DCIM Software: Adventures in ROI

Datacenter infrastructure management (DCIM) software is often described as one of the most powerful technologies that can be applied in the modern datacenter. But deployment can be difficult, and the benefits are not always easily understood.

For these reasons, as well as others, DCIM software remains a controversial and under-deployed technology.

This report summarizes the challenges and benefits of calculating ROI for DCIM, and gives recommendations for those considering a DCIM deployment. The full DCIM report provides a guide for conducting a comprehensive ROI analysis as well as a baseline for comparing different use-case scenarios:

  • Scenario 1 – Raised Temperatures/Improved Efficiency
  • Scenario 2 – Real-Time Asset Tracking and Environmental Monitoring
  • Scenario 3 – Identifying and Eliminating Zombie Servers
  • Scenario 4 – A Roll-Up of the Above Three Scenarios

Introduction

Commercially available (off-the-shelf) DCIM software has been around for more than a decade. But despite steady growth, overall adoption remains relatively low. According to 451 Research, less than 15% of midsize to large datacenters (at least 3MW) have commercial DCIM packages deployed.

In recent years, the software has matured to become more robust, easier to use and more feature-rich, lowering barriers to adoption. Yet the ROI drivers for DCIM have proven elusive for some.

While no ROI study can be 100% accurate – there are too many variables and intangibles – ROI calculations are still an important way to help organizations choose, deploy and exploit DCIM systems successfully.

Challenges and Benefits

For many organizations, the strategic business benefits of DCIM are reason enough to deploy the software.

A recent survey of DCIM users by the Uptime Institute, 451 Research’s sister company, shows that many managers have secured budget for DCIM without calculating an ROI.

One reason why many operators do not carry out a full cost-benefit study is that, if deployed well, the benefits of DCIM can be substantial, varied and hard to quantify.

The core business benefits of deploying DCIM include:

  • Capacity management and planning. DCIM enables managers to understand historic capacity trends, and to forecast capacity requirements with greater insight and a higher degree of accuracy than before. Buyers of DCIM have consistently ranked improved capacity management and planning as the top driver – and benefit – of deploying a DCIM system.
  • Reduced risk. Analyzing data from a wide range of sources within the datacenter can uncover risks and vulnerabilities. DCIM software ‘alarms’ can spot anomalies and help identify issues before they happen. And predictive ‘what if’ scenarios can enable managers to model the effects of moves, additions and changes.
  • Operational efficiency and agility. DCIM users often cite standardizing and ‘codifying’ (in software) operational processes, including workflows, as a significant benefit. Having templated processes and a means to track them can boost efficiency and the overall professionalism of datacenter operations.

While these benefits are typically justification enough, calculating an ROI for DCIM can be a valuable and worthwhile undertaking – many DCIM deployments that fail do not tackle specific goals with measurable success.

The process of calculating an ROI can help crystalize the desired outcomes of a DCIM deployment – specifically and in a measurable way. It can help identify what these goals could or should be and determine which DCIM features and products would be suitable. Calculating an ROI can also uncover benefits, as well as costs, that may not have been previously considered.

When choosing a DCIM system, whether it’s a comprehensive suite from one supplier or a mix of best-of-breed components, 451 Research recommends considering the long-term objectives.

Ideally, a DCIM system should be used to manage datacenters over their lifetime and to support changing datacenter environments, including the option to run workloads both on- and off-premises.

DCIM Alone Is Not Enough

DCIM is an enabling technology, making it easier to raise datacenter temperatures, push utilization levels higher, drive up power density, and balance IT demand with the supply of power and cooling. While DCIM can automate some of these actions, they are mostly enabled or supported by data and analysis from DCIM – not DCIM itself.

This means that DCIM is as much of a management approach as it is a technology. Project leadership, operational process and cross-domain collaboration are all essential to realizing DCIM’s full value.

In other words, to maximize the benefits from DCIM data and analysis, new internal operational and business procedures and workflows are typically required.

However, a DCIM system alone will not solve all management problems within a datacenter. To an extent, then, the ROI of DCIM is about measuring the actions that are made more feasible with DCIM.

For example, effective collaboration between a datacenter’s facility and IT managers is critical to more closely align the IT demand (servers) with the supply of datacenter resources – such as power and cooling.

Yet these two disciplines remain separate in many datacenters, with different budgets, skills, processes and technical language. A closer alignment of these departments will require internal change for most datacenters. And, of course, a change in one process may have a cascade effect on other procedures, amplifying the challenge.

Other new processes that DCIM typically requires include greater transparency around performance metrics and alarming, and best-practice workflows.

Big Benefits, Difficult To Quantify

Because of the many variables and intangibles involved, it is impossible to quantify the true value of DCIM. Some of the most significant benefits from DCIM can be the most difficult to measure, as illustrated below.

One of the largest benefits of DCIM is avoiding a potential outage when, for example, a monitoring and asset management system alerts an operator to, say, a faltering uninterruptible power supply (UPS). In this case, it can be very difficult to quantify the actual cost savings of avoiding downtime.

DCIM can also enable more efficient use of resources, such as power, cooling and space, which can delay the need for additional capacity. But organizations can add capacity in a number of different ways, including building a new datacenter and outsourcing to third-party service providers, which complicates the savings picture.

Power savings, on the other hand, while relatively small in comparison, can be readily calculated.

There are other challenges when calculating a DCIM ROI. Different business units and different roles are most concerned with the benefits (and costs) directly relevant to them.

For example, the finance department might value the internal controls that DCIM can enable (such as regulatory compliance), while the IT department may be focused on efficient server refreshes.

The total cost of ownership of a DCIM system and the return it delivers will vary among teams. This is why taking a multi-disciplinary approach to calculating ROI for DCIM is key.

Recommendations

451 Research makes the following recommendations when considering a DCIM deployment:

  • Organizations should undertake an ROI assessment of DCIM with the primary purpose of identifying the goals and benefits that can be achieved from deploying the software.
  • Understand that the business benefits of DCIM – such as improved capacity planning, reduced risk, and increased efficiency and agility – are difficult to quantify, but will typically justify a DCIM deployment. An ROI assessment should be used to prioritize smaller, specific actions that have measurable outcomes.
  • The total cost of ownership of a DCIM system and the return it delivers will vary among different business units and roles. Taking a multi-disciplinary approach to calculating ROI for DCIM is key.
  • Prior to DCIM deployment, create operational processes that will ensure adequate use of the software and encourage cross-domain communication and collaboration between facilities and IT teams.
  • In choosing a DCIM system, consider long-term objectives. Ideally, a DCIM system should be used to manage datacenters over their lifetime and to support changing datacenter environments, including both on- and off-premises.

You can access the complete 451 Research report here.

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