bringing data center management and technology into the 21st century
DESCRIPTION
This talk is a slightly modified and condensed version of one I gave at DCD Converged in London on the morning of November 19, 2014. I gave it at VIP dinner sponsored by Siemens on the evening of that same day. I moved "One boss, one team, and one budget" to be the 2nd thing management can do, because tying IT to business performance with metrics is a prerequisite to doing the hard work of busting the silos. I realized this during the talk ("One boss, one team, and one budget" was original item #1).TRANSCRIPT
Bringing data center management and technology
into the 21st century Jonathan Koomey, Ph.D.
Research Fellow, Steyer-Taylor Center for Energy Policy and Finance, Stanford University
http://www.koomey.com Presented at DCD Converged
London, UK November 19, 2014
1 Copyright Jonathan G. Koomey 2014
Can you answer these key management questions?
• How many servers do you have? • How many of the servers are comatose? • What is the average utilization for those that
aren’t comatose? • Do you track costs and benefits from data
center operations each year? – Total? – At the business unit level? – At the project level?
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Most companies can’t!
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What do executives need to know about information
technology (IT)?
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Modern businesses can’t succeed without IT
5
Brynjolfsson, Erik, and Andrew McAffee. 2014. The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. New York, NY: W. W. Norton & Company. [http://amzn.to/1gYHEGk]
Copyright Jonathan G. Koomey 2014
However…
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IT is almost invariably fragmented and divorced from
business performance Only management can fix that
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Almost all enterprise data centers are paragons of inefficiency, but management doesn’t know it, so
they don’t fix it.
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Inefficient IT increases costs, decreases revenues, AND
reduces the rate of innovation
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What can management do?
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I. Tie IT performance to business performance
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How?
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Metrics!
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Creating the right metrics is not as easy as it sounds
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How far are you from this?
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ProfitsComputation
= (Revenues - Costs)/Computations
Complexities • Some parts of IT are really cost centers, but
some generate revenues • Hard work needed to build up to revenues
and costs/computation – Activity based costing (Romonet) – Detailed cost and inventory modeling (Apptio) – Server based inventory and operations (DCIM)
• Computations – first order estimate = utilization * GHz * secs/year
(good enough to start)
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Metrics drive organizational change
• Focus on the whole system – reducing total costs per computation – increasing total value from computation
• “Show back” the consequences of choices to every employee, then “charge back” if needed
• Key Performance Indicators (KPIs) for management include both costs AND benefits
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You need a model of costs and revenues that tracks all
components in the data center over time!
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II. One boss, one team, one budget!
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III. Use IT to transform IT
• Standardized IT deployments • Move from “sit down restaurant” to “buffet
style” IT • Move many users to internal or external cloud • Software should matter more, hardware less • Measure, experiment, learn, and replicate • Use computer modeling to anticipate effects
on cooling/power of ∆s in existing facilities
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Conclusions
• What management can do – I. Drive institutional change using metrics that
tie IT performance to business performance – II. One boss, one team, one budget – III. Use IT to transform IT
• Summary: Make IT serve the business!
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IT should NOT be treated as a cost center, it should be a cost reducing
profit center that also improves corporate and customer
environmental performance
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For more details on the ongoing (Nov 10 to Dec 12, 2014) online class titled Data Center
Essentials for Executives, see http://goo.gl/K4kJG2
Also see my 2014 article titled Bringing
Enterprise Computing into the 21st Century: A Management and Sustainability Challenge
http://goo.gl/WYFBjb
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Watch Dean Nelson (eBay) talk about how companies can turn IT
into a profit center (35 mins): https://www.youtube.com/watch?
v=h6NJpHgReE8&feature=youtu.be
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A case study of a company that has been successful at tying its IT performance to business performance
Schuetz, Nicole, Anna Kovaleva, and Jonathan Koomey. 2013.
eBay: A Case Study of Organizational Change Underlying Technical Infrastructure Optimization. Stanford, CA: Steyer-Taylor
Center for Energy Policy and Finance, Stanford University. September 26. [http://www.mediafire.com/view/8ema554a2ho9ifj/
Stanford_eBay_Case_Study-_FINAL-130926.pdf]
25 Copyright Jonathan G. Koomey 2014