Source: Cameron Khan. The Nexion Partnership
Cameron Khan, a partner with The Nexion Partnership, looks at the strategic possibilities opening up to banks from developments in virtualisation technology.
"Nirvana, a state of supreme liberation delivering extinction of all attachment".
Our 'attachment', to physical computing, hardware and software, is forecast to be a thing of the past by rapidly growing investment and development in virtualisation technology.
At the heart of this dream is the enormous productivity and cost savings a business could realise. Easy to see why Microsoft, EMC, Veritas, Sun, HP and IBM are unremittingly pushing the envelope in this new battle ground. The surge in academic research heralds the prospect of a new technology Zeitgeist.
The term virtualisation owes its lineage to the inception of the virtual machine, evolved since the 1960s into a sophisticated set of highly coordinated objects composed of code and memory. The concepts, methods and technologies for virtualising have been doggedly pursued in an attempt to overcome the dependency on a machine’s physical limitation. Virtual machines mimicking and managing the behaviour of the underlying hardware and operating system has empowered niche solutions in the IT environment.
This domain has been the mainstay of the IT infrastructure expert. These specialist problem solvers look at improving and optimising the delivery of processor power, memory management, network and storage to correct localised problems. The aim to consolidate the workloads of several under-utilised servers to fewer machines, perhaps a single machine with savings on hardware, environmental costs, management, and administration. A legacy application unable to run on newer hardware can also be served by virtual machines. The virtual machine can be used for debugging operating systems without losing productivity, providing fault and error containment thus allowing for powerful debugging and performance monitoring.
It’s a technical solution to a technical problem. So why should the business get excited?
There is growing realisation at executive level of the strategic possibilities of virtualisation. The hypothesis that a truly integrated virtualisation model provides a level of optimisation extending way beyond the fabric. A vision to disintermediate the application layer from its hard-wired host. To convert the existing infrastructure delivery mechanisms into an IT utility – the terms 'on tap' and 'just–in-time' creeping into the nomenclature.
Those IT executives with the vision are initiating strategic infrastructure projects that map across the enterprise. A Global investment bank is currently investigating a model for ‘Shared Infrastructure’ with the aim of simplifying the infrastructure and reducing provisioning time from months to days.
Critically, the IT team are planning beyond the technology, encompassing the business drivers and process and management view points to develop a service based architecture. The benefits of getting it right are obvious: improved service to the business, cost savings and reduced reliance on empirical modeling. Specifically, IT infrastructure aligned to the bank’s strategy.
Driving the IT resources to a state where they can be genuinely shared across business applications and processes is predicted to be a top three CIO priority for next year. The idea of advancing virtualisation to a policy driven domain of automated service levels for deployment, provisioning, failover, disaster & recovery, work load management is compelling. Interestingly, the focus is not on achieving all the '9s' but an acceptable, well-utilised state across the organisation.
According to Gartner, enterprises that do not leverage virtualisation technologies will pay up to 40% more in acquisition costs by 2008, and roughly 20% more in administrative costs than enterprises that leverage virtualisation technologies.
A European bank recently implemented an enterprise-wide Storage Area Network (SAN) to remove significant complexity of disparate technologies and solutions spread across business units. The resulting solution has been far reaching and through a single SAN has provided virtualisation of the entire storage asset and automated allocation to the business on demand. The benefits of improved capacity planning and therefore more efficient technology have seen estimated savings in IT spend of 20%.
But its not just about IT cost reduction.
The key to addressing virtualisation is to look beyond servers or storage to the people, processes and technologies, where true benefits can be delivered.
Developing a comprehensive view of the 'as is' state of IT services and business priorities is a critical first step. Building a working model of the service dimension includes knowledge about how customer, operations, strategy, technology and business axes co-exist within a framework.
No one virtualisation strategy is going to be the same. Gathering the critical information and very quickly shaping theoretical options will identify business focused IT priorities. Importantly, this step provides IT executives with a clear understanding of the areas that could initially be developed towards the most effective service based architecture.
Companies must clearly consider how a shared infrastructure will affect the people and processes dedicated to applications and business functions. Aiming towards simplification and flexiblity of the entire infrastructure requires a throrough impact analysis of all the key dependencies. With infrastructure resources virtualised, they are driven to meet service levels within a dynamic and optimised infrastructure architecture.
The success of a virtualised environment will ultimately rely on the quality of the technology decision. It is essential to avoid vendor driven TCO statements and to clarify the true costs of implementing a solution. The need for a robust and scaleable solution is obvious. Simplification is key to achieving a cohesive solution where service levels are at stake. Good product research with a focus on the benefits of virtualising the environment will ensure the technology does not drive the solution. Traditional approaches to piloting are fine as long as they evolve in safe and predictable environments where genuine measurements can be made against the business drivers.
Not quite Nirvana but on the right road.