IT delivers the goods

1 Aug 2007

Holding down a senior IT role in a multinational company with a large local presence can be something of a double-edged sword. On the one hand you can find yourself part of a large company committed to international best practice, which can be a terrific place to hone your existing skills, learn new ones and climb the corporate ladder.

On the other, especially in these days of global connectivity and seemingly effortless outsourcing, you can find your local role being ‘de-emphasised’ as companies seek to centralise more and more functions in the most cost-effective locations.

One man who has straddled both local and international roles in a world-class company for many years is Derek Monahan of DHL who currently holds what he calls “the grandiose title of director of IT services for DHL in Ireland”.

He is responsible for providing and maintaining IT to all of DHL’s 2,500 users in Ireland while also reporting in to the international side of the business where his role includes helping to develop and articulate future IT strategy for the company. As a veteran of 15 years with the company, and more than 20 years in IT roles with other leading companies, he brings to the job the technical expertise provided by a lifelong enthusiasm for technology, a degree in management information systems and what he calls many years of study at the university of life.

DHL, which is a subsidiary of the German mail company Deutsche Post, is one of the world’s leading suppliers of freight delivery and international courier services. It has been in Ireland since 1979 with its headquarters in Swords, north county Dublin.

Since January 2005 DHL in Ireland has operated as a single entity called DHL Express comprising the former Securicor Omega Express, Danzas Eurocargo and DHL International businesses. Its services include domestic and international express deliveries, air and ocean freight services, same-day service, logistics, warehousing and global business mail.

Although many of the business units are autonomous, Monahan says over the past three to five years the company has been trying to develop synergies across its international operations for many back-office functions. As a result, functions such as finance, HR and IT have been grouped into an organisation called Global Business Services.

The IT services component of this is now responsible for supporting 400,000 employees worldwide and is organised as a business unit charging out services based on business requirements to DHL employees. “IT used to be a cost centre within each country,” says Monahan. “Now we have to behave like an external services company providing services at an agreed price. We have to take control of projects and staff costs and provide innovation to the business at a much wider level than before.”

This does not mean that all IT is centralised; far from it. Although DHL has managed to centralise many of its core applications directly supporting its delivery business at three data centres in Prague, Czech Republic, Arizona and Malaysia to serve the European, North American and Asian markets respectively, the individual countries retain control of the rest of their IT infrastructure.

“The core applications that look after freight and shipping run on big Unix systems requiring large amounts of processing power and so it makes sense to run them out of centralised data centres,” explains Monahan. “But all other applications such as front-end systems, customer interface applications, bespoke applications particular to any one country and back-office systems are managed by the individual countries themselves.”

DHL’s Irish IT team is based at the company’s Swords office and comprises between 15 and 20 people at any one time. The dual nature of the IT department’s role – supporting Irish IT users while contributing to the overall IT strategy of the company – is exemplified by the fact that Monahan sits on the board of DHL Express in Ireland but also reports into the European headquarters of the global IT services group in Prague.

Monahan is full of praise for the way DHL’s management adopts a centralised IT strategy while continuing to give individual countries some leeway with regards to implementing applications according to their specific needs.

“We all have input into developing the strategy for the company,” he says. “The way global visions are put together is that the heads of IT from all the countries meet once a quarter in Prague to discuss strategy for how we can align IT more closely with the business requirements of the company. We don’t have decrees handed down from on high. Global visions are all very well but when you get down to individual country level, you always have to modify things slightly because the individual requirements that exist in each country are different.”

A core part of DHL’s IT strategy, which fits well with its organisation as a global services business, is the concept of ‘supply on demand’. Essentially this means that each local IT department will have to be ready to provide its local user community with whatever applications and services they need according to an agreed level of service. A key element of this is that each country has a ‘demand manager’ who sets out the required level of service and type of applications that are needed and then works closely with the local IT manager to ensure that they are delivered.

At the moment, Ireland does not have such a manager, so Monahan is temporarily fulfilling that role as well as his own. However, he says the company is currently recruiting to fill the post, which will allow him to go back to being in charge of IT for the Irish office.

Tried and tested

As well as participating in strategy discussions, the expertise of the Irish team at DHL is also recognised within the company at large and as such, it is frequently given the role of company ‘test bed’. The number of projects for which Ireland is assigned the task of trying out new applications and systems thoroughly before they are deployed in other parts of DHL around the world is testimony to the esteem in which the Irish organisation is held globally.

