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Global CIO: St. Luke's CIO Saves Millions With Apptio's Help

Apptio's tools helped $2.5 billion St. Luke's Health System identify where its IT spending was exemplary, okay, or troublesome.
By more than $700,000.

Apptio bills itself as offering "technology business management" solutions and has an impressive list of customers on its website, including BNP Paribas, Cisco, Expedia, Starbucks, Hallmark, and others.

While each of those individual reductions have been vital, the larger impact from the broader spending-analysis effort and the Apptio analytical application has been that Gash can now devote more capital and more of her people to strategic initiatives instead of mundane operational work.

"Becoming aware that you're not like everyone else drives the question of 'why?' Apptio doesn't tell you why, specifically, but it does say that there's something going on that needs to be looked into, and it helps you direct your efforts," Gash said.

"It worked the opposite way with our help desk—I was always getting calls from vendors saying they could do it better and cheaper if I'd source it elsewhere, so we took a good look around to see how we stacked up against a comparable set and we saw that we were much lower than the industry average—so we knew that was one area to leave alone."

Desktops was another area undergoing significant change within St. Luke's as rapidly changing business needs, compounded by dramatic technology advances, have convinced the $2.5 billion organization to begin moving aggressively on mobile infrastructure and solutions.

"When we do strategic planning for technology, we always try to look at what the organization needs from us for solutions today and we also try to focus on anticipating what our infrastructure needs will be in the longer term.

"Our IT plan goes out 3 years: we watch what's going on very closely, and CTO Roger Zarimba does an excellent job of letting us all know what's coming and what we need to watch out for as that relates to our business," Gash said.

"And a couple of years ago, Roger started to tell everyone that we just can't sustain this desktop thing: mobility is coming, and virtualization, and thin clients, and cloud environments where we can push out the technology on-demand. So then we knew we had to explore what it will take to get there and how that coincides with what we have: we looked at electronic health records, where mobility is critical, and the need to secure all the information, and all the privacy regulations that we get out in front of a couple of years ago, so now we think we're gonna be able to meet that at the clinician end," Gash said.

Along the way, the Apptio tools allowed St. Luke's to discover that outside of IT's knowledge and consent, millions of dollars were being spent by various departments on projects and products, including desktops and related applications. Because those aberrations were pointed out by Apptio—as Gash said, it doesn't answer why exceptions are happening but it definitely tells customers that they *are* happening—St. Luke's was able to pull those outliers into the mainstream, cutting costs dramatically and improving overall business outcomes.

"We were surprised at the efficiencies we were able to derive from getting those insights," Gash said. "That changed how we do cost-accounting in IT, how we go about managing our resources, and how we work on an ongoing basis with the Finance Department to reclassify costs to give greater visibility.

"Our next step is to push that forward by analyzing where our people are spending their time, analyzing if that's where it should be, to look at that investment by investment, and to be able to dig into why various projects are consuming so much time—which equates to money."

If appropriate, Gash said, her team can then go back to talk with vendors and try to ascertain if there's an inherent problem.

"We put in a metric in our scorecard that tells us how much time is invested in strategic initiatives versus daily production and operations," Gash said. "The industry average is 25% strategic and 75% production, but we're striving to push that up to 30-35% so that we're able to deliver more in a quicker turnaround time.

"As we do that, we're seeing the metrics change, we're getting more projects done, we're able to respond to things more quickly, and—this is very important—it lets us avoid hiring more resources and lets us move more people from mundane stuff to strategic projects."


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GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

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