Innovation, automation keep down outsourced data center bills

Renewals for data center outsourcing deals during the past year reveal a drop in prices, thanks to increases in automation, and server and storage demand.

Gas prices have been steadily falling lately — something outsourced data center costs have also done for buyers during the past year.

In the $70 million data center infrastructure utilities space in the U.S. and Canada, prices on renegotiated contracts have eroded by about 10.5% in the past 18 months, according to a survey of about 200 clients by Gartner in 2015. This is among several major data center outsourcing trends identified by the analyst firm.
“What we are seeing are continuous improvement and automation efforts,” said David Ackerman, a research director at Gartner.

Among the top outsourced data center vendors are IBM, Hewlett Packard Enterprise, Dell, HCL Technologies, Computer Sciences Corp., Atos, Unisys and Accenture, based on rankings by Gartner that examined each provider’s market understanding, product strategy, innovation, customer experience, market responsiveness and operations.

About 30% of outsourced data center pricing is variable, according to Ackerman, with unit-based pricing the most common practice. Variable pricing is also based on shared risk and reward, and some is incentive-based, he said.

One of the data center outsourcing trends Ackerman wants changed is for buyers to push for more innovation in outsourcing deals, and to share the responsibility for the risk and reward from that innovation.
“If you don’t have it in the contract, don’t expect it,” he said.

The price drop comes as demand increases, with a 24% increase in server capacity and a 38% increase in storage demand annually.

The onus is on companies to decide whether to outsource some of their data center operations.

“How long are we going to see value in having our own data center?” said Nick Everard, senior manager of North American Technology Services at Ferguson Enterprises Inc., a plumbing distribution company in Newport News, Va.

Everard is trying to be better informed about his outsourcing options while he operates one on-premises data center and one colocation data center.

I am always analyzing the cost and benefit of maintaining the infrastructure we have.
Nick Everard
senior manager of North American Technology Services, Ferguson Enterprises
“I am always analyzing the cost and benefit of maintaining the infrastructure we have,” he said.

Outsourcing his data center might not be the way to go, Everard said. Four years ago, as part of a project to put in place an ERP system from SAP, he moved into two colocation data centers near each other.

Everything changed, though, when the company aborted the SAP move.

“When we threw SAP out and fell back to the legacy ERP, we dropped one of the colos,” he said.

The company’s on-premises data center is “not quite an enterprise data center,” used mostly for test and development with some production applications, according to Everard.

The colo space is an enterprise-class data center, and the goal is to move all of the company’s production there.

Don’t forget about the cloud

One of the biggest weaknesses for data center outsourcing vendors is that they don’t promote cloud computing well, Ackerman said.

Those providers often do not aggressively push to move legacy environments to the cloud, and they should be more aggressive with contracts that allow companies to move to the cloud without penalty, according to Ackerman.

“Many CIOs that I talk to say they would like to see their data centers empty out over time, because they are moving workloads to the cloud,” Ackerman said. “That needs to be embraced by providers and their contracts going forward.”

Some companies have found that the quality of service from so-called low-cost geographies has been poor, and some providers may not be using data center tools well, such as a data center infrastructure management system.

“It doesn’t mean they can’t use the tools or know what the tools are, but they may not be using the in-depth features of the tools that can really bring some capabilities to the data center,” Ackerman said.

Enterprises need to know their business and IT needs, and pick a vendor to meet those needs. Most users are looking for service providers that can support a specific workload, and not necessarily the biggest vendor or the market leader, Ackerman said.

Strengths of data center outsourcing vendors lie in standardizing processes, consolidating data centers and the service management that is provided, according to Ackerman.

“There’s definitely some consolidation and reduced complexity going on out there, and the providers have done a good job on that,” he said.

One of the most significant challenges for buyers is dealing with mainframe workloads. The number of Ackerman’s clients that are looking for help with mainframe workloads has “escalated significantly” during the past year, with staff retiring and enterprises wondering what to do with the mainframe workload.

IBM is not the only choice for mainframe work, Ackerman pointed out — half of the top data center outsourcing vendors also do mainframe work.

“You don’t have to [go with IBM],” he said.

Some enterprises are also using data center outsourcing for hosting virtual desktops, with 18% of the users surveyed by Gartner doing it with Citrix, VMware and Microsoft making up most of the work.

