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The Storage Economist

Two Economically Superior Customers – In One Day!

by David Merrill on Dec 12, 2012

I am working in Sweden this week, meeting with various customers and speaking at the Hitachi Information Forum in Stockholm. I was fortunate to visit 2 customers, and was very surprised to find that they embrace some key enablers that reduce unit costs of storage:

  1. Consolidation of frames, data centers
  2. A virtualized storage environment
  3. Multi-tiered storage
  4. Virtual volumes
  5. Both employ a Storage Services Catalog
  6. Unit cost ratio for the tiers very close to the 7:3:1 ratio
  7. And they do chargeback!

I posted a blog a few months ago that referenced 11 steps in a 4-phased approach to reduce unit costs. Interestingly, these 2 customers are doing many of these 11 steps evenly distributed between all 4 phases that I outlined:

  • Basics have been done, and are constantly being implemented (consolidation, tech refresh, leasing)
  • Age of virtualization (storage, some servers) with thin volumes and tiered storage definitions. Interestingly, both had homogenous storage (each one had a different primary vendor) so it seems to me that they may be missing out on an opportunity to see price reductions with competitive pricing
  • Behavior change (chargeback, catalog)
  • Challenge ownership – one is leasing, the other is a step lease that is trying to look like CoD (but it really isn’t because they cannot flex down)

Very few customers have the combination of catalog and chargeback. My estimation is less than 3-5% of IT operations use both of these methods to control configurations and costs. When you add the combination of catalogs, chargeback and a virtualized storage environment, there are some amazing results in efficiency, total cost and IT flexibility. To meet with 2 customers in one day that are doing the better part of all 4 phases is amazing.

There are cost-reducing investments and changes that can still be made to these organizations:

  • Archive tiers can be inserted to reduce the backup volume and provide searchable content in an object store.
  • Backup is a problem for both, with many ways to address their costs.
  • Migration factory is needed (one client’s virtualization choice does not help with array-based migration from older arrays from the same vendor).
    • One company is virtualizing with HDS and the other is not. Some limits with 1st generation virtualization can be pretty clear vs. 5th generation virtualization (in the controller) from HDS.
    • Both need more flexibility to match performance and availability needs with costs within their catalog. Their customers or constituents are constantly comparing and contrasting prices and services with cloud providers.
    • Both are looking at external storage managed services (their labor rates are relatively high compared to other unit costs).

The good news is there are companies that implement what I have preached and witnessed over the years. Even with these capabilities, there are still options available to help reduce costs even more.

To end on a lighthearted note as I reflect on my experience in Sweden this week, one thing that always makes me smile when clearing baggage claim at the ARN airport in Stockholm are the large poster-sized photos of Sweden’s most famous personalities. I take the order somewhat seriously (as you exit the area the importance seems to get higher). Anyway, at the exit is a picture of the King and Queen of Sweden, but they are not the most famous. Can you guess the last picture in the famous-Swedes series?

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David Merrill - The Storage Economist

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