Tuesday, 17 August 2010

Data Centre Migration Solutions

Check out this SlideShare Presentation:

Cloud Models

The hype surrounding cloud computing is tempered by concerns over data security and persistent storage costs.  The elasticity in capacity provided by the cloud is not the most efficient way of provisioning long and medium-term data storage - just as renting a car by the day isn't the most efficient way of owning a car.  Security issues for many organisations render the public cloud inaccessible.

Organisations with concerns such as these are turning to private and hybrid cloud delivery models to take advantage of the rapid deployment, self-service models of the cloud - but leverage their shared service infrastructure to provide IT access internally. 

The search for the ideal cloud deployment model is based a very specific efficiency formula.  Which is the most efficient way of delivering flexible IT capacity, in the most risk-free way? 

Over time, the multi-tier architecture delivered in today's datacentres may come to incorporate public cloud components, yet leverage internal data stores.  These hybrid cloud models appear to offer the best benefit, yet security concerns still linger wherever sensitive data is exposed beyond the firewall.

Private cloud models are simply an extension of the provision of virtualized capacity on request.  With service-based billing, and an assumption of risk by the infrastructure provider - private clouds can offer benefit in a shared services environment.  Data is held and transmitted securely, lines of business will pay only for the capacity they consume, and provisioning will be made quickly and by the end user.

Yet do these models truly offer the cost/efficiency of a well-run data centre?  Leveraging the cloud means taking advantage of the compute power available throughout the network.  As an extension of grid computing - this truly does make sense for efficiency.  Yet still there is a lingering, niggling doubt.  Renting cars in the long term rarely represents an efficient way of ownership - is IT capacity really different??

Friday, 16 April 2010

Delivering Returns on Virtualization

There have been many posts on Delivering Returns on Virtualization but most from vendors purvey the idealistic view that all implementations are perfect. This post on governance puts a perspective that incremental gains may prove the most effective

Wednesday, 17 March 2010

Performance = Revenue, Capacity = Costs

We industry professionals would do well to remember that in collaboration, our work as a team is often counteracting each other.  I sat in one meeting recently between two SAP Architects and the Data Centre manager.  The Architects main focus was on delivering the next project on time, and with good performance.  The Data Centre manager was under pressure to cut costs.  (Essentially, this classic struggle is often the reason for virtualization programmes).

To regain our balance, we must for a while think like a CFO - and get the biggest picture.  What does this mean?  It means, we must balance performance and risk against controlling and managing expenditure.  IT Services will make or save the organisation money - but balancing that against cost is an imperitive for the CFO. 

Why isn't this imperitive more pressing?  Well, the answer is - that it is - to the CIO.  He's under pressure to cut or contain costs, whilst continuing to deliver acceptable service quality - and find buget for new projects.  However, don't underestimate the complexity of this challenge.  Often times the CIO is struggling to get to grips with the finances of his operations, and his headache is getting worse with the competing perspectives coming out of his team. 

This is where Financial & Capacity Management can help
By combining (1) a thorough understanding of IT asset utilization against (2) service portfolio and configuration and (3) financials of operating capacity we can help the CIO to reduce overheads, whilst maintaining critical IT capacity and service performance. 

What does this mean?

It's a new level of maturity. 
It's not ITIL Capacity Management. 
It's not ITIL Financial Management. 
It's not Performance Engineering. 
It's combining all these disciplines to help the CIO - and the CFO make some sense of the world, and answering those key questions - "am I getting value for money out of my IT services?"

Is it hard to achieve?
Of course it depends.  But it needn't be hard.  Odds on, all the data already exists in your environment.  Correlating it and cormalising it can deliver huge value to the right Decision Makers - and can help release more money for those exciting innovations!

What's the first step?
Audit your data quality, and your supporting ITSM processes.  Forge links between key processes and individuals.  You can start small.  For training and advice - click www.limsol.com

Tuesday, 9 March 2010

IT Financial Management - Depreciation

Hardware and Software capital purchases are often accounted through depreciation (or amortization, as it is known in the context of software).  Depreciation mechanisms can be complex, or more straightforward - ranging from the simple "straight line" method to the more complex accelerated mechanisms like "sum of years" or "double depreciation method".  

Let's analyse the effectiveness of these 3 mechanisms in the context of IT Financial Management:

Straight Line Method
The most simple method, accounts for a monthly asset value reduction by a linear method whilst also factoring in any salvage value.  Can be easily applied and calculated according to the following formula:
Monthly Depreciation = (Capital Purchase Value - Salvage Value) / Depreciation Period

Sum of Years/Months Method
The first accelerated method, introduced to recognise the fact that greatest depreciation happens early in the depreciation period.  A common example of this would be buying a new car.  For IT Financial Management, accounting for costs on a monthly basis, this becomes the "sum of months" method and is calculated:
Montly Depreciation = (Capital Purchase Value - Salvage Value) * (Depreciation Period in Months - Current Month) / Sum ( Depreciation Period in Months)

For example, a server costing $10,000, no salvageable value and being depreciated over 36 months would have monthly depreciation according to this formula:
Montly Depreciation = $10000 * (36 - Current Month) / (36+35+34+33+...+1)

Double Depreciation Method
The second accelerated method, again a more complex method to recognise the fact that greatest depreciation happens early in the depreciation period. This gives greater depreciation in a first period of depreciation, then slows in a second period.  This is calculated according to the following:
Montly Depreciation = ( Current Value - Salvage Value ) / ( 2 * Depreciation Period in Months)
unless this value is less than ( Capital Purchase Value - Salvage Value ) / Depreciation Period in Months, in which case this value applies

The complexities of the accelerated methods mean that, unless you have a large number of assets, and close financial control is really important to you, then the straight line method will be most appropriate.  In practise, this is closely what we see.

The more complex accelerated methods may be appropriate if you might consider selling your assets before their depreciation periods, or if you consider the improved accuracy to be important.  

For benefit in implementing these depreciation models for IT Financial Management - visit our main webpage at www.limsol.com

Friday, 22 January 2010

What Does Financial Performance Mean?

What Does Financial Performance Mean?

Investopedia defines Financial Performance as "A subjective measure of how well a firm can use assets from its primary mode of business and generate revenues. This term is also used as a general measure of a firm's overall financial health over a given period of time, and can be used to compare similar firms across the same industry or to compare industries or sectors in aggregation."

Financial Performance is a mechanism by which Business Executives can manage the efficiency of their service delivery.  It provides correlation between investment and quality of service, highlighting inefficiencies where investments are being underutilized. 

In the non-IT world, this tool is used to support business decisions such as
  • number of call centre staff to employ.  
  • amount of desk space to provide for employees
  • number of distribution agents for Order-To-Cash process
Correct use of Financial Performance data will right-size the investments to provide maximum efficiency for the business.  Overprovisioning capacity will result in excess costs.  Underprovisioning will impact the revenue generating processes.  Right-sizing capacity will deliver maximum benefits for minimum possible costs.

In IT, the same principles apply.  This time the assets for consideration are either staffing, or compute platform assets.  Using Financial Performance to measure and improve the efficiency of your IT investments is a technique used successfully by IT Executives across the world to cut overheads, and release budget for greater business support and innovation.

Thursday, 21 January 2010

new year, new website

Proud to announce updated website is now live, at www.limsol.com. Invested time and in new technology to make this happen; should be easier to add new content and with a better, more consistent styling.