During the next year, buyers will continue to see vendors make use of economies of scale, and capitalize on expanding server and storage demand, bundle more services — for example, data center with networking — and devise more standardized portfolios.

Source: techtarget-Innovation, automation keep down outsourced data center bills


Here’s Who Made Gartner’s 2015 Magic Quadrant For Data Center Outsourcing

Commoditization Threatens Margins In Data Center Management

Annual double-digit declines in revenue per managed server have outpaced fast growth in the number of data center clients, resulting in the world’s largest data center outsourcing and infrastructure utility service providers losing $1.2 billion in North America in 2014.

This market — which is expected to come in at $79.2 billion worldwide and $29.8 billion in North America this year — is slated to grow 1 percent to 3 percent in the coming years, with data center outsourcing sales falling 3 percent to 4 percent and infrastructure utility outsourcing jumping 11 percent to 14 percent as demand grows for external management of on-premise private cloud environments.

Market research firm Gartner’s North American Magic Quadrant for Data Center Outsourcing and Infrastructure Utility Services evaluated 21 IT companies with management services for mainframe and centralized server environments. Here is how the Magic Quadrant shaped up, according to Gartner’s analysis.


The Gartner Magic Quadrant evaluates service providers on two sets of criteria: their success on delivering results today and into the future (Ability to Execute); and their service operating model and strategic plans for growth and service improvements (Completeness of Vision).

Five of the 21 firms Gartner evaluated are considered Leaders, meaning they have a clear vision of the market’s direction and develop competencies to maintain their leadership. Two are Visionaries, meaning they have a clear vision of the market but need to improve their penetration of the North America market.

Nine firms are classified as Challengers, meaning they execute well but have less-defined views of the market. And five providers emerged as Niche Players, meaning they focus only on a particular service or limited number of North American markets.

Leader: IBM

IBM continues to hold its spot as the largest competitor across cloud and traditional environments, even after a 5.8 percent decline in Global Technology Services revenue.

Gartner estimates that the Armonk, N.Y.-based mainframe management goliath — whose global services practice is No. 1 on the CRN 2015 Solution Provider 500 — will have about $3 billion in revenue in the space.

In 2014, IBM said it would pour more than $26 billion into big data and analytics and continue investing in its cognitive computing initiative, Watson, to the tune of $1 billion. IBM said it plans to increase revenue coming from data, cloud and systems of engagement from $25 million in 2014 to more than $40 billion.

Strengths: IBM said it will be moving away from a business model that focuses on simply providing technology and management services, instead concentrating on helping individual clients solve their business problems. In this way, IBM is actively avoiding market commoditization. Clients applauded IBM for its size, relationship management and willingness to switch to a managed service model.

Cautions: Gartner estimates that IBM’s strategic outsourcing business lost $1 billion in 2014 and said the company will have to review its strategy, expand the reach of its partner ecosystems and manage the tradeoff between its own SoftLayer cloud and enabling client use of other clouds like AWS or Azure. Clients report IBM lacks automation, responsiveness and cost competitiveness under certain conditions.
Leader: HP

The then-Hewlett-Packard’s data center outsourcing and infrastructure utility services revenue declined 5 percent in 2014, according to Gartner.

The Palo Alto, Calif.-based company, whose enterprise services division ranked No. 3 on the CRN 2015 SP 500, had more than 30 data centers and 78,000 physical servers in North America.

HP had 490 infrastructure utility and cloud-based services clients globally, of which roughly 35 percent are in North America.

Data center outsourcing and infrastructure utility services are key components of HP’s $14 billion global IT outsourcing business, according to Gartner.

Strengths: HP’s investment in the Helion cloud brand and acquisition of Eucalyptus have moved the vendor toward enabling AWS-compliant private clouds and managing hybrid, traditional and cloud-based services. The vendor offers a comprehensive portfolio of data center services spanning from cloud migration advisory services to high-availability services.

Cautions: The penetration attained by HP’s managed virtual private cloud and utility or managed private cloud is still below 15 percent, according to Gartner. The vendor faces an uphill battle in maintaining its leadership in traditional enterprise services because of a significant loss in market share. Some clients have indicated that HP’s response to contracting and provisioning is slow, Gartner found.

