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Bridging The C‐Suite Gap

How To Build The Business Case For 
   Data Center Transformation
Defining Data Center Transformation
DATA CENTER TRANSFORMATION
Delivering the data center needed for your future success




Dedicated infrastructure                                                 Shared infrastructure
   and applications                                                         and services




 The DCT opportunity
 » Reduce overall IT costs.                   »   Support new initiatives and promote growth.
 »   Shift spending to business priorities.   »   Allow for modular data centers.
 »   Improve business continuity.             »   Increase environmental sustainability.
DATA CENTER TRANSFORMATION
Four Integrated Initiatives
                               Simplify, standardize, and
                              reduce the number of data
                                   centers, applications,
                                   servers, storage, and
                                      network resources.


                               Automate the entire data
                                     center operations
                                              lifecycle.



                                   Protect business with
                                    resilient operations.



                                    Optimize the use of
                                energy, floor space, and
                                  cooling infrastructure.
Bridging the C‐Suite Gap
VULCAN VS. KLINGON
Does it feel like you and your CIO are from separate planets?




                                 vs.
UNDERSTANDING YOUR CIO
How is he/she being measured? – By business outcomes


 Accelerate             Lower costs              Mitigate risks
 business growth

 • Maintain customer    • Reduce IT cost and     • Improve compliance
   relationships          drive down business    • Protect critical assets
 • Target new             cost                   • Ensure continuity of
   opportunities and    • Enhance operational      business operations
   markets                efficiency
 • Improve business     • Improve return on IT
   decision making        investments
                        • Improve workforce
                          productivity
DESIRED BUSINESS OUTCOMES DRIVE
THE CIO AGENDA
                       HP CIO Agenda framework

    Desired Business
                              Priorities              Metrics
       Outcomes
         Growth                Business
                                                      Business

         Costs               Management
                                                    IT Strategic &
                                                      Operational
          Risks               Technology




Business: How CIOs help meet key business objectives and measure
their business contribution
Management: How CIOs manage the IT organization and resources
Technology: Which technologies meet these needs



8
CIO AGENDA PRIORITIES (2009)
     Business Priorities                  Mgmt Priorities               Technology Priorities
1.  Improve business                 1.   Link business and IT         1.   Business Intelligence
    operations and processes              strategies and plans              applications
2. Control enterprise wide           2.   Reduce the cost of IT        2.   Enterprise applications
    business costs                        operations                        (ERP, SCM, CRM, etc)
3. Improve the effectiveness         3.   Deliver projects that        3.   Real time infrastructure;
    of the enterprise workforce           enable business growth            servers and storage
4. Attract, retain & develop         4.   Improve IT governance             technologies
    customer relationships                                             4.   Legacy application
                                     5.   Improve IT processes
5. Expand the use of                      and service delivery              modernization, upgrade
    information / analytics in the        quality                           or replacement
    business
                                     6.   Improve the business & IT    5.   Collaboration
6. Create new products &                                                    technologies
    services (innovation)                 relationship
                                     7.   Attract, retain and          6.   Networking, voice, data
7. Support change initiatives,                                              and mobile technologies
    mergers/acquisitions                  develop IT personnel
                                     8.   Consolidate IT (shared       7.   Technical infrastructure
8. Expand into new markets,
    geographies and                       services)                         management and
    capabilities                                                            automation
                                     9.   Enable the use of
9. Support regulation and                 information in operations,   8.   Security technologies
    compliance requirements               products or services         9.   Service oriented
10. Manage environmental             10. Manage IT risk                     applications and
    impacts (Green IT, Carbon                                               architecture
    Footprint)                                                         10. Document and workflow
                                                                           management
So How do you build a Business Case?
BUSINESS CASE IN 3 SIMPLE STEPS
Represent everything in financial terms




  1. Current State               3. What does it take to                   2. Future State
                                       get there




                     Tie it to the 3 objectives. Does this project help:
                     » Reduce overall IT costs?
                     »   Shift spending to business priorities?
                     »   Mitigate risk and improve business continuity?
MORE ADVANCED TERMS


• Revenues generated
• Solution cost
• Internal costs– including customer
  care and marketing expenses
• Return on Investment
• Cash flow and Payback
• Net Present Value
• Internal Rate of Return
Business Case in Action –
 Breaking it down for DCT

Example: Data Center Consolidation
1. CURRENT STATE
Complexity continues to grow.


