Fortune 200 Insurance Company Reduces IT Costs by 25%
Business Value of Vityl Capacity Management: Large insurance company saved $5 million in hardware expenses and $800,000 in annual call center operations costs while improving response time by 5 seconds per call in the pilot program. Within three years, Vityl Capacity Management delivered hardware and software savings exceeding 25 percent of the company’s annual IT budget.
ITIL Implementation At This Fortune 200 Insurance Company Revived By Vityl Capacity Management
“The pilot project saved roughly $5 million in hardware expenses in one exercise alone. It also saved us $800,000 in annual call center operation costs by improving response time by 5 seconds per call. And that’s just the beginning,” says the capacity manager. “Over a three-year period, Vityl Capacity Management (Vityl CM) delivered hardware and software savings in excess of 25 percent of our annual IT budget.”
“Over a three-year period, Vityl Capacity Management delivered hardware and software savings in excess of 25 percent of our annual IT budget.”
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Fortune 200 Company Requires Better, Cheaper IT Service Delivery
Averaging five million customer service calls per month and 12 million claims-related transactions per day, this company relies on high-performing IT to deliver services. But high-performing IT doesn’t happen without careful planning and ongoing maintenance, since IT environments are forever evolving.
The IT environment at this company consists of roughly 10,000 mainframe MIPS, 300 midrange servers (primarily Sun and IBM), 3,000 Windows servers, and 35,000 workstations (mostly Windows-based). While performance and capacity management tools existed on mainframes, Unix and Windows servers had little or no coverage despite the impact a failure could have on profit margins. Internal reviews confirmed that IT had inconsistent service delivery and higher costs than many competitors. The company needed to improve to keep up and increase market share in their competitive marketplace.
After discussing internally and consulting with industry experts, the company began to implement ITIL best practices.
Capacity Planning Tools Are Essential
Shortly after implementation began the company realized their existing capacity planning tools weren’t sufficient. Vendors consulted had limited information and gave generic solutions which generated overcapacity situations.
Accurate, consistent performance and capacity management software was needed, at least on midrange and Windows servers.
The company first turned to ITIL consultants and industry analysts for potential vendors to send a formal Request for Information (RFI). When they reviewed the RFIs, the company felt they had enough information to narrow the list significantly. “Vityl Capacity Management emerged as a leading candidate already at that point.”
After evaluating several products, Vityl CM was selected as the best option for a capacity planning and performance management solution. “During the evaluation process, Vityl CM clearly demonstrated its superiority. It was also the easiest to use, and we were able to get the software up and running quickly. And it worked.”
“During the evaluation process, Vityl CM clearly demonstrated its superiority. It was also the easiest to use, and we were able to get the software up and running quickly. And it worked.”
Roll-out Reaps Early Benefits
After a rapid roll-out of Vityl CM software on the majority of the organization’s integral servers, IT found serious performance and capacity issues for the first time.
“Analyzing Vityl Capacity Management data, we noted tremendous over-capacity and some surprising performance data that substantiated our suspicions about poorly performing applications,” the capacity manager explained. “Our suspicions didn’t get us far with the application team. But with objective Vityl Capacity Management data to point at and confirm our suspicions, we got their attention.” IT was able to request fixes with evidence of the specific causes of application problems. This exercise also helped improve database indexing processes.
Vityl CM allowed the company to halve their resource consumption for one of their most used applications while improving their response times. “That really got management’s attention.” Having proved the impact of Vityl CM, IT launched several major improvements to performance management processes.
Improved communication and collaboration between IT and line of business managers was another bonus of Vityl CM. With accurate and objective software in place to support mature capacity management practices, IT showed their new-found ability to empower the decision-making process. They were better equipped to provide business managers with infrastructure options and associated costs when negotiating SLAs or launching new services. This placed cost/benefit decisions squarely with business unit managers, who became much more disciplined with IT requests. As a result, the quality of business data provided to IT also improved.
Looking Back...It’s Simply Irresistible
ITIL Capacity Management processes were the first to be evaluated in a pilot project of the broader ITIL campaign. This focus impacted a sub-team within IT, minimizing risk and disruption to day-to-day operations. The pilot project saved roughly $5 million in hardware expenses and $800,000 in annual call center operating costs while improving response time.
“There is no doubt that this pilot highlighted the value of IT. Senior management had a much clearer understanding of the impact both ITIL and capacity planning could have on the business.”
“There is no doubt that this pilot highlighted the value of IT. Senior management had a much clearer understanding of the impact both ITIL and capacity planning could have on the business,” the capacity manager said. Proven cost savings and process improvements made continuing with the 2-year project an easy decision.
The company was able to avoid buying any new servers for 22 months, without sacrificing service levels. “With results like that,” the capacity manager says, “IT really became viewed as an important contributor to business value.”
As confidence in Vityl CM grew, more of the IT environments began using it. Now an integral part of day-to-day operations and strategic planning projects, Vityl CM has helped standardize data, processes, and reporting across the business. Data and analysis generated through Vityl CM is used widely across ITIL areas other than CM, further enhancing its value and ROI.
“Looking back, the combination of ITIL and Vityl Capacity Management software is really irresistible,” says the capacity manager. “Over a three year period, Vityl Capacity Management delivered hardware and software savings in excess of 25 percent of our annual IT budget. That’s a lot of cash. It is easy to see why we consider ITIL and Vityl Capacity Management a competitive advantage.”
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