Leader: CSC

CSC’s overall global revenue declined by 8 percent in 2014, to $13 billion, because of restructuring, cost optimization and product development efforts, the analysis said.

The Falls Church, Va.-based company, No. 5 on the CRN 2015 SP 500, has adjusted its data center outsourcing strategy to focus more on cloud-based infrastructure and partners, offering integrated and automated delivery options for both legacy and cloud platforms.

CSC’s data center contracts typically range from $2 million to $500 million, with a market sweet spot of $10 million.

Strengths: CSC is experiencing exponential growth in data center deals worth less than $1 million, thanks to its reliance on cloud and hosting partners and embracing an “as-a-service” delivery model. The company has seen an increase in advocates and 30 percent decrease in detractors, thanks to launching next-generation delivery centers, standardizing service delivery and a new Net Promoter program.

Cautions: CSC’s data center outsourcing business declined in 2014 as small and midsize clients pushed to fill the hole created by a drop in megadeals. Speculation that CSC could be an acquisition target may also reduce clients’ willingness to add the company to their short lists. Clients were dissatisfied with CSC’s offshore service team, reporting to Gartner that local account teams don’t have access to expertise and knowledge.

Leader: HCL Technologies

HCL’s modest data center outsourcing and infrastructure utility services growth in North America and healthy growth in the EU helped drive what Gartner estimates is a 14 percent increase in business.

Gartner also estimated that the Noida, India-based company grew its data center outsourcing and infrastructure utility services revenue in the United States and Canada by 5 percent last year, thanks to automation and investing in third parties’ next-generation data centers.

Gartner said that investment has created a positive perception around HCL’s strategy.

Strengths: HCL achieved one of the highest absolute growth rates in 2014 by creating megadeal pursuit teams that have signed more large, complex deals than the company has historically seen. The company has invested nearly a third of its R&D budget on developing a next-gen data center, as well as using Software-as-a-Service to automate the SoftLayer, Amazon Web Services (AWS) and Azure platforms.

Cautions: HCL is new to the business and IT consulting and verticalization game, and its limited credibility may stunt its growth. Gartner says HCL must raise its visibility and cites HCL’s lack of a physical data center as a challenge, because many clients shy away from vendors that do not have their own data centers. Clients reported HCL faces staffing challenges, especially in skill sets that are hard to find

Leader: Dell

Dell’s data center outsourcing and infrastructure utility services revenue came in at roughly $850 million in 2014, according to Gartner.

The Round Rock, Texas.-based company — whose services practices is ranked No. 9 on the CRN 2015 SP 500 — has nine multiclient data centers and 39 managed customer and colocation sites. Dell is focused on the data center infrastructure, compute, network, storage and server markets, according to Gartner.

Dell has acquired 12,000 new customers — 7,000 of which have seen line-of-business expansions around hardware, software or services — since going private in 2013.

Strengths: Dell is servicing the software-defined data center by both building its own storage stack and partnering with leading hyper-converged, hypervisor and open-source vendors such as Oracle, SAP and VMware. Dell also expanded its data center portfolio with new switch options. Clients praised Dell for its robust, standardized methodologies, quality assurance processes and technical personnel expertise.

Cautions: Dell still has some way to go to catch other providers that had a head start in cloud-based “as-a-service” solutions. The vendor has sometimes been risk-averse when it comes to innovation, resulting in long implementation lead times for new initiatives. Some clients have been less that satisfied with Dell’s thought leadership and reported that the vendor has a high attrition rate, according to Gartner.

Challenger: Unisys

Unisys offers complete managed services solutions that layer on top of IT infrastructure, providing a nearly end-to-end service for customers. The company reported $332 million of its $784 million data center outsourcing and infrastructure utility services revenue was generated in North America.

The Blue Bell, Pa.-based company — No. 19 on the CRN 2015 SP 500 — runs 14 data centers in the U.S. and Canada and operates 36 globally. Unisys is partners with Google, Microsoft Amazon Web Services, and Virtustream to provide public, private, hybrid and multi-cloud services.

Strengths: Unisys is moving to hybrid IT and a more asset-light ecosystem, Gartner said. The company’s focus on combining its services with cloud is a practical approach reinforced by investments in service automation, service management/integration and security. Clients said the costs of Unisys’ services were competitive and appreciated the scalability and technical expertise in data center management.

