Technology During an Economic Crisis: The Benefits of Open Sourcing Brian Hutzley VP of Business & Finance and Chief Financial Officer State University.

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: Smartboards

Open Sourcing: Smartboards

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: e-Portfolios

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