Business-technology vendors, which spend their days trying to sell the latest and greatest to companies around the world, face many of the same challenges as their customers. At the top of the list: identifying and aligning their strategic business processes with their internal IT resources. Many of these IT vendors have been slow to fully achieve the benefit of the technologies they tout to other companies.

That challenge can become even more difficult as IT companies face new competitors, try to enter new markets, and work to keep existing customers happy. If that weren't enough, many of them have had to integrate one or more acquisitions and their technology systems. Few understand the challenges as well as Hewlett-Packard, which two years ago underwent a megamerger with Compaq and, more recently, unified its global business operations with its IT operations.

Hewlett-Packard's GO+IT effort has changed the way employees view the role of IT, VP John Buda says.

HP in December officially combined the two operations into the single GO+IT organization, the completion of an effort the company says has resulted in savings of $1.5 billion. A unified GO+IT required direct communications between the two areas of HP, says John Buda, VP of global operations and IT strategy and planning. During the consolidation process, Buda himself served as the touch point between the company's CIO and its global operations manager to ensure that investment plans for both IT and supply-chain purchases were properly integrated with the company's customer-facing operations.

"It was a logical extension of those two organizations," Buda says. "With this type of effort, we can be in a leadership role in showing how there can be synergy and an accountability blended between business-operations management and IT."

The effort has brought a number of measurable improvements for HP, but the journey remains far from complete, Buda says.

"We clearly understand that right now HP is still more complicated to work with, both from our suppliers' and customers' points of view, than we want," Buda says. "But as an $80 billion company, looking at global consistency in operations isn't going to be simple."

The creation of GO+IT is the next step after the easy cost savings that resulted from consolidating and eliminating duplication between the two merged companies. One of the organization's key tasks has been identifying and defining common processes used by business units across the company and finding ways to more efficiently manage them across the multiple units, Buda says. To date, HP has identified 114 specific processes that drive the company, and the next big step is understanding how those processes affect specific apps within the IT organization.

"We've had to make some pretty big decisions in unifying processes," Buda says. "We had to get down to a few appropriate supply chains, order-management systems, major enterprise processes, and make business-process decisions on a global basis in conjunction with the IT investment."

The efforts have allowed HP to cut the operational costs of its supply chain from 14% of revenue to 11%. The company has reduced the number of applications it uses from 7,000 to 4,000; by November, that number should drop to 3,500. The ultimate goal is to run the company with only 1,500 applications.

"It took us 25 years to get to 7,000 applications and 2-1/2 years to take half of them out," Buda says.

The company has also cut the number of data centers it operates from 300 to 85, and plans to reduce that to only 11 data centers. In all, IT costs have been reduced from 4.6% of revenue to 3.7%, according to HP.

The GO+IT effort has helped change the way HP employees view the role of IT. "Everyday people in the supply chain know a little more about what databases are, and everyday people inside IT know a little more about what days of inventory are all about and how that affects cash flow," Buda says. "It does my heart good when I see a bunch of IT guys talking about the impact of their program on cash flow."

In part, the answer has been to understand that HP's supply chain needs to be global in reach and that the old model of localized systems had to be taken apart, Buda says.

	Perot Systems' processes now better reflect the company, CIO Mike McClaskey says.

For Perot Systems, a provider of outsourced IT services, the past year has seen a worldwide initiative to integrate back-office software and hardware systems and processes into a unified enterprise application infrastructure that better reflects its overall mission, CIO Mike McClaskey says.

"We really hadn't been running our internal IT like we run a customer's account," he says. "We didn't take advantage of our leveraged service-delivery model, and we had dedicated teams doing things that were divorced from our commercial efforts."

A key move was to make McClaskey a member of Perot's senior leadership team and to make IT part of the company's overall service effort. "I'm now in the same data centers as our customers," he says. "I receive the same service levels. I buy my storage from a leverage pool rather than owning Perot-specific assets. We can run Perot now exactly like we run a customer account."

To get its IT house in shape, Perot last year completed Project Foundation. The effort included upgrades for major applications such as PeopleSoft Enterprise, Windows XP, Office 2003, Exchange 2003, Active Directory, and SharePoint. The company also added new servers from Sun Microsystems, an Oracle database, a Web-services layer of middleware, and an Internet portal that lets employees access resources more cheaply and efficiently, McClaskey says.

In some cases, improving IT operations is crucial to other major projects. Fujitsu Computer Systems Corp. a year ago asked its IT department to help with the merger of two disparate North American organizations--Fujitsu PC Corp., responsible for mobile PCs and tablet systems, and Fujitsu Technology Solutions Inc., responsible for high-end enterprise servers.

Fujitsu wanted to create a company capable of offering a full line of computing products and needed to establish a common infrastructure as well as a common set of tools for its sales force so it could sell the entire suite of products to business customers, CIO Bitin Badani says. The IT organization formed a cross-functional task force to develop a companywide configuration tool, an online quote tool, and an order-entry tool. An online reporting system and a purchase-requisition system also were rolled out. An executive information system was put in place to provide online and real-time order booking and for backlog and billing information. The system was updated to include all products from the two units.

"We were able to roll this out in three months, which was really key to ensure we could meet our profitability targets during this upgrade," Badani says.

Security also was a concern with the newly implemented organization, he says, and the company wanted to take advantage of the ongoing consolidation efforts to upgrade and alter policies. The company implemented 802.1x port-based authentication for wireless and wired LAN access, and personal and broadband firewalls became mandatory. In addition, steps were taken to add layers of security to servers, workstations, routers, switches, and other network devices. And all unused ports were turned off, even in the data center.

As tech markets get more competitive, efficient IT operations become even more important to IT companies. EMC Corp. used its IT organization as a driving force behind its "Go To Market" strategy over the past year, says Dave Ellard, senior VP and CIO. The storage vendor earlier this year deployed a global configuration, quoting, and ordering system to more than 3,000 sales reps and around 3,000 partners, which work with the company's distributor and reseller units.

EMC was seeking to improve internal sales productivity and provide its partners with tools that would let them become self-sufficient in selling the EMC product line, Ellard says. The company developed a configuration tool capable of scaling with its increasing product portfolio. A new sales tool was designed to provide direct sales reps with a level of pricing and quoting flexibility, while maintaining overall pricing disciplines.

While not on the scale of the HP-Compaq merger, EMC was also faced with the integration of three significant software-vendor acquisitions made over the past 18 months: Legato, Documentum, and VMware. EMC remains in the process of identifying and attempting to leverage synergies between the new business units, looking for opportunities to reduce operating costs with a shared-service model, Ellard says. The company is focusing on creating cross-selling opportunities among each of the organizations.

Part of the challenge has been to bring a consistent IT decision-making approach to the new divisions. In the past few months, EMC completed deployment of its IT Portfolio Model to the Legato division, Ellard says. The model is intended to better align IT with the business by managing processes and technology systems as a portfolio of assets.

With fewer IT resources at Legato, the Portfolio Model was deployed slightly differently than at EMC corporate, he says. Within corporate, each functional business unit has a corresponding portfolio focused on that area's specific requirements. But Legato was set up to have miniportfolios that share IT resources.

Other factors such as regulatory compliance requirements have caused companies to change their IT operations. ViewSonic Corp., a privately held maker of monitors with more than $1 billion in annual revenue, in the past year made the decision to conform to standards and requirements related to the Sarbanes-Oxley Act, VP and CIO Robert Moon says.