Shell operates in over 70 countries with over 94,000 people employed across over 30 refineries and chemical plants and 44,000 service stations producing 3.1 million barrels of oil equivalents per day. This case study is about the adoption of open standard IT4IT for IT management by Shell. IT4IT involves running of IT as a business in involving planning, building, deployment, operation, and retirement.
The company added IT4IT reference architecture version 2 technical standard to its existing base of standards including W3, W2r, W32b and (gt)2. The case study explores the IT infrastructure as it was before the adoption of IT4IT, explores the reasons for adoption, and assesses the outcomes of the adoption. Lastly, the case would help understand if addition of IT4IT could be an appropriate move for companies who have already adopted ITIL (Enterprise Opinions Limite, 2016).
This case study explores the reasons for adoption of the open source framework by Shell. It first studies the condition of Shell IT systems before the system was adopted so that reason for adoption could be better understood. The case study also studies the output would result from the use of framework. At last it would also explore IT4IT for the companies that are already using ITIL to understand if the two frameworks would be supportive of each other (Graham, 2016).
Shell has a lot of complexities involved in its IT structure as it was huge consisting of 27,000 servers and 140,000 desktops over which 4,500 applications ran containing over 3000 supplier licenses. The company has 10 data centres worldwide storing over 35 perabytes of data. 25,000 networking devices are managed with 1.4 million IP addresses in Shell. Shell has had political, commercial as well as IT challenges faced. While on one side they were attacked by activists in response to their pricing or other commercial strategies, on the other side, company faced security issues because of hactivists. Attitudes of IT users were also found to be changing with them demanding things to happen fast. The company was dealing with the multiple pressures simultaneously including internet threats, external issues of hacktivist and activitist, commercial pressures, and pressures due to change of attitude of users. The IT landscape of Shell is huge, complex and critical (HP Enterprise, 2017). It is not run with full insights or full automation as a business. The company manages its IT system involving systems and processes like investment planning, investment prioritization, requirements and testing systems for building, service catalogue for deployment, and monitoring of integrated systems. But the company could not get the most out of their systems. An integrated system that could take care of the IT management for the complete life cycle of IT would an appropriate thing to have or developed (The Open Group, 2016).
The Shell faced a dilemma between cost, agility, and manageability in IT management. There were functional requirements of these systems that needed reduction of costs and risks while business requirements demanded increase in speed, agility, and improvement in performance and experience. There were tradeoffs happening between cost and growth, speed and agility versus diversity and complexity, and technology disruption and manageability. In order to ensure that these tradeoffs do not have add adverse impact on the system performance, an integrated IT system was adopted that would allow a seamless flow between different components and stages of the IT life cycle (The Open Group, 2015). As per a Gartner research, an integrated IT system can help an organization save up to 20% of its IT costs allowing company t make use of saved money out of IT budget for innovation. The company needed its system to achieve better quality, increase the speed of development, reduce cost of implementation and IT, and improve management of risks, enhance monitoring, and better exception handling (The Open Group, 2016).
The company had a choice between having own propriety standard or going for an open standard. The company had been managing IT4IT for over a decade formally as an IT department seeing that the gap between the needs and actual capabilities was only growing because of the disruptive environment like cloud, IOT, big data and so on. The department realized that problem was big as well as the value that solution to the problem would also be big (Allen, 2016). Thus, the department believed that the problem could not be entirely solved by a single company and that too when the company was actually not an IT company. Developing own propriety framework would not even have build a competitive advantage for the company as IT was not the core to it. Thus, management thought that it was fair to use IT management just the way others did. Thus, the company decided to adapt to the open framework and with the collaboration with experts helped move things faster. Also, the solution was to bring in the value for the customers and a collaborative approach would be useful in generating that (GARDNER, 2016).