Cautions: Unisys may be overdependent on federal and other government contracts in the future. Unisys is incorrectly perceived as having a hardware-limited focus on the market, which the company needs to change by marketing its infrastructure utility services and cloud-based resources in North America. Clients reported that they wanted more access to offshore resources to reduce project costs.

Challenger: CompuCom

CompuCom’s data center practice grew to $125 million in 2014, representing an 8 percent jump over the year before. The growth rate is well above the North American average for data center practices, Gartner said.

The Dallas-based company, No. 23 on the 2014 CRN SP 500, supports 48 secure data centers throughout North America.

CompuCom offers a full range of data center outsourcing services, including managed services and remote infrastructure monitoring capabilities that can be integrated to provide end-to-end support.

Strengths: CompuCom has recently partnered with AT&T around network access, cloud access and mobile access solutions. The solution provider is well-suited for midsize financial services or retail clients, Gartner found, as well as Canadian firms. Many clients said that CompuCom has excellent account management performance, with a strong focus on service delivery and responsiveness.

Cautions: CompuCom is focused on private and hybrid cloud, and is not making significant investment in public cloud Infrastructure-as-a-Service. The company also frequently hires subcontractors for delivery, resulting in a lack of clarity, accountability and ownership. Gartner said CompuCom should focus more on process improvement, with clients reporting little complex issue coordination and management.

Challenger: Atos

Atos’ data center outsourcing business passed the $2 billion mark globally, Gartner reported, 20 percent of which is based in North America.

With market trends slowing organic growth, Atos has acquired enterprise data company Bull as well as Xerox’s Information Technology Outsourcing business.

The company’s acquisitions are focused on creating new services for big data and security and leveraging its Canopy enterprise to enable the creation of hybrid clouds.

Atos’ use of proven practices for data center, server consolidation and virtualization help it standardize all of an enterprise’s IT infrastructure and provide services on a pay-per-use, “utility” basis.

Strengths: The acquisition of Xerox’s ITO business provides Atos with a strong foothold in North America and is in sync with the company’s 2016 ambition to become a Tier 1 global service provider. Atos’ focus on optimization is intended to result in less expensive and more secure data centers able to deliver scalable cloud services at lower prices. Clients liked Atos’ flexibility and responsiveness to changes.

Cautions: Atos’ organic data center outsourcing revenue declined in every region last year. Atos’ initiatives surrounding its new acquisitions, consolidating its data centers and expanding globally will require strict focus to avoid reducing customer satisfaction. Gartner reported that clients said Atos has shown limited ability to deliver projects that are not part of its core data center services.
Challenger: Infosys

Infosys’ North American data center outsourcing and infrastructure utility services sales grew by 18.7 percent in 2014, to $531 million, according to Gartner, with global revenues from those technology segments climbing to $910 million.

The Bangalore, India-based company’s strategy of design-led thinking and innovation appears to be working, Gartner said, with the solution provider recently winning 16 deals each worth more than $15 million.

Infosys also runs a $500 million investment fund to develop promising IT startups focused on helping enterprises move into cloud computing and software-defined technologies.

Strengths: Infosys has increased its investment in innovation by five orders of magnitude as the company unifies its go-to-market strategy for cloud and infrastructure services. The solution provider also acquired automation technology firm Panaya, expanded its data center networking presence and developed data center capabilities to host business platform offerings.

Cautions: Infosys has been struggling with high attrition rates for the past two to three years, which can result in a short-term challenge for clients. Gartner said the company must continuously revise its portfolio, broaden its country footprint and improve its global visibility. Clients said that Infosys lacks technical expertise, especially in database domain, and has a limited ability to scale on-site resources.

Challenger: Wipro

Wipro’s North American data center outsourcing and infrastructure utility services revenue increased 13.8 percent in 2014, to $555 million, making it the largest chunk of service revenue in the region.

Wipro’s global growth in this technology area is even more impressive, with sales rising nearly 20 percent in 2014, to $1.18 billion.

The Bangalore, India-based company, No. 21 on the 2013 CRN SP 500, has achieved this growth by demonstrating leadership in automation capabilities and through a strong focus on both traditional and industrialized low-cost services, according to Gartner.

