How to Use Virtualization to Save Money and Improve Service Quality

By Mark Settle  |  Posted 2010-08-23 Print this article Print

Just when you think you've trimmed any semblance of fat remaining in your IT budget, an economic downturn comes along, requiring you to find new ways to further reduce spending. You can target some of the usual suspects such as travel and training or, as Knowledge Center contributor Mark Settle explains here, you can explore virtualization as a means of achieving significant IT cost savings while also improving productivity and quality of service.

Our IT organization began its virtualization and automation journey with a limited number of key objectives. We wanted to obtain the maximum return on existing investments in server and storage resources and become more responsive to the needs of our software developers. We were pleasantly surprised to discover significant side benefits that far exceeded the objectives of our original plan. These side benefits included labor savings within the IT organization and productivity gains within our R&D teams.

Our IT organization achieved the typical virtues of virtualization such as improving the utilization of existing assets and minimizing additional hardware purchases. For example, server reuse by multiple development teams saved more than $5M in avoided procurement costs. These efforts also reduced power consumption and data center floor space requirements by 20 percent. The financial payback of our investment in virtualization, which was approximately $2M, was achieved in less than six months.

Automation procedures that were implemented as part of our virtualization initiative dramatically improved our ability to respond to developer requests for data center resources. The speed and predictability of our response times, in turn, has made the developers less possessive of "their" assets and more willing to return underutilized resources to the virtual pool for reuse by others. Developers have become increasingly confident in our ability to satisfy their needs on a just-in-time (JIT) basis.

Although it's difficult to precisely estimate the time savings for developers through the new provisioning process, lead times for individual requests have been reduced by at least 10 to 15 workdays. This is equivalent to a collective reduction in lead times of 360 work months per quarter for a 1,500-person development organization operating in five distinct locations.

Mark Settle is Chief Information Officer at BMC Software. Mark joined BMC Software in June 2008. He has served as the chief information officer of four Fortune 300 companies: Corporate Express, Arrow Electronics, Visa International and Occidental Petroleum. Mark has worked in a variety of industries including consumer products, high-tech distribution, financial services, and oil and gas. During the early stages of his career, Mark was the director of a systems integration business unit within Hughes Aircraft Company. Mark is a former Air Force officer and NASA program scientist. His formal training is in the geological sciences. He received his Bachelor's and Master's degrees from MIT and a PhD from Brown University. He can be reached at

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