HOW TO PREPARE A DATA CENTER STRATEGY. What you need to know to build a business case for Data Center sourcing

Transcription

1 HOW TO PREPARE A DATA CENTER STRATEGY What you need to know to build a business case for Data Center sourcing

2 Presented by: Gary Davis Principal PlanNet Consulting (714) Steve Miano Principal PlanNet Consulting (714)

3 Agenda ü What is a Data Center strategy? ü Ge;ng started ü Assessing the current state ü Developing a future state model ü Building a business case ü What your decision- makers want to know ü Case studies

4 Data Center Strategy A Data Center Strategy is usually inibated for any or all of the following reasons: ü Data Center failures are impacbng the business ü Growth is expected to exceed power, cooling and/or space capacibes ü Risk real or perceived ü Lowering Cost of OperaBon ü Improve systems availability and disaster recovery ü Inform a decision to build, co- locate or a combinabon of approaches

5 Ge;ng Started Define your objecbves ü Business drivers ü Technology imperabves ü Desired outcome Assemble a Core Team ü IdenBfy/appoint a project sponsor Sponsorship typically comes from Real Estate, FaciliBes or IT ü Typical make- up of a Core Team FaciliBes representabve (VP, Director) IT representabves CIO, IT Infrastructure VP, Network, user representabve(s) Procurement, sourcing and finance

6 IdenBfy Stakeholders ü A Data Center strategy has many stakeholders ü It s cribcal to engage to appropriate stakeholder resources to gain consensus and eliminate surprises ü Missing a key stakeholder is analogous to missing a Bre on your car

7 Gather InformaBon Formalize the project with a Stakeholder kick- off ü Introduce the inibabve and objecbves ü Layout Bmelines ü Set expectabons

8 Assessing the Current State Develop and issue a Comprehensive Request for InformaBon and meet with Stakeholders to gather informabon ü Some of the informabon is available electronically (e.g., CMDB, As- Built drawings, energy bills, etc.) ü Some of the informabon will be drawn out in Stakeholder meebngs (e.g., applicabon por\olio, financial models, etc.) RFI Categories ü Equipment/applicaBon inventory ü Data Center FaciliBes ü Real Estate ü OperaBons ü Network ü Business Systems & Services ü Business ConBnuity ü Finance ü Growth & Capacity Planning ü IT Strategic Plan

9 Assessing the Current State Key Points ü Establish current demand load KW is the currency ü Determine historical demand growth (3-5 years) ü Assess exisbng facility s aaribute and constraints (e.g., Tier rabng, power, cooling, space, SPOCs) ü IdenBfy applicabons and their Ber levels ü IdenBfy network constraints (e.g., latency sensibve applicabons) ü IdenBfy adjacency requirements/constraints ü IdenBfy key business & IT inibabves (e.g., new business ventures, merger/acquisibon, virtualizabon, etc.) ü Document outage history (many execubves are unaware of outages)

10 Outages.what outages? 11/18/2007 PRISM outage 3/12/2007 UPS Failure 16 hour outage 4,000 hours recovery effort 6/30/2008 Spokane ATS Failure 25 hour outage 6,300 hours recovery effort 12/31/2008 Failed UPS Transfer 4/1/2007 7/1/ /1/2007 1/1/2008 4/1/2008 7/1/ /1/2008 1/1/2009 4/1/2009 7/1/ /1/2009 1/1/ /26/2009 7/11/2007 Over Temp from Power Failure 5/16/2008 Power Upgrade Outage 12/8/2008 Sprinkler Work Power Outage 6/25/2009 Fire Panel AC Outage 23 hour outage 5,800 hours recovery effort

11 Future State IdenBfy the future state scenario ü Establish operabonal objecbves and service levels ü Establish availability targets Tier RaBng Geography ü Determine efficiency objecbves (PUE) ü Define sustainability goals ü Consider adaptability needs Plan for the Unplanned

12 Establish the Future State Determine relevant sourcing models ü Co- LocaBon ü Greenfield ü Tenant Improvement ü Retrofit ExisBng FaciliBes ü Cloud/Services Select markets to be evaluated ü Ideally, markets with co- locabon opbons, cheap power and free- cooling potenbal ü Determine business affinity to parbcular markets ExisBng operabons Business drivers ExisBng or future real estate or facility programs