Strengths: Wipro’s vision for the future focuses on data center services, Internet of Things initiatives, cloud brokerage and smart automation. The company is embedding its numerous tools into “as-a-service” based pricing and delivery mechanisms. Clients said Wipro is very accommodating, willing to adapt to changes in requirements without asking for a change request or imposing additional costs.

Cautions: Wipro lags behind large firms when it comes to competing for some global contracts because of its lack of a strong global cloud partnership ecosystem. The company may also be somewhat stressed by efforts to integrate local culture and meet local data protection and security requirements. Clients said that Wipro’s procurement activities for new offerings need to be more responsive and effective.
Challenger: Capgemini

Capgemini reported its North American data center outsourcing and infrastructure utility services business reached $390 million in 2014, a 12.1 percent increase over 2013. Gartner reports that the increase was boosted by improved margins as a consequence of the company’s globalization program.

Paris-based Capgemini, No. 5 on the CRN 2014 SP 500, owns 39 data centers, along with several offshore locations spread across the Americas, Europe and Asia/Pacific. The company has been increasing its focus on RIM, automation, cloud migration, orchestration and brokerage services.

Capgemini recently acquired Bridgewater, N.J.-based IT services company iGate for $4 billion, broadening its offerings in North America and increasing its scope globally.

Strengths: Capgemini has been increasing its footprint and revenue in the U.S., with its focus on service delivery optimization to enhance profitability. Capgemini’s portfolio includes “as-a-service” offerings that allow the company to focus on delivering technologies that are manageable through a vertical integration approach. Clients said that Capgemini is flexible with its contract structure and pricing.

Cautions: Capgemini’s progress in its data center consolidation and service delivery standardization currently lags behind competitors’, Gartner reports. Unless Capgemini links its go-to-market strategy with capabilities in its consulting, application services and vertical expertise, the company will not be able to take advantage of emerging opportunities in digital business and the Internet of Things.
Challenger: Tata Consultancy Services

Tata Consultancy Services — No. 4 on the CRN 2015 SP 500 — increased its data center outsourcing and infrastructure utility services global revenue by nearly 25 percent in 2014. That increase was heavily influenced by its growth in North America.

The Mumbai, India-based company has consistently stressed the importance of leveraging secure, regionally interconnected locations, effective leveraging its own cloud and seamlessly integrating its offerings across public, private and hybrid clouds. The company’s focus has consistently propelled Tata’s solutions forward.

Strengths: TCS has created more than 10 vertical-specific strategies in areas ranging from government to manufacturing. Gartner reports that Tata has a 98 percent customer retention rate and strong delivery pipeline. Its automation, business management, cloud and global delivery approach coupled with its new automation product may further improve the company’s market traction, Gartner said.

Cautions: TCS’ infrastructure utility services growth has historically been curtailed by its selective pursuit of deals providing end-to-end solutions. TCS’ attrition rate also continues to grow every quarter, and unless it figures out how to retain personnel, TCS will not be able to meet projected head count requirements. TCS must improve its leadership presence and use of junior resources, clients said.

Challenger: CGI

CGI’s North American data center outsourcing revenue dropped by 12.8 percent in 2014, to $591 million, with global data center outsourcing revenue coming in at $1.27 billion.

The Montreal-based company, No. 15 on the CRN 2015 SP 500, runs both traditional integration services and programs to standardize its services across the globe, setting up partnerships with companies like Dell and Hitachi to help it do so.

Strengths: CGI is developing higher-level services like multicloud management and is moving toward a service integration and asset management solution for its customers. CGI’s focus on cloud migration and application modernization is a sound strategy for avoiding overexposure to commoditized services. CGI is moving toward a partnership-based approach to its service delivery and go-to-market strategy.

Cautions: CGI’s geographic structure increases the risk of inconsistent service delivery and can hurt its ability to deliver global solutions. CGI also suffers from a lack of brand recognition since it was a latecomer to integrating global delivery. Clients report a lack of relevant automation initiatives by CGI and stated the need for CGI to improve its cloud offerings and backup technology.

Toy can red more information at: CRN-Here’s Who Made Gartner’s 2015 Magic Quadrant For Data Center Outsourcing

Checklist of IT KPIs for responsive data center ops

The right metrics, aligned with business needs, strengthen data center monitoring and capacity planning. KPIs orient IT performance to specific goals.

The traditional focus on hardware and software monitoring is shifting to a business focus using key performance indicators (KPIs). IT KPIs gauge abstract targets, such as user experience or job ticket turnaround effectiveness.

