Strategic Data Center Ownership - What does it Mean?

Mark Thiele, EVP Data Center Technology, SuperNAP

Mark Thiele, EVP Data Center Technology, SuperNAP

The importance of even the abbreviated list above cannot be under estimated. If the data center is in fact critical to the company’s success, then it must be answerable in real time to business needs, in all areas of need; agility, cost control, enablement of technology access, support for growth flexibility, CapEx vs. OpEx investment priorities, and sustainability objectives among others

Few companies can answer any more than two to three of the questions outlined above in anything approaching real time. Of all of the above questions, TCO and accurate business influenced budgeting are usually the two questions that can’t be answered or are answered incorrectly.

Let’s Just Pick on TCO

Capturing your TCO for the data center seems relatively straight forward. There are people, a building(s), real estate, power, maintenance costs, water, etc. Unfortunately, only accounting for the aforementioned items leaves out some very critical areas of opportunity. How valuable is IT agility and even more importantly, how valuable is IT What about connectivity (WAN) services. If you haven’t factored your cost to acquire and risk of ownership for connectivity to your data center you’re missing a huge piece of the cost and opportunity story.

After you’ve captured all the traditional TCO measures, I highly suggest you place a couple not so obvious measures on the table (Connectivity & Agility or Ecosystem).

Connectivity:

Most data centers have between 1 & 5 WAN service provider connection options. Having this limitation means that it will be very difficult to ensure real cost competitiveness. It also means that you are less likely to have easy access to diverse routes, shortest path, best technology solution, or strong SLA options. How could you possible apply leverage to a vendor if they know they are one of your only 2 or 3 options and that you will need at least 2 options just to satisfy resiliency minimums? Why would they negotiate fast install times or more customer focused language in their SLA or contract if they don’t have the competition forcing them to? Lastly, how could you hope to obtain the best technical solution or performance options if you only have 2-3 providers to select from? All of these factors put you in the position of having your connectivity be an inhibitor to growth and to greater technology use and adoption. Connectivity has been a wretch in the spokes of business pretty much since the beginning.

It’s time that you put yourself in the position of being able to remove the network as a stumbling block for forward progress. Solve this problem by leveraging the right partner(s). Find a service provider that has 20+ independent (not riding over each other’s fiber) providers, and ideally one that offers some form of cost negotiation benefit through the larger purchasing power of a community of buyers.

As a final note on connectivity; Keep in mind that more connectivity options to and from your data center generally translates to more connection options to each of your company’s facilities

Agility, Options, and Value in Being Part of a Strong Technology Services and Solutions Ecosystem

Have you ever thought how nice it would be to have a full service garage where you park your car every night? How could you make that happen? There’s no way a service firm or your car’s manufacturer could cost justify having a team in your car port just so you could have easier access. The value equation for you is simple; just in time support on a buy as you need it basis. However, for the manufacturer there would be no value as a single customer wouldn’t drive nearly enough business to the staff. “The art of strategically owning your data center can only be understood and practiced if you accept that the data center and the services therein are critical to your businesses success” What about if you had 1000 neighbors who all had cars from the same manufacturer and you all parked in one very large garage, now the economics start to make real sense for both parties. The aforementioned analogy is identical to what running your IT in one private space is like vs. having some or all of it in a space who’s scale creates an ecosystem of providers that you can readily work with and choose from. Similar to the Connectivity story you would have dramatically increased your pallet of options and gained a much better capability to compare cost, service, and capabilities. You’d also have a much easier ability to jump from one to the other as appropriate. Having the aforementioned options lends itself again to the idea that IT doesn’t get in the way of the business and that when you need an IT solution you can get it and get it quickly.

No More Compromises or Forced Pragmatic Decisions

IT has historically been put in the position of having to make pragmatic choices about technology solution adoption because of any number of issues including but not limited to time to acquire, complexity of ownership, and cost. The options and the resources are here to help get you away from making pragmatic decisions and instead allow you to make choices that offer the best possible opportunity to your customers. You don’t need to settle anymore.

Total Cost of Ownership is Probably the Biggest Single Measure for DC Ownership

While each of the other measures listed above are important to ensuring you are owning your data center appropriately, TCO is likely the biggest area of concern or opportunity and not just because of cost management. When you’re leveraging your resources effectively and getting the best value for them it likely means that you’re also doing more for the business with what you have. We are regularly asked to do more with less, but how about changing the mindset from Using IT to cut the cost of IT to Using IT to deliver new value to the business through innovation, agility and effective investment. If you’re focused on only the dollar you will miss the bigger picture. If you’re focused on the dollar and you don’t actually know where the dollars could be spent differently or better, you’re failing. Understanding where your real cost of operations are allows you to make informed decisions about whether to make change, leverage new partners, spend more or all of the above.

Treat the Data Center as the Critical Growth Enabling Infrastructure

Take control of your data center strategy by treating it as the critical growth enabling infrastructure that it is. Build an organization designed to “own” responsibility across all functions (Facilities, Finance, IT, Real Estate) that make up a data center. Once you have the right organization, empower them to make decisions based on opportunity not on whether its internal, external or from a siloed perspective appears to cost too much.