1. Maximize the Business Value Enabled by IT Randy Ramusack IT Account Manager – United Kingdom Microsoft Corporation

2. Where We Were (1999) ● No scorecard ● Non-enforced standards ● No global consistency ● Redundant infrastructure and functions ● Custom patching scripts ● No central backups ● Technology focus, not service oriented

3. Strategy To Change ● Be Microsoft’s first and best customer ● Enable world-class and predictable customer, client, and partner experience ● Protect Microsoft’s physical and digital assets ● Make IT a strategic asset

4. Where We Are Today (2005) ● IT Scorecard ● Enforced standards and policies ● Centralized IT operations ● Account Managers are the “Face” of IT in regions ● Service Catalog ● Service Managers ● Higher builder spend, lower sustainer spend ● Client Satisfaction from 106 to 134 Regional IT Account Management Ops Center (Monitoring, Tier 1 and Tier 2) MOM and MOF Windows & Storage Windows Server AD Virtual Server Network Windows Networking ISA Proxy Messaging Exchange Office System Client Mgmt Windows Client SMS Windows CE Office System Comm & Collab SharePoint Office System LCS Security and Infrastructure Architecture

5. Sydney Chofu & Otemachi Les Ulis Thames Valley Park Dublin Benelux Madrid Dubai Singapore Johannesburg Sao Paulo 90,000 mailboxes Microsoft IT Environment Canyon Park, Redmond Las Colinas Charlotte Chicago Milan Stockholm Munich 400+ supported Microsoft sites worldwide 3M+ e-mail messages per day 99.99% Availability 300,000+ network devices 221,960 running SMS agent 6,000 servers 172 wireless subnets Single Instance SAP (1.7TB Db) Silicon Valley 400 primary LOB applications 26 million voice calls per month 7M Remote Connections / Month 55,000 employees

6. New Technologies ● Windows XP SP2 ● Windows Server 2003 ● Office 2003 SP1 ● Exchange Server 2003 ● Rights Management Services ● Windows SharePoint Services ● SMS 2003 SP1 ● MOM 2005 ● BizTalk Server 2004

7. IT Enterprise Balancing Tensions IT Value Cost Constraints New Technologies Security Threats

8. IT Adding Business Value Core Operational (35%) Strategic (40%) High Potential (15%) Support or “Other” (10%) Running the IT Utility Running the IT Utility Helpdesk Helpdesk Project Management Project Management “Dogfooding” “Dogfooding” Model Enterprise Model Enterprise Thought Leadership Thought Leadership IT Evangelism IT Evangelism Integrated Innovation Integrated Innovation Model Enterprise II Model Enterprise II Non IT Activity Non IT Activity Client Value Line IT Value Line

9. Business Unit IT Model Solid to CIO Dotted to CIO Finance, HR, LCA LCA Enterprise Apps Services Sales and Marketing MBS H&E Planning, Architecture, and Governance ITOperations AdminITXIT Server & Tools ServicesIT OEMMSN Corporate groups Sales and Marketing Business Segments Sales IT IT Infrastructure Information Security & Privacy OPS IT MSN IT OEM IT H&E IT Server & Tools IT MBS IT

10. Applications60% App Development (29%) App Support (31%) Infrastructure40% Network (14%) Data Center (7%) Employee Services (5%) Voice (5%) Helpdesk (5%) Security (3%) Microsoft IT Spend Breakdown Functional View FY05 Breakdown Cost Element View People 70% Data & Voice15% Hardware 5% Facilities 5% Software 5% Employee Services = monitoring/Tier 2 (2%), messaging (1%), software deployment (1%), collaboration (0.5%), data protection (0.5%)

11. IT Budget Process 1. Move the Decision to the Budget Owner 2. “Push and Pull” Non discretionary PUSH Discretionary PULL ** 3. Regional Cost Pools Data Centre costs Network costs Helpdesk costs 4. Regional Allocation Blended rate Headcount tax per user ** Need to ensure appropriate “Model” spend for overall TCO efficacy

12. Value Realization Process Managing the Value Proposition of the IT Application Portfolio Common measures and processes We only invest in something when we know its value ● Common benefit factors, definitions, calculations ● Spans entire IT lifecycle (planning, execution, deployment and maintenance) Accountability for spend – VRP verification We only invest in what the business is willing to stand up and be held accountable for ● Spend tied to commitments from business ● $ value audited by finance ● Business held accountable for commitment Alignment of portfolio to business strategy – VRP rationalization We only invest when we can tie the value to Microsoft’s business strategies ● Rational decision making ● Project ranking mechanism

13. Process: Microsoft Operations Framework Service Level Management Capacity Management Availability Management Financial Management Incident Management Problem Management Service Desk Service Monitoring and Control System Administration Security Administration Network Administration Change Management Configuration Management Release Management MOF

