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IT Steering Committee

IT Steering Committee. Consolidate IT Budget Proposal. IT Steering Committee. Budget Proposal. Agenda IT Initiatives UVW Initiatives XYZ Initiatives RST Initiatives Corporate Initiatives Consolidated Project List. Budget Proposal. Information Systems and Technology.

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IT Steering Committee

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  1. IT Steering Committee Consolidate IT Budget Proposal The information contained in this presentation is considered proprietary

  2. IT Steering Committee Budget Proposal • Agenda • IT Initiatives • UVW Initiatives • XYZ Initiatives • RST Initiatives • Corporate Initiatives • Consolidated Project List The information contained in this presentation is considered proprietary

  3. Budget Proposal • Information Systems and Technology • How can we get more value from our IT? • What is the return on investment? • Is outsourcing the right answer? The information contained in this presentation is considered proprietary

  4. Budget Proposal • IT Initiatives • Infrastructure Lifecycle Management • Datacenter Virtualization • Workstation Virtualization • Capacity Planning • Hosting • Outsourcing • Proposal The information contained in this presentation is considered proprietary

  5. Budget Proposal • Infrastructure Lifecycle Management • 8 out of 19 (42%) Switches are Currently EOL • 13 Single Points of Failure within Core Network • 11 Secondary Single Points of Failure • Organic Infrastructure Growth (Unplanned) • No Network Load Balancing • Aging Servers and Workstations • Capacity Planning to Accommodate Growth The information contained in this presentation is considered proprietary.

  6. Budget Proposal • Infrastructure Lifecycle Management Our infrastructure is suffering from coronary disease… The red circles show single points of failure within our Core Network. The switches with the pink background are EOL. Doing nothing puts all the companies at risk of losing business, including branch locations. The information contained in this presentation is considered proprietary

  7. Budget Proposal • Infrastructure Lifecycle Management • Option 1 Do Nothing • Option 2 Plan for Failure • Option 3 Rebuild our House The information contained in this presentation is considered proprietary

  8. Budget Proposal • Infrastructure Lifecycle Management • Option 1 Do Nothing • Upside • Potentially Saves Money in 2009 • Down Side • No Support from Cisco • Replacement with 2 - 4 days (Used Market) • Net Sales Losses of ~ $357,296 to $714,592 ...for Each Occurrence • No Load Balancing • Problem Doesn’t go Away The information contained in this presentation is considered proprietary

  9. Budget Proposal • Infrastructure Lifecycle Management • Option 2 Plan for Failure • Upside • Pre-purchase used equipment as backup • Cost Deferred Over Time • Downtime Reduced to 4 hours • Downside • Network Performance Doesn’t Improve • Net Sales Losses of ~ $89,324 for Each ...Occurrence • No Load Balancing • Problem Doesn’t go Away The information contained in this presentation is considered proprietary

  10. Budget Proposal • Infrastructure Lifecycle Management • Option 3 Rebuild Our House • Upside • Lease Option for 3 years • Fully Support Infrastructure by Cisco • Load Balancing and Redundant Failover • Improved Network Performance • Problem Goes Away • Increased Network and Application Availability • Buyback Credit for Obsolete Equipment • Down Side • Monthly Payment of ~ $1,800 The information contained in this presentation is considered proprietary

  11. Budget Proposal • Infrastructure Lifecycle Management The information contained in this presentation is considered proprietary

  12. Budget Proposal • Infrastructure Lifecycle Management • Option 3 Rebuild Our House • Additional Equipment Needed • Cisco 2851 Router 1 = 9,395 • Cisco ASA5510 Firewall 1 = 2,100 • Catalyst 3560/48 PoE Switch 5 = 24,130 • Catalyst 3750/24 2 = 11,025 • Sales Tax .= 3,850 • Installation & Configuration .= 6,500 • Less buyback of existing equipment ~ (3,000) • _______ • Total Construction Cost to Rebuild .= 54,000 The information contained in this presentation is considered proprietary

