Data Center Consolidation: Avoiding Surprises and Returning Business Value
We see many organizations, papers, vendors, etc. discussing data center consolidation.  Wonderful projections and claims are being provided by vendors. But many Data Center Consolidation decisions are not being made on solid, objective cost analysis. Studies show that about 21% use consultants, and about 17% use ROI calculators from vendors. Hopefully these analyses provide accurate costs and savings.Â
But there is another way…
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Repeatable, credible & risk oriented
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Documented analysis using sound estimation process
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Application of SEER-IT for cost, schedule, risk analysis
Galorath’s approach is to first model the as-is approach in a fully justified approach, then to estimate the to-be approach. Full risk analysis is performed as well, ensuring you understand the range of probabilities.
If you are interested in a viable estimate including cost, headcount, schedule, and risk of data center consolidation, contact Galorath. Everything from software assets to hardware assets, facility assets, and real estate assets are analyzed. People, power and other analyses are included. Additionally, the cost of shutting down the legacy must be included in a complete analysis. These could be substantial.
The following example shows nearly $100 million in savings over 7 years at a cost of $33 million.
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To discuss this analysis or to get started on data center consolidation analysis, contact Galorath, worldwide.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Estimating Best Practices
The following are the bullet points from Dan’s paper on estimating best practices. Â Using these best practices can increase project success dramatically.
- Decide Why You Want An Estimate
- Map Estimation Goals To Estimate Process Maturity & Develop Plan To Achieve The Maturity
- Have A Documented, Repeatable Estimation Process
- Evaluate Total Ownership Cost; Not Just Development
- Estimate A Range And Pick A Point For The Plan
- Re-estimate The Program When It Changes
- Avoid Death Marches: Programs With Unachievable Schedules Are Likely To Fail And Drain Morale
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
IT Project Failure Warning Signs
This list was adapted from ITBusinessEdge
Lack of governance: Project criteria, roles, processes & outcomes not used or accepted by management. Â Not understanding project risk.
Internal politics: Territorial fights. Â Its not my job, or “they” messed up.
Communication issues between the business and IT: IT talking with the business stakeholders about bandwidth and blobs rather than end user oriented benefits.
Unclear expectations: Bad estimates and ambiguous expectations.
Lack of fact based analysis: Plans not based on facts but on opinions. Â Studies have shown, for example, that projects of any magnitude can’t produce a viable estimate without a model like SEER.
Lack of input from users: IT may know how to do it but users probably know what they need better.
Changes in project without re-planning
Unplanned changes in key personnel
Unrealistic schedules: Projects on death marches.
Unanticipated operations costs: These must be estimated well up-front
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Cost To Recover from an IT Business Interruption
Aberdeen group published some interesting information regarding the time and cost to recover from business interruptions. Â This is the time to recover 90% of functionality. Â I recommend getting the complete report. Â They found that best in class recovered 6.5 times faster than laggards and had an average cost of $72,000 versus laggards with an average cost of $2,880,000.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Live From UK Williams Formula 1: Ford Motor Company Europe Uses SEER for Software and IT
This morning Ford Motor Company’s European operation presented their development process, how estimating is improving their developments and how they tie IT infrastructure and IT services into the estimate with SEER to see the complete costs, make trade-offs and produce successful solutions. They have several gates where estimates are required and a lessons learned post mortem. In an excellent talk the speaker pointed out that even when the requirements are known, there is requirements growth. This is modeled with the SEER “requirements volatility” parameter.
The presentation will be available at www.galorath.com in the next few days.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Estimating the Cost & Schedule of Packaged Software Deployments
Packages (such as ERP systems, payroll systems, etc) can be great cost savings to organizations, offloading most of the development and maintenance. But they are not a panacea and many deployments fail. About two thirds of the cost of a large package deployment is not the software itself, but the IT infrastructure and other services. SEER for IT covers all those other two thirds of the cost along with SEER for Software (SEER-SEM) which handles all the software development and COTS cognition associated with such a program. Thus a complete package deployment can be estimated, planned and controlled.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Churn Rate For On-Demand (Software as a Service) Solutions
From an email I received from Frontrange Solutions looking at tradeoffs of internal versus SaaS.
