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Making the case for in-house data centers

Bruce Harpham | April 21, 2016
With seemingly everything moving to the cloud these days, it’s important to know when setting up your own data management center can still be the right decision.

Outsourcing, cloud services and financial pressure are constant realities for IT leaders. Shared data centers and cloud service providers are often a good choice. If the organization’s IT demands are difficult to predict or highly variable, building additional data centers make little sense.

Despite the cloud trend, managing internal data centers effectively remains an important IT responsibility. Cost optimization, vendor management and creative ways to add value are all in play for data center managers in 2016.

Meeting increased demands for data center services

Industry surveys suggest that data centers are under increasing pressure to deliver results. Consider the following findings from AFCOM’s 2015 State of the Data Center Survey. Gathering information from over 250 leaders, the findings provide a useful snapshot of opportunities and priorities for data center management.

Leading data center managers are using several methods to meet rising demands from their organizations. Over the next 12 months, survey respondents plan to meet data center demands using several methods including:

  • Expand capacity in existing data center(s): 74 percent
  • Renovate/refurbish at existing data centers: 57 percent
  • Build new data centers: 42 percent

These findings show that data center managers are focused on making the most of their current facilitates. The survey also found a growing appetite for outsourcing data center services. The trend to cloud and SaaS services make such a move highly appealing to many organizations. Yet there are still cases where internal data centers represent a good choice.

Organizational performance needs often drive the need for internal data centers. “Certain medical applications will continue to be run in-house here because low latency and high performance are absolutely vital. Lives are at stake if some of our applications fail to perform” says Shawn Arcus, enterprise data center manager at St Joseph Health Centre, an organization that runs hospitals in Texas, California, New Mexico and several other states.

Cost optimization options in data centers

Cutting expenses through better data center administration is a priority for several sectors. According to the Uptime Institute’s 2015 Industry Survey, 83 percent of executives at retailers are focused on reducing IT costs. In contrast, leaders at financial firms are less focused on cost control – 39 percent of executives in that industry identify IT cost as a top priority. What are the opportunities for reducing cost at in house data centers?

“Soon after joining the organization, I found out that we were wasting significant money on buying electrical power at data centers. Optimizing that situation delivered one million dollars in savings,” says Shawn Arcus, enterprise data center manager at St Joseph Health Centre. Electricity consumption and management is a major cost optimization opportunity. “DCIM and monitoring software are important to monitor facility temperature, electricity usage and other factors,” says Janna Connor,Lead Technical Data Center Specialist at BlueCross Blue Shield of Texas


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