system administration class

Objectives:

1. To practice conducting a financial feasibility cost benefit analysis for

a server virtualization project.

2. To prepare an executive summary of the feasibility study.

Project Two: The Current Scenario

What you are going to do in this project is pretend that you are

the system administrator for an organization that is attempting

to determine if virtualization of its computing infrastructure

would be beneficial to the organization from a financial

perspective.

As the system administrator you are in charge of conducting the

cost/benefit analysis for the proposed virtualization project.

This will include creating financial spreadsheets using a 5 year

projection and writing a brief report summarizing your findings.

The next few pages describe the current infrastructure of the

organization and the proposed virtualization project. Lets call

the organization the ITCorp.

Currently ITCorp is running 5000 physical servers in its data center which

support various applications and several different operating systems.

These servers are configured into four different groups:

Group 1 consists of 2500 mission critical servers. Group 1 servers consume 3500W of power

each at full load (100% CPU utilization). The Group 1 servers average load is 25%.

Group 2 consists of 1500 mission critical servers. Group 2 servers consume 3800W of power

each at full load (100% CPU utilization). The Group 2 servers average load is 30%.

Group 3 consists of 500 non-mission critical in-house application and file servers, each of which

consumes 2800W of power at full load. The servers in this group run with an average load of

10%

Group 4 consists of a pool of 500 redundant servers utilized as backup servers. The Group 4

servers are split into two subgroups of 250 servers each, call them Group 4A and Group 4B.

Group 4A servers draw 3800W at full load and are used as backups for Group 1 and Group 2

servers. The Group 4B servers draw 2800W at full load and are used as backups for primarily

Project Two Common Elements

Some basic assumptions about ITCorp and the future as it pertains

to your cost/benefit analysis:

The cost of 1kwH of power is currently 15 cents. Assume that the cost of power

will increase 2%/year over the duration of the study.

When calculating power costs for the new servers, note that the loading of each

server was already factored into the value produced by the power calculator.

Assume that server maintenance costs will increase 4%/year over the duration of the

study for all server maintenance agreements.

The outside service contracts for security and storage will continue in the proposed

scenario just as they are to continue in the current scenario.

Assume that administrative costs on a virtual server are 60% of the administrative

costs on a physical server.

1 administrative day is 10 hours long. 1 server day is 24 hours long. There are 365

days in one year.

Project Two: Your Task

Your first task for this project is to construct spreadsheets like the ones

we discussed in class that will illustrate the current and proposed

infrastructure costs for the ITCorp given this proposed virtualization

project.

You should create (1) a variables spreadsheet(s) that includes all the

variables defined in the project, (2) a current infrastructure cost

spreadsheet, (3) a virtualization projected cost spreadsheet, and (4) a

summary spreadsheet that highlights the major costs and benefits of the

project.

IMPORTANT ! ! !

You must create your spreadsheet using variables to identify the various costs that are

being tracked. In other words, dont hard code any numbers into the formulas in your

spreadsheets. The following page illustrates one of the variables pages in my

spreadsheet where I defined the variables used in current cost spreadsheets. You must

include a similar page(s) in your spreadsheet

Once your spreadsheets are completed, youll construct a 1 page executive

summary report of your findings.

This report should address the feasibility of the proposed project and its

financial impact on the ITCorp.

Normally, an executive summary summarizes a more complete

accompanying report. You will not be preparing this more complete report

in this case, you will only be preparing the executive summary.

Note that an executive summary is different from an abstract.

Abstracts tend to be most common in academic environments whereas

executive summaries are primarily confined to business environments.

An abstract is a brief summarizing statement which is read by people who

are trying to decide whether or not to read the entire document.

An executive summary is the document in miniature which can be read in

place of the longer document.

1. A spreadsheet (similar to that we developed in the notes) with

worksheets containing variable definitions, current cost

infrastructure, proposed project cost infrastructure, and a

summary worksheet. Feel free to use the example spreadsheet

from the notes as a template or starting point for your project.

2. A one page executive summary of your findings with respect to

the feasibility of this project for the ITCorp. This executive

summary should give an extremely brief overview of the

proposed project, a summary of your findings (spreadsheet

analysis results), and a recommendation of whether the project

should move forward or not.

