The Computerworld Honors Program
Honoring those who use Information Technology to benefit society
LOCATION:
Cambridge, MA, US

YEAR:
2007

STATUS:
Laureate

CATEGORY:
Business and Related Services

NOMINATING COMPANY:
Dell

ORGANIZATION:
Data Guard Systems

PROJECT NAME:
Consolidation through Virtualization

Short Summary
In today's world, you are never out of range of a cell phone store. Like the mom-and-pop grocery shop of old, today's cellular phone retailers can be found on nearly every street corner. But selling cellular is not as simple as vending vegetables. Cellular store owners must navigate a complicated sales process that includes managing contracts, equipment, rebates, activations, and more. But because most cell phone stores are owned by independent contractors, these owners generally lack the financial means and IT expertise to implement the costly enterprise applications needed to support such a complex sales process.

Additionally, while increased competition and the rise of prepaid cellular service and niche MVNOs have helped to create more choices and drive down costs for the end consumers, the cellular retailers themselves still face an uphill battle every day, and with ever-shrinking profit margins due to this increased competition and market over-saturation, many independent cellular retailers find it difficult to stay afloat on a monthly basis.

That's where Data Guard Systems comes in. The company addresses the challenges facing cellular retail store owners through a comprehensive hosted online point-of-sale (POS) and management system. Data Guard Systems offers cellular retailers everything they need to manage every aspect of their cellular retail business including account activation, point-of-sale transactions, paperless document storage and management, commission reconciliation, inventory management, and customer relationship management. And because Data Guard Systems hosts the solution, retail stores have no IT worries at all. Their only need? A computer with Internet access. Accessed through an Internet web browser, Data Guard’s CellularManager software platform offers cellular retailers an always-on, enterprise-level software service that is both easily-accessible and very affordable. Data Guard is able to provide these small business owners with a software platform that they could never afford to create themselves, in-house.


Introductory Overview
The CellularManager software platform itself is hosted completely by Data Guard Systems. Via this business model of supplying software as a service, Data Guard has offered cellular retailers nationwide a versatile productivity platform at a very reasonable and cost-effective monthly fee.

With a customer base of well-over 3,500 retailers across the United States — many of whom require access to data 24 hours a day—it is essential that the CellularManager platform be always available. “If the POS system were to run slowly, our customers would essentially consider it down,” explains Timothy Maliyil, President of Data Guard Systems. “That’s how demanding the point-of-sale environment is.”

Consequently, as a result of Data Guard’s tremendous growth, the infrastructure grew to match the demand with new servers and new storage. Redundancy was also an absolute necessity – not only on the local level (multiple servers and backups) but also on a global level (multiple datacenters). Ironically enough, it was not space limitations, per se, that soon became the largest inhibitor to Data Guard’s continued growth, but rather the capacity, cost, and availability of power for this expansive hardware network. After learning that adding power capacity would cost millions of dollars, Data Guard realized that there had to be a more elegant way to address this problem.

This problem was further complicated by two very significant factors: (1) rising oil and natural gas prices due to global conflicts and shortened supply and (2) stagnant growth in the cellular industry.. Whereas many companies will commonly raise their rates at the drop of a hat to accommodate their own rising costs, Data Guard, seeing first-hand the issues facing their struggling clients, opted not to go down that path.

Nevertheless, with power as a central factor to the prolonged growth of Data Guard Systems, the company needed to find some way to address this critical consumption issue. The hope was that the potential solution could not only cut power consumption and thereby drive down costs but also eventually pay for itself, so the costs were not passed on to the end-users.

The final solution became an act of consolidation via virtualization. Using VMware ESX Server software, Data Guard could run multiple virtual servers on one physical server. This planned server consolidation would dramatically reduce the number of physical servers in the data center, thereby lessening power consumption.

In the initial implementation, Data Guard consolidated forty-five (45) backup database servers onto four (4) Dell PowerEdge servers with dual-core processors. VMware ESX Server software would maintain multiple virtual machines on each physical server running Microsoft® Windows® 2003 and Microsoft® SQL Server 2000 software. Additionally Data Guard consolidated its distributed storage devices on the backup servers onto a Dell/EMC CX500 SAN that would be shared by all the virtual machines. In the event of a backup database going down, Data Guard can be back online in under a minute because all virtual machines have access to the SAN. Furthermore, the Dell/EMC SAN assisted in the easier replication of machine configuration and user data to remote data centers in Denver. Surprisingly enough, from plan to action, the migration to this consolidated infrastructure was implemented in just under three weeks with no downtime whatsoever.

Since migrating to the consolidated server infrastructure, Data Guard Systems is saving approximately $10,000 a month in power costs – savings that can be passed on to grateful small business owners who use the service. The new solution is projected to reduce the power required by as much as 80%, and these savings are sufficient to pay for the new servers and software within the year.