The difference between IT KPIs and common IT monitoring is the involvement of business leadership. Any organization can deploy tools to track the computing resources assigned to VMs or watch the bandwidth utilization on servers. Granular technical factors can be helpful to IT staff, but have little practical value to the business. Insights from KPIs allow management to justify investments to remediate issues.

KPIs help business executives gauge the impact or success of IT. For example, a business dependent on Web-based sales or content delivery would implement KPIs on overall computing capacity, application performance and system utilization. Additional KPIs measure the state of the IT infrastructure, including transactions, efficiency and agility.

Although ITIL has a general set of suggested key performance indicators, there is no single set of universal KPIs that fit every purpose. IT KPIs typically fall into three categories: service delivery effectiveness, service or performance efficiency and agility (responding to change). Organizations like IT service providers also use service availability KPI metrics.

Service delivery effectiveness

  • Throughput

The user load or demand on an application or system(s). Throughput is often expressed as the number of transactions or measure of computing work.

  • Response time

This KPI covers how much time is needed to complete a transaction.Response time may include multiple infrastructure elements, including servers, networking and storage. It may be tied to service level agreements (SLAs).

  • Utilization

The amount of physical or virtual computing resources or capacity that is actually used, as compared to total capacity, yields a utilization rate. For example, if a VM is assigned 10 GB of memory and it uses 10 GB of memory, utilization is 100%.

  • Uptime

Uptime measures the percentage of time that an application or system is running. Technologies like clustering, resilient servers and network failover all help gird uptime against individual failures.

The organization uses these metrics to compute its custom service delivery KPI. For example, if throughput and uptime are high and response time is low, the service delivery score will likely be good — regardless of utilization. But if utilization and response times increase, and throughput or uptime fall, the waning score brings to light potential IT issues.

Service efficiency or performance

  • Workload efficiency or performance

This derived index compares a workload’s allocated resources to utilized resources. It shows if a workload is wasting resources, oversubscribed (resource starved) or just right.

  • System efficiency or performance

System efficiency is another derived index comparing a server’s allocated resources to its available resources at an optimum load. This shows if the server is wasting resources or is oversubscribed.

The metrics for workloads and systems are typically aggregated across the data center to calculate a weighted average. The team can quickly gauge status for the period and compare it to previous periods — justifying new technology initiatives and investments to preserve and enhance efficiency figures. A poor KPI may require workload balancing or a technology refresh project.

System agility

  • Service requests resolved

This measures the number of help desk tickets, support calls or other service requests addressed and resolved successfully within an acceptable time period.

  • Time to resolution (TTR)

TTR tracks the amount of time needed to address service requests. Examples include how long it takes to evaluate, justify, approve and provision a new VM once a request is received, or make changes to resource allocations once a performance impairment is detected.

As the number of IT service requests increases and TTR decreases, it can be inferred that IT is agile and able to respond to changes in workload or user demand. If the number of requests increases and TTR increases, IT faces pronounced agility concerns.

Service availability

IT service providers — or any IT organization bound by SLAs — might adopt an SLA KPI that involves a wide range of metrics.

  • Resolution percentage

This IT KPI metric measures the percentage of help or service requests addressed within an acceptable period.

  • Uptime

Uptime is how much the service was available over the billing cycle. Some amount of service disruption is unavoidable, but uptime is a means of gauging SLA adherence and business performance.

  • Mean time between failure (MTBF)/ mean time to repair (MTTR)

MTBF and MTTR gauge fault frequency and how long it takes to fix them.

  • Number of action items

This is the number of complaints or service requests that IT receives. Increases in this number indicate problems with certain systems or platforms.

Collecting all of this data, weighting it, and formulating a result provides business leaders with an important early warning of SLA problems, offers the basis for follow up or discussion with IT leaders, or spawns a business goal for service improvement.

KPI oversights

  1. Subjective metrics, such as user satisfaction, are based on objective characteristics like app performance or throughput, but the perception of the KPI may be skewed or used improperly. Always use objective, measurable parameters.
  2. When business and IT leaders look at the same KPIs the same way forever. For example, a business might track system utilization and uptime. Early on, utilization was more important, but as services evolve and utilization reaches goals, uptime takes on greater significance.
  3. When business leaders fail to update KPIs as the business model matures. For example, a greenfield data center build focused on energy consumption and cost control. Once it met those goals, the focus should change to improving IT service quality or agility.