Adopting IT4IT means running IT like a business, IT is not just deployed but used. It is monitored to understand what it is telling about IT and actions are taken based on them. The outputs or results are measured in terms of performance of the IT systems. The measurements would include metrics, actions, and improvements that can help understand the capabilities of people, processes, information, and tools (HP, 2016). IT4IT helps figure out the cost of each element of the lifecycle, risks that are taken during deployment or implementation, what mitigation plans does a company have against those risks and the value that is created at each stage of the life cycle (NS Tech, 2016). With this clarity, an IT team would be able to analyze IT systems and incidents as well as identify if incidents are created in the system or not by specific suppliers or teams. Suppliers adding incidents can actually help improve the system and thus, they may be rewarded while those skipping the process maybe discontinued with. Adoption of IT4IL would bring out facts and figures with analysis of the system performance in the real time so that appropriate actions can be taken for improvement (Saran, 2015).
IT4IT and ITIL architectures actually complement each other. While ITIL is a community based process framework which serves as guidance for managing IT services, IT4IT standard s a data driven model that provides prescriptive guidance for the management of IT systems. Thus, IT4IT framework can actually help build a foundation on which the best practice IT models like ITIL can be run. In some perspectives, IT4IT is seen as a competition while others felt that both would not provide any support for each other. But considering the flexibility of the framework, it can be said that combination of the two may not a bad but good (TOGAF, 2016).
ITIL includes a set of best practices and is process driven while IT4ITis process agnostic and it is focused on the automation of the IT function. As compared to ITIL, IT4IT can provide a bigger picture of the IT systems in an organization throughout the whole life cycle of IT management value chain.
This report was prepared to understand why Shell adopted the IT4IT open framework over developing a propriety framework of its own for integrated IT management which was the need of the time. It was found that the because of the disruptive technologies connecting with the IT systems of the company and making it difficult to fill the gap between what was needed and what was developed, the company management through that the problem could better be solved if it was a collaborative effort understanding the value it would give to the IT community. The report also discussed the outcome of adoption and it was found that the management was able to track the data and run analysis that would help company take insights and act upon them. The case study also revealed that IT4IT was actually a complementary framework for ITIL systems and thus, can be supportive to the system.
Allen, A., 2016. IT4IT modernizes IT and increases business value, s.l.: Techtarget.
Enterprise Opinions Limite, 2016. IT4IT – The Basics. [Online]
Available at: https://www.theitsmreview.com/2016/04/it4it-the-basics/
[Accessed 31 March 2017].
GARDNER, D., 2016. The Open Group IT4IT Architecture Offers a New Direction | @CloudExpo #Cloud. [Online]
Available at: https://opensource.sys-con.com/node/3775829
[Accessed 31 March 2017].
Graham, D., 2016. Designing the Business of IT. [Online]
Available at: https://enterprisearchitects.com/designing-the-business-of-it-with-it4it/
[Accessed 31 March 2017].
HP Enterprise, 2017. IT4IT Value Chain. [Online]
Available at: https://saas.hpe.com/en-us/software/it4it-value-chain
[Accessed 31 March 2017].
HP, 2016. IT4IT™: the new enterprise architecture framework , s.l.: Hewlett Packard Enterprise.
NS Tech, 2016. IT4IT is a push for sexy new IT architecture standards – and it’s got a powerful advocate in HPE. [Online]
Available at: https://tech.newstatesman.com/enterprise-it/it4it
[Accessed 31 Mach 2017].
Saran, C., 2015. CIOs collaborate on managing the business of IT, s.l.: TechTarget.
The Open Group, 2015. The Open Group IT4IT Forum Launches First Standard. [Online]
Available at: https://www.prnewswire.com/news-releases/the-open-group-it4it-forum-launches-first-standard-534517031.html
[Accessed 31 March 2017].
The Open Group, 2016. IT4IT™ FAQ, s.l.: The Open Group.
The Open Group, 2016. Shell and The Open Group IT4IT™ Reference Architecture, Version 2.0: The Adoption of the IT4IT Standard at Shell, s.l.: The Open Group.
TOGAF, 2016. IT4IT Relationships with ITIL and Other Practices and Standards, s.l.: TOGAF® Foundation.
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