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© 2010 IBM Corporation Data Center Actions That Your CFO Will Love Bob Tierney IBM, Site and Facilities Services March 26, 2010
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 2 Key messages The data center environment needs to adapt to be more flexible and cost-effective to meet the unpredictable needs of business and IT. Simple actions can yield significant operational and capital cost savings. We are deploying solutions with clients and within IBM. We can help you determine how to get started.
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 3 6x 69x Growth in server and storage shipments this decade. 85% Of distributed computing capacity sits idle. 18% 75% Of CIOs anticipate a strongly centralized infrastructure in 5 years. 20x Technology density increase in servers this decade. 78% Of data centers were built before the dot com era (>7 years old). 5-60% Of IT workloads may be cloud-enabled. Increasing IT demandContinued cost pressureResponsive to change Increase in data center energy costs in next year. Customers challenges are driven by the following…
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 4 We can help clients in three simple ways. Extend the life of an existing data center infrastructure. Rationalize the data center infrastructure across the company. Design new infrastructure to be responsive to change. Double IT capacity or Reduce operational expenses by 50%. Improve operational efficiencies while reducing operational expenses by 50%. Pay as you grow by deferring 40-50% of capital and operational costs.
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 5 Extend the life of the hardware, software, and facilities. Actions for cost savings with immediate paybacks. Optimize IT infrastructure Virtualization provides TCO savings. Reduce costs and complexity with 30-40% TCO. Leverage energy efficient IT technology. Reduce on-going IT energy costs over 30%. Optimize data center infrastructure Get the facts with an energy assessments. Reduce costs 15-40% with < 2 year payback. Add cooling capacity with High Density Zone. Cost effectively adopt new technology at up to 35% less than site retrofit. Optimize IT and data center infrastructure Monitor and manage energy use. Integrate IT, data center, and buildings energy consumption to save 15-30% a year. Range of cost savings 0% 20% 40%60% 80%100% Server & Storage Virtualization Client Virtualization Energy Efficient Hardware Data Center Optimization LOW HIGH Software Energy Management
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 6 IBM Lexington case study of an existing data center. Smart execution allowed for 8x IT growth in the same energy footprint. Diagnose Establish baseline energy use 20x more servers than needed Virtualize 10x increase in asset utilization Compute Resources 2x growth in number of servers 8x growth in IT capacity Improved Operations 10% improvement from less over cooling Best Practices Right size infrastructure to virtualized IT workloads Measure and Manage 15-20% power savings from actual usage
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 7 Rationalize IBMs data center infrastructure. Smart transformation has delivered cost savings and operational efficiency. Data center infrastructure consolidation Cumulative benefit yield of $4.1B over the past 5 years IT consolidation and virtualization 80% less energy, 85% less floor space Substantial TCO savings Consolidate and virtualize thousands of servers onto approximately 30 IBM System z mainframes 19972007 CIOs1281 Host data centers1557 Web hosting centers805 Network311 Applications15,0004,700
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 8 Establish Baseline Strategic Modeling Execution Roadmap Current State What-Runs-WhereApplication Growth Forecast Decision Model Alternative Cash Flow Resiliency Rationalization Tactical Projections Relocation – Build - Lease Physical Infrastructure Threshold Analysis Future State Alternative Scorecard Future State What-Runs-Where Transition PlanPMO Guide Board Level Deliverables Rationalize your data center infrastructure. Optimize to adapt to market pressures and changing business requirements. Reduce operating costs by up to 50 percent Reduce operational complexity and improve adoption of new virtualization technologies Meet business continuity requirements through reduction of outages and data loss Design for flexibility to meet dynamic business requirements Reduce time to deploy new technology from months to weeks
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 9 Rationalize to fewer centers for operational efficiency. A major Chinese bank realized $180M savings and improved operational efficiency from data center consolidation. Client requirements Reduce time to market of new applications Reduce overall costs, improve resiliency and security Solution Consolidate 36 mainframe data centers to 2 Establish enterprise command center Benefits US$180 million annual savings Improved time to market of new banking services Security-rich environment; 99.95% availability
