In 18 months, the state of Indiana has gone from disarray to discipline in its IT infrastructure. Brought in by Governor Mitch Daniels, an experienced IT management team has cut 230 jobs, consolidated hardware and services, renegotiated contracts and saved the state US$25 million in annual costs. Senior Editor Carolyn Duffy Marsan interviewed Gerry Weaver, CTO of Indiana's Office of Technology, about how he pulled off this remarkable turnaround.

What was the state of Indiana's IT operations and infrastructure prior to the election of Governor Daniels?

I had just taken early retirement from [Electronic Data Systems]. He brought in a new management team as you normally do when you change administrations. There was Karl Browing, who is the CIO, and myself. The first thing we did was assess what we had. We found a pretty dismal situation. In one of my past lives at EDS, my job was to go around and fix major problems we had with our biggest clients. Quite frankly, I have never seen anything in quite as bad of shape as what we had here.

Our service to other government agencies was very poor but at a high price. The management team was weak. They used the build-it-and-they-will-come mentality. There were no metrics. There were no real business processes in place. They had no strategic plan. The data center was in complete disarray. There were cables all over the place. It was a mess.

Each agency had its own infrastructure groups supporting PCs, doing LAN management and server management. The vendors were running wild. We found some terrible contracts that had been negotiated. There was no disaster recovery. The statewide network was a huge problem. I don't want to call it abuse, but there was definitely misuse of state money.

We were asked by the governor to do a couple of things. He wanted to develop a statewide infrastructure services team. He wanted service excellence. He wanted reduced costs. And he gave us an edict to be successful. One of the critical success factors of this effort was the governor. He gave the power to Karl and myself to dictate the way things were going to go.

What progress have you made so far?

Before we arrived, IT infrastructure services were provided by 400 people across the state. We had close to 100 people at the time, and we were supporting around 900 PCs. We have taken that 400 people and reduced it down to 170 people, and we're supporting 24,000 PCs.

The first thing we did was establish a service excellence plan. We looked at what services we needed to provide. We established the key metrics that you'd measure an IT organization on, and we started measuring our performance. We used standard red, yellow and green indicators to measure our performance.

We started with 20 primary service areas. When we first started measuring, they were all red. Now we only have one red. That measures the call-abandonment rate on our help desk. We wanted to get to 2 percent, but it may be that we can't afford to get to 2 percent. We have two metrics that are yellow. Our goal is have those be green by the first of the year.

We consolidated all of the infrastructure services including help desk, server administration, mainframes, desktop services and networks. We consolidated all of these functions in 14 months without spending any money on contractors.

We went through agency by agency for the 70 agencies we support. We came up with agreements about the services we would provide and the cost savings they would receive. We've finished every agency except the Bureau of Motor Vehicles. They were in the middle of implementing a new computer system [purchased before Governor Daniels was elected], and we felt it was inappropriate to migrate them because of all the changes going on there.

So far, we've generated around $14 million in annual savings from these steps. The savings came from eliminating contractors and people.