Benefits
Has your project helped those it was designed to help?   Yes

What new advantage or opportunity does your project provide to people?
Major Benefits:

1) Power Consumption and Costs – The most obvious benefit – this technology uses 20% of the power that a comparable, standard, clustered server solution would use.

2) Infrastructure – Virtualized machines streamline the amount of space needed by Data Guard for infrastructure, new web or SQL servers can be deployed in minutes, and engineers no longer waste time with the physical aspect of racking equipment as often.

3) “Virtually” Limitless Growth – Virtualization allows Data Guard to accommodate customer growth without the need to purchase additional hardware to support it. With this consolidation, Data Guard could add on new services with zero additional hardware costs.

4) Simplified Administration – This consolidation project has simplified server administration not only due to the fact that there are fewer servers to manage but also due to powerful administrative tools that can move live, running virtual machines from one physical server to another without disruption of service and no downtime.

5) More Resources for Upgrades – Data Guard prides itself on providing cutting edge technology and services at the forefront of the cellular industry. With administrator productivity up dramatically, teams can focus on improving the overall platform instead of simply running it. Additionally, more money and resources are available for research and development instead of simple maintenance.

6) Customer Savings and Service – Data Guard’s customers are the most important benefactors of the consolidated infrastructure. Not only do they benefit from fast performance with zero downtime, but due to freed up development resources, they look forward to new, advanced software features designed to help their overall productivity. Furthermore, as hoped, Data Guard’s consolidation project, which has reduced power costs by $10,000 per month, allows the company to continue to assist struggling business owners with a very reasonable price point for the software service.


Has your project fundamentally changed how tasks are performed?   Yes

How do you see your project's innovation benefiting other applications, organizations, or global communities?
Recently, there appears to be renewed focus concerning computer energy consumption and cost in the nation’s datacenters. And with little surprise, considering that energy costs can account for up to 30% of a company’s IT budget. IDC calculates that the total power and cooling bill for servers in datacenters across the US stands at $14 billion a year. Advanced technology has increased server density within the same space. What used to hold seven servers now can hold upwards of double that amount. Furthermore, this increased server density – unsurprisingly – runs parallel with overall power density in the datacenters. Power consumption is increasing, and this electricity consumed by servers is released as heat. To combat the heat, advanced cooling systems are deployed, which consume even more power. If the nation’s current datacenter trends continue, this bill will grow to over $50 billion by the end of the current decade. [IDC, “The Impact of Power and Cooling on Data Center Infrastructure”, May 2006]

Factor in rising energy costs due to global conflicts and shortages as well as increased demand, and spending for datacenter power can easily become a drain on a company’s IT budget – thus diverting resources from other vital and developmental projects.

Data Guard views consolidation via virtualization as a very real and very cost-effective initiative with a potentially large ROI. Virtualized consolidation effectively:
•Drives down power consumption and costs
•Utilize less datacenter space, less electricity and cooling
•Minimizes administrative labor costs
•Consumes shared resources more intelligently and efficiently across virtual servers

Data Guard reduced its power consumption by 80% and saves approximately $10,000 monthly, per datacenter, in energy costs. Not only does this have a positive effect on Data Guard’s own resources and bottom line, but also a positive effect on reducing the overall consumption of global environmental resources.

The Importance of Technology
How did the technology you used contribute to this project and why was it important?
The overall goal was to implement a scalable platform that would not diminish existing performance nor inhibit future growth while, at the same time, would reduce power consumption and costs across the infrastructure. Based on Data Guard’s specific requirements, virtualization simply made sense.

Data Guard’s infrastructure primarily consisted of a combination of Dell PowerEdge servers running the Microsoft® Windows® operating system and Microsoft® SQL Server 2000 database software. Furthermore, the company used additional PowerEdge 2850 servers for applications and several Dell PowerEdge 1850 Web servers. The overall design goal of the infrastructure is one of redundancy and “always-on” capability.

Without the following specialized hardware and software, this project would never have been such a success:

HARDWARE
• Dell™ PowerEdge™ servers with dual-core Intel® Xeon® processors
• Dell/EMC CX500 storage area network

SOFTWARE
• VMware® ESX Server® software
• VMware VirtualCenter virtual infrastructure management software with VMotion™ technology
• Microsoft® Windows® 2003 operating system
• Microsoft® SQL Server 2000 database software

With the above combination, multiple virtual servers can run on one physical server using the VMware software and VMware systems management tools enable a virtual server to be moved from one physical server to another within seconds, helping to make automatic failover a breeze. The end result is that the number of servers can be reduced without any discernible or detrimental effect on service or performance.

