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Around 2000, semiconductor giant Texas Instruments (TI) took the decision to centralise its globally dispersed IT helpdesks at a single location in Dallas. Even though the working language of the company is English, with manufacturing, design and sales operations spread over more than 25 countries TI decided to draft in staff from around the world so it could provide the service in multiple languages.

"Texas Instruments predominantly requires people to speak English," explains European IT manager Barry Cooper. "But the reality is that when it comes to a manufacturing line in Japan or the Philippines for example, not everyone will speak English. So we knew we had to put local speakers on the Dallas helpdesk."

The problem, however, was that in the minds of users of the centralised service, distance was a major factor. What Cooper and the IT management at TI found was that 'shadow helpdesks' soon started to emerge in local countries, simply because many people were more comfortable dealing with a helpdesk with a closer cultural fit.

Learning from that naturally evolving structure, TI adopted the two tiers. "What we now have is a centralised helpdesk in Dallas with strong links through to local helpdesks for things that need to be dealt with in the user's country," says Cooper. "And we allow those to coexist. The local helpdesk is an integrated part of the global helpdesk and both use a single, common database."

That highlights just one of a long checklist of issues that IT executives have been wrestling with for half a decade as they seek to rationalise the sprawl of systems and applications across their organisations.

Consolidation is now an almost universal trend for mid-sized and large IT departments that grew their IT fast and often haphazardly during boom times of the late 1990s or as a result of merger and acquisition activity. They are now seeking to rationalise not just the duplication of resources and management effort but, as one CIO describes it, the multiplication of resources and effort.

It is a tricky balancing act. Companies embarking on the globalisation of their IT function need to figure out how to provide infrastructure services, manage suppliers and enforce standards and processes globally while maintaining enough flexibility to ensure local needs are not overwhelmed by the centralisation and rationalisation ethos. That requires a much higher degree of awareness of the different requirements of the business, on a country-by-country and location-by-location basis, than during any expansion phase.

Global vs central

Perhaps most important is an appreciation of the distinction between globalisation and centralisation. While centralising all IT in one or two locations may work well on an accountant's spreadsheet, there are enough war stories to suggest that it is too simplistic a model for any IT globalisation strategy.

For one, the global structure needs to be multi-centred, tapping into the skills available in different parts of the organisation.

"Globalisation is very much about the utilisation of the skills you have around your global organisation," says Cooper. He adds that such an approach has "saved our company tens of millions of dollars."

It is a perception shared by Stephen Pownall, the CIO of the glass maker Pilkington. When he set out the globalisation strategy for what were then 52 separate and largely autonomous IT departments, he discovered that many of these units possessed expertise and knowledge in specific areas. "There were no standards, as there was no reason for the departments to talk to one another, and there were no networks in place," he says. "Clearly there was a need to create a single strategy and then create an organisation to implement and deliver it."

Rather than universally centralise, Pownall instead set about creating what he describes as 'global centres of excellence' across the St Helens, UK-headquartered but globally dispersed business. "For example, we ended up with all our main server hardware being operated out of Germany, where they had proven to be particularly skilled in this area," Pownall explains. "Under this structure, people working in a particular area of technology around the world now report into those centres of excellence, which manage things on a global basis, and they, in turn, report to me."

But one of the keys to the effective globalisation of IT is to be judiciously selective about what exactly should be globalised. And, naturally, that means knowing exactly what resources and infrastructures are currently in place. In a company like Pilkington, which in 1997 - after 20 years of acquisitions - was being run as scores of separate business units, that can prove a daunting task.

"When we started the effort, we didn't even know how many people we had in IS," says Pownall. "We didn't know what kind of systems we had around the place and we didn't know how much we even spent in total on IS." So the first step was an exhaustive programme of asset tracking and cataloguing, he says.

Armed with a clear picture of those resources, a deceptively simple question needs to be asked of each aspect of IT: 'Can we do this globally?' If it is not viable for something to be implemented globally, then and only then should it be implemented locally, suggests TI's Cooper. But globalisation should not become a management mantra, slavishly repeated in the face of organisational and logistical resistance.

"We all recognise some things have to be done locally, such as desk side support," says Cooper. "But with things such as ERP systems, you can centralise. At TI, for example, we have one SAP system that runs across all four global regions."

And even when local implementations are undertaken, they are made under the auspices of a global IT management which can ensure that the implementation fits with global standards and that global IT resources are utilised where and when appropriate, adds Cooper.

