The next BriefingsDirect cloud efficiency case study examines how a world-class private cloud project evolved in the financial sector.
We’ll now learn how public cloud-like experiences, agility, and cost structures are being delivered via a strictly on-premises model built on hyper-converged infrastructure for a risk-sensitive financial services company.
Jim McKittrick joins to help explore the potential for cloud benefits when retaining control over the data center is a critical requirement. He is Senior Account Manager at Applied Computer Solutions (ACS) in Huntington Beach, California. The discussion is moderated by Dana Gardner, Principal Analyst at Interarbor Solutions.
Here are some excerpts:
Gardner: Many enterprises want a private cloud for security and control reasons. They want an OpEx-like public cloud model, and that total on-premises control. Can you have it both ways?
McKittrick: We are showing that you can. People are learning that the public cloud isn't necessarily all it has been hyped up to be, which is what happens with newer technologies as they come out.
Gardner: What are the drivers for keeping it all private?
McKittrick: Security, of course. But if somebody actually analyzes it, a lot of times it will be about cost and data access, and the ease of data egress because getting your data back can sometimes be a challenge.
Also, there is a realization that even though I may have strict service-level agreements (SLAs), if something goes wrong they are not going to save my business. If that thing tanks, do I want to give that business away? I have some clients who absolutely will not.
Gardner: Control, and so being able to sleep well at night.
McKittrick: Absolutely. I have other clients that we can speak about who have HIPAA requirements, and they are privately held and privately owned. And literally the CEO says, “I am not doing it.” And he doesn’t care what it costs.
Gardner: If there were a huge delta between the price of going with a public cloud or staying private, sure. But that deltais closing. So you can have the best of both worlds -- and not pay a very high penalty nowadays.
McKittrick: If done properly, certainly from my experience. We have been able to prove that you can run an agile, cloud-like infrastructure or private cloud as cost-effectively -- or even more cost effectively -- than you can in the public clouds. There are certainly places for both in the market.
Gardner: It's going to vary, of course, from company to company -- and even department to department within a company -- but the fact is that that choice is there.
McKittrick: No doubt about it, it absolutely is.
Gardner: Tell us about ACS, your role there, and how the company is defining what you consider the best of hybrid cloud environments.
McKittrick: We are a relatively large reseller, about $600 million. We have specialized in data center practices for 27 years. So we have been in business quite some time and have had to evolve with the IT industry.
We have a head start on what's really coming down the pipe -- we are one to two years ahead of the general marketplace.
Structurally, we are fairly conventional from the standpoint that we are a typical reseller, but we pride ourselves on our technical acumen. Because we have some very, very large clients and have worked with them to get on their technology boards, we feel like we have a head start on what's really coming down the pipe -- we are maybe one to two years ahead of the general marketplace. We feel that we have a thought leadership edge there, and we use that as well as very senior engineering leadership in our organization to tell us what we are supposed to be doing.
Gardner: I know you probably can't mention the company by name, but tell us about a recent project that seems a harbinger of things to come.
McKittrick: It began as a proof of concept (POC), but it’s in production, it’s live globally.
I have been with ACS for 18 years, and I have had this client for 17 of those years. We have been through multiple data center iterations.
When this last one came up, three things happened. Number one, they were under tremendous cost pressure -- but public cloud was not an option for them.
The second thing was that they had grown by acquisition, and so they had dozens of IT fiefdoms. You can imagine culturally and technologically the challenges involved there. Nonetheless, we were told to consolidate and globalize all these operations.
Thirdly, I was brought in by a client who had run the US presence for this company. We had created a single IT infrastructure in the US for them. He said, “Do it again for the whole world, but save us a bunch of money.” The gauntlet was thrown down. The customer was put in the position of having to make some very aggressive choices. And so he effectively asked me bring them “cool stuff.”
You could give control to anybody in the organization across the globe and they would be able to manage it.
They asked, “What's new out there? How can we do this?” Our senior engineering staff brought a couple of ideas to the table, and hyper-converged infrastructure (HCI) was central to that. HCI provided the ability to simplify the organization, as well as the IT management for the organization. You could give control of it to anybody in the organization across the globe and they would be able to manage it, working with partners in other parts of the world.
Gardner: Remote management being very important for this.
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McKittrick: Absolutely, yes. We also gained failover capabilities, and disaster recovery within these regional data centers. We ended going from -- depending on whom you spoke to -- somewhere between seven to 19 data centers globally, down to three. We were able to consolidate down to three. The data center footprint shrank massively. Just in the US, we went to one data center; we got rid of the other data center completely. We went from 34 racks down to 3.5.
Gardner: Hyper-convergence being a big part of that?
McKittrick: Correct, that was really the key, hyper-convergence and virtualization.
The other key enabling technology was data de-duplication, so the ability to shrink the data and then be able to move it from place to place without crushing bandwidth requirements, because you were only moving the changes, the change blocks.
Gardner: So more of a modern data lifecycle approach?