  13. Budget Proposal • Infrastructure Lifecycle Management • Rebuild Infrastructure Next Year • ROI • Total Cost to Rebuild .= <54,000> • Four Hour Lost Sales 89,243 • Increase Performance 12,566 • (116 network users) • First Year 47,809 Savings • Second Year (Increased Performance Only) 60,375 Savings • Third Year 72,941 Savings • 6 Month ROI The information contained in this presentation is considered proprietary

  14. Budget Proposal • Datacenter Virtualization • What is Virtualization • Virtualization is the ability to utilize one physical server as several different servers. • The users, the network, and even the hardware sees the virtual server as if it were a different physical server. • Why would we want virtualization The information contained in this presentation is considered proprietary

  15. Budget Proposal • Datacenter Virtualization • Why would we want virtualization • We took the concept of a single mainframe computer and broke it into multiple servers to add redundancy. • Different servers took on specific roles like email, file, print, or accounting to provide greater availability. • But servers are inherently under utilized. They sit and wait for something to do and then do it very fast, then sit and wait again. The information contained in this presentation is considered proprietary

  16. Budget Proposal • Datacenter Virtualization • Why would we want virtualization • By virtualizing several servers on a single physical computer we’re able to get more bang for the buck because the server waits less. • If the physical server is capable of doing more and waiting less then we should stack as much work on a single server as possible. • Through virtualization we need fewer physical servers and that saves money. The information contained in this presentation is considered proprietary

  17. Budget Proposal • Datacenter Virtualization We Can “Do more with less” The information contained in this presentation is considered proprietary

  18. Budget Proposal • Datacenter Virtualization Server virtualization on a single platform presents risks… If the server hardware fails then three servers are taken down. As a result only non-critical applications are currently virtualized One Server Two Servers One Server Three Servers Application Programs Application Programs Application Programs Application Programs Operating System O.S. O.S. O.S. Server Hardware The solution is to virtualize the entire datacenter… The information contained in this presentation is considered proprietary

  19. Budget Proposal • Datacenter Virtualization O.S. O.S. O.S. Three Servers Three Servers Application Programs Application Programs Application Programs Application Programs Application Programs Application Programs O.S. O.S. O.S. Server Hardware Server Hardware The information contained in this presentation is considered proprietary

  20. Budget Proposal • Datacenter Virtualization O.S. O.S. O.S. Three Servers Two Servers Four Servers Three Servers Application Programs Application Programs Application Programs Application Programs Application Programs Application Programs O.S. O.S. O.S. O.S. O.S. Server Hardware Server Hardware O.S. O.S. O.S. O.S. The information contained in this presentation is considered proprietary

  21. Budget Proposal • Datacenter Virtualization Current Server Pool Domain Controller DHCP / DNS Argus Server Antivirus Server Great Plains Email Server ADP Server Web Sense Server SQL Server User Profiles Server Print Server Solar Winds Server File Server Backup Exec Server Citrix Server Domain Controller Backup Exchange Server (Cleveland) FTP & Web Orders Server Backup SQL Server (Cleveland) SharePoint Intranet Server Print Server Backup The information contained in this presentation is considered proprietary

  22. Budget Proposal • Datacenter Virtualization Server Consolidation Through Virtualization Domain Controller DHCP / DNS Argus Server Antivirus Server Great Plains Domain Controller DHCP / DNS Great Plains Server Web Sense Server User Profiles Server Backup Exec Server SharePoint Intranet Server Domain Controller Print Server Backup Argus Server Antivirus Server Email Server SQL Server ADP Server Print Server Solar Winds File Server Email Server ADP Server Web Sense Server SQL Server OS OS OS OS OS OS OS OS OS OS OS OS OS OS OS OS Server Hardware Server Hardware Server Hardware Server Hardware User Profiles Server Print Server Solar Winds Server File Server Backup Exec Server Citrix Server Domain Controller Backup Exchange Server (Cleveland) FTP & Web Orders Server Backup SQL Server (Cleveland) SharePoint Intranet Server Print Server Backup The information contained in this presentation is considered proprietary

