Wall Street. Main Street. Tobacco Road and Highway 9?

A Regional Perspective on Our Industry in 2009

Varrow was busy during the last months of 2008, but economic news did make it through the email filters at times.  Looking ahead to 2009, it appears that our market may change “slightly”.  Therefore, I thought it worthwhile to lay out a few of the key considerations for making infrastructure business decisions as we endure tighter budgets.

 

Cost, Cost, Cost

Although they didn’t reach the status of the .com boom, the virtualization and storage markets were fairly bullish in 2007 and 2008.  As a strategic advisor and integrator, Varrow’s primary project drivers were more often customer business constraints than customer budget constraints.  Savvy customers took the opportunity to build flexible, highly available infrastructures that moved their systems towards delivery rather than deployment.

 

Now, flexibility, availability, and streamlined management are giving way to doing more with less.  The reports that we used to provide as supplemental materials outlining cost of ownership and returns associated with a project now are taking the primary focus during the decision process.  Usually customers exhibit this behavior in two forms.  One form is to scale the project down to match budget funding rather than purchasing the complete solution with all of its features.  Another form is to stress the hard dollar savings that the project must generate, and exclude softer costs like management time savings and efficiency from the calculations.  Usually the second approach produces a more strategic implementation, but we have worked successfully with customers employing both approaches.

 

Did the CIO just ask about iSCSI?

Organizations drove the productivity and growth booms of the last two decades by solving the problem of how to do more with less.  With regard to infrastructure management, responsibility and decision making authority for greater and greater resources was pushed further and further down the org chart.  In 2008, administrators and directors frequently made purchasing and implementation decisions delegated by the CIO. 

 

Although the resources under consideration have not increased, current discussions feature much more involvement from the executive suite.   Brokering strategies and conversations between organizational levels now occurs as part of Varrow’s daily business, alongside architectural work on storage layouts and consolidation ratios.  The nice benefit from increased executive involvement is that decisions frequently occur faster and with greater customer buy-in across the organization.

 

Who’s the Big Winner (Wiener?)

One counterintuitive benefit to the current environment is the fiercer competition it creates.  As service companies face greater financial challenges to their business, the desire to win projects and provide customer value increases.  Customers therefore have more options for their potential projects, even if it becomes harder to evaluate the choices.

 

Varrow’s opportunity becomes more exciting in this situation.  We’ve worked hard to build an organization that can qualify for and win almost any project that we set our sights on.  The key to doing so is our focused solution set (virtualization, storage, and disaster recovery), vendor relationships (only VMware premier/EMC focus partner in the Carolinas), and engineering expertise (contributing worldwide best practices to the infrastructure community). 

 

And in the end…

In 2009, I expect that these considerations will remain pertinent to most projects we encounter.  Hopefully however, the economic adjustment has placed our region and country on firmer footing for future growth. 

 

Patriotism

Whether or not you voted for Barack Obama, the past week provides a moving example of what makes America great.  People shed the cynicism that has pervaded the country for the last few months (at least) and headed to the polls to display the shining idealism that both McCain and Obama inspired during their campaigns.  Instead of resorting to the tactical pragmatism that divided our country along social and economic issues, they focused on change and hope.  As we start a new week, confronted with new economic challenges, the dramatic events of last week make me proud to be an American.

The Obligation

Something about Lance Armstrong always seemed to leave me less than impressed.  Obviously his mountain (no pun intended) of Tour de France wins placed him at the all time pinnacle of cycling.  However, as a baseball, football, and golf fan, that never seemed like a world changing thing to me.  That changed last Tuesday night.  During the closing keynote of Citrix Summit, Lance took the stage and told the simple, but very powerful story of his fight with cancer and its results in his life.

 

At that moment, he repositioned himself in my mind.  Instead of remaining the aloof icon of a not entirely mainstream sport, he became a human being and a hero.  Oddly though, he did it by talking about something that people face every day and that did not necessarily set him apart from his peers.  He talked about obligation.  In his case, he talked about how the fight with cancer created an obligation in his life to raise cancer awareness and promote research towards a cure.  He talked about how that obligation gave him a significant portion of the discipline and the drive to win all of those cycling titles. 

 

However, I did not walk out of the session hall thinking about his triumphant life and inspiring dedication, although I respect and admire both of those things very much now.  What remained in my mind afterwards was that concept of obligation.  What Lance called an obligation really seemed like the certain recognition of his life’s higher calling.  Obviously, there are significant religious topics that can enter into the discussion here, but I’ll focus on the lesson that seems to apply to organizations and knowledge workers.  How often do companies have the chance to offer their employees and stakeholder’s the sense of obligation and purpose that would drive them to repeatedly win the Tour de France in their field?  How would such a company compete with other organizations in their market?  What would the impact be on retention, recruitment, and results?

 

As you can tell by all of these questions, I didn’t end up with a lot of answers after Armstrong’s talk.  That short half hour though, did give me an insightful and inspiring vision into what it takes to drive and win at his level.  It became apparent that desire, effort, and talent could not beat his obligation to win.

Concurrent Heavy Workloads

Even with our fantastic engineering team at Varrow, our presales organization sometimes struggles with this common customer question... "Is there a good way to go from a virtual guest to a physical server?"

At Citrix Summit this week though, I had one of those "ah hah" moments that simple elegant solutions can cause. During one of the presales architectural sessions, an emerging Citrix product called Provisioning Server (PVS) was included in a diagram as a way to stream guest images to either physical or virtual environments. The "ah hah" that I experienced was caused by the realization that if you can choose which environment you are streaming to, then you can use the management capabilities of PVS to migrate images from virtual to physical environments and back again.

Sounds like I got caught up in a "geek out" moment right? What's the business implication here? Well, all of those trouble workloads in your datacenter that are only virtualization candidates some of the time can now be migrated back and forth from bare metal hardware depending on the business demands of your users. A database server that gets pounded during the financial close of each period can be moved to a physical server during that high use time and moved back into your virtual environment during the rest of the year. Just like some software companies have a concurrent user licensing model, you can use PVS to scale your physical server environment according to the number of "concurrent heavy workloads" that you have at any given time. Maybe, you could even engineer flexible leasing terms that let you increase and decrease your physical server count according to your seasonal business needs.