IT Management

Due to poor architectural design practices, data centers all around the world have become highly inefficient and fragmented. Distributed systems architectures proliferate network access points, creating tens, hundreds, or even thousands of ports that need to be protected from security intrusions. Distributed servers are notoriously inefficient from a resource utilization perspective, often being used at less than 20 percent of capacity. Underutilized distributed servers waste power and energy due to inefficient power supplies, a proliferation of network interface cards, and an overabundance of supporting network switches, hubs, and routers. Further, distributed systems architectures are rife with program-to-program interoperability issues—such as communicating between Microsoft .NET, Java 2 Enterprise Edition (J2EE), and legacy programming models—and these interoperability issues also hamper the efficiency of business processes.

To address these issues, last May IBM introduced a new model for data center design— called the New Enterprise Data Center (NEDC)—that focuses on controlling data center costs through more efficient information systems and data center designs, as well as better resource use, improved program-to-program communications, and more advanced service and process flow management practices. This NEDC model calls for:

• Increased systems/storage consolidation
• Heavy use of virtual computing involving underutilized resources (Virtual computing is the logical pooling of physical resources that enables unused resources to be easily found and exploited.)
• Implementation of a Service-Oriented Architecture (SOA)
• Deployment of automated systems and business process flow “service” management software.

IBM believes that, by redesigning data centers using the NEDC model, IT executives can collectively save billions of dollars annually. One IBM customer in Germany’s retail banking industry, Sparkassen Informatik (SI), is already following IBM’s NEDC advice and is saving millions of dollars annually in hardware, software, power, management, and services costs. This article describes SI’s business and information system environment in greater detail and shows how SI is saving millions and using the NEDC model for competitive advantage.

SI Background

Owned by the German Savings Bank Organization, SI is a highly successful provider of IT services to Germany’s retail banking industry. Through mergers and acquisitions, strong customer service and attractive pricing, SI has grown into an organization that owns more than 30 percent of Germany’s retail banking services market and now supports more than 290 savings banks, 30 million banking customers, and 175,000 banking employees.

The senior executive in charge of SI’s production data centers and network environments is Uwe Katzenburg, stellv. Vorsitzender der Geschaftsfuhrung. SI has chosen IBM as its premier information systems and services supplier and Katzenburg said he believes that choice has led to operational efficiency, especially in IT, which is key to SI’s profitability.

SI’s enterprise information systems are tuned to deliver maximum computing power without wasting computing cycles or energy. To deliver maximum computing performance, SI:

• Buys dense systems architectures (primarily large, scale-up systems and blades) that house dozens or hundreds of servers in compact systems enclosures or chassis. (By consolidating computing power into dense packages, the management of thousands of servers is greatly simplified, software licensing costs are reduced, and the need to install thousands of redundant failover servers on a one-to-one ratio is scaled back.)
• Virtualizes (logically pools physical computing resources) its enterprise-class servers to increase usage rates and reduce acquisition costs (though to date little virtual computing with x86 resources has occurred)
• Deploys advanced systems management software to automate systems/storage/network management, helping to reduce management labor costs
• Modernized its data centers—adding new power management systems to feed its dense architectures, updating its Uninterruptible Power Supplies (UPSs) to deliver the exact amount of backup power required in case of failure, and adding new cooling facilities to efficiently dissipate the heat generated by its dense systems architectures—all while significantly scaling back the number of data centers it operates. (In an age where many enterprises are building more data centers, SI has downsized from nine to six consolidated data centers over the past five years.)

The Road to Operational Efficiency

3 Pages