Zero Maintenance IT: Achieving Operational Efficiency while Powering Business Agility

Featured article by Srinivasan Thiagarajan, Chief Technology Officer for Cognizant’s Next Gen Application Services

IT executives today expect they will need to provide more rigorous cost and ROI calculations to justify spending on services. At the same time, digital technology is increasingly the means for delivering profit-generating business services, so keeping technology in optimal working order is critical. This paradoxical imperative with the dual mandate of reducing cost and increasing value needs an effective strategy to drive toward “zero maintenance IT.”

Zero maintenance strategies drive delivery improvements and transform results by focusing on how IT organizations can more effectively manage non-discretionary and discretionary maintenance spend. Non-discretionary spend is primarily directed to incidents and service requests. If applications were fully functional, and didn’t fail or create issues, nondiscretionary spend could be eliminated.

Discretionary spend encompasses upgrades and enhancements to ensure applications and systems enable a business to meet its objectives. This spend can quickly grow because often what appears to be a simple change to enhance a service, has a ripple effect that touches many other applications and even infrastructure. If apps could be more easily modified and processes optimized, disruption could be minimized and discretionary spend contained.

A zero maintenance IT strategy works to minimize both types of spend while also achieving a balance between cost and value. Becoming too focused on cost avoidance eventually leads to systems that cannot meet today’s business requirements, which can blunt a company’s competitive edge. Conversely, adding every available new feature to a system without evaluating whether the feature meets an important business objective or customer need, drives up operational costs and potentially leads to overly complex systems. Understanding the different types of “debt” that accrue to maintenance spending, calculating their cost and minimizing those that deliver little value, are the cornerstones of the zero maintenance strategy.

Understanding the True Costs of Application Maintenance

IT organizations must often make compromises to balance operational excellence with supporting business growth. This process results in the application “debts” described below:

– Technical debt. Compromised code quality or other technical problems create incidents that must be addressed.

– Functional Debt. An application that has limited flexibility or features like self-service so users must create service requests.

– Knowledge debt: Missing or incomplete documentation and training results in a long turnaround time in responding to incidents and requests.

– Operational debt. A lack of process and tools means expensive manual intervention is required because an application does not fully automate a business process.

IT organizations accrue “interest” on these debts by increasing maintenance spend to ensure business continuity. The way to reduce this interest is to pay down the “principal,” i.e., the various debts. Debts can be addressed with automation, optimization, transformed business processes, etc.

Yet, IT still must make informed decisions about which debt to address and how. If interest is relatively low on a certain debt, resources might be better deployed in “paying down” another debt that is more costly. Determining that requires categorizing all the expenses associated with an application into one of the above categories. The goal is to understand the percentages of avoidable, unavoidable and incidental debt.

Unavoidable maintenance spend is that which must occur, such as required risk management compliance or where there is an external dependency. Avoidable debt is driven by improving an application or process. Incidental debt is user-driven, such as a one-time business project; it’s harder to predict the duration of these activities.

The objective is to keep the technical and business value of an application synchronized. Apps that must deliver high business value deserve commensurate maintenance spend. Identifying these key apps requires understanding what business transactions an app contributes to or manages and tracing its impact throughout the IT portfolio and how long it takes for the transaction and related data to flow through the relevant business processes.

Optimizing spend on such apps might require re-engineering the business processes around them to ensure they deliver the highest business value. It can also mean addressing application structure: how modular is its architecture? How much time does it take to enhance it?

Making an application simpler, more local and rules-based can deliver business value, while also greatly reducing its maintenance debt. In addition, automating unavoidable activities significantly reduces costs and frees resources.

Zero Maintenance strategies in action

Running debt calculations routinely is important to get a clear view of debt causes, and to identify changes necessary to balance operational efficiencies with the business value delivered by the application portfolio.

One large multinational retailer took this approach to reducing maintenance costs and rationalizing its application portfolio, which had a wide range of diverse, disparate and even obsolete applications. By using debt analysis to simplify and standardize systems and reduce operating costs, the company estimated it would save more than $2.4 million over three years.

Figure 1: Debt Classification Report for the multinational retailer

Figure 2: Avoidable/Non Avoidable % of tickets for each debt type, based on the overall number of tickets

 The debt calculation framework helped a large insurer identify where its contract set-up processes were not fully automated and the costs associated with the resulting manual handoffs between critical business processes. When those gaps were automated and processes transformed, the company reduced its time to deliver an approved contract by 90 percent. That improved customer satisfaction and helped the company achieve better prospect conversion rates.

Zero maintenance: A continuing journey

Success with zero maintenance initiatives requires companies to embrace change and automation solutions to make transformation real. Furthermore, zero maintenance is not a single destination: organizations must continue to monitor their maintenance spend, as well as involve multiple stakeholders across IT layers in identifying potential improvements in areas such as operating models, services, tools and infrastructure as well as processes.

Organizations willing to investigate their application maintenance debts and address them based on detailed cost-benefit analyses, will achieve a near zero-maintenance IT portfolio that is both operationally efficient as well as deeply relevant to the business and its objectives.

Srinivasan Thiagarajan (Srini) is the Chief Technology Officer for Cognizant’s Next Gen Application Services. With over two decades of IT work experience, he has played many roles including Delivery management, Account management, Business consulting and General management. In his present role, with his team of consultants, Srini articulates, designs and implements models that help companies embrace Next Gen Application Services strategies, irrespective of their current level of maturity. Srini has a master’s of engineering degree in computer science from Birla Institute of Technology and Science, Pilani.