Case Study - Due Diligence
Business Challenge
UK Government Departments are constantly looking to identify savings and reduce overheads and one Department were targeting areas around their IT spend on a specific large site as a pilot to identify potential savings , without any impact on efficiency or service delivery around their IT infrastructure which could be repeatable at a number of locations.
N2S meet with the client to discuss the scope and requirements of the pilot programme. The client explained the history and background of the site where over time, responsibility and management of certain assets had been allocated and re-allocated to different departments / cost centers / internal and external contractors etc.
It was suspected that during the many iterations of reorganisation process, some information may have been fragmented, lost or misrepresented. For example the organisationcould be paying line rental and maintenance fees for more telephone extensions than were actually in service. Also there was a concern that business users using the IT services were not being accurately billed internally for the services they were using. Another concern was that the lack of clear understanding of the network topology resulted in an inability to accurately manage capacity and growth, and additional IT spend may be incurred which was not necessary.
It was jointly agreed that some form of site audit was required.
N2S discussed various options with the client and explained their track record in this area. The complex nature of the Government Department was taken into account.
A few of the key points that needed to be carefully considered were:
- The Departments estate covered over 2000 acres , containing several hundred buildings
- The Department is subject to the highest levels of security throughout the estate
- The scope of the audit would need to involve many autonomous business units, each with their own specialisedneeds and requirements.
- The size and scale of the organisation, and the various inter departmental relationships required sympathetic management and awareness would have to be taken.
- The budget for any site audit would have to be justified and clear deliverables from the audit would need to be documented within a Business Case.
N2S were able to offer independent and impartial advice and offer a solution that met with the client’s requirements.
After reviewing samples of the documentation available, N2S proposed that the most effective way forward would be a due diligence approach. A physical on site audit would be performed and the findings of this would be compared with the paper records available, resulting in a report with recommendations. The outcome of the pilot audit report, would demonstrate the level of savings possible and the viability of extending the audit to the entire Government estate across both the UK and Globally.
The N2S Solution
The site identified was originally built almost 130 years ago and over the past century, it had expanded, (and contracted). At the time of the audit it consisted of over 100 buildings with a migratory workforce of over 15,000 people working there. For estate management and maintenance purposes, the site was split roughly in to two main sections. In administration terms, there were 35 autonomous business units operating from the site.
The telephone system for the entire campus was served by one switch, rented from and managed by a major UK telecom provider. We were informed that the switch was at capacity and would require replacement to permit the organisationto keep up with operational and technological requirements.
As part of the initial planning and investigative work, N2S arranged a preliminary site meeting with the client and one of the key holders responsible for general maintenance. After an overview of the site, access and security requirements were discussed and agreed. During the meeting it became very apparent that there could be issues relating to internal politics of the organisation. It is assumed throughout Government Departments that cost savings usually results in a reduction of staff or withdrawal of equipment. It was paramount that the on site engineers relate to the business units that the envisaged cost savings would not have any operational impact.
As part of our normal working practices N2S produced a Risk Assessment, Project Plan and Methodology Statement. This provided the client with a fixed cost and timescale solution whilst demonstrating the manner in which we would complete the task and the key areas of risk. The Project Plan provided for interim reports, to allow the client to assess the Due Diligence operation in real time, to ensure that the audit was going to plan.
The physical audit took place over a period of four weeks. N2S engineers aimed to access every room, in every building on the site. The engineers documented the location, and related business unit, of every telephone extension, fax machine, modem, etc. throughout the campus. These details were then collated with the paper records provided by the client to produce the final report.
During the physical survey, observations were made and recorded, where possible risks and dangers were identified, (i.e. security risks, potential points of failure, non compliance to standards). For example two of the five equipment rooms allocated for incoming circuits were noted to be housing eight redundant racks. Cost savings could me made by decommissioning the racks, (power, heating, air conditioning, maintenance contracts etc).
It was also identified that the system extended to two remote sites not covered by the agreed scope of the audit. N2S were able to incorporate the audit of these two sites into the final report, within the original timescale and without jeopardisingthe agreed fixed cost.
Feedback
On receipt of the final report our client commended N2S on the service provided and the professional manner in which it was completed. The final report was delivered on time at a fixed cost, (which was considerably less than originally anticipated by the client). Although the financial savings realised,remain restricted information, the pilot site expects to make year on year rental and maintenance savings of around 30%. Additional capacity on the existing equipment has now been identified, extending the useful life of the system and removing the immediate need for a costly upgrade. Also, the audit has painted an accurate picture of the current requirement, allowing a more realistic prediction of future needs.
The client is now preparing an internal business case to perform audits nationwide
