DATA CENTER CONSOLIDATION AT GUARDIAN LIFE
As one of the largest mutual life insurance firms in the United States, Guardian Life (www.guardianlife.com) has more than 5000 employees and over 3000 financial representatives in 80 agencies. Guardian and its subsidiaries provide almost three million people with life and disability income insurance, retirement services, and investment products such as mutual funds, securities, variable life insurance, and variable annuities. The company also supplies employee benefits programs to six million participants, including life, health, and dental insurance, as well as qualified pension plans. In addition to regional home offices in New York City; Bethlehem, Pennsylvania; Spokane, Washington; and Appleton, Wisconsin, the company has 55 remote sales offices and 80 remote agency offices.
Like other insurance companies, Guardian Life is an information intensive organization where data processing and communications network infrastructure have consistently been important contributors to its success. Guardian Life’s IT organization has earned numerous accolades including multiple CIO100 awards from
CIO
magazine [PRNE11]. According to Dennis Callahan, Executive Vice President and Chief Information Officer for, Guardian Life, "A strong partnership between IT and the businesses enables
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Guardian to deliver cost-effective technology services that facilitate world- class customer service, product innovation, and operational efficiency.” Ensuring alignment between business and IT is important to Guardian Life and provides a consistent theme for many of the insurance companies IT projects including its data center consolidation initiatives [CIOZ12].
Data center consolidation has been an ongoing concern at Guardian for more than a decade. Guardian’s IT governance structure is team-oriented and the company’s data center consolidation initiatives are overseen by it Infrastructure team. The Infrastructure team is primarily co-located in New York, and Bethlehem, Pennsylvania but it has key support teams in Spokane, Washington, Appleton, Wisconsin, and Pittsfield, Massachusetts.
Guardian Life began taking a serious look at data center consolidation in 2000, but in the aftermath of the September 11, 2001 terrorist attack, Guardian also became more concerned with business continuity issues. Guardian had four significant data centers, at its four home offices, but the primary data center was in New York City. After 9/11, Guardian wanted make infrastructure changes to ensure business continuity across its existing data centers and made plans to add two more data centers to the mix.
Guardian performed an assessment of its data centers to provide a basis for planning on the location of data processing resources. One surprising outcome of this assessment had to do with utilization. The assessment revealed that the four data centers had about 1000 UNIX and NT servers, with an average capacity utilization of 1 ...
DATA CENTER CONSOLIDATION AT GUARDIAN LIFE As one of the lar
1. DATA CENTER CONSOLIDATION AT GUARDIAN LIFE
As one of the largest mutual life insurance firms in the United
States, Guardian Life (www.guardianlife.com) has more than
5000 employees and over 3000 financial representatives in 80
agencies. Guardian and its subsidiaries provide almost three
million people with life and disability income insurance,
retirement services, and investment products such as mutual
funds, securities, variable life insurance, and variable annuities.
The company also supplies employee benefits programs to six
million participants, including life, health, and dental insurance,
as well as qualified pension plans. In addition to regional home
offices in New York City; Bethlehem, Pennsylvania; Spokane,
Washington; and Appleton, Wisconsin, the company has 55
remote sales offices and 80 remote agency offices.
Like other insurance companies, Guardian Life is an
information intensive organization where data processing and
communications network infrastructure have consistently been
important contributors to its success. Guardian Life’s IT
organization has earned numerous accolades including multiple
CIO100 awards from
CIO
magazine [PRNE11]. According to Dennis Callahan, Executive
Vice President and Chief Information Officer for, Guardian
Life, "A strong partnership between IT and the businesses
enables
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2. Guardian to deliver cost-effective technology services that
facilitate world- class customer service, product innovation, and
operational efficiency.” Ensuring alignment between business
and IT is important to Guardian Life and provides a consistent
theme for many of the insurance companies IT projects
including its data center consolidation initiatives [CIOZ12].
Data center consolidation has been an ongoing concern at
Guardian for more than a decade. Guardian’s IT governance
structure is team-oriented and the company’s data center
consolidation initiatives are overseen by it Infrastructure team.
The Infrastructure team is primarily co-located in New York,
and Bethlehem, Pennsylvania but it has key support teams in
Spokane, Washington, Appleton, Wisconsin, and Pittsfield,
Massachusetts.
