Accenture had to quickly create its own IT infrastructure after separating from Arthur Andersen. It viewed IT differently than Arthur Andersen, seeing it not just as a cost center but also as strategic to the business. Accenture chose Microsoft as its platform provider due to its financial strength and the integration of its applications. It adopted a managed service approach for its email infrastructure and began outsourcing non-core repetitive IT tasks like data center management while keeping differentiating processes in-house. It implemented SAP globally in a big-bang approach to drive costs down worldwide.
Accenture had to quickly create its own IT infrastructure after separating from Arthur Andersen. It viewed IT differently than Arthur Andersen, seeing it not just as a cost center but also as strategic to the business. Accenture chose Microsoft as its platform provider due to its financial strength and the integration of its applications. It adopted a managed service approach for its email infrastructure and began outsourcing non-core repetitive IT tasks like data center management while keeping differentiating processes in-house. It implemented SAP globally in a big-bang approach to drive costs down worldwide.
Accenture had to quickly create its own IT infrastructure after separating from Arthur Andersen. It viewed IT differently than Arthur Andersen, seeing it not just as a cost center but also as strategic to the business. Accenture chose Microsoft as its platform provider due to its financial strength and the integration of its applications. It adopted a managed service approach for its email infrastructure and began outsourcing non-core repetitive IT tasks like data center management while keeping differentiating processes in-house. It implemented SAP globally in a big-bang approach to drive costs down worldwide.
Accenture had to quickly create its own IT infrastructure after separating from Arthur Andersen. It viewed IT differently than Arthur Andersen, seeing it not just as a cost center but also as strategic to the business. Accenture chose Microsoft as its platform provider due to its financial strength and the integration of its applications. It adopted a managed service approach for its email infrastructure and began outsourcing non-core repetitive IT tasks like data center management while keeping differentiating processes in-house. It implemented SAP globally in a big-bang approach to drive costs down worldwide.
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Summary of Strategic IT Transformation at Accenture
Arthur Andersen decided to split its business into two separate entities: Andersen Consulting, in charge of all consulting activities of the firm, and Arthur Andersen, which continued to provide traditional financial audit services. Andersen Consulting began a process of arbitration that sought to separate the consulting division from the financial audit firm. Accenture had the right to use Andersen’s technology infrastructure for one year. This gave Accenture only a very short time to create an IT infrastructure of its own. Arthur Andersen had viewed internal IT the way most large companies still do today: as a cost center with an assigned budget, run largely by technology-savvy engineers with limited involvement from management. As in other traditional organizations, IT expenditures at Andersen were budgeted in yearly meetings. There was pushback from different levels of the organization, especially within large contingents of the IT staff who were more comfortable conceiving their roles as “providing superior technical insights.” The new approach now made IT staff responsible not only for operational statistics such as server up-time but also for dealing with people and satisfying service levels, for managing an internal technology service, and for creating and delivering IT tools that would support Accenture’s business requirements.
Accenture could espouse, to the extent possible, a one-platform approach—that is, have one strategic partner provide compatible applications that might not necessarily be best in class. A single global platform would resolve the problem of the Pareto effect created by the company’s requirements, wherein a relatively small number of specialized applications needs tended to create a disproportionately large number of complexities. Accenture’s negotiating power regarding future purchases from that one vendor, who would recognize that any decision to move to a different platform would be a costly one. Furthermore, if the vendor was not financially strong or encountered future operating challenges, Accenture could put itself at risk should the vendor fail financially. Accenture chose Microsoft because of the software giant’s solid financial position its global presence, and the high degree of integration it offered in its applications. Microsoft provided Windows NT to run Accenture’s server and network infrastructure, as well as its SQL database for all data-related tasks. Accenture also adopted Microsoft Outlook for its e-mail client, together with other tools from the Microsoft Office suite of products. To maximize efficiency while maintaining appropriate levels of service, Accenture decided to run its e-mail infrastructure under a managed service approach. The new directive entailed fundamental changes in the organization. For one, several IT engineers were named managers of an internal product—not simply custodians of an IT application. As product managers, they became responsible for innovating around that particular product, as well as for offering different“flavors” for the product that would satisfy the various segments of internal customers in the Accenture organization. Under this managed service approach, every product offering was accompanied by different levels of service, each with a distinctive price point for the end user.
Accenture’s IT steering committee faced important strategic choices when deciding what to outsource and what to retain in-house. To make a decision, Accenture divided activities into different buckets: processes that provided a differentiating competitive core; processes involving highly confidential information; and processes involving tasks that were repetitive and, although important, could be considered common in any services firm. The decision then became easier. Accenture was open to outsourcing rote IT tasks to capable providers. At a basic level, these tasks included data-center management, storage, and hardware maintenance, among others. At a more sophisticated level,
Accenture began to outsource the development of most of its IT applications. Accenture also leveraged its ability and experience to effect a single-instance, big-bang implementation of SAP across the globe—perhaps one of the largest implementations of its type for a service organization. The risky move faced significant pushback from global offices more familiar with customized platforms, but Accenture skillfully communicated the ways in which the new platform would drive cost competitiveness worldwide.
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