Technology During an Economic Crisis: The Benefits of Open Sourcing Brian Hutzley VP of Business &...
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Transcript of Technology During an Economic Crisis: The Benefits of Open Sourcing Brian Hutzley VP of Business &...
Technology During an Economic Crisis: The Benefits of Open Sourcing
Brian HutzleyVP of Business & Finance and Chief Financial Officer
State University of New York at Delhi
Patrick MassonChief Information Officer
State University of New York at Delhi
The State University of New York (SUNY)
464,000 students 87,000 faculty & staff 64 campuses
(doctoral, 4 year and community colleges) 6,700+ programs
$1.2 Billion state support from $1.6 billion in 2008-2009 $260 Million cut since October 2009
SUNY Delhi
3,000 students: freshman class 850-1000 400 faculty/staff 4 year College with 50 programs
Premier Programs include Hospitality, Culinary Arts, Professional Golf, Vet Sci.
History in agriculture and technology (trades)
Budget Crisis
Massive impact from state budget cuts $12.2 to $7.6 million From "break even" to a $3.3 million deficit over
night !
State support cuts = 40% over last two years Ten year trends: 60% state support to less than 20%
During a period with 50% enrollment growth 2010 support - Actual dollar amount received from state
today, equal to 2000
Now is the time to be driving improvements in operations, driving savings and improved services.
Investing in technology is not an option, it is a long-term responsibility and needs to be a part of your operational
strategy.
Traditional investments and procurement practices should be questioned.
“Open-sourcing” our planning, procurement, software, etc. provided SUNY Delhi with real savings, while
delivering extended systems, allowing academic and administrative departments to not only meet operational
requirements but extend services and capacity.
“Open Sourcing”
SUNY Delhi's strategy for technology implementation goes beyond open source
software, it includes an open approach to needs identification, resource analysis, communication,
organization, planning and procurement.
In spite of our budget crisis...Year 2007-2008 2008-2009
Funding $3,900,000 $3,600,000
IT Staff 16 16
New orEnhanced
Services
Alumni Donor Analytics Blogging Network Replacement Emergency Notification Enterprise Wiki iTunesU LMS Migration Online International Programs Online Tutoring Network Monitoring Point of Sale Upgrade Print Templates Redundant Power Retention Analytics Server Virtualization SIS/LMS Integration Website Redesign Wireless Upgrade
Computer Lab Consolidation Data Center Rebuild Disaster Recovery Document Management E-commerce E-reporting E-portfolio Help Desk Upgrade Housing Management Hosting Services Lecture Annotation LMS Upgrade Online Syllabus Oracle Migration Public Address Security Cameras SIS/Bookstore Integration Thin Clients Unified Messaging VoIP
Barriers to Adoption: Technology
Support: “Who will we call at 2:00 a.m.?” Quality: “You Get what you pay for.” Security: “If the code is exposed anyone can
hack it.” Continuity: “What happen if the guy dies?” TCO: “Open source isn't free.” Staffing: “You'll need to hire a developer.”
Barriers to Adoption: Planning
Distributed vs. centralized Bottom-up vs. top-down Self-organization vs. committees Transparency vs. messaging Evidence-based vs. visionary Achievements vs. initiatives Adoption vs. procurement
Benefits to Adoption
More responsive to the organization Quicker pace of development Broader scope of services Greater alignment with needs (outcomes) Less traumatic (awareness, training, continuity) Prioritization Lower costs
Open Sourcing: Case Studies
Open Source Software: LMS Migration Procurement: Network Replacement Planning: Smartboards & e-Portfolios
Open Sourcing: LMS Migration
One online program
283 enrollments
17 courses
17 instructors
WebCT 4.1 licensing: $20,000/year Increase to $45,000 - $75,000/year
Local hosting: $3,000/year
1 FTE: Coordinator of Online Learning
.1 FTE: Systems Administration
8/5 End-user and technical support
Realtime integration with Banner
Open Sourcing: LMS Migration Two online programs
1,214 enrollments
104 courses
192 Instructors
Moodle 1.9 licensing: $0/year
Remote hosting: $6,000/year
1 FTE: Coordinator of Online Learning
1 FTE: Assistant Coordinator of Online Learning
5/13 and 2/8 end-user support
24/7 technical support
Real-time integration with Banner (also an open process!)