B D Variables Used In This Spreadsheet 1 2 3 Hard Costs Value Variable Name Variable Description 4 5 6 7 8 9 TU 11 numServersGroup1 numServersGroup2 numServersGroup3 numServersGroup4A numServersGroup4B 12 server PowerGroup1 server PowerGroup2 server PowerGroup3 server PowerGroup4A server PowerGroup4B 13 14 15 10 17 18 19 20 GroupA consists of this many 3200W servers Group 2 consists of this many 3800W servers Group 3 consists of this many 2800W servers Group 4A consists of this many 3800W servers-backup servers Group 4B consists of this many 2800W servers - backup servers power in watts of the servers in group 1 power in watts of the servers in group 2 power in watts of the servers in group 3 power in watts of the servers in group 4A power in watts of the servers in group 4B average load of the servers in group 1 average load of the servers in group 2 average load of the servers in group 3 average load of servers in group 4A average load of servers in group 4B cost of maintenance contract year 1 - servers in group 1 cost of maintenance contract year 1 - servers in group 2 cost of maintenance contract year 1 - servers in group 3 cost of maintenance contract year 1 - servers in group 4A cost of maintenance contract year 1-servers in group 4B serverLoadGroup1 serverLoadGroup2 serverLoadGroup 3 serverLoadGroup4A serverLoadGroup4B 21 22 23 24 25 26 27 maintenanceCost Year 1 Group1 maintenanceCost Year 1 Group2 maintenanceCost Year1 Group3 maintenanceCost Year1 Group4A maintenanceCost Year 1 Group4B securityFirm MonthlyCharge dataStorageMonthlyChargeYears1 And2 dataStorageMonthlyChargeYears3 Thru5 costkwHYear1 power Ratelncrease maintenanceRatelncrease cost per month for security auditing service - outside vendor cost per month for storing archival backups - years 1 & 2 - outside vendor cost per month for storing archival backups - years 3,4 5-outside vendor cost of 1 kwH or power in year 1 assume 2% increase in cost of power/year of study assume 3% increase in server maintenance cost each year of study 29 30 31 32 33 34 35 36 37 Soft Costs 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 administrativeCost Per HourYear1 administrativeRatelncrease weeksAdministrative TimeGroup1 weeksAdministrativeTimeGroup2 weeksAdministrative TimeGroup3 weeksAdministrative TimeGroup4A weeksAdministrativeTimeGroup4B cost of administrative time per hour in year 1 administrative pay increase amount weeks of administrative time per server Group 1 weeks of administrative time per server Group 12 weeks of administrative time per server Group 3 weeks of administrative time per server Group 4A weeks of administrative time per server Group 4B hoursPer BackupGroup1 hoursPer Backup Group2 hoursPer BackupGroup3 hoursPer Backup Group4A hoursPerBackupGroup4B hours per backup of server in Group 1 hours per backup of server in Group 2 hours per backup of server in Group 3 hours per backup of server in Group 4A hours per backup of server in Group 4B numberOfBackupsPer Year Group1 numberOfBackupsPerYear Group2 numberOfBackupsPerYear Group3 InumberOfBackupsPerYear Group4A number of backups performed on servers in Group 1 in 1 year number of backups performed on servers in Group 2 in 1 year number of backups performed on servers in Group 3 in 1 year Inumber of backups performed on servers in Group 4A in 1 vear B D Variables Used In This Spreadsheet 1 2 3 Hard Costs Value Variable Name Variable Description 4 5 6 7 8 9 TU 11 numServersGroup1 numServersGroup2 numServersGroup3 numServersGroup4A numServersGroup4B 12 server PowerGroup1 server PowerGroup2 server PowerGroup3 server PowerGroup4A server PowerGroup4B 13 14 15 10 17 18 19 20 GroupA consists of this many 3200W servers Group 2 consists of this many 3800W servers Group 3 consists of this many 2800W servers Group 4A consists of this many 3800W servers-backup servers Group 4B consists of this many 2800W servers - backup servers power in watts of the servers in group 1 power in watts of the servers in group 2 power in watts of the servers in group 3 power in watts of the servers in group 4A power in watts of the servers in group 4B average load of the servers in group 1 average load of the servers in group 2 average load of the servers in group 3 average load of servers in group 4A average load of servers in group 4B cost of maintenance contract year 1 - servers in group 1 cost of maintenance contract year 1 - servers in group 2 cost of maintenance contract year 1 - servers in group 3 cost of maintenance contract year 1 - servers in group 4A cost of maintenance contract year 1-servers in group 4B serverLoadGroup1 serverLoadGroup2 serverLoadGroup 3 serverLoadGroup4A serverLoadGroup4B 21 22 23 24 25 26 27 maintenanceCost Year 1 Group1 maintenanceCost Year 1 Group2 maintenanceCost Year1 Group3 maintenanceCost Year1 Group4A maintenanceCost Year 1 Group4B securityFirm MonthlyCharge dataStorageMonthlyChargeYears1 And2 dataStorageMonthlyChargeYears3 Thru5 costkwHYear1 power Ratelncrease maintenanceRatelncrease cost per month for security auditing service - outside vendor cost per month for storing archival backups - years 1 & 2 - outside vendor cost per month for storing archival backups - years 3,4 5-outside vendor cost of 1 kwH or power in year 1 assume 2% increase in cost of power/year of study assume 3% increase in server maintenance cost each year of study 29 30 31 32 33 34 35 36 37 Soft Costs 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 administrativeCost Per HourYear1 administrativeRatelncrease weeksAdministrative TimeGroup1 weeksAdministrativeTimeGroup2 weeksAdministrative TimeGroup3 weeksAdministrative TimeGroup4A weeksAdministrativeTimeGroup4B cost of administrative time per hour in year 1 administrative pay increase amount weeks of administrative time per server Group 1 weeks of administrative time per server Group 12 weeks of administrative time per server Group 3 weeks of administrative time per server Group 4A weeks of administrative time per server Group 4B hoursPer BackupGroup1 hoursPer Backup Group2 hoursPer BackupGroup3 hoursPer Backup Group4A hoursPerBackupGroup4B hours per backup of server in Group 1 hours per backup of server in Group 2 hours per backup of server in Group 3 hours per backup of server in Group 4A hours per backup of server in Group 4B numberOfBackupsPer Year Group1 numberOfBackupsPerYear Group2 numberOfBackupsPerYear Group3 InumberOfBackupsPerYear Group4A number of backups performed on servers in Group 1 in 1 year number of backups performed on servers in Group 2 in 1 year number of backups performed on servers in Group 3 in 1 year Inumber of backups performed on servers in Group 4A in 1 vear