Monday, January 28, 2008

Data Center Costs

One of the great challenges of being a CIO is that I am asked to anticipate demand and deploy the infrastructure and applications needed by stakeholders, while tightly controlling costs. This means that I am rewarded for meeting demands just in time, but penalized for under provisioning (not meeting demand) or over provisioning (spending too much).

Even in a world of virtualization and on demand computing, many IT products and services have a significant lead time to deploy. Creating a new data center, adding significant new power feeds and expanding cooling capacity are examples. To help understand the relationship of real estate, power, cooling, storage, network bandwidth and costs, we've created a web-based model which we're now sharing with the IT community. Feel free to access it here.

You'll see that this dashboard enables you to change costs per square foot, costs per kilowatt, total server/storage capacity and other variables to create a customized cost dashboard. At Harvard Medical School, we've used this dashboard during the budget process to achieve predictable budgeting. CFOs do not like surprises, so agreeing on a predictable cost model that directly relates demand, supply and cost, makes life for the CIO much easier.

I hope you find this useful!


Matthew said...

Speaking of Dashboards, when are you going to share some of your Decision Support type stuff.

I don't necessarily want to see what data you present, but I would love to see how you present it. Although, if you have a dashboard / balanced score card that you are willing to share, I would love to see it.

John Sambrook said...

Nice dashboard, John! I would expect that many IT types would benefit from it.

Is it open source? Maybe publish it on freshmeat or source forge.

Thanks for sharing.

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Jason said...

Hello John. You mention the budgeting process in this post. How does your budgeting process work in terms of CIO-CFO interaction? I know you set the IT agenda, do you then have to demonstrate certain financial benchmarks (NPV, ROIC) or quality outcomes in order to get the CFO approvals?