Guardian Life began taking a serious look at data center
consolidation in 2000, but in the aftermath of the September 11,
2001 terrorist attack, Guardian also became more concerned
with business continuity issues. Guardian had four significant
data centers, at its four home offices, but the primary data
center was in New York City. After 9/11, Guardian wanted
make infrastructure changes to ensure business continuity
across its existing data centers and made plans to add two more
data centers to the mix.
Guardian performed an assessment of its data centers to provide
a basis for planning on the location of data processing
resources. One surprising outcome of this assessment had to do
with utilization. The assessment revealed that the four data
centers had about 1000 UNIX and NT servers, with an average
capacity utilization of 10%. Even at peak demand, only 25% of
the processing power of the servers was being used [MUSI02].
Guardian responded to this assessment with a plan that included
the following objectives:
3. 1. Move the primary data center from New York City to
Bethlehem, Pennsylvania.
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Improve the efficiency of its data centers, including server and
storage utilization. Specifically, Guardian set a goal of reducing
the number of servers supporting Guardian's applications and
databases by 40% and reducing the server support staff by 60%.
Ensure a smooth transition to the new primary data center.
The company chose IT consulting firm Greenwich Technology
Partners
(GTP) to help it design and carry out the transition. GTP began
with an assessment of the company's IT environment and looked
at the impact of moving the data center from New York to
Bethlehem. A major issue related to the move was that the
largest number of data center users was located in the New York
area. Thus, the new deployment needed to provide sufficient
data transmission capacity to meet these users' needs.
Fortunately, the network infrastructure already in place was
fairly standard and easily scalable (Figure C7.1).
4. C7-3
An ATM WAN backbone linked the four regional home offices.
Frame relay connections linked the remote sales offices and
remote agency offices, and 100-Mbps and 1-Gbps Ethernet
LANs provided connectivity within campuses. The Cisco
Catalyst 5500 and 7200 series routers provided Ethernet support
combined with a modular, easily scalable design. The Cisco
IGX 8400 ATM switches could be scaled to support an ATM
network service at any desired capacity. With three widely used
networking technologies in place, some of the problems that
might have been encountered in a more convoluted networking
environment were avoided.
GTP also looked at the application and database patterns. They
determined that in addition to traditional applications such as
file and print services, PeopleSoft, and Lotus Notes, Guardian
also used a collection of applications to support its intranet.
Then, as now, the site included marketing materials and sales
tools for the firm's agents, account profiling, and customer data.
The company had also invested in a number of financial
services applications, including applications for supporting its
trading and securities functions. Due to their complexity and the
amount of resource required to support them, many of
Guardian's applications have historically been supported by
dedicated servers.
The transition team, consisting of Guardian and GTP personnel,
did extensive validation work and benchmarking to make sure
the data they had gathered during the initial assessment were
accurate. They measured network utilization at granular levels
and modeled various consolidation scenarios for reducing server
hardware.
5. From this analysis, GTP proceeded to develop a plan for
consolidating the servers, looking at both business and
technology issues. For example, the team considered the
criticality of the applications supported by the servers, as well
as which business units they belonged to. Some servers were
good candidates for consolidation; others were not; and others
were out of warranty, which made them too expensive to keep.
After the
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migration plan was devised and the new architecture developed,
more testing was conducted to ensure their viability.
The team devoted much thought and analysis to the migration to
the new architecture, so as not to disrupt day-to-day operations.
The plan targeted the least complex opportunities first, starting
with file and print services. Guardian initially had more than 30
servers providing file and print services. These were
consolidated into just two servers clustered in a high-
availability, fault-tolerant configuration. For more complex
parts of the plan, the team opted to do some of the consolidation
in New York, and only then move the servers to Bethlehem after
the consolidation had settled down.
The initial consolidation and relocation project yielded tangible
benefits to Guardian in terms of reduced hardware and
personnel requirements. But the benefits extended well beyond
these initial objectives. The mindset of solving new problems
efficiently and in the context of the existing infrastructure had
taken hold. Guardian no longer automatically takes orders for
new servers to support applications as it did throughout the
6. 1990s. Instead, Guardian analyzes each new application
requirement and attempts to support it with the existing
hardware/software suite or with minimal upgrades and
extensions.