Forty-five backup database servers were consolidated onto four Dell PowerEdge servers with dual-core processors. VMware ESX Server software maintained multiple virtual machines on each physical server running Microsoft® Windows® 2003 and Microsoft® SQL Server 2000 software. In addition, the distributed storage devices on the backup servers were consolidated onto a Dell/EMC CX500 SAN that is shared by all the virtual machines. The SAN also allowed Data Guard to more easily replicate machine configuration and user data to remote data centers.

Each PowerEdge server used with a VMware deployment can essentially manage approximately 15 virtual servers. Not only does this reduce power consumption by simply eliminating extraneous servers but it also provides ample room for growth. Consider that again – one server can effectively take the place of fifteen servers. With the ever-increasing demands for and limitations on space and power in the nation’s datacenters, a VMware solution makes logistical and fiscal sense.

To simplify server administration, Data Guard implemented VMware VirtualCenter virtual infrastructure management software and VMotion™ technology. VMotion allows administrators to move live, running virtual machines from one physical server to another without disruption of service. Additionally, VMotion helps administrators perform zero-downtime maintenance by moving virtual machines among physical servers, so the underlying hardware and storage can be serviced without impacting the applications or disrupting users.

The technology was also extremely easy to implement and roll out. Once the decision was made, the process itself took approximately three weeks, including testing and training.


Originality
What are the exceptional aspects of your project?
Companies similar in size to Data Guard Systems normally would not take on the invested risk with regards to a project with this scope. Most stories or case studies about virtualization revolve around larger, multinational companies that greatly reduce their infrastructure and consumption costs due to consolidating and virtualizing their infrastructure. However, the argument can be made that virtualization generates a large ROI for smaller companies with large infrastructure requirements. Data Guard Systems is proof of this. It is a small, privately-funded company that supports thousands of cellular retail stores across the United States and Canada. Data Guard is able to maintain a distinct competitive edge through the better IT management that was obtained through virtualization.

Additionally, what is truly exceptional about this consolidation project is how Data Guard obtained a much larger ROI than anticipated in a very short time. Power costs were reduced by $10,000 monthly, per datacenter, almost immediately. Money that was formerly allocated to pay for rising power costs is now allocated for other projects, and new services, such as e-mail marketing, added redundancy, and advanced engineering test environments, were easily added with zero additional hardware cost.

Through the implementation of the VMware virtualization technology, Data Guard has reduced power costs and consumption, streamlined server administrator productivity, and made better and more efficient use of its datacenter spaces. To reach the first goal would be no small feat, but to accomplish all three of these in such a short amount of time speaks volumes not only about the potential of the technology but also the efficacy of the resources at Data Guard Systems and of the Dell Technical Services team who assisted in the construction and implementation of the project.


How is it original?
Data Guard’s CellularManager platform is a completely web-based ERP designed for the specific business requirements of retailers in the cellular industry. It is the only software platform of its kind in this specialized marketplace. Data Guard’s main technological differentiation over its competition lies within its architecture and attributes as an ASP. Data Guard’s competition in this marketplace opted for the development of client-installed applications that maintained limited synchronization capabilities with one or two hosted servers. The major flaw of this approach, however, is that the target audience for the product is not technical-savvy nor can they frequently afford to hire an IT staff to manage deployment, integration, and networking for a smaller business. A typical computer user has difficulty installing drivers or implementing patches for Windows. To expect a non-technical user to implement a synchronized network with client-installed software is a tall order indeed.

In this space, then, Data Guard Systems offers a unique alternative with the only real-time, fully-redundant and fully-hosted software platform. Clients have full access to an easy-to-use, high caliber, and low maintenance ERP at a low, competitive price comparable to that of the competition. The combination of feature-laden software, eliminated local, IT maintenance, and real-time data accessibility enables Data Guard to achieve superior service and performance in comparison to its competition.

This consolidation project further expands Data Guard’s capabilities with the platform to provide an even more capable environment for Data Guard’s server administrators while maintaining fast, optimal performance for its users. Not only was Data Guard the first entirely hosted ERP in the marketplace but now it is the first with a virtualized infrastructure for cellular retail management software. Data Guard’s driving force is to provide enterprise-level technology, software, and solutions to small business owners. Their overall success is Data Guard’s greatest pride.


Is it the first, the only, the best or the most effective application of its kind?   Most effective

Success
Has your project achieved or exceeded its goals?   Exceeded

Is it fully operational?   Yes

How many people benefit from it?   7000

If possible, include an example of how the project has benefited a specific individual, enterprise or organization. Please include personal quotes from individuals who have directly benefited from your work.
This project benefits two distinct parties: 1) Data Guard and 2) Data Guard’s clientele.

