Reducing the Cost to Serve - Server & Storage Services

About this research note: Operate & Optimize notes provide Reducing Cost-to-Serve: recommendations for effective and efficient IT practices that help Server & Storage improve the performance or reduce the cost of technologies already Services deployed in the enterprise. Publish Date: April 6, 2009
Servers and storage infrastructure make up a significant portion of the budget for most IT organizations. When faced with a mandate to control costs, IT managers must take steps to manage these expenses. Start with these techniques to optimize server and storage services costs and employ strategies recommended in this note to avoid potential challenges. © 1998-2009 Info-Tech Research Group www.infotech.com
Executive Summary This research note applies the Cost-to-Serve approach to identify cost-cutting opportunities in the server and storage services area. Coverage includes: » Guidance on whether this service area is a strong cost-cutting candidate for the organization. » Descriptions of specific cost-reduction measures that can be achieved according to varying time frames. » A section on potential mistakes and mitigation steps. » Case studies that provide real-life insight into experiences with these cost-reduction techniques. By understanding the cost to deliver server and storage services, IT can determine a better cost management approach that reduces costs while protecting the overarching strategy of the organization.
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Introducing Cost-to-Serve The Cost-to-Serve methodology examines the relative cost to deliver specific IT services, such as network and telephony services, end-user support services, and application maintenance services. Its ultimate goal is to directly map and forecast the impact that changes in spending on IT services will have on the ability to achieve business strategy.
When activities have been categorized into services, it's much easier to decide which spending changes to make. Spending changes that will negatively affect business strategy are avoided, and those that will positively impact business strategy are prioritized and pursued.
Service Description The server and storage services area includes support of A Practical Methodology computing platforms across enterprise data centers, offices, and For step-by-step guidance on locations. It also includes support for storage management leveraging the Cost-to-Serve systems associated with computing platforms, including archiving, method to reduce costs, refer to capacity management, data backup, and data restore. An the ITA Premium research note, important element of this service area is management of the "Methodology: Reducing IT Cost-energy and cooling capacity required to run the IT infrastructure. to-Serve."
When to Reduce a Service Consider the following statements to investigate whether exploring server and storage services presents a cost-cutting opportunity: » There are pending or unfinished server consolidation projects in the organization. » Virtualization projects are implemented on an ad-hoc basis. » The organization is looking at server refresh. » The organization contains legacy server platforms that are becoming increasingly difficult to maintain and integrate. » Cooling costs and server power consumption represent a significant percentage of the organization's energy consumption. » Data storage devices are broadly distributed across the organization. » Data sets are redundant or unnecessarily duplicated across the organization. » The organization's solution to increasing data volumes is simply to buy more storage capacity.
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IT organizations with any of these characteristics should examine the server and storage services area for possible cost savings.
Cost Reduction Targets Server and storage services are one of the most capital-intense IT service areas. It is not surprising that it is receiving a lot attention as a cost-reduction target. According to a recent Info-Tech survey, 74% of IT respondents view server and storage services as an area of cost management focus. Two commonly cited methods are: » Server consolidation and virtualization (79%). » Collocation or... [download for more]