IT is under increased pressure to make positive contributions to the bottom line and provide competitive advantage in a dynamic, uncertain business environment. When we factor in the increasing complexity of today’s Web-enabled applications, the steadily declining pool of mainframe expertise, and the ever-present need to improve service delivery, we have what appear to be insurmountable challenges for any IT organization. A business-centric approach to capacity management can help IT address these challenges more effectively, open new channels of communication, enable better strategic alignment with the business, and help ensure IT delivers competitive advantage.
Make a Positive Impact on the Bottom Line
IT is responsible for providing the infrastructure that supports revenue-generating business applications. IT also is responsible for cost-effectively managing the infrastructure and reducing Total Cost of Ownership (TCO). Maximizing business service availability and performance while reducing TCO can be contradicting objectives unless capacity management is approached from a business service perspective.
Capacity management processes have been helping IT organizations optimize IT component resources for decades. However, a component perspective and approach to capacity management don’t always account for the reality that these components are shared by a multitude of business applications. A component approach ignores the business perspective, which is key to ensuring that the decisions IT makes have a positive impact on the bottom line. IT needs to take a business service perspective when it considers, for example, deploying new mainframe technologies to optimize mainframe performance.
IBM’s specialty engines are an excellent means of adding processing power without incurring additional software licensing costs. This is a compelling financial argument that is causing many IT organizations to consider their use. In addition to software cost savings, IBM’s specialty engines provide the benefit of offloading processing from the general purpose engines and freeing up that capacity for workload growth or for new workloads. Without the ability to shift work to the specialty engines, IT could be faced with an upgrade to accommodate the amount of growth or new work. Shifting work to the specialty engines avoids the upgrade. For example, if IT shifts 50 MIPS from a general purpose to a specialty engine, that 50 MIPS is available for growth or new work, and the customer avoids having to upgrade to get 50 MIPS of additional capacity. If we assume a cost range of $3,000 to $7,000 per MIPS, then the expected saving would be in the $150,000 to $350,000 range in year one. This is real cost avoidance due to realizing additional capacity by shifting work to the specialty engine. This line of reasoning applies to shops where there’s an increasing need for additional mainframe capacity, which is the case for the majority of sites.
If IT is considering an investment in specialty engine technology, it makes sense to identify the business workloads that will either directly or indirectly benefit from the specialty engines, use analytical modeling to “test drive” the specialty engines, determine the performance impact on the business workloads using them, and quantify the expected benefit from a business-value perspective. IT organizations that don’t have business-centric capacity management processes in place will take a more technical component approach when it comes to such capacity planning decisions.
Optimizing existing resource utilization is a proven approach to optimizing TCO and has its benefits; however, if IT is truly trying to align itself with the business and make decisions that have a quantifiable, bottom-line impact, then a business-centric approach is necessary. Component performance metrics need to be aggregated and analyzed from a business service perspective. Optimally, business Key Performance Indicators (KPIs) (e.g., widgets produced per hour) should be associated with IT performance metrics to gain an even more profound understanding of how closely IT and business performance are related.
Justify New Hardware Budgets From a Business Perspective
IT budgets are increasingly constrained, and hardware upgrades are expensive. Proposals for new hardware acquisitions are closely scrutinized and require supporting proof to help justify the request. IT budgets are approved by corporate executives who want to understand how an increase in the IT budget will benefit their business, how it affects their revenue flow, and how it relates to the business KPIs they track.
A business perspective to capacity management is critical to ensuring the decisions that IT makes benefit the business. It’s much easier for IT to communicate with the revenue-generating side of their organization if they can speak in terms the business understands instead of how wonderful new technology is. The dialog will be much more constructive if IT can demonstrate how a hardware expenditure will help the business produce 20 percent more widgets per hour rather than, for example, how it will improve MIPS consumption during prime shift by 5 percent.