Cloud Migration + Cost Savings = Innovation + Agility

BrandPost By Dwight Davis
Jan 26, 2021
Cloud ComputingERP SystemsInternet

Faced with the need to reduce IT costs while at the same time increasing IT innovation, Unisys embraced cloud computing and a comprehensive search for savings.rnrn

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Credit: iStock

Upinder Phanda is vice president and CIO at Unisys Corp., a global information technology company. Unisys offers a broad portfolio of professional services and cutting-edge products, including the Unisys Stealth micro-segmentation security technology.

As is often the case within high-tech companies, the IT department at Unisys performs a dual role: providing IT services to support the company’s 20,000 employees and also serving as an internal proving ground for technology solutions the company develops. Unisys VP and CIO Upinder Phanda was charged with managing both of these critical roles, while at the same time pursuing a more fundamental objective.

“We were challenged with reducing our operational costs in order to have more money to innovate,” Phanda explains.

To tackle these challenges, Phanda initiated an aggressive IT transformation initiative about four years ago. At the time, about 85% of his budget was spent on running the IT infrastructure, leaving just 15% for innovating and building new solutions. Today, just 60% of the budget goes to “keeping the lights on,” with 40% now available for strategic innovation.

A core element of the Unisys transformation effort has been a wholesale migration of its on-premises IT infrastructure to the cloud. Today, having moved approximately 500 servers and 250 applications into the Microsoft Azure cloud, 98% of Unisys’s operations are cloud based.

Among other changes, “Customized applications have been replaced with cloud-based solutions, and our team is learning new skills focused on innovation,” Phanda says. The move to the cloud itself required Unisys to be innovative as it was the first to migrate hundreds of applications and technologies to Azure, and it had to create its own roadmap for doing so.

As it executed its transition to the cloud, Unisys sought out cost savings wherever possible. The result: a 35-40% reduction in the IT budget over the past four years.

“We’ve returned money to the corporation every year,” Phanda says.

“The key to our success is agility”

Phanda and his team found IT savings in a variety of areas, starting with the termination of an offshore supplier relationship, which allowed a 30% reduction in its overall IT labor force.

“That gave us some room to maneuver, and we then started looking at every line of our budget,” he says.

Renegotiated contract renewals with large software vendors proved to be one significant source of savings. For example, Unisys cut its Microsoft Enterprise Agreement (EA) volume license by $3 million when it came up for renewal.

Reducing maintenance costs required a different strategy.

“Maintenance is a cash cow for vendors, so they’re never going to let me renegotiate,” Phanda explains. Instead, when Unisys moved its Oracle ERP from an on-premises deployment to the cloud, it shifted to a third-party maintenance provider and cut its maintenance line item by 50%.

The move to the cloud also served as a catalyst for Unisys to establish more efficient and cost-effective processes.

“We had 15 ways to contact IT when we started our transformation journey,” Phanda says. “Today there’s only one way.”

Along with simplifying its processes, Unisys made it easier for its employees to perform self-service, in part by developing and deploying its own chatbot, which is now interactively fielding most employee queries.

“We’ve managed to reduce our help desk tickets by 80%,” Phanda says.

Combined, Unisys’s cloud transition, its cost savings, and its ability to be more innovative have produced an essential benefit.

“The key to our success is agility,” Phanda says. “We’re now better able to perform and quickly respond to our company’s ever-changing business requirements.”

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Click here to read this ongoing series of interviews about how the role of the CIO is evolving as digital transformation initiatives mature.