  23. Budget Proposal • Datacenter Virtualization Server Consolidation Through Virtualization Domain Controller DHCP / DNS Great Plains Server Web Sense Server User Profiles Server Backup Exec Server SharePoint Intranet Server Domain Controller Print Server Backup Argus Server Antivirus Server Email Server SQL Server ADP Server Print Server Solar Winds File Server OS OS OS OS OS OS OS OS OS OS OS OS OS OS OS OS Server Hardware Server Hardware Server Hardware Server Hardware Citrix Server Backup Exchange Server (Cleveland) 35 35 35 FTP & Web Orders Server Backup SQL Server (Cleveland) Citrix Farm The information contained in this presentation is considered proprietary

  24. Budget Proposal • Datacenter Virtualization • Virtualized Datacenter • Additional Equipment Needed • Dell PowerEdge R900 3 = 71,925 • VMware License 7 = 28,990 • Sales Tax .= 8,325 • Installation & Configuration .= 5,500 • Less buyback of existing equipment ~ (8,000) • _______ • Total Cost to Virtualize .= 106,740 The information contained in this presentation is considered proprietary

  25. Budget Proposal • Datacenter Virtualization • Virtualized Datacenter • ROI • Total Cost to Virtualize .= <106,740> 11 Month ROI • Replace Servers Out of Warranty 113,261 2009 • Most warranties expired 2007 6,521 Additional • Replace Servers Out of Warranty 13,000 2010 19,521 Additional • Replace Servers Out of Warranty 26,000 2011 • 45,521 Additional • The cost to delay virtualization continues to escalate every year the decision is postponed • The risk of system failure increases by 20% every year • The benefits of virtualization, high availability, automatic load balancing, redundancy, and recovery remain unavailable. The information contained in this presentation is considered proprietary

  26. Budget Proposal • Workstation Virtualization 65 - 100 Workstations 65 – 100 Workstations Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Workstation Operating System Operating System Server Hardware Server Hardware The information contained in this presentation is considered proprietary

  27. Budget Proposal • Workstation Virtualization • Virtualization • Workstation Virtualization • Thin Client Architecture • Reduced Cost and Footprint (7w-vs-150w) • Greater Security / Faster Startup • Virtualization of Hard Disk and RAM • Complete System Backups • Unified Patch Management The information contained in this presentation is considered proprietary

  28. Budget Proposal • Workstation Virtualization • Wyse • The Wyse V10-L will provide desktop • connectivity at a fraction of • the cost of a normal PC and • operates at 4% of the power, • providing more control and • less administration while at • the same time giving the • user more power and speed. The information contained in this presentation is considered proprietary

  29. Budget Proposal • Workstation Virtualization • Virtualized Workstation • Cost Analysis • Dell Desktop Computer (average) 1,200 • Dell Laptop Computer (average) 1,800 • Wyse Thin Client V10-L 320 • 89 Desktops, 27 Laptops • Wyse V10-L 89= 28,480 • Dell PowerEdge R900 2 = 47,950 • Sales Tax 6,305 • Less buyback of existing equipment ~ (8,900) • _______ • Total Cost to Virtualize = 73,835 The information contained in this presentation is considered proprietary

  30. Budget Proposal • Workstation Virtualization • Virtualized Workstation • ROI • Total Cost to Virtualize = < 73,835 > • PC Lifecycle (89@ 1200) / 4 Years 26,700 per year • Power Consumption Savings 2,800 per year • (PC =116,946Kw, Servers =25,404Kw) • Lost Worker Productivity 12,566 • First Year = <31,769> • Second Year = 10,297 Savings • Third Year = 52,363 Savings • Fourth Year = 94,429 Savings • Fifth Year = 136,495 Savings • 21 Month ROI • Savings offset virtual server replacement cost over 3.5 years The information contained in this presentation is considered proprietary

  31. Budget Proposal • Capacity Planning • Current SAN • Current Capacity 2 Terabytes • Currently Used 1.33 Terabytes (67%) • Divided in to Five Drives (Not Sharable) • Drive 1 15% Available (Ghost Images) • Drive 2 9% Available (User Data) • Drive 3 96% Available (SQL Databases) • Drive 4 56% Available (SQL Logs) • Drive 5 85% Available (Virtual Servers) • Needs Additional Capacity and Reallocation The information contained in this presentation is considered proprietary

