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How to avoid the perils of virtualization and cloud stall

Thor Olavsrud | April 11, 2012
Virtualization and cloud computing offer the promise of cost savings, efficiency and flexibility, but organizations must plan their transitions carefully or risk finding themselves stuck with a bundle of sunk costs and no path forward.

"We received a tremendous number of benefits over and above our initial ROI," he says.

Westcon successfully managed its transition. But many organizations fail or stall in their move to virtualization or to the cloud, Hurley says.

Virtualization Stall

"Virtualization stall, when we see it, happens primarily at the enterprise level," Hurley says. These projects often start out like Westcon's own skunkworks project, but fail to get off the ground because IT is either unable to justify the ROI or business value of the project or they underestimate the total cost of the project.

"They end up judging the ROI based on speeds and feeds rather than the business value offered to the enterprise," Hurley says. "It's got to be about the business initiatives running on those pieces of equipment you're about to virtualize. They don't get the budgets approved because they're not able to talk to the business in terms of the ROI value of the project."

While failure to explain the business value of the project can torpedo it before it gets funding, underestimating the actual cost of virtualization is another leading factor in virtualization stall, Hurley says. Organizations often base their estimates solely on the cost of the VMs and fail to consider the concomitant infrastructure costs for storage, networking and security.

"For every dollar spent on virtualization software, the IT manager should expect to spend another $11 or $12 on infrastructure for that virtualization project," Hurley says. "They end up running out of money before they achieve the effects they were looking for."

Cloud Stall

Hurley calls virtualization the gasoline that enables the cloud. More and more organizations are investigating the benefits of cloud computing and beginning deployments. But cloud computing has its pitfalls. Avoiding cloud stall also requires proper planning, Hurley says, because the way you use software inside the enterprise may not be the same way it will be used in the cloud.

"There's a tremendous amount of preparation work that needs to be done before you jump into the cloud," he says. "You need business process analysis to make sure I don't just take my Exchange servers, push them into the cloud, and then find out I have someone in France that's running a 200,000 item inbox in their exchange server that grinds everything to a halt. Everybody's all hot and bothered by $5 per person per month for email, but you really need to spend an extra $50,000 or $100,000 up front to make sure you're not going to be surprised when you push things into the cloud."

Some firms also assume that moving to the cloud means they can reduce or eliminate their IT function, and that's a huge mistake that can lead to stall, Hurley says.


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