The total cost of the data centered consolidation project was
$4.5 million, but the company saved more than $3 million in
2002, offsetting much of that cost. Even greater savings were
realized during each of the following two years.
Further Consolidation
In 2010, Guardian embarked on a second major data centered
consolidation initiative. The maturation of virtualization
technologies and evolution of high- bandwidth WAN
connections encouraged Guardian to consolidate six data centers
into two [MITC11]. This is illustrated in Figure C7.2. Guardian
will
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consolidate its mission critical data processing infrastructure
into one primary data center that it will own. The company
plans to lease a second modular pod for use as its second data
center. Pod data centers can be thought of as data centers in a
box. These can be configured by vendors to customer
specifications and delivered as a container that looks similar to
refrigerated box car or multi-modal shipping container stacked
on ships or carried by tractor trailer trucks. Pods are energy
efficient but can be a cramped for human movement.
7. C7-6
In addition to moving to a much leaner data center
infrastructure, Guardian is migrating from Unix to Linux. It has
also started to move some of its applications to the cloud
[MITC11]. By the beginning of 2012, Guardian had moved 18
back-end applications to SaaS and had begun transitioning e-
mail, HRIS, and IT services into the cloud. The breadth of
Guardian's move to the cloud put the company on the leading
edge among Fortune 250 organizations [MITC12].
Guardian is using the IDEAS Advantage services from Ideas
International to help it make decisions about remodeling its data
center infrastructure [GOLI11]. These sophisticated tools in
combination with Guardian’s commitment to cloud services
indicate that the insurance company’s data center consolidation
initiatives are far from over. Guardian has not yet moved its
core ERP systems to the cloud, but even this is under
consideration.
Discussion Points
Do some Internet research on the reasons why businesses
generally invest in data center consolidation projects. What
benefits do they commonly hope to realize? How do Guardian’s
rationale for consolidating data centers compare to those of
other businesses?
Getting outside consultants to manage data center consolidation
projects is a common practice. Discuss the pros and cons of
8. using consultants to manage data center consolidation projects?
How/why has virtualization fueled business interest in data
center consolidation?
Why is the availability of high-speed, high bandwidth
communications an important consideration in data center
consolidation plans and decision-making?
Do some Internet research on modular (pod) data centers.
Summarize the advantages of disadvantages of modular data
centers.
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Guardian is consolidating from six to two data centers
supplemented with SaaS cloud services. As the company
continues to move applications to the cloud, could it consolidate
to zero data centers? Why or why not?
Do you think that winning multiple CIO 100 awards has
encouraged Guardian’s IT executives to recommend risky IT
projects? Why or why not?
9. Sources
[CIOZ12]
CIO Zone.”Guardian CIO on Aligning IT, Business.” Retrieved
online at:
http://www.ciozone.com/index.php/Management/Guardian-CIO-
On-Aligning-IT-Business.html.
[GOLI11]
Golia, N. “Guardian Life Using Analytics to Assist Data Center
Planning.
Insurance Technology,
September 1, 2011. Retrieved online at:
http://www.insurancetech.com/architecture-
infrastructure/231600651
[MITC11]
Mitchell, R. “Cloud to Lower Bar, Intensify Competition.”
Computerworld
, March 7, 2011. Retrieved online at:
http://blogs.computerworld.com/17935/cloud_to_lower_bar_inte
nsify_comp etition
[MITC11]
Mitchell, R. “Best Practices for Scaling up SaaS to the Cloud.
Techworld,
February 14, 2012. Retrieved online at:
http://features.techworld.com/sme/3337405/best-practices-for-
scaling-up- saas-in-the-cloud/
[MUSI02]
Musich, P. “Project Gets Helping Hand.”
eWeek,
November 25, 2002. www.eweek.com.
10. [PRNE11]
PR Newswire. “Guardian Life Recognized by CIO Magazine for
Third Consecutive Year in CIO 100 Awards.” Retrieved online
at: http://www.prnewswire.com/news-releases/guardian-life-
recognized-by-cio- magazine-for-third-consecutive-year-in-cio-
100-awards-54985272.html