  32. Budget Proposal • Capacity Planning • Proposed SAN • Increase Capacity to 3.5 Terabytes • Reconfigure Drive Allocation • Drive 1 1.2 TB 67% Available (Ghost Images) Raid 5 • Drive 2 1.2 TB 38% Available (User Files) Raid 10 • Drive 3 600 MB 80% Available (SQL Databases) Raid 2 • Drive 4 146 MB 59% Available (SQL Logs) Raid 1 • Drive 5 300 MB 73% Available (Virtual Servers) Raid 1 • Drive 6 146 MB 40% Available (Exchange Datastore) Raid 1 • Drive 7 146 MB 40% Available (Exchange Backup) Raid 1 • Requires a Complete Wipe and Restore The information contained in this presentation is considered proprietary

  33. Budget Proposal • Capacity Planning • Proposed SAN • Additional Equipment Needed • 300GB 15K RPM SAS Drive 5 = 6,000 • Sales Tax .= 495 • Installation & Configuration .= 0 Included • _______ • Total Cost to Upgrade .= 6,495 • This solution positions the company for 5 years of growth. • Data growth of 18% common • Current data (1.33TB) will grow to 3.04TB in 5 years • This solution adds 2 additional drives for Exchange (increasing performance) The information contained in this presentation is considered proprietary

  34. Budget Proposal • Hosted Service • Upside • No Need to Replace Aging Equipment • Consistent Monthly Cost (Never Ending) • Zero Capital Expense • Server Virtualization Increases Availability • 24x7 Professional Monitoring of Systems • Load Balanced Architecture • Server Recovery SLA The information contained in this presentation is considered proprietary

  35. Budget Proposal • Hosted Service • Downside • Very Expensive • Contract Renewable Without Escalation Limits • Costly to Resume Premise Based Operation • ISP Becomes Single Point of Failure • T1 Lines Critical for Data Access • Need to Increase Internet Bandwidth • Still Need IT Support Personnel The information contained in this presentation is considered proprietary

  36. Budget Proposal • Hosted Service Compared to a hosted solution we could replace every server in our data-center 2 times a year. To implement the additional servers and virtualization in our own datacenter would cost $100,740 11.50 Times More Over 5 years Total Monthly Fee - $18,030 Total Setup Fee $10,375 Total 5 Year Commitment$1,159,060 • Quantity adjusted for • comparison purposes only. Still need to supply our own support personnel The information contained in this presentation is considered proprietary

  37. Budget Proposal • Hosted Service Compared to a hosted solution we could replace every server in our data-center 4 times a year. To implement the additional servers and virtualization in our own datacenter would cost $80,725 Not Recommended 11.50 Times More Over 5 years Total Monthly Fee - $18,030 Total Setup Fee $10,375 Total 5 Year Commitment$1,159,060 • Quantity adjusted for • comparison purposes only. Still need to supply our own support personnel The information contained in this presentation is considered proprietary

  38. Budget Proposal • Hosted Service As with the previous hosted solution the cost is 1389% more expensive over a five year period. Hosting fees will never end and most like will rise more than the rate of inflation. $17,525 The information contained in this presentation is considered proprietary

  39. Budget Proposal • Hosted Service As with the previous hosted solution the cost is 1389% more expensive over a five year period. Hosting fees will never end and most like will rise more than the rate of inflation. Not Recommended $17,525 The information contained in this presentation is considered proprietary.

  40. Budget Proposal • Outsourcing • Can Outsourcing Save Money • Outsourcing Model Works For Large Companies • Provides immediate scalability of staff resources • On site staff usually owned by outsourcing company • Outsourcing Model Works For Small Companies • Cannot afford to hire staff full time • Disparate skill sets make support expensive • Outsourcing Model Does Not Work For Medium Companies • Minimum staff required full time • Reduction in staff not sufficient to warrant support cost The information contained in this presentation is considered proprietary

  41. Budget Proposal • Outsourcing • Outsourcing Service • Assumes 80% resolution • If resolution rate increases to 90% … • 145 x 25 = 3,625 Mo • Increase 725/Mo or 8700/Yr • Monthly cost could increase to $12,800 • Annual cost could increase to $153,600 • Still need IT Support on site The information contained in this presentation is considered proprietary