13 Establish Demand Forecast Align business growth with IT growth ü OpBmize IT deployment as part of the deployment of a new data center 30,000 28,000 26,000 24,000 22,000 Capacity Demand Forecast Capacity Demand - k Watts 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Un- optimized Managed Optimized

14 Establish Demand Forecast ü Establish capacity threshold vs. demand forecast ü Depict historical growth with future planning ü IdenBfy strategies to mibgate capacity constraints

15 Define Day 1/Day 2 Plan for incremental deployment based on demand forecast 16,000 Site 1 - Production Buildout Phases 14,000 12,000 k Watts 10,000 8,000 6,000 4,000 * DAY 1: 3,900 kw, 22.5K SF *DAY 2: 7,900 kw, 22.5K SF 2,000 0 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Managed Forecast Deployed Capacity

16 Market Analysis Qualitative Metrics use to disqualify markets Energy ü Rates vs. Nat l average ü Sustainability ü Free cooling ü Reliability TelecommunicaBons Labor ü Diversity ü RelaBve costs ü Latency ü Availability ü RelaBve costs FaciliBes ü Control/Lease Terms TransportaBon/Accessibility ü Flight Availability ü Door to Door Time Vendor & Services Support ü Proximity to cribcal vendors Environmental Risk ü Seismic/Volcanic ü Hurricane/Tidal ü Severe Weather IncenBves (very dependent on properbes) ü Enterprise Zones ü Sales Tax ü Energy rebate programs

17 QualitaBve Market Rankings What s important to you? Keep it simple

18 Building a Business Case Determine Capital Expenditures Determine OperaBonal Expenditures Develop a MulB- Year Total Cost of Ownership for each model (5/10 yr) Compare TCO for each model

19 Determine CapEx & OpEx CAPEX OPEX ü ConstrucBon & Sok Costs (Greenfield, TI) ü Cable Plant ü Network Electronics ü DepreciaBon ü MigraBon ü Lease costs ü Power ü Maintenance ü Facility Management ü Security ü IT OperaBons Staff ü TelecommunicaBons ü Services ü Sales Tax ü MigraBon

20 Prepare TCO for each Scenario Co-Location Example E. Washington Co- Lo (Phase- In) 2011 Start Year 1 Year 2 Year 3 Year 4 Year 5 5 year Total Year 6 Year 7 Year 8 Year 9 Year Year Total Operating Costs Power $ 46 $ 96 $ 154 $ 166 $ 178 $ 641 $ 192 $ 205 $ 220 $ 237 $ 254 $ 1,749 Predictive Maintenance $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Rent $ 478 $ 915 $ 1,244 $ 1,269 $ 1,294 $ 5,201 $ 1,411 $ 1,439 $ 1,468 $ 1,497 $ 1,527 $ 12,542 IT Staff $ 90 $ 93 $ 96 $ 99 $ 102 $ 480 $ 105 $ 108 $ 111 $ 115 $ 118 $ 1,037 Facilities Staff $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Telecommunications $ 828 $ 845 $ 861 $ 879 $ 896 $ 4,309 $ 914 $ 932 $ 951 $ 970 $ 990 $ 9,066 Co- lo Setup Costs $ 120 $ - $ - $ - $ - $ 120 $ 17 $ - $ - $ - $ - $ 137 DC Equipment Sales Tax $ 128 $ 130 $ 133 $ 135 $ 138 $ 664 $ 141 $ 144 $ 144 $ 146 $ 146 $ 1,384 Operating Costs Subtotal $ 1,690 $ 2,079 $ 2,489 $ 2,548 $ 2,609 $ 11,414 $ 2,779 $ 2,828 $ 2,894 $ 2,965 $ 3,035 $ 25,916 Capital Costs DC TI $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Racks / Cabling $ 1,112 $ - $ - $ - $ - $ 1,112 $ 127 $ - $ - $ - $ - $ 1,240 Network Electronics $ 879 $ 188 $ 188 $ - $ - $ 1,256 $ 378 $ - $ - $ - $ - $ 1,633 Migration Costs $ 1,624 $ 915 $ 634 $ - $ - $ 3,174 $ - $ - $ - $ - $ - $ 3,174 Capital Costs Subtotal $ 3,615 $ 1,104 $ 823 $ - $ - $ 5,541 $ 505 $ - $ - $ - $ - $ 6,047 Depreciation $ 1,958 $ 1,288 $ 1,296 $ 410 $ 410 $ 5,363 $ 328 $ 290 $ 94 $ 94 $ 94 $ 6,262 Cash Flow $ 5,305 $ 3,183 $ 3,311 $ 2,548 $ 2,609 $ 16,956 $ 3,284 $ 2,828 $ 2,894 $ 2,965 $ 3,035 $ 31,963 Total $ 3,649 $ 3,367 $ 3,785 $ 2,958 $ 3,019 $ 16,777 $ 3,107 $ 3,119 $ 2,988 $ 3,059 $ 3,129 $ 32,178

