Is there ever an automatic savings?

Is there ever an automatic savings?

Summary: One of the key messages most suppliers of any virtualization technology use is that the use of their product will automatically save the customer money. I have concerns that some of them are really over reaching to convince customers.

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One of the key messages most suppliers of any virtualization technology use is that the use of their product will automatically save the customer money. I have concerns that some of them are really over reaching to convince customers. Do you agree?

If I follow their line of thinking correctly, some of what they're saying certainly can be supported by cost of ownership or return on investment studies that have been published. Most of these marketing messages focus on saving staff time and thus saving money.

I believe that this is based upon North American and Western European focused studies that seem to suggest that hardware and software when combined usually make up under 25% of the costs in a 5 year cost analysis. Staff-related costs typically are between 50% and 70% of the total costs in those same studies.

Some of the folks focused on virtual processing technology (grid computing software, clustering software, workload management software, virtual machine software and operating system virtualization/partitioning software) also state the the customer will save money on both hardware and software.

In my short time in the industry, I've learned that no single technology automatically produces savings. Even the best of technology can be used in "sub-optimal" ways. Alright, stupid ways. When a technology is used improperly or is seen as a panacea that will solve all problems everywhere, there's often a cost.

The organizations that seem to get the most out of technology have developed an overall architecture that makes room for changes, future technology and the like. They've included thoughts about management and security in their plans. They adopt technology only when it can be made to fit in their architecture without causing disruption. If a suppliers offers a technology that seems to offer benefits when taken on its own but, will cause disruption when put into the organization's network, the organization says "no thanks" and continues based upon their plan.

Does your organization have a plan for the adoption of technology or do they have separate teams for infrastructure, network, database, application and virtualization technology?

Do you think that any technology really offers automatic savings?

Topics: CXO, Hardware, Software, Virtualization, IT Employment

About

Daniel Kusnetzky, a reformed software engineer and product manager, founded Kusnetzky Group LLC in 2006. He's literally written the book on virtualization and often comments on cloud computing, mobility and systems software. In his spare time, he's also the managing partner of Lux Sonus LLC, an investment firm.

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2 comments
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  • No, care is needed.

    Dan,

    Thank goodness you've asked the question. The King has has no clothes, and
    to date no-one has mentioned it.
    My take is that virtualisation in the form of VMs will eventually make a real
    saving, but to get it right, there needs to be an up-front spend on investment.
    Really good servers (plural) and networking will be required, and at least two
    members of staff (to cover for one another) must be fully-trained and
    conversant with backups, restores, and moves.
    This is one technology that needs to be done top-down (as above), not ad-hoc and
    piecemeal. A shoddy approach will result in lost or accidentally deleted VMs,
    poor performance, and too many eggs in very fallible baskets.

    In answer to your question about organisations and their approaches, I regret to
    say, the UK public sector is usually not good at either planning or investing in
    infrastructure. The money gets frittered on fixing things that should never have
    been problems.

    Regards.
    peter_erskine@...
    • I'm reminded of a quote...

      Failing to plan is planning to fail.
      Alan Lakein
      dkusnetzky@...