -30% reduced staff req’ts § 10 -25% saving in physical consolidation § Increased storage utilization up to 3 X - © 2004 IBM Corporation 6

Maximum flexibility while increasing utilization Provisioning and Orchestration Customer IT Server Usage Example 100 – Variable peak workloads – 92% manual processes 80 % Demand § Traditional IT Environment 60 40 – Slow response to change 20 0 8 AM Low, Medium and High Demands Throughout the Day 10 AM – IT personnel focus on maintenance – Increased resource costs % Utilization – 15% average utilization 2 PM 4 PM 6 PM 8 PM Online banking: morning peak Branch Bank Teller: afternoon peak Home Banking: evening peak Just-in-Case Provisioning 100 § Traditional IT Results NOON 80 60 40 Result: Low Overall Resource Utilization and High Labor Costs 20 0 8 AM 10 AM NOON 2 PM 4 PM 6 PM 8 PM Source: IBM analysis of Industry Consultant Reports and IBM customer engagements © 2004 IBM Corporation 7

Provisioning and Orchestration Provisioning Orchestration § Automate execution of manual processes § Sense and respond § Capture data center best practices § Best practices for aligning IT resources with business goals § Help reduce human error Estimated Manual Estimated Automated 3 Days <1 Hour Install software 5– 10 Days <1 Hour Configure security and network settings 5– 10 Days <1 Hour Variable Automated 13 -23 Days Half Day IT Task Identify resource Return resources Total Time © 2004 IBM Corporation § Dynamically support SLAs Service Level Threshold Response Time Dynamic Resource Allocation 8

The Challenge with Traditional IT Management IT View Router 99. 1% MQSeries 99. 4% DB 2 99. 1% Network 99. 4% Web. Sphere 97. 9% Domino 98. 6% Unix 95. 1% Customer's Application © 2004 IBM Corporation 74. 0% 9

Business Designed for Growth and Change Consumer Relationship Category/Brand Strategy 1 Customer Relationship Strategy Manufacturing Strategy Customer Relationship Planning Brand P&L Management Assessing Customer Satisfaction Matching Supply and Demand Customer Insights Corporate Strategy Production and Materials Planning Next, decide what’s differentiating and what is simply operating Distribution Oversight Manufacturing Oversight Supplier Control Then, analyze costs Account Management In-bound Logistics Out-bound Logistics Product Ideation Concept/Product Testing 4 Execution Value-Added Services Finally, prioritize your initiatives Product Management Marketing Execution Consumer Service Product Directory © 2004 IBM Corporation Make Products Customer Account Servicing Retail Marketing Execution In-store Inventory Mgmt Customer Directory Assemble/Pkg. Products Business Administration Supply Chain Strategy Supplier Relationship Management Marketing Development & Effectiveness 3 Supply Chain & Distribution First, create a componentized view of the business Category/Brand Planning 2 Tactics Customer Relationship Distribution Center Operations Corporate Planning Alliance Management Line of Business Planning Business Performance Management External Market Analysis Organization and Process Design Legal and Regulatory Compliance Treasury and Risk Management Accounting and GL Indirect Procurement Plant Inventory Management Manufacturing Procurement Transportation Resources Facilities and Equipment Management HR Administration En route Inventory Management IT Systems and Operations 10

Reality Check—What They Want vs. What You Have Consumer Relationship Category/Brand Strategy Tactics Customer Relationship Strategy Manufacturing Strategy Supply Chain & Distribution Corporate Strategy Supply Chain Strategy Corporate Planning §The highest impact priorities are typically horizontal processes Category/Brand Planning Customer Relationship Planning Brand P&L Management Assessing Customer Satisfaction Matching Supply and Demand Customer Insights Supplier Relationship Management Account Management Alliance Management Line of Business Planning Production and Materials Planning Distribution Oversight Supplier Control In-bound Logistics Out-bound Logistics Organization and Process Design Legal and Regulatory Compliance §They’re cross-divisional—and probably cross-company Product Ideation Concept/Product Testing Product Management Marketing Execution Consumer Service Product Directory © 2004 IBM Corporation Business Performance Management External Market Analysis Manufacturing Oversight Marketing Development & Effectiveness Execution Business Administration Treasury and Risk Management Make Products Value-Added Services Customer Account Servicing Retail Marketing Execution In-store Inventory Mgmt Customer Directory Assemble/Pkg. Products Distribution Center Operations Accounting and GL Indirect Procurement Plant Inventory Management Manufacturing Procurement Transportation Resources Facilities and Equipment Management HR Administration En route Inventory Management IT Systems and Operations 11

Govern Manage IT by Business Priority and Increase Service Levels Business Service Management Align IT operations to business priorities and manage business systems in realtime, historical and predictive ways §Consolidation point of data and management capability across the IT infrastructure §Single consolidated view of the end-to-end “health” of the IT infrastructure including non-IBM Tivoli assets © 2004 IBM Corporation 12

IBM Partners Aspects of an insurance solution – portal view The workplace (Web. Sphere Portal) Tailored reporting Visualization tools, “portlets” Manage/orchestrate systems Tivoli BSM Prompted actions (WBI Monitor/business rules) Collaboration service (Lotus Instant Messaging) Customize rules; provide rules management system Comparative analyses DB 2 Information Integrator Business Intelligence Provide industry specific analysis & reporting Alerts Tivoli BSM, WBI Monitor, business intelligence, business rules Process monitoring WBI Monitor “Insurance leading practice” Application, system, data and process events Provide leading best practice model, costing, key performance indicators © 2004 IBM Corporation 13

Increase Business Flexibility e. Bay: Continuing the On Demand Journey with 60, 000 Transactions Per Second Challenges § Provide highly reliable infrastructure – WW auctions 24 x 7 § Manage fast business growth – 104. 8 million users § Deploy new services real-time IBM On Demand Automation behind the scene: Automated deployment process for all the servers in less than 12 weeks Cut time to remove and reactivate a system from 20 to 4 minutes – 328 million listings Reduced application downtime due to rollouts Solution IBM Web. Sphere Application Server, IBM Web. Sphere Studio Application Developer IBM Tivoli Business Systems Manager, IBM Tivoli Monitoring Family, IBM Tivoli Configuration Manager, IBM Global Services “The IBM On Demand Automation roadmap will help us move to full-automation and gain new levels of resiliency, efficiency, responsiveness, and flexibility” — Mark Hydar, Manager Enterprise Management Systems, e. Bay © 2004 IBM Corporation 14

Business Designed for Growth and Change © 2004 IBM Corporation 15

How Do I Start? The steps required to build an On Demand Operating Environment Customized on demand Adoption Roadmap Assess current state © 2004 IBM Corporation Determine future state Identify required capabilities and initiatives Develop Roadmaps 16

Take the next steps now… 1 Learn more about the On Demand Operating Environment – www. ibm. com/ondemand – www. ibm. com/software/tivoli/features/may 2004 2 Look at how customers like you gain value from the On Demand Operating Environment – Case studies (US Open, HBOS, e. Bay) – User groups – www. tivoli-ug. org 3 Talk to your IBM sales rep or business partners about a free On Demand Automation Assessment On Demand Operating Environment drives Business Discipline to IT © 2004 IBM Corporation 17