21 Total Cost of OperaBon Tenant Improvement Example Seattle TI/Lease Year 1 Year 2 Year 3 Year 4 Year 5 5 year Total Year 6 Year 7 Year 8 Year 9 Year Year Total Operating Costs Power $ 297 $ 320 $ 345 $ 371 $ 400 $ 1,734 $ 429 $ 460 $ 494 $ 530 $ 568 $ 4,216 Predictive Maintenance $ 131 $ 221 $ 279 $ 233 $ 240 $ 1,104 $ 247 $ 254 $ 262 $ 270 $ 278 $ 2,415 Rent $ 462 $ 476 $ 490 $ 505 $ 520 $ 2,453 $ 536 $ 552 $ 568 $ 585 $ 603 $ 5,296 IT Staff $ 250 $ 258 $ 265 $ 273 $ 282 $ 1,328 $ 290 $ 299 $ 308 $ 317 $ 326 $ 2,868 Facilities Staff $ 147 $ 151 $ 155 $ 160 $ 165 $ 778 $ 170 $ 175 $ 180 $ 186 $ 191 $ 1,680 Telecommunications $ 828 $ 845 $ 861 $ 879 $ 896 $ 4,309 $ 914 $ 932 $ 951 $ 970 $ 990 $ 9,066 Other Costs $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - DC Equipment Sales Tax $ 131 $ 134 $ 137 $ 139 $ 142 $ 683 $ 145 $ 148 $ 148 $ 151 $ 151 $ 1,425 Operating Costs Subtotal $ 2,246 $ 2,405 $ 2,533 $ 2,561 $ 2,644 $ 12,388 $ 2,730 $ 2,820 $ 2,911 $ 3,009 $ 3,107 $ 26,966 Capital Costs DC TI $ 6,078 $ - $ - $ - $ - $ 6,078 $ 876 $ - $ - $ - $ - $ 6,954 Racks / Cabling $ 1,112 $ - $ - $ - $ - $ 1,112 $ 127 $ - $ - $ - $ - $ 1,240 Network Electronics $ 1,157 $ - $ - $ - $ - $ 1,157 $ 378 $ - $ - $ - $ - $ 1,535 Migration Costs $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Capital Costs Subtotal $ 8,347 $ - $ - $ - $ - $ 8,347 $ 1,381 $ - $ - $ - $ - $ 9,728 Depreciation $ 796 $ 796 $ 859 $ 796 $ 796 $ 4,041 $ 716 $ 716 $ 557 $ 557 $ 557 $ 7,145 Total $ 3,041 $ 3,200 $ 3,392 $ 3,357 $ 3,440 $ 16,429 $ 3,447 $ 3,537 $ 3,468 $ 3,566 $ 3,664 $ 34,111 In thousands