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 10 New data center infrastructure decisions. Business objectives Data center requirements High availability 1 Provide required capacity 1 Optimize capital costs 1.Digital Realty Trust; Emerging Trends in the data centre market, DCD London, November 2007; US EPA Study, August 2007 Maximize scalability Maximize flexibility for technology and computing model adoption Minimize capital and operational costs Maximize scalability Maximize flexibility for technology and computing model adoption Minimize capital and operational costs Meet business and IT growth Align capital and operating costs Flexible to support new technology Faster time to deploy Reduce risk Security
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 11 Defer 40-50% of the lifecycle costs by implementing modular data centers to align business and IT requirements. Data center capital costs 60% costs from mechanical / electrical systems Shell 7% Mechanical 20% Fees 24% Fit-Up Costs 9% Instrumentation & Controls 4% Power 36% Source: IBM Estimates Pay as you grow Modular approach aligns capacity to business need Year Power (range of kw) 12345 6 78910 0 0.5 1 1.5 2 2.5 3
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 12 Optimize lifecycle costs & reduce operational costs by up to 50%. Example: One 20,000 square foot data center Cumulative cost to run a data center 10% annual energy increase Data center operational costs are 3-5 times the capital costs 75% of operation costs is for energy Cumulative Cost of Operations ($Millions) Year 1234567891011121314151617181920 Energy Cost Staffing Bldg. Maint. & Mgmt. R E Tax Source: IBM Estimates for $50M $100 $150 $200 $250 $50 0
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 13 Scalable modular data center. Enterprise modular data center. Portable modular data center. High density zone. Up to 20% less than traditional designs. Turnkey center for 500-2,500 sq ft. Implement in 8-12 weeks. Defer 40-50% of capex and opex cost. Standardized design starting with modules as small as 5,000 sq ft Save up to 50% operational costs. Fully functional data center. Rapidly deploy in 12-14 weeks. 35% lower cost than site retrofit. Without impacting operations. Watch a video at :http://www-03.ibm.com/systems/data/flash/dynamicinfrastructure/datacenterdesignsolutions/http://www-03.ibm.com/systems/data/flash/dynamicinfrastructure/datacenterdesignsolutions/ Design new infrastructure for flexibility with modularity. IBMs data center family solutions align to your business and cost objectives.
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 14 Design for flexibility in enterprise class data centers. Pay as your grow: align costs to IT needs with enterprise modular data center. Meet unpredictable business and IT growth Enable 3x power & cooling growth at one-third cost Up to 12x power and cooling capacity growth Align capital and operational cost to IT needs Defer up to 40% capital costs until required Defer up to 50% operational costs until required As much as 50% energy savings Provide available and predictable operations Provide expansion without downtime to operations Provide standardized operating environment Design to an open architecture Integrated leading vendor's capabilities Opportunities for OEM innovation
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 15 IBM site and facilities services brochure IBM report: cutting energy costs for a powerful competitive advantage Extend the life of an existing data center: IBM Lexington case study Data center strategy Data center consolidation and relocation Modular data centers provide an agile response to change Art of the possible: rapidly deploying cost- effective, energy- efficient data centers Prescription for server room growth: Design a Scalable Modular Data Center For more information
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 16 Green IT: www.ibm.com/greenwww.ibm.com/green For CIOs:: www.ibm.com/ciowww.ibm.com/cio For facilities managers: www.ibm.com/services/siteandfacilitieswww.ibm.com/services/siteandfacilities Leverage IBMs experience
© 2010 IBM Corporation Data Center Actions That Your CFO Will Love 17 Rationalize to fewer centers for operational efficiency. Bryant University realized major savings from reducing server room sprawl. 26% reduction in capital spend reduction in operational spend Scalable Modular Data Center Servers & Virtualization Energy Management Software 30% time savings in operational overhead 15% annual energy savings 21% 12-15% improvement in service delivery Scalable Modular Data Center Servers & Virtualization
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