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11/5/2012
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When IT Becomes A One Man Show

Investment firm Hearthstone laid off its IT team during the economic downturn. CTO Rob Meltz turned to cloud services and virtualization to keep the business running and growing.

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Like plenty of people and organizations, the institutional investment firm Hearthstone was hit hard by the 2008 financial crisis. Its business -- managing assets for pension funds, endowments, Fortune 100 firms and other large clients -- was kicked directly in the teeth. Add to that the fact that Hearthstone invests exclusively in residential real estate development and, well, the math isn't that difficult.

The sobering results: Three rounds of layoffs in as many years. At its peak, Hearthstone had 80 people across four offices; today, it has 28. Hearthstone's five-person IT department became a one-man show: CTO Rob Meltz. The executive is now all things IT, relying on consultants and other outsourced help when the workload exceeds the available human resources. In other words: Him.

You don't often hear a company tell the remaining employees after a downsizing: It's OK to get less done. Hearthstone was no exception. The firm has managed more than $12 billion in real estate investments. IT is more than a help desk.

"When I lost those people, I didn't lose servers," Meltz said. "We lost some transactions, but we still had staff to support, [and] we still had servers and infrastructure to support. I just no longer had four additional souls helping me."

[ Is there a role for Windows? Read Windows 8: 4 Upsides For SMBs. ]

In an interview, Meltz discussed the changes he made to ensure his gutted department could continue to support the business -- and that he could still get some sleep. "Doing more with less" went from everyday cliche to everyday reality. Meltz credits virtualization and cloud services as the twin pillars that kept things up and running. The strategic use of consultants for initiatives like Hearthstone's business intelligence deployment with IBM's Cognos, which is currently underway, has also played a part. The same IT shift that enabled survival is now supporting growth -- the company came through the crisis and is now expanding again. Here are the key specifics on what Meltz did to adapt to life without a team.

Server virtualization. Step one for Meltz was to virtualize using VMware; doing so, Hearthstone has halved the physical servers it maintains from 18 to nine. Meltz has also been able to eliminate $1,800 per month in expenses but cutting the company's outsourced co-located servers and virtualizing them instead. "Virtualization is probably [behind] 70% of all initiatives that I have going right now," Meltz said.

Cloud time and billing. Hearthstone's legacy time and billing application was one of its more labor-intensive systems from an IT support standpoint. The previous time-and-billing system alone used to take up nearly three-quarters of one employee's full-time job, according to Meltz. He opted for Harvest's online system as a replacement. Set-up and deployment took one day, and it was so well-received by employees that the case for additional cloud services was much easier to make. "That's one less major application for me to support," Meltz said.

Virtualized accounting system. Meltz has virtualized the company's accounting system, another labor-intensive legacy application, and is now considering moving it into Microsoft's Azure cloud for additional streamlining.

Outsourced remote monitoring and management. Keeping a network up-and-running 24-7 without a staff isn't a particularly appealing challenge, nor the best use of Meltz's time. He signed on with Continuum for remote monitoring and management services instead.

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tstevens853
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tstevens853,
User Rank: Apprentice
11/12/2012 | 5:27:54 PM
re: When IT Becomes A One Man Show
You need to do a better job reading text before you send a reply... I mentioned SANS cloud technology (sans = except, less, minus....)

Also, I said SHOULD HAVE BEEN UNDERWAY IF NOT IMPLEMENTED. He went from 100% physical, to 50% physical, which tells me there wasn't any baby steps in getting to virtual servers in production.

Also, the number of support staff needed at an organization is determined the staff itself, vendor support, outsourcing models utilized, and business requirements.

Finally, virtualization has been economical for a while. VMware offfered theirs for free in 2008 and there were plenty of other avenues to get a free hypervisor before then. All it would have taken is vision, learning capacity, and some effort.

If you run a SMB and didn't start working with the free ESXi in 08, or haven't been using Voip for over 5 years now, you are just like Mertz.
angelcec
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angelcec,
User Rank: Apprentice
11/9/2012 | 3:02:38 PM
re: When IT Becomes A One Man Show
I see this as a trend - shrinking I.T. staffs doing more with fewer hands on-deck thanks to the ability to outsource applications and infrastructure to cloud-based providers. Not one Meltz's cloud services existed in 2008 so I don't agree with your critique. Plus, it's only been the last 5 years that virtualization became economical for SMBs (I run one!). Your points might be true for a large organization but it simply doesn't cut it for us smaller shops.
tstevens853
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tstevens853,
User Rank: Apprentice
11/6/2012 | 11:59:49 PM
re: When IT Becomes A One Man Show
I would LOVE to know how long Mertz had been there before the downturn.... Most of the initiatives he did should have been well underway, if not implemented (sans cloud technology) well before 2008. Really?, I'm guessing if not for the economy collapse, these clowns would still be running a Nortel key system, backing up DDS4 tapes and purchasing physical servers....

Article does not shed a good light on these guys.
angelcec
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angelcec,
User Rank: Apprentice
11/6/2012 | 3:00:22 AM
re: When IT Becomes A One Man Show
There is a difference between CIO and CTO - the latter being a more hands on, well rounded technologist. The number of support staff is really determined by the type of business, end user headcount and number of legacy systems. I.T. at SMB's will be the fastest to adopt cloud services as they are able to shift in-house talent to that of the provider. This company got there sooner or faster out of necessity.
majenkins
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majenkins,
User Rank: Moderator
11/5/2012 | 9:24:20 PM
re: When IT Becomes A One Man Show
Maybe part of the problem with the IT department, and perhaps the business in general, was that they had a CTO when there were only 4 people "working" under him.
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