Cost savings is a big consideration, says Avnet CIO Steve Phillips, but the global electronics distributor sees other advantages to giving employees choices.
Steve Phillips isn't a bleeding edge kind of CIO, but he's quick to recognize important business technology movements and set a thoughtful strategy for each of them. That's how he's tackling two of the major CIO issues of the day: cloud computing and IT consumerization.
Phillips is the first to acknowledge that his employer, Avnet, the $26.5 billion global electronics distributor, isn't a cloud pioneer. But when it comes to software as a service, it's now placing its first big bet.
Having adopted SaaS for a few niche applications, including SuccessFactors performance management, Paymetric credit card processing, and Concur expense management, it's now two months into deploying a core app as a multitenant service: Workday HR, including benefits and other standard features. Avnet is rolling out the Workday service to 7,000 employees in the Americas, Phillips says, and will consider a global rollout.
Avnet's SaaS strategy is straightforward: When evaluating new or replacement apps, it will consider at least one SaaS product. Its assessment emphasizes security, scalability, uptime, vendor viability, and how the app would integrate with Avnet's business processes, technology architecture, and data model.
Phillips says cost wasn't a factor in Avnet's decision to go with Workday. "Its pricing was close enough that we could have argued one way or the other," he says. Avnet was impressed with the HR app's out-of-the-box user interface, which Phillips calls "world class," and Workday's seasoned leadership team, especially founders Dave Duffield and Aneel Bhusri of PeopleSoft lineage.
Avnet considered Salesforce.com to replace its aging, proprietary CRM platform but found it to be "relatively expensive," Phillips says. Instead, it went with the on-premises Microsoft Dynamics, liking its UI as well. "If you can use Outlook, you can use Dynamics," he says. An Exchange shop, Avnet also evaluated Microsoft 365 but wasn't convinced by the economics of that SaaS package, he says.
Phillips sees the Workday implementation as a chance for his team to learn more about SaaS in general. "SaaS will be very important to us," he says. But he isn't sold on infrastructure and platform as a service. "We haven't seen the ROI yet," Phillips says, noting Avnet's big investments in its two data centers. "But we're talking about it more than we used to. The economics should be there one day, but we need to see more maturity."
Avnet's also taking a measured approach to allowing personal technology at work. Instead of issuing a standard smartphone, for instance, it gives each employee who qualifies for its BYOD (bring your own device) program an allowance--paid out at three levels, related to job function--to buy a phone, email service, and data and voice plan. Avnet's IT organization will support and secure the email. It manages each device and sandboxes (and can wipe) the company data that resides on them using Good Technology software.
Avnet's also piloting iPads--Phillips doesn't see much employee interest in Android and BlackBerry tablets. And it's considering extending its BYOD policy to PCs and laptops via desktop virtualization, having set up a pilot program with about 10 employees. Phillips' team hasn't worked out the numbers yet, but he doesn't see the company providing the same level of hardware support for bring your own computer as it does for company-issued desktops.
So what's the end goal here? Cost savings is a consideration, Phillips says, as the smartphone program cut Avnet's wireless expenses 15% to 20%, and "it will be interesting to see if that plays out with more complex laptops." But more important, he says, "our people expect choice, and it's a fair demand, so I want to satisfy that. There aren't too many cost-cutting opportunities that get a lot of employee buy-in."