Mansfield Oil CIO: How IT Is Driving Revenue - InformationWeek

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10/7/2010
07:20 PM
Lorna Garey
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Mansfield Oil CIO: How IT Is Driving Revenue

After a major data center virtualization project, it has started selling IT services directly to its customers.

Mansfield  Oil Co. CIO Doug Haugh
Doug Haugh, CIO, Mansfield Oil Co.
Mansfield Oil Co. doesn't extract oil and gas, it delivers energy--in whatever form customers want, from fossil fuels to renewable energy sources. One of Mansfield CIO Doug Haugh's goals is to make IT a revenue source, getting paid for IT services provided to customers, and not just support operations. To do that, Mansfield needed a major consolidation and virtualization project. Haugh spoke with InformationWeek's Lorna Garey about the innovation that made Mansfield the top energy company in the InformationWeek 500:

On whether his data center is a "private cloud":

Haugh: I'm in the camp with those who think the term "cloud" is overused. It's convenient marketing terminology, but what we're doing is really bringing together in a homogeneous environment networking, storage, and processing power.

On the project's ROI:

Haugh: ROI for our consolidation project is really measured based on risk avoidance and improved resiliency, combined with reduced recovery time for our disaster recovery plan. Downtime can cost us $60,000 of new revenue an hour, and potentially far more in the pricing and logistics of business already being processed and executed. We simply saw a virtualized environment that encompassed the network, the servers, and the storage as the only way to get to the service levels we wanted. Obviously, the key is being able to scale the network and storage resources on demand, like IT has been able to do with virtualized server configurations.

On how it allowed new services, such as letting customers monitor their fuel tanks online:

Haugh: The most important outgrowth of our infrastructure projects has been the launch of our FuelNet application suite for our customers. This is a direct revenue-generation source, through delivery of several of our core services via a Web portal that incorporates telemetry to thousands of tank-monitoring and environmental-control and protection devices, as well as monitoring and data collection across fuel controllers and dispensers that provide our clients the inventory security and reliable fuel supply that is mission critical for their operations.

On the revenue impact:

Haugh: We charge for those solutions, have grown that business unit to several million dollars in revenue, and of course believe that leads to customers wanting even more from us on the physical supply side long term. Right now, we have 20% penetration into our customer base for FuelNet. It's a good start, but we want to do better.

The majority of inventory management in our business is still manual--sticks lowered into tanks and clipboards. The fact that we can take real-time transport and inventory data and put it on the Web is huge for customers to optimize their operations. Eventually, we see this business going all the way up to management functions like hedging risk.

On getting users on board with VoIP, as part of the consolidation:

Haugh: Users are more comfortable being able to work from anywhere. Any employee can walk into any office and plug in and have their phone and desktop resources just as if they were at their normal desks. In fact, when accessing resources, remotely from a hotel or an airport and using a headset, their phones, shared network resources, and data are all available anywhere. What's not to like for the employee?

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