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IT FOCUS AREA: Data Center Strategy
more in Data Center Strategy

An Effective Data Center Strategy Can Deliver Many Happy Returns

AUTHOR: Matt Pollard Joe Wolke
Flow Chart and Coins

Developing a comprehensive strategy for your data center can take time, energy and planning. For some IT executives, the prospect of interrupting day-to-day operations in order to formulate such a strategy can seem overwhelming. Although it’s important to remember that the sooner you get started, the sooner you’ll ensure the availability of your ongoing critical business needs—and will also realize greater savings.

Many of today’s data centers were not designed to house current power and cooling demands of today’s technology. In fact, the average age of a data center is 18 to 20 years old. Additionally, most data centers have experienced significant introduction of new technologies to support business efficiency and innovation that often require extensive infrastructure and facility upgrades. These shortcomings have a significant impact on performance, availability, recoverability and security.

Long-Term Data Center is Imperative

For many organizations, the need for a clear, long-term data center strategy is imperative. In fact, in 2006, International Data Corporation (IDC) conducted a poll that determined that 40 percent of study participants reported that they were running out of power, cooling and space. And, polling conducted by Forsythe at its Executive Consumer Council (ECC) in 2009 shows that among 40 IT executives interviewed, 33 percent expect to face floor space, power and cooling issues within the next 12 to 18 months.

By applying strategic thinking, new technologies, proven methodologies and best practices, you can help your organization meet its business and IT needs—all while reducing power and cooling costs, freeing up floor space, and optimizing data center performance and cost.

How a Pragmatic Data Center Strategy Can Work for You

Formulating an effective strategy will help you maximize the value of your existing data center investments by optimizing the power and performance of your in-place infrastructure. An effective strategy should be holistic; meet stakeholder needs; link underlying business objectives to short- and long-term technology infrastructure needs; and identify cost optimization opportunities.

By baselining your current environment and examining your risks, benefits, costs and business needs alignment, you can determine a list of actionable steps that will help you optimize existing infrastructure, space and management needs while establishing a long-term strategy.

Consider these three areas for potential savings: Sourcing, Technology and Facilities.

1. Sourcing

Estimated timeframe to realize cost savings: 6 to 24 months*

Organizations often consider strategic, alternate forms of sourcing to reduce costs, add capacity, reduce risk, prepare for growth and become more scalable. In fact, while specifying sourcing, organizations frequently consider multiple paths. Three such sourcing alternatives are colocation, IT managed services and molocation.


Estimated timeframe to realize cost savings: 6 to 12 months*

Colocation is a facility commonly referred to as a resource for “power, ping and pipe.” However, colocation can also provide business benefits that extend well beyond the obvious. With colocation, you can quickly access higher tier levels than you have in-house. You can also take advantage of increased geographical diversity, improve redundancy, and realize security and cost savings. Flexibility is another benefit: you can upgrade and expand your technology infrastructure as your business requirements increase, without the need for additional capital investments.

IT Managed Services

Estimated timeframe to realize cost savings: 6 to 24 months*

Using IT managed services allows an organization to take over some of the management of your IT assets. Incorporating managed services into your data center strategy can provide a budget-stretched organization with many benefits, including freeing up personnel so they are able to focus on critical, day-to-day operations; filling in skill gaps; and prolonging capital investments.

Managed services can be particularly helpful in an e-commerce environment. Justifiably, busy consumers will not tolerate any interruption in service, no matter how small. Therefore, any downtime or breach in security to an e-commerce site can cost a company millions of dollars in lost revenue, not to mention a tarnished reputation and brand.


Estimated timeframe to realize cost savings: 6 to 12 months*

Molocation is a hybrid solution between colocation and managed services. A company that would benefit from this type of arrangement is one that needs to increase its space capacity or improve its tier level, as well as utilize basic managed services. You might consider molocation if you are facing the following situations:

  • Rapid or unexpected growth

  • Reduction in staff due to layoffs or attrition

  • Declining capital budgets

  • A merger or acquisition

  • The need to meet higher service level agreements (SLAs)

  • The need to heighten security or improve BC/DR storage

  • Cost-prohibitive or declining availability of power

Molocation can provide a company with relief and resources while the company formulates a longer-term data center strategy. Overall, strategic sourcing solutions have evolved from mere cost-oriented, tactical approaches to strategic frameworks positioned for growth. It is important that you understand how your sourcing decisions map back to your business drivers and yield meaningful, measurable results.