  42. Budget Proposal • Outsourcing $141,151 $3,749 $1,200 Solar Winds Network Monitoring $500 $142,851 $2,049 $2,049 $142,851 • Dropping top two service techs – still cost $2,049 to $10,749 more each year • VPN Support Extra - $210 / Month • Add Users, Remove Users, Tape Backups and Restore, and other service all EXTRA $ The information contained in this presentation is considered proprietary

  43. Budget Proposal • Outsourcing Not Recommended $141,151 $3,749 $1,200 Solar Winds Network Monitoring $500 $142,851 $2,049 $2,049 $142,851 • Dropping top two service techs – still cost $2,049 to $10,749 more each year • VPN Support Extra - $210 / Month • Add Users, Remove Users, Tape Backups and Restore, and other service all EXTRA $ The information contained in this presentation is considered proprietary

  44. Budget Proposal • IT Proposal • IT Budget Recommendations and Proposal • Additional Equipment Needed • Infrastructure Rebuild (6 Mo.ROI) 54,000 • Datacenter Virtualization (11 Mo.ROI) 106,740 • Workstation Virtualization (21 Mo.ROI) 73,835 • Capacity Planning 6,495 • Hosted Service (Not Recommended) 0 • Outsourcing (Not Recommended) 0 • _______ • Total IT Proposal .= $ 241,070 Financing over 3 years will cost ~ $7,600 / Month Financing cost will be ~ $30,800 The information contained in this presentation is considered proprietary

  45. Budget Proposal • Proposal Erwin Commercial Finance • OPTION 1 – CAPITAL LEASE • LEASED PROPERTY COST $250,000.00 • PAYMENTS Monthly Rental Payments are to be received in advance. • INITIAL LEASE TERM 36 Months 48 Months • MONTHLY • RENTAL FACTOR .02718 .02244 • MONTHLY • RENTAL PAYMENT $6,795 $5,610 • END OF INITIAL LEASE • TERM OPTIONS Purchase all of the Leased Property for its then fair market value. • OPTION 2 – CAPITAL LEASE • LEASED PROPERTY COST $250,000.00 • PAYMENTS Monthly Rental Payments are to be received in advance. • INITIAL LEASE TERM 36 Months 48 Months • MONTHLY • RENTAL FACTOR .03040 .02414 • MONTHLY • RENTAL PAYMENT $7,600 $6,035 • END OF INITIAL LEASE • TERM OPTIONS Lessee will have the option to purchase the Leased Property at • the end of the Initial Lease Term for $1.00. Recommended $1.00 The information contained in this presentation is considered proprietary

  46. Budget Proposal • UVW Initiatives • Increased Performance for Branch Offices • Great Plains Upgrade • Web Ordering • CRM • WMS – Warehouse Management System • Video Conferencing • Proposal The information contained in this presentation is considered proprietary

  47. Budget Proposal • Increased Performance at the Branches • Three things we can do to increase performance at the branches… • Performance issues isolated to Great Plains operating in the afternoon • New T1 Lines • Upgrade Citrix Server(s) for Performance • Additional T1 Lines at the Branches • Upgrade Infrastructure in Torrance The information contained in this presentation is considered proprietary

  48. Budget Proposal • Increased Performance at the Branches • New T1 Lines • Already Installed with Telekenex Phone System • Improved Reliability • No Measurable Difference in Performance The information contained in this presentation is considered proprietary

  49. Budget Proposal • Increased Performance at the Branches • Upgrade Citrix Server(s) for Performance • Branches Accessing Great Plains Through Citrix • Distributive Processing at the Client • Only One Citrix Server for ALL Branches • Need Multiple Servers With Load Balancing Called a Citrix Farm • Need Faster Servers • PowerEdge 2950 III – Estimated $9,500 The information contained in this presentation is considered proprietary

  50. Budget Proposal • Increased Performance at the Branches • Additional T1 Lines at the Branches • Increase Bandwidth • Telephone • Video Conferencing • Data Access • Great Plains • Microsoft Office Applications • Internet Access The information contained in this presentation is considered proprietary

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