SAN Buyers Guide: Part II


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Storage Area Networks (SANs) have definite measurable benefits over direct attached storage (DAS) as previously discussed in Part I of this article. They also carry additional costs over DAS as well. These costs include additional capital (SAN hardware, SAN software, Redundant Array of Independent (or Inexpensive) Disks (RAID) hardware and RAID software) and additional operating budget (maintenance, training and possibly more personnel). The key here to making a decision, is whether the measurable benefits of an enterprise moving to a SAN from a DAS environment for the first time, will outweigh the additional costs.

In other words, the combination of hard- and soft-dollar savings will yield the payback picture for the SAN infrastructure that can be used for management and technical decisions around SAN technology. Each enterprise will have to consider their infrastructure and determine which savings are hard, and which are soft. For example, hard savings are characterized by the following business planning case options:

  • Asset utilization.
  • Defer storage purchase.
  • Reduce tape systems.
  • Reduce floor space.
  • Increase availability.
  • On-line recovery.
  • Storage on demand.
  • Increase disk.
  • Storage maintenance.
  • Reduce number of servers.
  • Avoid network costs.
  • Non-disruptive growth.
  • Improve LAN/WAN.
  • Backup Window.
  • TB-per-system application (SA) Ratio.
  • Reduce backup servers.

And, soft savings are characterized by the following business planning case options:

  • I/O, data movement.
  • New Dr capability.
  • Protect critical data.
  • Reduce CPU load.
  • Impact to application development/test.
  • Vendor consolidation.
  • Increase disk life.
  • Management $dollars versus storage $dollars.
  • Server clustering.
  • Improve DR.
  • Terabytes (TB)-per-data base administration (DBA) ratio.
  • Secondary security.
  • Application migration.
  • Extend server life.

Estimated Savings

Estimated savings can be characterized for conservative, aggressive, or nominal states (calculations) and should be considered in the analysis. Conservative states usually will include hard savings and highly likely savings areas (seen or predicted), while an aggressive approach will take hard- and soft-savings examples together for the return on investment (ROI) calculations. Nominal cases will take a middle-of-the-road approach and will be consistent with the most acceptable/believable ROI case studies. Aggressive estimates are often used when baseline data is not verifiable or for soft-dollar savings. Each of the business planning case options identified in Part I and II of this article have different hard/soft considerations, and tend to be best applied in an approach that is clearly conservative, nominal, or aggressive. For example, the following are rules for simple ROI determination:
  • To achieve simplicity in ROI, cash flow, internal rate of return (IRR), and depreciation are not factored.
  • Moore's Law (the pace of microchip technology change is such that the amount of data storage that a microchip can hold doubles every year or at least every 18 months) is used with price stability for all servers and disk price decline.
  • Lease costs converted to purchase costs.
  • All hardware costs can be pulled to year 0, at Net Present Value 0 (NPV0).
  • Hardware costs can be spread out over the time period in which it is acquired.
  • Three-to-four-year planning usually is adequate for most SAN payback models.

Calculating SAN ROI

The following steps are also part of a structured approach (methodology) for calculating SAN ROI. A detailed discussion of these steps follows:
  1. Gather baseline data (see examples in each case model discussed later in article).
  2. Define the proposed SAN topology and then determine SAN costs.
  3. Select ROI business planning cases that best meet the current and target optimum situations (typically, five to eight models are chosen for a business case justification).
  4. Run the ROI case models and create summary charts and conclusions.
  5. Review conclusions and make adjustments to topology type, assumptions, and parametric values of the ROI models.

Gather Baseline Data

There are several baseline costs that will be required in order to determine current- or future-year costs before starting a SAN ROI exercise. Each of these cost elements could be applied to any of the ROI business planning cases discussed in Parts I and II of this article. Also, each case will outline the necessary baseline elements needed. A listing of these cost elements are as follows:
  • System administrator, database administrator (DBA), storage manager and tape operator.
  • New storage (S/390., UNIX, Windows NT).
  • Rate of storage price decline.
  • Average unit cost of new servers (UNIX, Windows NT).
  • Average unit cost of Windows NT or UNIX servers with SAN kits (h/w, s/w, middleware, setup).
  • Expected increase/decrease of servers.
  • Tape library systems.
  • Tape media (Digital Audio Tape (DAT), digital linear tape (DLT), 8mm, other).
  • Off-site tape storage.
  • LAN operational costs.
  • LAN degradation impact.
  • LAN build-out costs.
  • Data center floor space.
  • Data center environmental costs.
  • Application(s) downtime.
  • Data off-line impact.
  • Recovery time for different types of data.
  • Revenue potential per person.
  • Monitoring cost.
  • Maintenance costs for all storage.
  • Maintenance/license fee for storage s/w.
  • Value of improved I/O performance.
  • Time to procure/request net new disk.

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