2. Technology

Estimated timeframe to realize cost savings: 6 to 36 months*

By identifying the IT “energy hogs” in your data center environment, you will often discover ways to maximize your technology through virtualization, consolidation or optimization. Many solutions can be implemented within a short- to mid-term timeframe, for quick savings. However, an effective strategy will also include solutions for long-term improvement. Begin with an assessment of your company’s environment, which can be completed within four to eight weeks depending on your organization’s size and requirements.


Estimated timeframe to realize cost savings: 6 to 12 months*

Many companies are currently exploring ways to further virtualize their IT environments for greater savings. However, strategizing and implementing a comprehensive virtualization project for your entire IT environment can take some time, especially if you are moving toward “Virtualization 2.0,” moving past servers to storage virtualization. For example, if you haven’t already done so, look at your current IT environment and identify one or two areas to virtualize based on application criticality.

You may decide to optimize your physical servers through virtual server technology. Such a solution could help you save 40 to 80 percent in hardware spend and 30 to 70 percent reduction in power consumption, depending on the size and needs of your organization.


Estimated timeframe to realize cost savings: 12 to 36 months*

Recently, we have noticed that many of its customers are moving from regional data centers to “mega-centers.” Consolidation of your regional data centers can save money and offer an opportunity to relocate to a more strategic location. Depending on the quantity, location and sourcing of your specific data center facilities, you may save 15 to 50 percent on data center spend through consolidation.


Estimated timeframe to realize cost savings: 6 to 18 months*

There are numerous ways to optimize your IT environment, both on a short- and long-term basis. A strategic place to start is in your storage environment. Companies that have implemented a re-raid/ re-tier/re-claim of their existing space have reduced storage complexity and saved between 20 and 40 percent in storage spend. WAN optimization can boost response times without moving costly servers/storage to branch locations. A key to determining if WAN optimization should be part of your data center strategy is to determine how your network is architected, and identify what types of applications your end users utilize. Impact for such changes can be between 40 and 60 percent savings in servers / storage / maintenance costs. Another trend we’ve seen is companies leveraging their quality assessment (QA) environments for disaster recovery—especially if the QA environment is exactly the same as or similar to the company’s production environment. In addition, maintenance optimization and contract renegotiation are two more areas where savings can be significant. Companies that secure accurate asset and contract inventory, audit and benchmark current maintenance contracts and align interdependent hardware and software maintenance service levels can see a savings in maintenance contracts between 10 and 30 percent.

3. Facilities

Estimated timeframe to realize cost savings: 3 to 18 months*

The final area you should examine while developing an effective data center strategy is the optimal use of your facilities. Consider the floor space within your data center environment. While the equipment footprint may get smaller due to more powerful or denser configurations, power and cooling requirements per square foot will increase significantly. Current data centers average 60-100 watts per square foot, and best practices suggest increasing that to 150-200 watts per square foot. Looking forward, industry leaders are predicting a need for 500+ watts per square foot in the foreseeable future.

Implementing a hot/cold aisle IT configuration can make the floor space in an older data center more functional, and, at the same time, improve the mechanical system’s ability to effectively cool the data center. A well-strategized and implemented floor space master plan with proper aisleway spacing, cabinet utilization and attention paid to where growth is likely to occur, will provide for more structured, long-term data center capacity.

Another facility consideration is to “go green.” Many green initiatives can benefit the company and the environment. By reducing power consumption, you will not only positively impact the environment, but you will also dramatically reduce your energy costs. Solutions such as blanking panels, power-management tools, cable reduction and temperature adjustment can often be simple to integrate and help you realize immediate cost savings. In fact, one company saved nearly 50 percent in hardware and power/ cooling costs after Forsythe implemented its recommendations for facility optimization.

A Comprehensive Data Center Strategy

A comprehensive data center strategy may not be the answer to all of your data center problems, but it certainly will help you understand more clearly what your organization needs now and in the future. By implementing one or two of the key, strategic solutions, you may even find that your stretched dollar can go farther than ever.

*Timelines are high-level estimates based on average implementation after funding has been approved and allocated. 

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