14. IT Offered Service Levels * MSN servers* MSN servers Service Level Customer Role Microsoft IT Role One LAN ServicesLAN Services HW SupportHW Support Data Back-up/ ArchiveData Back-up/ Archive Asset ManagementAsset Management Monitoring Infra.Monitoring Infra. Core Tech. OpsCore Tech. Ops Facilities MgmtFacilities Mgmt Power & CodingPower & Coding WAN ServicesWAN Services Best Effort SupportBest Effort Support ReactiveReactive 1,048 / 285* Servers: 10,217 Two OS, IIS, SQL PlatformOS, IIS, SQL Platform ContentContent Application SupportApplication Support All MonitoringAll Monitoring Facilities MgmtFacilities Mgmt WAN ServicesWAN Services LAN ServicesLAN Services Best Effort SupportBest Effort Support ReactiveReactive HW SupportHW Support Data Back-up/ ArchiveData Back-up/ Archive 3,267 / 663* Hosted ContentContent Application SupportApplication Support Application MonitoringApplication Monitoring Facilities MgmtFacilities Mgmt WAN & LAN SvcsWAN & LAN Svcs Full Svc SupportFull Svc Support HW SupportHW Support Data Back-up/ ArchiveData Back-up/ Archive Asset ManagementAsset Management Core Tech. OpsCore Tech. Ops 3,702 / 1,253* Managed Managed Note: All data shown is representative of actual data at time of publish. Data is specific to the Microsoft environment and should not be used for general modelling purposes without further detail breakdown and explicit permission from Microsoft Corporation.Note: All data shown is representative of actual data at time of publish. Data is specific to the Microsoft environment and should not be used for general modelling purposes without further detail breakdown and explicit permission from Microsoft Corporation.

15. Deploying Software ● Use SMS for enterprise deployment – highly automated ● Distribute testing of LOB applications ● Use one intranet site as upgrade clearinghouse ● Strong use of remote assistance at Helpdesk ● Help employees understand VALUE they get ● Software deployment service manager

16. Consolidation ● Infrastructure server consolidation ● 51% reduction in Exchange servers ● Reduced from 74 to 7 sites with Exchange servers ● 30% reduction in global infrastructure servers ● 2 print servers in Redmond (650 queues) ● Key enabler – Windows Server 2003, Exchange Server 2003, Office System 2003 ● Data center consolidation ● Eliminated 5 data centers ● Remote management – Windows Terminal Services ● Event monitoring and dispatch – Microsoft Operations Manager 2005

17. Consolidation Benefits Financial ● FY‘04 cost savings ● Server Consolidation: $5M ● Data Center Consolidation: $4.5M ● Internet Connected Offices: $2M ● Wave contributes to: ● $100M savings over 3 years, raise SLAs and client sat ● 200:1 server to site services person ratio in Puget Sound Service Levels ● Messaging availability = 99.99% ● Proactive IT service requests = 87% ● User domain controller availability = 100% Security ● Critical security patches deployed to 7,300 production servers in 48 hrs ● Clear and enforced security standards and policies

18. Mitigate risk to the infrastructure through implementation of four key security strategies 1. Secure the Network Perimeter Secure Wireless Smart Cards for RAS Secure Remote User Messaging Firewall 2. Secure the Network Interior Eliminate Weak Passwords Acct Segregation Patch Management Network Segmentation Smart Cards for Admin Access 3. Secure Key Assets Secure Source Code Assets Lab Security Audit 4. Enhance Monitoring and Auditing Secure Environmental Remediation Automate Vulnerability Scans Forced Patching Port Shutdown Security Strategies

19. Approval removes payment block E-mail to user for approval BizTalk Order travels to supplier Delivery Schedule Communicated Connecting Systems – Value from IT Order loaded into SAP as PO Invoice loaded into SAP as parked (blocked) document Employee Places Order MSMarket Supplier Submits Invoice MSInvoice SAP/R3

20. Document Workspace Meeting Workspace Team Sites > 150,000 sites My Site 33,000 sites 6 IT People Support

21. Remote Desktop OWA 54,000 monthly users RPC over HTTP 22,000 monthly users Pocket PC 11,500 users Tablet PC 24,000 users SmartPhone 9,000 users

22. Enhanced Telephony 9,800 unique users Live Communications Server 26,600 active users/month All campus calls Unified Messaging 1.6M messages/month Integrated Communications Integrated Communications

23. ● Get the basics right ● Take down sustainer spend ● Connected architecture ● Business leadership IT As A Business Value Driver

24. For More Information ● Additional content about Microsoft IT deployments and best practices can be found on http://www.microsoft.comhttp://www.microsoft.com ● Microsoft TechNet http://www.microsoft.com/technet/itshowcase http://www.microsoft.com/technet/itshowcase ● Microsoft Case Study Resources http://www.microsoft.com/resources/casestudi es ● E-mail IT Showcase showcase@microsoft.com

25. This document is provided for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS DOCUMENT. © 2003 Microsoft Corporation. All rights reserved. This presentation is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. Microsoft, Active Directory, Visio, Windows, Windows Server, and Xbox are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.