Team Up for Business Value

In this CIO 100 Award-winning initiative, Hess CIO Jeff Steinhorn created metrics and governance with vendors to boost outsourcing value

How can CIOs improve vendor commitment and effectiveness?

When we started on a path to outsource our IT infrastructure, we faced several common but challenging requirements, including increased demand for wireless and remote access, and consistent, global availability.

According to our initial plan, our primary vendor, IBM, would provide support staff and uniform governance for our infrastructure processes. But we soon discovered there were too many differences in our internal processes, making it nearly impossible for IBM to keep up with service demands.

We needed to fix that, and made it clear to IBM that helping us develop a solution would position them for more work with us.

Together, we went back to our agreement to redefine expectations and needs. This led to the creation of a Global Service Desk, solidified the relationship, and put us on the path to a CIO 100 Award this year.

We first set and prioritized strategic goals. High among them was a resolution to reduce the number of Severity 1 incidents and respond faster and more effectively to those that occur.

We also recognized that we were not tracking the same metrics as our vendor. A joint team built a consistent set of goals from the bottom up, developing a new mix of metrics and performance objectives that are continually re-evaluated and refreshed. For example, we set the high-level goal of getting to green on stoplight charts across six key service towers in our infrastructure deal. We also tracked about 50 detailed metrics, such as call handling and network uptime.

Above this, we applied new governance and communication structures. At regular meetings with my team responsible for the deal and key senior IBM leaders, we review our high-level objectives and any detailed metrics that are not on-plan.

I think it’s always important to have the right balance of leadership involvement when establishing this kind of oversight. I manage these meetings with an emphasis on goals for overall improvement.

I also believe it is extremely important for a CIO to maintain an open and consistent dialog with key ­senior-level vendor partners. You’ve got to be the voice of your company.

In the end, we were able to reduce our Severity 1 incidents by more than 70 percent—a clear win for our business and a demonstration from IBM that they are a flexible, long-term partner.

Jeff Steinhorn is CIO at Hess and a member of the CIO Executive Council.


This story, "Team Up for Business Value" was originally published by CIO Executive Council.


Copyright © 2010 IDG Communications, Inc.

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