Select the KPIs to measure

Perhaps the most important — but overlooked — aspect of KPIs is business relevance. Accounting, marketing, sales and IT can manage and report on granular metrics generated by a myriad of sources, systems and tools. But not every metric is essential for business decisions or measuring goals. And essential metrics vary from company to company, even project to project.

Select IT KPIs by first understanding the goals. A business that focuses on IT services will pay attention to transactional- or throughput-related measurements under various load conditions and activity levels. Conversely, a business concerned with controlling IT costs selects KPIs around computing resource availability, utilization and system power consumption.

Then, select areas that can be measured, establish thresholds of performance, implement measurements with monitoring or management tools and generate periodic or ad-hoc reports that show KPI data over time.

Source: techtarget- Checklist of IT KPIs for responsive data center ops by Stephen J. Bigelow

Santander data storage: Gimmick or real challenge to IT giants?

Spanish bank Santander is taking on the IT giants at their own game by offering data storage to its corporate customers: But is this just a side show to inject confidence in an industry facing increasing competitive tensions.

While banks have the trust of their corporate clients, they cannot compete with companies such as Amazon and Google when it comes to scale for services such as data storage.

But Santander chairman Ana Botín recently said banks are perfectly positioned to offer corporate services such as data storage.

“As I think, ‘How I am going to compete with all these new technology players?’ I can offer the same services as some of these big guys,” she said. “As a small business or private individual customer, where you lodge your information is something you should think about. One of the things banks have is trust and resilience and, with all the cyber risk, that is incredibly important.”

Botin had a point. The fact that people perceive banks as safer places to store data, and that banks are heavily regulated, could make them competitive. Research of more than 6,000 consumers from Bizrate Insights found 72% of respondents trusted their bank with card details. In comparison, 45.4% trusted Amazon, 21.4% Apple and 12.9% Google.

But this might be a misconception. PayPal has 157 million active users, which is more than most banks, while Facebook has more than one billion users and holds a lot of sensitive data. Meanwhile, Amazon boasts more than 244 million users. In comparison, Santander has 107 million customers, Lloyds Bank has 30 million, HSBC has 52 million and Barclays has 48 million.

Read more at: Santander data storage: Gimmick or real challenge to IT giants? by Karl Flinders

Data Center Building vs. Outsourcing: What’s Best For Your Business

Ernest Sampera is the Chief Marketing Officer of vXchnge, a carrier-neutral colocation services provider that helps improve the business performance of its customers.

When businesses are on the fast track and experiencing growth, they often find themselves in need of additional storage space for their data. Whether it’s adding additional applications for email, streaming or other critical resource-intensive applications, businesses must make the decision to lease data center space or build an in-house storage infrastructure.

Whether looking to support critical applications or simply manage day-to-day operations, the IT needs of every company vary. Eventually, the right decision comes down to what offers the best advantages and which strategy maximizes the organization’s data storage total-cost-of-ownership (TCO).

There are a number of factors to consider when making the decision of whether to own or outsource a data center, including virtualization issues, different cloud computing environments and simply, the way companies handle different IT issues. It is important to analyze all options in order to make the most appropriate decision that best suits a business’ needs.

Building Your Own Data Center

If building out an existing property, the estimated cost is around $200 per square foot to build a data center, according to Forrester. Additionally, to have fiber installed on the site can cost over $10,000 per mile to simply reach your location. Larger companies have extensive financial resources to cover all construction and fiber costs and are able to handle an influx of staffing and IT needs including infrastructure maintenance, around-the-cloud monitoring and the additional cooling that may be required. This means that building an in-house data center may make the most sense in the long term for a larger company with expansive amounts of data.

Outsourcing to a Reliable Data Center Provider

Smaller companies, including those with cloud compute solutions, require a certain amount of data storage space in order to grow its business. A startup may require only a small amount of cabinets, three or four, for example, yet complete dependency for connectivity is required. In this case, due to the cost, it is prohibitive for a small company to build its own data center infrastructure.

Read more at:  Data Center Knowledge- Data Center Building vs. Outsourcing: What’s Best For Your Business by Ernest Sampera