Location, location, location

Almost all organisations have core IT services that they need to provide irrespective of location. Those are the areas that will yield the greatest benefit by being globalised. In the majority of organisations, "requirements all revolve around management of applications, infrastructure and information, and the basic organisational building blocks for carrying out those tasks are fairly standard," writes Robert Barton, the former head of global IT strategy, architecture and standards at pharmaceutical giant Novartis, in his book Global IT Management. "The primary question becomes not so much whether to globalise IT, but rather which specific IT activities to globalise and how far to globalise them." Barton points to four distinct areas in which a business will typically benefit from IT globalisation: architecture, strategy, standards and control.

In order to deliver the maximum benefits of globalisation while still retaining the required level of localised service, a solid organisational structure must be put in place.

In the case of TI the organisational hierarchy is topped by a worldwide CIO and then several regional IT managers. "We have global priorities that are relevant across all of the IT organisation," says Cooper. "Those priorities are cascaded down, ensuring that each region is satisfying the local needs of the business from a global perspective."

The success of any globalisation strategy, though, is somewhat dependent on the shape of the business it supports. If the business itself is highly fragmented and not run along truly global lines then the IT organisations will struggle to overlay the delivery of services at a global level. That was just one of the challenges for Stephen Pownall at the aggregate of companies that constitutes Pilkington.

But the resistance points can come from inside as well as outside the IT organisation. When trying to break down the often-isolated silos of IT that have grown unchecked in large IT departments, globalisation strategy leaders find plenty of people who vigorously protect their turf. "Our biggest challenge was that we had a number of people who were 'techies'," says Cooper. "No disservice to their skills, but we deliberately pulled in people from the wider business [to lead the new global structure], so that we could get a wider-ranging perspective and become more customer service orientated."

As that confirms, re-structuring of the IT organisation goes hand in hand with globalisation. Prior to embarking on its IT globalisation efforts, Nestlé, the world's largest food and beverage company, was typical of many sprawling multinational organisations. Each location or market was generally running its own independent IT operation, and the only global IT activities that took place centrally were capital expenditure reviews, guideline setting, negotiation of non-binding global contracts and the development of global systems, typically those used in manufacturing. This changed dramatically when Nestlé undertook a major business initiative - GLOBE - in 2000 to implement best practices for key business processes across the company. The globalisation of IT was such an important factor in the mega-project that the CIO reported to the business leader of the GLOBE project who, in turn, reported directly to the CEO.

Before the GLOBE project, local market-specific general management managed Nestlé's IT spending and performance levels, which led to uncontrolled increases in consolidated IT spending. Under the GLOBE project, the IT budgets are set centrally and spending has come rapidly under control.

All change?

At other companies, the distinction is made between global architectural change and global business process change. Moving all application development to one location, for example, does not change the underlying IT architecture; deciding to run procurement in a centralised, automated way will require an architectural shift.

Says David Weymouth, CIO of Barclays Bank: "I don't think the architecture changes as a result of globalising IT development or indeed infrastructure. It does change if you decide to run business processes globally or implement effectively single instances of major applications such as SAP."

Within the first year of Pilkington's globalisation project for example, the IT department had developed a strategy in which all the various application systems would be replaced with a single enterprise-wide SAP system. "It was a fairly simple straightforward strategy," Pownall says. "It underpinned the business strategy, but at the same time had to be half a step ahead of the business. In other words, we had to make sure we got the communications and the infrastructure in place in order that the business could consolidate globally."

The speed at which various globalisation strategies can be implemented depends very much on the global DNA of the business. "If you have a global business process, it is a lot easier to centralise the relevant systems," agrees Yonadav Yuval, head of integration for Europe at General Motors (GM). "In our engineering department the process of IT globalisation was relatively quick, as the business process was already global. What we at GM are trying to do now is to work closely with business units to help centralise their business processes."

As that suggests, the imperative to 'think local, act global' is a staged and continuous process. The well-documented financial benefits demand it, but the benefits are wider, says Pilkington CIO Stephen Pownall. "For one, we now have a structure where there are much longer and varied career paths for IT people." And perhaps more importantly for the developing role of IT, globalisation has meant a closer alignment of IT and the business.

As Pownall says: "Being part of a change in business strategy on this scale has fundamentally changed our relationship with the business."