       »   Inconsistent or poor quality of service
       »   Slow to respond to business needs


       »   Escalating costs
       »   Inefficient and manually intensive
           processes

       »   Isolated applications and data
       »   Aging facilities and infrastructure
       »   Too many data centers
       »   Inefficient use of technology assets



           Current data center facilities and infrastructure is a barrier
           to business growth, and expensive to maintain and manage
2. FUTURE STATE
Reduced complexity = reduced cost, improved service levels, less
downtime

       »   Fewer data centers
       »   HP’s own transformation: 85 -> 3 pairs


       »   Fewer applications
       »   HP’s own transformation: 8000 -> 1500
           applications

       »   Fewer infrastructure components
       »   Virtualize and converge servers,
           networking, storage etc
3. GETTING THERE
                            Lower complexity.
                              Increase use of 
                        shared infrastructure.
                   Lower application life cycle 
                                         costs.



                        Lower costs through 
                               reduced space, 
                         energy, and cooling 
                                requirements; 
                     simplified management; 
                                and improved 
                              asset utilization.


                    Significantly reduce costs.
                   Mitigate energy and space 
                             costs and issues.
                   Improved asset utilization.
                              Improve quality 
                                   of service.
TYING CONSOLIDATION TO THE 3
GOALS
      Improve elasticity and enable innovation.
      » Shift
            resources to innovation.
      » Rapidly deliver new business services.
      » Deploy new resources in minutes/hours instead of days/months.



       Lower costs.
       » Lower energy and maintenance costs.
       » Enhance productivity, utilization.
       » Achieve 20–50% costs improvements.



       Manage risks.
       » Reduce   complexity.
       » Build in continuity and security.
GETTING THE BALL ROLLING
Two helpful tools
  Experience DCT Workshop                   CIO Agenda Workshop
   Workshop Focus                            Workshop Focus
   »   Determine benefits, scope, scale,     »   Best practice model based on 
       and critical success factors.             annual Gartner CIO survey
   »   Identify quick wins.                  »   Clarify and align business, IT 
   »   Gain stakeholder buy‐in and               management and technological 
       project traction.                         priorities 
                                             »   Half day session
   »   Build a next‐steps roadmap.

