The New Zealand arm of global real estate services company DTZ has outsourced its entire IT operations as it looks to lower tenancy costs and provide staff with seamless remote access to office IT systems. 

The company has signed a three-year multimillion-dollar deal with local data centre and computing infrastructure provider Revera, which effectively takes IT off DTZ’s hands and offers the company virtual office capability. 

DTZ managing director Ross Pickett said a significant number of his company’s 180 staff are on the road and prime candidates for working from a virtual office, rather than taking up office desk space.

“Office mobility is our top priority. It will help us to reduce staff occupancy costs and provide competitive advantages through faster access to information and more responsive customer service,” Pickett said.  

DTZ’s entire IT operation, including servers, core applications, desktop and network management and support for 180 staff in DTZ’s seven offices are now running from Revera data centres. A Revera IT support person is onsite at DTZ’s larger offices, in the three main centres.

Pickett said the hosting arrangement with Revera was the culmination of a programme to consolidate and stabilise a complex IT environment that grew from several company acquisitions and continued growth. DTZ New Zealand was formed in 2002 when DTZ Darroch Ltd purchased Knight Frank (NZ).Though largely a Microsoft shop, DTZ, like most other large property services companies, is required to run specific applications for individual customers, making IT difficult to manage. 

Pickett said DTZ had previously outsourced aspects of its IT, but encountered difficulties. “We haven’t entered this arrangement lightly, because previous outsourcing attempts were a struggle,” he said.

“We gave Revera little bits over time to see if they performed and were compatible. They’ve been very good and as a result we awarded them the full computing infrastructure and services contract.”

He said the lessons for businesses considering IT outsourcing were clarifying what was required, knowing what you’re going to get, and compatible people.

Pickett said it was difficult to gauge cost savings, but saw advantages in the transparency of outsourcing, which has immediately established the true cost of IT. “I’d suggest that most companies don’t know what IT really costs them. What they see at head office is only the tip of the iceberg and it isn’t until you manage IT as contract, rather than managing IT yourself, that you begin to see the full picture. Nevertheless, we’ve notched up quick wins in reduced software licensing, communications links and leasing.”

In any case, the immediate focus was ongoing development, particularly mobility, and developing new systems and better information for customer reporting, Pickett said. “IT infrastructure provision is not just about reducing costs, but making sure you get what you want and a partner who can assume the mantle of strategic IT adviser.

"The arrangement with Revera provides a better platform to drive the business. We end up getting access to far greater IT know-how and a tier one platform that is out of reach of most businesses,” Pickett said.

Revera was formed in 2002, when managers Roger Cockayne and Wayne Norrie bought a controlling 51 percent stake in the New Zealand arm of Hitachi Data Systems. Revera became 100 percent locally owned and was rebranded in 2005 after Cockayne and Norrie purchased the remaining 49 percent stake held by Hitachi.

Revera group managing director Roger Cockayne said businesses increasingly viewed IT infrastructure provision as a business enabler rather than an exercise in cost savings. “Nevertheless, a flat operational cost line for core systems, which doesn’t change for years, does have its advantages,” he said.

Cockayne said the company’s VDC™ (virtual data centre) data centre hosting model provided DTZ with economies of scale, as they paid for only what they used rather than standalone hardware and related 24x7 management.