February 16, 1998Enterprise Management:
Is the promise of enterprise management software too good to be true? Gartner Group says 70% of these packages fail to be fully implemented-even after three years of work. Here's what's behind this massive case
By Caryn Gillooly
anagers dreaming of full-fledged, centralized enterprise management may be headed for a rude awakening.
Enterprise management packages offered by market leaders Computer Associates, Tivoli Systems, and Hewlett-Packard promise to detect and fix all system and network problems in the enterprise from a single console. But a surprising number of IS managers say the software is unexpectedly difficult and expensive to implement. In some cases, they've scrapped it altogether. In fact, depending on which industry analyst you ask, anywhere from one-quarter to nearly all large-scale enterprise-management packages fail to be fully implemented, even after IS staffs put in years of effort.
At stake are millions of dollars spent by user companies on these packages-not to mention the reputations and careers of the IS managers who fail to get the software up and running.
What's behind this massive failure? According to IS managers, consultants, and vendors, there's no single culprit. Rather, it's a mix of poor planning on the part of users, overselling on the part of vendors, complicated and misunderstood products, missing features, and mistakes made by users to cut costs or speed implementation.
"The vendors make it sound like it's plug-and-play software, but it's not," says Doug Chapman, manager of distributed computing at Niagara Mohawk Power Corp., one of the fortunate few who has successfully implemented an enterprise management package.
Less fortunate is The Money Store Inc. While CA announced nearly two years ago that The Money Store had "standardized" on Unicenter TNG for multiplatform enterprise management, the company has since abandoned all efforts to implement the package, says Dave Berry, computer operations manager at the Union, N.J., company.
Most customers seem to fall somewhere between these two extremes. Three years after purchase, 70% of enterprise-management packages are neither fully implemented nor meeting the goals of their users, estimates Gartner Group (see chart). Delayed and failed implementations have created what the Stamford, Conn., IT advisory firm describes as a "trough of disillusionment" that will last through 200 0. Another analyst is even more skeptical: Steve Foote, a management analyst at the Hurwitz Group in Boston, says the percentage of enterprise-management implementations that succeed "closely approximates zero."
But Rich Ptak, a management analyst at D.H. Brown Associates in Port Chester, N.Y., has a different take. Though he's heard of difficulties, Ptak insists that really serious problems account for no more than 25% of all users.
No one argues that centralized enterprise-management products like CA's Unicenter TNG, Tivoli's TME 10, and Hewlett-Packard's OpenView are virtually irresistible to overtaxed IS managers looking to stretch limited staffs by integrating network and systems management. Many IS operations use separate management packages for help desks, network management, event management, software distribution, and other tasks. Each package needs its own console, and few interoperate. With so many products and so little time and staff, management focuses on fighting daily fires.
Other vendors of enterprise-management software, including Bull HN Information Systems Inc. and Platinum Technology Inc., offer products that focus more on modular implementations than do the CA, Tivoli, and HP packages.
Managing the enterprise is an "ugly, dirty, stinking problem--nobody wants to deal with it," says Ray Paquet, a senior research analyst at Gartner Group. "If customers think they can just write a check and get it all taken care of, that's very appealing."
As a result, users are clearly writing checks hand-over-fist for these packages, which can run as high as $25 million. By 2000, the worldwide network- and systems-management market will approach $10 billion, more than double last year's $4.5 billion, Gartner predicts.
CA's Unicenter TNG revenue alone is expected to reach sales of $1.6 billion by 1999, nearly triple last year's $550 million, according to financial analysts' estimates. "Things are going really, really well," says Yogesh Gupta, senior VP of product strategy at CA, in Islandia, N.Y.
Tivoli has a similar story. "We grew 100%-plus on the distributed side in the fourth quarter of our calendar year," says Jan Lindelow, president and CEO of Tivoli, an IBM division in Austin, Texas. TME 10 is the primary piece of that side of Tivoli's business.
But not all users of these packages are as happy. Instead of getting a cure for their management ills, some have found their problems multiply when they start installing these packages.
Many have only themselves to blame: Users' failure to properly plan undermines many of these purchases. Carolina Power & Light's nuclear division, for example, bought Tivoli TME 10 two years ago, but never implemented it at all due to poor planning. "It's very complex," says David Gross, distributed technology manager of the utility's non-nuclear IT group in Raleigh, N.C. "You have to have a methodology defined. You can't just push this software out there. It's an awful lot of work."
Caroli na Power's nuclear division evaluated the product, but never planned its implementation or arranged for people and funding to do the work, Gross says. Also, the unit lacked the technical expertise to handle the implementation, he adds. Taking a lesson from the nuclear group's problems, the utility's non-nuclear division is currently installing TME 10 and planning appropriately.
But vendors must also share some of the responsibility for not helping customers grasp the enormity of the task. "These are powerful tools," says Gartner Group's Paquet. "Vendors are shipping a box of parts to build a 747, but there are no instructions."
In fact, vendors acknowledge that these are not out-of-the-box products. "Once clients have done the selection and are ready to implement, now comes the hard part," says Marc Sokol, senior VP of advanced technology at CA. "Customers generally underestimate what it will take to implement."
That was the case at Mrs. Baird's Bakeries, a regional chain in Dalla s. The company initially thought Unicenter TNG would be a panacea for all its management woes. David Brown, director of software development, says the decision to buy the software was made by a former employee. "But it's really overkill for what we need."
