Consolidation: The hard truth


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High start-up costs
Even with leasing, however, consolidation doesn't come cheap. Companies that turn to storage consolidation for immediate hard-dollar savings will be surprised and disappointed. The organization will likely have to put out money to buy new storage devices--the SAN and switches if it is consolidating to a SAN--and new servers. In addition, the organization may be buying new storage management software, hiring consultants to help with the consolidation effort and will have to train staff on the new storage environment.

A Canadian energy company consolidated its servers when it consolidated storage, which isn't uncommon. So, it faced the added expenses of new servers and a major OS software upgrade along with the cost of buying a new EMC storage system with 29TB of capacity and advanced features such as mirroring. The company also consolidated its backup, which required the purchase of a large automated tape library from StorageTek.

There are, however, some ways to mitigate the cost. For example, organizations that normally lease equipment will find that leases for the new equipment can be written for a longer time period, which effectively lowers the monthly outlay, much like refinancing a house. Similarly, replacing maintenance agreements on old equipment with less costly agreements on the new equipment also will lower the out-of-pocket expenses. And the consolidated system

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is cheaper to operate and manage. At the Los Angeles Unified School District, the cost of the leased storage equipment was offset by the reduced maintenance costs. "Now, just two people internally can manage the whole thing," Rapozo says.

The energy company is just starting to see significant savings from its consolidation. When it started, the company employed about 130 people to manage its server and storage infrastructure. Today, the company runs the new infrastructure with approximately 100 people. "We were able to get rid of almost all the contractors," says the storage manager. But it took about two years to arrive at this point, which isn't exactly a fast payback.

Two consolidation options
There are two basic ways to consolidate storage, via a network--network-attached storage (NAS), a SAN or by connecting directly to a large storage subsystem loaded with ports. IDC clearly favors the network approach, particularly SAN, in a report on storage consolidation sponsored by Dell Computer. In today's IT environment, many enterprise customers turn to a SAN solution as the most effective way to consolidate their storage devices. SANs promise to deliver higher utilization rates by the nature of their design, which allows all servers to access data stored across the SAN.

Datalink's Robinson also favors the network route: "If you go with a storage network, you get more flexibility." You can attach more devices and hosts, and you have more and easier redundancy options for high availability. Consolidating to a NAS system not only consolidates the storage, but automatically gives you file and print server consolidation.

"One huge [non-networked] storage subsystem does not solve the problem of heterogeneous hosts," says Marrone. SAN consolidation--at least in theory--handles hosts from multiple vendors.

Still, consolidating on a giant storage subsystem--such as those provided by IBM, EMC, or HDS--works, says Robinson. You'll get the same advantages of centralized management and flexible storage configuration. However, you'll be limited by the available ports, which could prove a problem. Redundancy, for example, requires extra ports.

In truth, most large enterprises do both. "We have multiple, large HDS storage systems and they are all part of the SAN, actually multiple SANs," says the Genome Sequencing Center's Carpenter. Although this hybrid approach may reduce some of the advantages of consolidation, it allows the organization to avoid disrupting some critical applications, such as its Oracle database.

Determining the potential payback from storage consolidation is tricky. Even IDC punts on the storage consolidation TCO and ROI question: "Because of the increasing complexity of storage solutions, it can be quite challenging to effectively evaluate TCO and ROI in a reasonable period of time," says Bill North, IDC. Part of the problem is that a consolidated storage environment will likely grow much larger than the previous environment--given the steady growth of storage--making comparisons difficult.

Still, the TCO question seems pretty straightforward. As the Canadian energy company's experience suggests, the ability to reduce the infrastructure support staff by 25% while greatly increasing the amount of storage being managed is attractive. That was also the experience at Los Angeles Unified School District. The consolidated storage produces "bigger savings compared to the individual storage we had before," Rapozo says. But getting there requires a significant upfront investment in new storage hardware, software and services.

You also need to consider the remaining organizational issues. Successful consolidation requires effective change management both within IT--which may have entrenched interests in the old infrastructure--and the business units, which will aggressively protect their own interests. At best, addressing these issues will slow the consolidation process. At worst, they can undo any advantages from consolidation.

No one has suggested that storage consolidation isn't effective. Almost every large organization can benefit from some level of storage consolidation. Those benefits, however, aren't guaranteed and won't materialize overnight.

This was first published in June 2003

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