How Virtustream/Smithfield Multi-Cloud Project Trims Fat from Enterprise IT

CLOUD SERVICE CASE STUDY / ANALYSIS: Virtustream’s flexible, scalable multi-cloud resources will allow the Smithfield food products company to pay only for the services it consumes. As a result, Smithfield estimates it will save a tidy $3 million in IT costs during the next three years.

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There’s a growing consensus around the value multi-cloud as the cloud consumption model of choice for enterprises, but why that’s true is sometimes muddled with PR jargon and IT vendor clichés.

On the upside, there are also clear examples of enterprises using multi-cloud offerings to their benefit, such as the recently announced partnership between food processor Smithfield Foods and cloud service and software provider Virtustream. Let’s take a closer look at what the two companies are doing.

Go here to read eWEEK's complete product overview and analysis of Virtustream.

Dell EMC Virtustream also ranks as one of eWEEK's "Top Companies in Enterprise Cloud Services." Go here to read that article.

Smithfield’s Global Reach

Based in Smithfield, Va., Smithfield Foods (a subsidiary of WH Group) is a $15B enterprise best known for prepared food brands, including Armour, Nathan’s Famous, John Morrell and Farmer John. According to the company’s profile, it is the world’s largest pork processor and hog producer and employs about 40,000 workers at 50 facilities in the U.S. The company also claims to be the  No. 1 supplier of pork products for retail, food service and export markets. That makes Smithfield a global enterprise by nearly any definition.

Like other enterprises, Smithfield depends heavily on IT products and services to support its core business processes, including SAP solutions and systems. Also, like other enterprises, the company has been looking for ways to better integrate its on-premises IT infrastructure and cloud-based data and applications, improve compute performance and lower IT costs. As noted in a recent media advisory, Smithfield’s IT goals are similar to more than half of the enterprise respondents in a Virtustream-sponsored Forrester study on multi-cloud trends.

Embracing Virtustream’s Multi-cloud Solutions

After determining that Virtustream offered the expertise required to achieve its goals, the two companies set to work. Following months of what they described as “meticulous preparation,” a “One SAP” project began in July 2018 that aimed to migrate all of Smithfield’s SAP-based operations to a single, unified S4/HANA SAP platform on Virtustream Enterprise Cloud. The project’s successful completion was announced on Jan. 24.

Will Smithfield benefit significantly? Yes, indeed. Practically speaking, Virtustream’s flexible, scalable multi-cloud resources will allow Smithfield to pay just for the services it consumes. In other words, partnering with Virtustream provides Smithfield access to on-demand IT services and pricing schemas designed to optimize IT consumption and performance. That will also result in substantial savings; Smithfield estimates it will save a tidy $3 million in IT costs over the next three years.

Final Analysis

Virtustream and Smithfield’s One SAP project contains a number of lessons for businesses considering or planning multi-cloud strategies. Most importantly, it’s crucial for organizations to understand what they hope to achieve by implementing cloud. Also critical is how they prepare prior to beginning what are often large and highly complex efforts. Finally, working with expert partners that possess the skills a project requires and understand an organization’s goals goes a long way to ensuring a project’s success.

The requirements and fine details of multi-cloud are sometimes hard to separate from marketing-speak and technical jargon. But successes do exist, especially when they involve the efforts of experienced, knowledgeable cloud vendors whose customers embrace careful, rigorous preparation. Smithfield Food and Virtustream’s One SAP project is an excellent example of what can be achieved with multi-cloud solutions and services.

Charles King is a principal analyst at PUND-IT.  © 2018 Pund-IT, Inc. All rights reserved.