Freescale"s CIO on building IT operations

25.10.2005
Von Thomas Hoffman

Tell me about some of the plans you have for the IT organization at Freescale. I put on the calendar plans to put together an IT strategy with the CEO after two months. I"ve just gone through that. There are two broad areas I would mention. The first one is that IT in and of itself is a very important function with a lot of complexity. You have to understand where you are, break everything into a lot of detail, benchmark everything and drive a lot of efficiency in the IT process. If you can do that, you can drive efficiency for the company, meaning lower cost ... at a unit-cost level and lower consumption. The second thing a CIO does is help everyone else optimize their processes.

A second area is supply chain. A certain amount of progress on having an application portfolio is part of this but there are gaps. For instance, we have one instance of SAP but not all of the functions are in there. That"s partly true of legacy systems, too.

What are some of these missing functions? Orders are placed into a legacy system first and then entered into SAP. What we"re trying to do is optimize the supply chain where IT can add value to the business. The more you can drive optimization and improve the yield out of these plants, it can be a huge benefit to the company. That"s a third area where we have a set of projects.

When do you expect to have some of this benchmarking completed? What will you be benchmarking -- the cost of delivering IT? Support costs? Application development and software maintenance costs? Yes, all of those things. I have a very detailed approach to this. I create a services model, which includes a breakdown on telecommunications costs, PC life-cycle costs, etc. Before my arrival, benchmarks were only done at the total level, i.e., IT costs as a percent of revenues.

I"ve already split the costs out for PCs, LANs, long-distance calling, etc. I understand our total costs in those areas. I"m in the process of dividing those costs into rate times volume. I expect to have benchmarks for everything between now and the first half of next year.