Complete deployment and migration in six months
TCO: Online Learning
2006 - 2007 2007 - 2008 2008 - 20090
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000
LMSSoftwareHostingStaffingTCO
Open Sourcing: Network Replacement
Timeline: Dec. 06 – August 24 “Any information contained in the Response will
be considered public.” 3Com, CampbellNet Solutions, Cisco, Enterasys,
Extreme, HP, Nortel, $319,323 off State contracted price
Open Sourcing: Network Replacement
The team has continued to meet with vendors... The process of comparing amongst vendors has also been very beneficial to the process. ...most every vendor is modifying their designs and proposal in reaction to HP's warranty and pricing range. Cisco has recently submitted a quotation that came in around $284,000. At the onset of this process we would never have expected, Cisco to discount their proposal nearly $100,000 or 25% below state contract pricing. So while the process is taking much longer than anticipated, the end result is very beneficial to the college.
This process initially embarked on just being a wired evaluation, but now the power of competition and aggressive pricing afford us an opportunity to replace our entire wired and wireless network within the available budget dollars allocated
Open Sourcing: Smartboards
Originally a siloed decision based on product demo seen at a conference.
Grant funding of $15,000 for implementation within Math Department (no ongoing costs).
Opened discussion up to end users: User stories and case studies:
“What do you need a Smartboard for?” Functional requirements led to $0 solution
Open Sourcing: e-Portfolios
Originally a siloed decision based on affinity initiative
Estimated costs of $2,000/year Opened discussion up to end users:
User stories and case studies:“What is an e-Portfolio?”
Functional requirements led to $0 solution
Open Sourcing: Financial Perspective
Why Now? Sometimes change for the good is forced. Financial Crisis - often the time organizations
try to get their arms around their business. Identify opportunities where technology can
help reduce cycle / turnaround times and / or bring efficiencies into the system
This is part of the SUNY Delhi planning process, strategic priorities and culture - Not a reaction to a crisis.
Open Sourcing: Financial Perspective How are purchasing decisions made?
Very often organizations can end up investing in cheaper technology, only because they look at addressing a short term need
Impulse Buying... I went to a conference... keeping up with Jones' This was the Delhi way!
OR
Evaluate business processes, infrastructure and manpower. Take a realistic approach and not just look at headcount reductions, etc as
a quick win solution (it may not always be the solution).
Complement with a long-term vision for the business rather than just immediate term.
Evaluate options available and choose the best
Technology and the CFO
Role of technology Make things more efficient
Providing higher quality
Enhancing Service
In times of recession/crisis, doing things more efficient is a very important factor
Many (all) organizations trying to keep IT services afloat with diminished budgets.
Investing in technology is in most cases: a good idea,
under the condition that you are buying the right technology for the right reason and have a strategy for using it within your organization,
managing all the consequences of using it. "Impact to Campus"
Open Sourcing: Financial & Procurement
Open source software packaged with vendor support is especially attractive, cash-poor agencies don't have to add staff for support and management.
Look at open source solutions as part of the procurement process
Calculate the total cost of ownership for an open source system "fixed costs” (direct purchases and licensing) operational costs for support, testing, upgrades,
maintenance and training
Open Sourcing: Financial & Procurement
Open Source frees the IT Department from: Upgrade cycles at the whim of the vendor Expensive maintenance fees IT platforms that often include more capabilities than
can put to good use (IT and end users)- S/W packages are very difficult to install and tend to
be cost-prohibitive.
Forrester reports that clients have typically saved between 20% and 55% over a three-year period when using open source rather than commercial software.
Summary
Organizations will gain from continuing to deploy technology in difficult economic times
The key to a successful evaluation of Open Source is to recognize that it is part of a broader strategy.
An Open Source strategy: reduces the software licensing costs, develops in-house talent, integrates as transparently as possible to the end-users and improves scalability
on like hardware. In an economic downturn, CIO/CFO’s must place priorities on investments
that will have the greatest long-term impact on business and deliver the strongest ROI.
It all comes down to smart decision-making
CFO and CIO – Should be best friends !
Greater Savings,Better Services,
Greater Efficiencies,Cost Avoidance
Brian Hutzley Patrick [email protected] [email protected]
Thank You