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The ROI of Asian Network Operations - How to Calculate Virtualization Savings
Virtualization is the information technology infrastructure option with the biggest potential since the Windows operating system. It can reduce server load, improve performance, cut down real estate space, increase safety in Asian data storage solutions, and allow faster, enhanced communication between offices. The potential is obviously huge. However for most businesses, simple potential is not enough to justify spending time and money switching to virtualization.
There needs to be concrete ROI, and there needs to be a dollar value on it before the project can begin. Measuring ROI in any situation can be tricky - we show you the method top Asian communications solutions firms and information technology consultants use to determine the savings that virtualization can deliver.
The benefits of virtualization increase exponentially with the size of a company. Where small companies still have the intangible benefits that virtualization brings, such as data security, ease of storage and reduced cost of software licenses, the actual ROI is minimal.
In larger companies running upwards of ten servers, virtualization can consolidate servers at a 1:7 ratio, and the flow-on savings are even greater than just the server maintenance. The main areas where companies need to measure their costs and apply formulae to determine IT savings are:
.Server pool costs
.Power and cooling costs
.Real estate costs
.Network requirements
There are also several other areas where companies will need to be aware of the extra costs associated with virtualization. Your information technology consultant will need to include everything, even seemingly insignificant costs like virtualization licenses, in order to gain an accurate picture of ROI over time. The areas of increased cost are:
.Cost of centralized storage
.Cost of manpower and downtime for setup
.Cost of software licenses
.Cost of systems for recovery and backup
.Cost of staff development and training
.Cost of improved security systems for the virtual server
Obviously, there are more diverse costs associated with implementing virtualization. The savings, although spread over fewer areas, can be much higher and increase along with the size of the company. The reduced pool of servers is the greatest saving that Asian network operations specialists see. The utilization rate of the CPU and memory of a server increase hugely with virtualization, and may allow a consolidation ratio of up to 1:7 for number of servers. The main factors for calculating ROI from reduced server numbers are the cost of acquisition and maintenance of the machines.
The reduced cost of real estate once servers have been consolidated will only apply for some companies that are easily able to rent out their own space, or to cease renting only part of their real estate. For others, of course, there will be no cost impact - only the intangible benefit of freeing up space to use for another activity.
Your Asian IT services firm will be able to directly measure the power output and cooling requirements per server in kilowatts per hour, which you can easily translate with information from your power company into a dollar saving. However, virtualized servers also require increased cooling per unit in some cases, which will offset these savings slightly. Check with your Asian network infrastructure firm about the technical cooling specifications of the particular servers you will be using.
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