McKittrick: Absolutely. The backup and recovery approach was built in to the solution itself. So we also deployed a separate data archive, but that's different than backup and recovery. Backup and recovery were essentially handled by VMware and the capability to have the same machine exist in multiple places at the same time.
Gardner: Now, there is more than just the physical approach to IT, as you described it, there is the budgetary financial approach. So how do they maybe get the benefit of the OpEx approach that people are fond of with public cloud models and apply that in a private cloud setting?
McKittrick: They didn't really take that approach. I mean we looked at it. We looked at essentially leasing. We looked at the pay-as-you-go models and it didn't work for them. We ended up doing essentially a purchase of the equipment with a depreciation schedule and traditional support. It was analyzed, and they essentially said, “No, we are just going to buy it.”
Gardner: So total cost of ownership (TCO) is a better metric to look at. Did you have the ability to measure that? What were some of the metrics of success other than this massive consolidation of footprint and better control over management?
McKittrick: We had to justify TCO relative to what a traditional IT refresh would have cost. That's what I was working on for the client until the cost pressure came to bear. We then needed to change our thinking. That's when hyper-convergence came through.
What we would have spent on just hardware and infrastructure costs, not including network and bandwidth -- would have been $55 million over five years, and we ended up doing it for $15 million.
The cost analysis was already done, because I was already costing it with a refresh, including compute and traditional SAN storage. The numbers I had over a five-year period – just what we would have spent on hardware and infrastructure costs, and not including network and bandwidth – would have been $55 million over five years, and we ended up doing it for $15 million.
Gardner: We have mentioned HCI several times, but you were specifically using SimpliVity, which is now part of Hewlett Packard Enterprise (HPE). Tell us about why SimpliVity was a proof-point for you, and why you think that’s going to strengthen HPE's portfolio.
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McKittrick: This thing is now built and running, and it's been two years since inception. So that's a long time in technology, of course. The major factors involved were the cost savings.
As for HPE going forward, the way the client looked at it -- and he is a very forward-thinking technologist -- he always liked to say, “It’s just VMware.” So the beauty of it from their perspective – was that they could just deploy on VMware virtualization. Everyone in our organization knows how to work with VMware, we just deploy that, and they move things around. Everything is managed in that fashion, as virtual machines, as opposed to traditional storage, and all the other layers of things that have to be involved in traditional data centers.
The HCI-based data centers also included built-in WAN optimization, built-in backup and recovery, and were largely on solid-state disks (SSDs). All of the other pieces of the hardware stack that you would traditionally have -- from the server on down -- folded into a little box, so to speak, a physical box. With HCI, you get all of that functionality in a much simpler and much easier to manage fashion. It just makes everything easier.
Gardner: When you bring all those HCI elements together, it really creates a solution. Are there any other aspects of HPE’s portfolio, in addition now to SimpliVity, that would be of interest for future projects?
McKittrick: HPE is able to take this further. You have to remember, at the time, SimpliVity was a widget, and they would partner with the server vendors. That was really it, and with VMware.
Now with HPE, SimpliVity can really build out their roadmap. There is all kinds of innovation that's going to come.
Now with HPE, SimpliVity has behind them one of the largest technology companies in the world. They can really build out their roadmap. There is all kinds of innovation that’s going to come. When you then pair that with things like Microsoft Azure Stack and HPE Synergy and its composable architecture -- yes, all of that is going to be folded right in there.
I give HPE credit for having seen what HCI technology can bring to them and can help them springboard forward, and then also apply it back into things that they are already developing. Am I going to have more opportunity with this infrastructure now because of the SimpliVity acquisition? Yes.
Gardner: For those organizations that want to take advantage of public cloud options, also having HCI-powered hybrid clouds, and composable and automated-bursting and scale-out -- and soon combining that multi-cloud options via HPE New Stack – this gives them the best of all worlds.
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McKittrick: Exactly. There you are. You have your hybrid cloud right there. And certainly one could do that with traditional IT, and still have that capability that HPE has been working on. But now, [with SimpliVity HCI] you have just consolidated all of that down to a relatively simple hardware approach. You can now quickly deploy and gain all those hybrid capabilities along with it. And you have the mobility of your applications and workloads, and all of that goodness, so that you can decide where you want to put this stuff.
Gardner: Before we sign off, let's revisit this notion of those organizations that have to have a private cloud. What words of advice might you give them as they pursue such dramatic re-architecting of their entire IT systems?
A people-first process
McKittrick: Great question. The technology was the easy part. This was my first global HCI roll out, and I have been in the business well over 20 years. The differences come when you are messing with people -- moving their cheese, and messing with their rice bowl. It’s profound. It always comes back to people.
The people and process were the hardest things to deal with, and quite frankly, still are. Make sure that everybody is on-board. They must understand what's happening, why it's happening, and then you try to get all those people pulling in the same direction. Otherwise, you end up in a massive morass and things don't get done, or they become almost unmanageable.
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