Are hidden costs plaguing your IT operations? A view from the trenches

These are tough times for financial services firms. Budgets are getting crunched, and IT managers are being asked to renew their focus on efficiency. One U.S.-based investment bank (which requested that it not be named) is taking the opportunity to identify some hidden costs "to streamline operations, use more energy-efficient systems and fewer physical machines in general."  

This bank is convinced that there's a lot of waste and redundancy that can be eliminated fairly easily. Using Tideway's mapping product Foundation, for example, it created "a map of all of our data center assets and the relationships between them. The idea here was to be able to be predictive about our data center relocation - 'what happens if we unplug this server?' When we did an initial scan of 3,000 servers, we found another 90 machines that should have been retired." On those servers, they found a lot of ghost services that created some maintenance issues.  

Reducing waste by grappling with these overlooked costs can pay off. "A typical data center costs about $1.5 million a year in electricity costs. A good environmental design may cut 20 percent off that. However, finding 200 unnecessary servers and turning them off could save a good deal more. Better yet, if you could move average server utilization from the typical 10 percent to more than 50 percent, how many servers could you take off the floor? Most companies have thousands of physical infrastructure boxes and they have lost track of what is actually on the floor."  

Tideway estimates that typically, up to 5 percent of hardware can be removed with no impact. If you've got 1,000 servers, the savings would total about half a million.   And then there's software issues. Most firms are guilty of overlicensing, which can reduce bargaining power with vendors that results from an inability to match license agreement with usage. There are likely a lot of other hidden costs that you may want to root out now. - Jim