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Bridging the c suite gap

  • 3. DATA CENTER TRANSFORMATION Delivering the data center needed for your future success Dedicated infrastructure Shared infrastructure and applications and services The DCT opportunity » Reduce overall IT costs. » Support new initiatives and promote growth. » Shift spending to business priorities. » Allow for modular data centers. » Improve business continuity. » Increase environmental sustainability.
  • 4. DATA CENTER TRANSFORMATION Four Integrated Initiatives Simplify, standardize, and reduce the number of data centers, applications, servers, storage, and network resources. Automate the entire data center operations lifecycle. Protect business with resilient operations. Optimize the use of energy, floor space, and cooling infrastructure.
  • 6. VULCAN VS. KLINGON Does it feel like you and your CIO are from separate planets? vs.
  • 7. UNDERSTANDING YOUR CIO How is he/she being measured? – By business outcomes Accelerate Lower costs Mitigate risks business growth • Maintain customer • Reduce IT cost and • Improve compliance relationships drive down business • Protect critical assets • Target new cost • Ensure continuity of opportunities and • Enhance operational business operations markets efficiency • Improve business • Improve return on IT decision making investments • Improve workforce productivity
  • 8. DESIRED BUSINESS OUTCOMES DRIVE THE CIO AGENDA HP CIO Agenda framework Desired Business Priorities Metrics Outcomes Growth Business Business Costs Management IT Strategic & Operational Risks Technology Business: How CIOs help meet key business objectives and measure their business contribution Management: How CIOs manage the IT organization and resources Technology: Which technologies meet these needs 8
  • 9. CIO AGENDA PRIORITIES (2009) Business Priorities Mgmt Priorities Technology Priorities 1. Improve business 1. Link business and IT 1. Business Intelligence operations and processes strategies and plans applications 2. Control enterprise wide 2. Reduce the cost of IT 2. Enterprise applications business costs operations (ERP, SCM, CRM, etc) 3. Improve the effectiveness 3. Deliver projects that 3. Real time infrastructure; of the enterprise workforce enable business growth servers and storage 4. Attract, retain & develop 4. Improve IT governance technologies customer relationships 4. Legacy application 5. Improve IT processes 5. Expand the use of and service delivery modernization, upgrade information / analytics in the quality or replacement business 6. Improve the business & IT 5. Collaboration 6. Create new products & technologies services (innovation) relationship 7. Attract, retain and 6. Networking, voice, data 7. Support change initiatives, and mobile technologies mergers/acquisitions develop IT personnel 8. Consolidate IT (shared 7. Technical infrastructure 8. Expand into new markets, geographies and services) management and capabilities automation 9. Enable the use of 9. Support regulation and information in operations, 8. Security technologies compliance requirements products or services 9. Service oriented 10. Manage environmental 10. Manage IT risk applications and impacts (Green IT, Carbon architecture Footprint) 10. Document and workflow management
  • 11. BUSINESS CASE IN 3 SIMPLE STEPS Represent everything in financial terms 1. Current State 3. What does it take to 2. Future State get there Tie it to the 3 objectives. Does this project help: » Reduce overall IT costs? » Shift spending to business priorities? » Mitigate risk and improve business continuity?
  • 12. MORE ADVANCED TERMS • Revenues generated • Solution cost • Internal costs– including customer care and marketing expenses • Return on Investment • Cash flow and Payback • Net Present Value • Internal Rate of Return
  • 14. 1. CURRENT STATE Complexity continues to grow. » Inconsistent or poor quality of service » Slow to respond to business needs » Escalating costs » Inefficient and manually intensive processes » Isolated applications and data » Aging facilities and infrastructure » Too many data centers » Inefficient use of technology assets Current data center facilities and infrastructure is a barrier to business growth, and expensive to maintain and manage
  • 15. 2. FUTURE STATE Reduced complexity = reduced cost, improved service levels, less downtime » Fewer data centers » HP’s own transformation: 85 -> 3 pairs » Fewer applications » HP’s own transformation: 8000 -> 1500 applications » Fewer infrastructure components » Virtualize and converge servers, networking, storage etc
  • 16. 3. GETTING THERE Lower complexity. Increase use of  shared infrastructure. Lower application life cycle  costs. Lower costs through  reduced space,  energy, and cooling  requirements;  simplified management;  and improved  asset utilization. Significantly reduce costs. Mitigate energy and space  costs and issues. Improved asset utilization. Improve quality  of service.
  • 17. TYING CONSOLIDATION TO THE 3 GOALS Improve elasticity and enable innovation. » Shift resources to innovation. » Rapidly deliver new business services. » Deploy new resources in minutes/hours instead of days/months. Lower costs. » Lower energy and maintenance costs. » Enhance productivity, utilization. » Achieve 20–50% costs improvements. Manage risks. » Reduce complexity. » Build in continuity and security.
  • 18. GETTING THE BALL ROLLING Two helpful tools Experience DCT Workshop CIO Agenda Workshop Workshop Focus Workshop Focus » Determine benefits, scope, scale,  » Best practice model based on  and critical success factors. annual Gartner CIO survey » Identify quick wins. » Clarify and align business, IT  » Gain stakeholder buy‐in and  management and technological  project traction. priorities  » Half day session » Build a next‐steps roadmap.