Help-desk software costing less than $10,000 would have sufficed for Mrs. Baird's, Brown says. Instead, the bakery chain spent $600,000 over five years on software distribution, asset management, single sign-on, help desk, and other capabilities. "And we have 400% more power units than we need," Brown adds.
CA says it's unaware of the situation at Mrs. Baird's. The cause may have been a communication problem, suggests Sokol. CA's salespeople told the bakery, "If you believe the business will grow, it's better financially to buy now rather than later," Sokol says. So the company apparently decided to buy right away, he adds.
Mrs. Baird's Bakeries also underestimated the complexity of implementing Unicenter. When project manager C.T . Robertson took on the installation, he says his boss wanted it up and running in three weeks. That's a goal even CA admits is unrealistic.
The bakery chain isn't alone in underestimating the difficulties involved in implementing these packages. H.E. Butt Grocery Co., a retail chain in San Antonio, has spent more than a year trying to implement Tivoli's TME 10. It didn't realize how much customization was required. "We thought this would be more out-of-the-box, but it really requires more expertise than that," says Bill Gillogly, the retailer's lead technical analyst.
Especially tricky was figuring out how the enterprise console related to the other applications, Gillogly says. Laying down the framework, layering in the products, then getting the console to put all the events in one place requires a "decent amount of training," he says. "It took me months to figure out what was what. Knowing what I know now, I would have demanded a team of five people, not just one."
Other custom ers say enterprise packages don't include all the features they needed. One New York brokerage firm says it was blinded by the hype surrounding HP's OpenView offering. "People see all the visual displays and topology maps," says a VP of IT at the brokerage, who asked not to be identified. "We saw the blinking lights and said, `Cool, let's get that.'"
His brokerage bought OpenView even though the software lacked reporting capabilities and other features the company needed. "We were thinking of having OpenView managing everything," the VP says. "We knew it didn't have reporting capabilities, but we didn't think about it too hard."
Similarly, H.E. Butt Grocery found pieces of Tivoli's TME 10 that didn't work as promised, says Gillogly. For example, one of the main draws of TME 10 was its single, integrated console. But that console is actually an add-on that costs an extra $65,000, Gillogly says, adding, "It's not even part of the package."
Central Vermont Public Service Co. found t hat Unicenter TNG didn't deliver all it expected, and that some features didn't work. The Rutland, Vt., utility originally bought TNG because it sought cross-platform integration of workload management, security, and event management, says Tracy Adams, manager of technical support. But Central Vermont later found that TNG didn't have the integrated security the utility needed.
Central Vermont also bought the module for Novell's NetWare, which Adams says failed to support the NDS directory structure. In addition, it required 80 NetWare Loadable Modules on the NetWare server, he adds. CA refunded the company's money on the module.
Three years later, Central Vermont finally has what Adams describes as a successful implementation of Unicenter TNG. He would even go so far as to recommend it to other customers--but says that success has been a long time coming. "They weren't where their glossies said they were, and what I got wasn't the demos I saw in Islandia," he says, referring to CA's headqu arters. "If you'd have asked me two years ago, I'd have said it wasn't worth it."
For some customers, long delays and added expense have prompted them to cut corners, leading to additional problems. Hurley Medical Center, a municipal medical center and teaching facility for the University of Michigan in Flint, Mich., was completely prepared for the implementation after it bought Unicenter TNG. Yet the company tried to save some time and money. That, says CIO Pat Milostan, turned out to be a mistake. "You can't cut corners," he says. "How satisfied you are with this kind of product will depend on the level of effort you put into it."
For their part, vendors have been taking steps to assist users. Last week, CA made a $9 billion offer to acquire IT services vendor Computer Sciences Corp. That acquisition would let CA provide management and consulting services to help customers better plan and implement Unicenter TNG, among other products.
For the last six mo nths, Tivoli has provided a design plan, best-practices implementation manual, and other tools to help TME 10 customers. Over the next few months, the company plans to release technology that will make the software "radically easier" to deploy, says Chuck Stern, VP of market intelligence at Tivoli, although he would not provide details.
Next month, HP plans to release a road map for OpenView that will focus on service management and new services for rapid deployment. "If you try to solve a problem with a tool, you're bound not to recover your money," says Mark Taguma, a program manager in HP Professional Services Organization. "You need the organization and process piece."
Despite the many frustrated customers, some larger-scale enterprise-management projects are succeeding. In addition to Central Vermont Public Service Co., Hurley Medical Center has a successful implementation of TNG, and Niagara Mohawk Power is successfully using TME 10.
"We planned accordingly, and everything's been stable," says Niagara Mohawk's Chapman. "We left enough time and focused on what we wanted to implement-software distribution and event management. We tried not to go off on tangents."
Setting specific goals and planning accordingly is the best approach, analysts say. Identify problems that need to be solved, and don't buy an enterprise-management package thinking it will solve all problems.
Customers-and even vendors-agree. "Systems and network management is more about the people and the processes than about the products," says the VP of IT from the New York brokerage firm. Adds CA's Sokol: "You have to distinguish between a product succeeding and failing and a project succeeding and failing. If one of any number of things are not right, a project can fail."
Also, IS managers need to realize that their commitment will likely be ongoing; there won't necessarily be a completion date. "Implementing an enterprise-management project doesn't have a termination," says Hurwitz's Foo te. "It will continue to evolve as the enterprise evolves."
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