Tight budgets boost, IT consolidation

The rush to consolidate servers and the data centre is on. Many companies appear to be squeezing redundant hardware, software, maintenance and service costs out their data centres – and the effort is quickly paying off, according to IT managers.

Bayer Corp. in Pittsburgh offers a dramatic example of how much money can be saved. The company last year consolidated 42 data centres into two and cut the number of servers from 1,335 to 615. Expected savings: US$76 million over five years, according to Hobart Moore, an IT manager involved in the project. The initiative delivered $10 million in savings last year alone, said Moore.

“We showed that we aren’t just out there providing services and that we can actually save the company money when it becomes necessary to do so,” said Moore. “We came up with very solid ways of reducing cost without slashing services.”

Mark Levin, an analyst at Meta Group Inc., called consolidation the “hottest thing” and said the most difficult aspect of this effort often is coming to terms with the inventory.

Consolidating servers can lead to some management resistance, particularly if a business unit hosts a particular server. But as long as service delivery is unaffected, company buy-in is usually easy to get.