With regards to Data Guard, the obvious success was a major reduction in power consumption (up to 80%) and immediate power cost savings (up to $10,000 monthly, per datacenter). However, there are several side effects of the consolidation which have benefited Data Guard immensely. First, a virtualization solution allowed the company to expand with new services and new offerings with zero additional hardware cost. Secondly, the company’s software upgrades became more inexpensive to deploy. Thirdly, virtualization allows administrators to build new web servers or SQL servers in minutes based on standard images. Furthermore, due to the reduced number of servers, engineers spend less time with the physical aspect of deploying servers (i.e., racking equipment, cabling, etc.). Overall, Data Guard obtained a much larger ROI on a much larger scope than originally anticipated.

The CellularManager end-users benefit from excellent service and performance. Dell and Data Guard deployed the consolidation project with zero downtime for any end-users. Furthermore, these changes are imperceptible to the end-users of the software platform; performance is equal to, if not better, than before. Additionally, virtualization offers Data Guard more efficient backup and restoration abilities, in case of emergency hardware failure. This means that any failovers performed by Data Guard in the event of an emergency are handled in minutes and will be hardly discernible to the end-user. The clearest sign of success, then, is truly never noticed by the end-users at all.

Finally, Data Guard’s clientele also benefits from the company’s freed-up resources due to virtualization. These benefits manifest themselves in the form of added capacity, added performance, and, of course, new features and upgrades that ensure that CellularManager end-users maintain their distinct competitive edge over competing retailers.


How quickly has your targeted audience of users embraced your innovation? Or, how rapidly do you predict they will?
As is often the case with the most effectively-integrated IT projects, the end-users of the ERP platform remain unaware of the existence of this innovative virtualization project. Their primary concerns are fast performance, 24-hour access, and consistent uptime. The implementation of this virtualization project further ensures that the requirements of Data Guard's clients are met both today and tomorrow.

As for the IT division at Data Guard Systems, they have fully embraced the consolidation effort and are pleased with their increased productivity as a result.

Difficulty
What were the most important obstacles that had to be overcome in order for your work to be successful? Technical problems? Resources? Expertise? Organizational problems?
The most difficult aspect to overcome for this project was the potential financial risk. The infrastructure upgrade (both hardware and software) to support the new virtualized environment was six times the cost of purchasing the traditional hardware to support the company’s needs.

From a small business perspective, a failure on the technical level to meet the company’s business requirements would create a major financial hurdle for other planned growth initiatives. Months of planning and preparation were required before implementing the solution.

Dell and Data Guard addressed the following needs during the planning phase:

1. SAN Maintenance – The solution required a Dell/EMC CX500 SAN. Data Guard did not have staff in place to maintain the SAN. Would this project require building up the IT division? No. The SAN is highly redundant by itself and backed by enterprise support. The SAN is even intelligent enough to notify Dell support independently if it predicts a possible drive failure. So help, literally, is simply a call away.

2. VMware Performance – The question was whether a virtualized VMware machine truly performs as well as a standalone system would. Dell’s proof-of-concept showcased the performance of the application within a simple virtual environment and clearly demonstrated that it was, indeed, more than capable of performing tasks and processes in a comparable manner.

3. VMware Maintenance – Similar to the company’s inquiries into SAN maintenance, Data Guard discovered that the end-user tools are extremely user-friendly, and the virtual environment requires little maintenance.

4. Power Requirements – The burning question was will this solution truly require only 20% of the power previously provisioned for the infrastructure. Proofs-of-concept and simulations showed immense promise, but there was no definitive answer. Data Guard had to accept the face value proposition of the pre-deployment calculations. The true power consumption would be discovered post deployment.

Often the most innovative projects encounter the greatest resistance when they are originally proposed. If you had to fight for approval or funding, please provide a summary of the objections you faced and how you overcame them.
While the potential financial risk was a possible hurdle for a privately-owned business such as Data Guard Systems, the president of the company fully supported the project as soon as the potential power cost and consumption savings and the overall stability of the virtualized platform were clearly demonstrated to him. Once satisfied with the proofs-of-concept and the simulated results, he signed off completely on the project.
Digital/Visual Materials
The Program welcomes nominees to submit digital and visual images with their Case Study. We are currently only accepting .gif, .jpg and .xls files that are 1MB or smaller. The submission of these materials is not required; however, please note that a maximum of three files will be accepted per nominee. These files will be added to the end of your Case Study and will be labeled as "Appendix 1", "Appendix 2" or "Appendix 3." Finally, feel free to reference these images in the text of your Case Study by specifically referring to them as "Appendix 1", "Appendix 2" or "Appendix 3."

Currently Uploaded Appendices:
No appendices currently uploaded.