One example, currently in use in many countries around the world, is a web-based product called Intraship. This allows customers to log on to a password-protected webpage via a browser to keep track of their shipments. Monahan points out that such an approach does not require customers to install any additional software on their system, which many companies are reluctant to do anyway because of security considerations. Intraship was tried out in Ireland before it was deployed globally.

A current project that promises to greatly simplify and thereby speed up and make more efficient the work of the couriers who deliver goods and parcels to end customers is also being tested by the Irish team.

Typically, a courier may have to make several deliveries of shipments on behalf of different divisions from the DHL family of companies. All of these have to be signed for by the eventual recipient as proof that delivery was made.

Traditionally, this was a paper-based process but nowadays people tend to sign digitally on a handheld terminal provided by the courier. This makes the process more efficient as data can be fed directly to the back-end computer system without having to go through the time-consuming and potentially error-inducing process of rekeying the data.

For historical reasons, however, the IT systems that support the various divisions are often completely separate from one another and this has often required the couriers to take several handheld scanners with them to cater for all the different systems.

Monahan says DHL was supplied with a custom-built handheld terminal from Motorola for use by its couriers. Although the original terminal only supported one of the DHL business units, Monahan and his team reckoned they could integrate all of the systems used by the various business units on to the same terminal. “The software was based on Windows CE so it was not too difficult a job to develop the new application,” he recalls.

DHL couriers now need to take only one of these terminals with them, regardless of which business unit they are shipping parcels for. At present, 120 such devices are being used in Ireland and it is hoped to make them available to between 600 and 700 couriers here by the end of the year, following which it will be rolled out to users in the rest of Europe.

Pioneer project

Perhaps the project for which DHL’s Irish team is best known within the company was its deployment of a Citrix Central Network to serve up applications to users in an easily managed way. It was pioneered in the Irish office and has now been rolled out to many other countries around the world. Monahan says the goal is to have between 70pc and 80pc of users globally using the Citrix Central Network, a figure the Irish office has already achieved. One of the key advantages of using Citrix is the degree to which users’ PCs can be managed centrally. “I’ve only got two people managing the whole Citrix network countrywide,” says Monahan. “That’s all I need.”

Monahan is an IT industry veteran. He graduated with a degree in MIS in the early Seventies and went to work in the IT department of Barclays Bank in the UK, which he says was a very advanced user of IT by the standards of the time. He stayed there for seven years before moving to General Electric, where he remained for 19 years. There he was involved in supporting manufacturing, sales and finance operations until, 16 years ago and fancying a change, he made the move to DHL.

“I had never been involved in anything to do with logistics or transport before,” he says. “So I looked on it as a challenge. Now many years later with numerous awards, several different buildings and a lot less hair, I’m still here!”

He says he has seen the requirements of his job change dramatically over the years as IT has become an important part of all sections of modern business, not just the back-office or manufacturing functions.

“The onus has changed dramatically from being a techie with a screwdriver and a spanner, which is what it was when I started, to being much more business oriented,” he says. “I used to love getting stuck into things but now because of the strategic importance of IT you’ve got to be a much more business-oriented leader. You must be able to make your case and frequently that means arguing for why something shouldn’t be done as opposed to why it should. People often come to you looking for all sorts of special features and you have to be able to point out that ‘OK, we could do this but if we do we will need to do this, this, that and that.’ You must have good business acumen and a good negotiating head.”

Monahan cautions that the upper reaches of IT decision making is a place where cool heads and even tempers are required. “You need to be very politically correct,” he says, “because the atmosphere at board level is very different from that of the typical IT department. You can’t be seen to be emotional; you must make your arguments in a clinical fashion. And when you’re dealing with people from other countries you have to be especially careful with cultural differences. What is acceptable in an Irish boardroom may be totally unacceptable elsewhere.”

In terms of current projects, Monahan and his team are looking after the fitting out of a new 13.5-acre site near Dublin Airport which will contain a data centre that will act as a failover site for its main Swords office. His team will have to cable it fully (for power purposes) and install the mirror servers. Perhaps most excitingly, the new site is going to house a completely wireless warehouse. This will allow all equipment used by warehouse operators to operate wirelessly, so that scanning, for example, can take place anywhere in the warehouse.

Another key advantage to courier staff is that when they come within range – 1,000 metres or so – their equipment will get uploaded automatically with all the data regarding the shipments they have to make. This will make for much quicker and more streamlined delivery of data to those who need it most.

By David D’Arcy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years