22 Compare Models Annual Operating Costs Years 1-10 (in 1000's) Year 1 Year 2 Year 3 Year 4 Year 5 5 year Total Dif $ Dif % 10 Year Total Dif $ Dif % As- Is Owned $ 2,929 $ 3,125 $ 3,461 $ 3,661 $ 3,878 $ 17,054 $ - 0% $ 39,639 $ - 0% Optimized Owned $ 2,669 $ 2,869 $ 3,047 $ 3,232 $ 3,433 $ 15,251 $ (1,804) - 11% $ 35,527 $ (4,112) - 10% Market 1 Co- Lo $ 3,145 $ 3,117 $ 3,281 $ 3,298 $ 3,383 $ 16,224 $ (830) - 5% $ 33,773 $ (5,866) - 15% Market 2 Co- Lo $ 3,205 $ 3,188 $ 3,362 $ 3,391 $ 3,489 $ 16,635 $ (419) - 2% $ 34,896 $ (4,743) - 12% Market 3 TI / Lease $ 4,388 $ 3,653 $ 3,900 $ 3,882 $ 3,993 $ 19,816 $ 3,620 21% $ 44,423 $ 4,784 12% Market 4 Co- Lo $ 3,327 $ 3,400 $ 3,610 $ 3,677 $ 3,814 $ 17,828 $ 3,449 20% $ 38,203 $ (1,436) - 4% Market 5 TI / Lease $ 3,302 $ 3,497 $ 3,730 $ 3,717 $ 3,823 $ 18,068 $ 3,447 20% $ 38,071 $ (1,569) - 4% Market 6 Co- Lo $ 3,306 $ 3,368 $ 3,557 $ 3,622 $ 3,746 $ 17,599 $ 3,425 20% $ 37,778 $ (1,861) - 5%

23 Scenario Analysis Annual Operating Expense Comparison $10,000 Annual Operting Expenses (1,000's) $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1, w/stabalization Scenario 2 $65.5M 10 Yr TOC Year Scenario 2 Scenario 1 Scenario 3 Senario 1 $68.1M 10 Yr TOC Scenario 3 (Current- state with expansion) $58.7M 10Yr TOC

24 Case Studies Issues ü Aging primary data center in a high risk region ü Sub Tier 2 design ü History of outages ü Running out of capacity ü Facing major capital expenditures to retrofit the primary data center ü Lease expiring on Disaster Recovery site Major Regional Bank Results Analysis ü Assess deficiencies of exisbng facilibes ü Determine amount of Bme before the DC reaches capacity ü Evaluate low- risk markets ü Evaluate own vs. co- lo Outcome ü Move primary DC to co- lo ü Retrofit exisbng DC to Tier 2 ü Repurpose exisbng DC to sub- producbon and DR ü Improved availability with nominal increases in TOC

25 Case Studies Global Technology Company Issues ü 40+ data centers worldwide ü Growing through acquisibon ü Unsustainable operabng costs ü Unmanageable data center footprint ü Business driver to consolidate operabons ü Latency sensibvity from global engineering applicabons Results Analysis ü Assess operabon efficiencies and costs ü Evaluate mulbple markets and corporate owned real estate ü Evaluate geo- regional consolidabon alternabves ü Analyze enterprise architecture ü Evaluate own vs. co- lo Outcome ü Geo- regional consolidabon (N.A, ENAME, PAC- RIM) ü Deploy owned Tier 2+ ü MulB- site recovery ü $100M+ 10- year future cost avoidance

26 Case Study Issues ü Significantly high energy costs ü High- risk locabon ü Planning for significant business technology inibabves ü Facing future capital expenditures to uplik primary data center Global Entertainment Company Results } Analysis Assess deficiencies of exisbng facilibes Determine impact of new compubng demand Evaluate low- cost markets Evaluate own vs. co- lo } Outcome Expand primary DC to co- lo Leverage exisbng facility for business partner and DR Recommended phased deployment to opbmize ROI

27 Case Study Issues ü Aging primary data center in a high risk region ü Sub Tier 2 design ü History of outages ü Running out of capacity ü Facing major capital expenditures to retrofit the primary data center ü Affinity for in- State deployment Regional Healthcare Company Results } Analysis Assess deficiencies of exisbng facilibes Assess mibgabon strategies to buy Bme Evaluate regional markets Evaluate own vs. co- lo } Outcome Move primary DC to co- lo in a lower risk geography Repurpose exisbng DC to sub- producbon and DR Stabilize current environment Recommended best value alternabve

28 Thank you for your Bme!