“Though many are jumping on the on-demand bandwagon, many are also jumping off. Â Churn rates for on-demand are as high as 30 percent while renewal rates with on-premise software stand in the 80 percent range. There must be a reason an increasing number of organizations that tried on-demand applications have returned to an on-premise solution. Â For reasons such as:
- total cost of ownership
- ease of customization
- control of data
- process automation options
- user-interface
- disaster recovery
What this doesn’t seem to show is whether those who drop out of SaaS go to an internal solution or just stop doing that SaaS function. This needs more study.
After the recent disaster where the building where we host our mission critical applications (with its backup generators, etc) was without electricity for two days, we are actually investigating getting our email and other functions out onto a data center ourselves. Â It is more expensive since we have already invested in infrastructure and IT services. Â But it may be worthwhile for disaster recovery. Â Of course the questions of what if the data center has a disaster itself, how do we keep long term backups, etc. are still unanswered.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Software Product Engineering Benchmark By Aberdeen
According to Aberdeen research study Software Project Engineering Outsourcing.. the value of Agile in outsourcing
- Reduce Development Cost  57%
- Lack of In-House Resources  50%
- Allow internal staff to focus on innovation 30%
- Improve time to market 25%
Benchmarking
| Productivity Scorecard Comparison | Â | Â | |
| Â | Best (Top 20%) | Average (Middle 50%) | Bottom 30%) |
| Â | Â | Â | Â |
| Project cost | -17% | 3% | 22% |
| Time TO Market | -10% | 2% | 28 |
| User Satisfaction | 18% | 4% | -4% |
ITIL Usage
Even best in class organizations onl 22% se ITIL with virtually no adoption by the average or laggards
Agile Development
Agile developers are more likely to use project management tools, code development and testing technologies, real-time progress tracking and other tools.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Eating the IT Elephant: Moving From Greenfield to Brownfield Development
The book “Eating the IT Elephant“ discusses the issues of moving from developing new systems to continuing evolution of legacy systems and provides practical, step by step methods of getting these under control. It discusses Brooks Law and its fundamental truths and then says “Brooks had it easy.” It points out that Brooks’ original work was developing a new (Greenfield) system with a local team. And that today our teams are global, our systems are scattered and interrelated.
It discusses the demands of global systems, project reporting, change management, induced complexity (the technology itself is rarely the problem but the way the technology is put together becomes the “induced complexity”), requirements definition and, my favorite, ORGANIZATION and PLANNING.
While the book does not reference SEER directly, it discusses the difficulties and probable failure of projects that do not understand the minimum time, the realistic costs and the risks.
This book recommends EVERYONE read Frederick Brooks’ book, “The Mythical Man Month.” I heartily agree. It has been interesting to see others attack Brooks Law , “There is an incremental person when added to a project that makes it take longer, not less time, and adding people to a late project makes it later.” Brooks Law is alive and well today and involved in nearly every Brownfield “legacy innovation system” as well as new system. The key is making sure you are viewing Brooks Law at the correct level.
The book includes a process for “eating the elephant,” improving Brownfield developments. I recommend giving it a read.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
IT Costs Per Transaction Provide Valuable ROI Basis
Here was a recent post on the Harvard Business Blog on understanding the transaction costs of IT. According to the blog:Â
- the IT cost per equity trade is approximately $0.17
- the IT cost per hospital bed is $65 per patient
- the IT cost per trucking mile is $0.18
“…executives usually think about technology in terms of percentage of revenue, or percentage of operating cost — which contains almost no useful operating insight at all”
I thought this was an excellent point and looking at IT costs in this way can add reality to the cost of IT. What we need now is the business value of IT. For example, if having IT for a hospital bed includes automated monitoring and reduces staff or increases correct treatment (hospital error is shown to be the third largest cause of death in hospitals, according to some studies) we can make the most appropriate decisions.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.
Project Prediction Infographic
