IT helps the global steel giant reduce costs at all points. By Karthik Sundaramsubi bhandari came on board as inco’s cio when the metal mining giant in Toronto, Canada realized that it’s IT department was as fragmented as its resource base. Inco, a 100-year old company, is listed on the Toronto and New York stock exchanges [NYSE: N, market cap: $7.4b, TTM revenue: $4b], and five other exchanges around the world, employs over 10,000 people worldwide at extensive operations in Canada, and Far East Asia. While primarily a nickel company, it is also an important producer of copper, precious metals, and cobalt and a major producer of sulphuric acid and liquid sulphur dioxide.
Bhandari was a senior executive for Toyota’s Toronto plant, handling IT and procurement, when he was tapped to lead the Inco IT initiative in 2001. In that year, the company’s board decided to create a CIO’s position within itself, to lead the next phase of Inco’s IT. “When I came on board, I found Inco’s IT largely ad-hoc, and it didn’t have an exposure at the executive level,” recalls Bhandari, who accepted the position for its global role-play. The growth curve Inco was taking at that time included new plants in New Caledonia (in the Pacific ocean) and Voisey’s Bay in Canada—one going live in 2005 and another on track for an investment of close to $1.9b. “The challenge was to provide an IT environment that could be powered from a central unit, and yet remain agile to the changing business demands of all these expansion plans,” says Bhandari.
The new CIO found his new IT environment with only one centralized element—a common network environment. “If I needed to use some part of IT that had been created and used in one department for another similar functionality elsewhere, I needed a lot of personal influence to achieve that access—there was pretty much nothing else to go with,” laughs Bhandari. He began with creating an IT strategy that would show the various distributed departments what the CIO office was planning to achieve, and to also build closer alignment with the business units—helping them understand their IT strengths and capabilities. “My first act was to sell the CIO office, so I had company-wide purchase; you cannot get this by demanding it,” he recalls.
After intense interviews with various Inco divisions, and assembling a semblance of unity within the IT network, Bhandari set out five global directions for his office: • standardize and rationalize the Inco IT environment to easy manageability and efficiency, • exploit the company’s data resource to provide better intelligence to the businesses, • selectively introduce new IT platforms to enable new business capabilities and new cost structures—which did not mean bleeding edge technologies, but successful models out in the market new to Inco that could be implemented, • focus on opportunities, including integration in the value chain that began with identifying mine sites, exploiting the site, and the processes that finally brought finished products to the market, • and finally improving the IT delivery infrastructure so that the business efficiencies are not compromised. All this looked good, but the IT department demanded a more finer plan and workable strategy.

In contrast to the market, where competition sells nickel to the London Metal Exchange, and thus indirectly to the customers, Inco has a direct selling strategy to sell in the open market. “It is critical to be able to meet the customer demands quickly and efficiently,” says Bhandari, where cyclical market demands created time-sensitive business fulfillment and the onus of customer satisfaction now fell directly on the Inco infrastructure. The CIO then created a workplan for the IT department, including immediate and long term goals:
1. Getting Our Own House In Order: establish credibility with the business, demonstrate fiscal responsibility – cost AND predictability, delivering measurable value
2. Demonstrate Ability To Engage Business: understand business issues, proactively offer cost effective solutions to the business, and offer assistance in resources, skills and funding
3. Achieve and Leverage Initial Successes in critical areas of the business: where quick wins could be used to attract larger projects
4. Become Enablers of Business Programs: engage at inception of business programs with focus on business outcomes

In a short 2 years, Bhandari has managed to streamline the IT portfolio, bringing on standardization across the global operations, and building greater visibility into the company information systems. One of the early successes included helping the Inco field divisions establish a robust mine-planning and process resources management system. “What we used weren’t very “sexy” tools, but the way we approached the project helped establish to the company that IT could help in more ways than just work the emails!” smiles Bhandari. In another exercise, the CIO was involved in the upgrade of an ERP software at a division. Before beginning the exercise, Bhandari invited the division business leaders to partner in a workshop to set out the target business outcome from the various processes within the division. “A lot more information was revealed in the discussion that wouldn’t have been so forthcoming, and we could truly apply a basket of tools—shutting down some and introducing new ones with easy entry points—that helped the division achieve its business goals with a lot less funds, and a lot more IT.”
The large projects that are normal to a company of this size made it necessary for Inco to evaluate a smart documentation and information sharing system—not bleeding edge, as usual. Bhandari is rolling out a large documentation system across the operations at Goro, Voisey’s Bay, and at the Indonesian plants. “We are asking the businesses to set out what they need from management information systems, and can share common goals between the divisions, so IT can become a shared services,” comments the CIO. Rolling out a shared-services model, he has created three groups within his IT department to handle the core functions—an infrastructure group that handles data centers, voice and network infrastructure, desktop provisioning and so on. The enterprise business group rolls out and supports all applications from the Canadian headquarters for the entire company, including the far-flung mining operations. The information management solutions group or the business intelligence group is now in its five-year operative goals to set up plans to deliver optimal intelligence to the business groups. Bhandari has taken the company through a data center consolidation, and has set up rigid performance monitors for its applications and data centers.

The CIO is now evaluating a move from mainframes to the UNIX environment, but is cautious in a full adoption. “I need a strong business reason that will hold good two, five years from now for the switch to happen,” he says. For a hundred-year old company, Inco is surprisingly free of large legacies, and Bhandari is waiting for a critical mass before exploring any offshore initiatives to handle legacy maintenance. Starting this year, the CIO is consolidating the IT budgets across the entire company. “We have developed a service catalog, where we show how many dollars in each business unit go into, say, supporting a service, delivering a service like payroll, and so on, so that the business unit can then choose how much it really can and wants to spend. And then, IT is truly defined to that business unit’s goals,” discloses Bhandari. The visibility has brought the CIO tremendou buy-in from the business heads, and by fine-tuning the spending in IT, Bhandari has managed to give back from his budgets, doing a lot more with a lot less.

A mechanical engineer from Chandigarh, India, Bhandari came to Canada in 1977 to work with Monsanto, and then spent 17 years with Nortel. After nearly another decade with Toyota, Bhandari in his current stint at Inco is ensuring IT levitates up to the executive visibility— “where future plans are cast, with IT playing a role right from the start.”