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Data Center ROI: The Good, the Bad and the Ugly

Nov. 07, 2017
Ryan Day

Remember The Oregon Trail?

If you grew up in the '80s or '90s, it was probably a hallmark of your elementary school years.

For those unfamiliar, The Oregon Trail was a computer game that inexplicably became a classroom staple throughout the country. The educational game was meant to teach children about the lives of 19th century settlers who journeyed along the Oregon Trail by covered wagon.

The game takes place in 1848, with your pioneers setting off from Independence, Missouri with the goal of reaching Oregon. Along your travels you must navigate rivers, hunt for food, repair broken axles, manage a budget and keep your players healthy. (It’s quite possible that an entire generation of children learned of dysentery from this game alone.)

The Oregon Trail was a learning tool disguised as a fun and engrossing diversion from typical classroom lessons. Those teachers had us figured out — we thought we were playing a video game when in fact we were absorbing crucial problem-solving skills. They tricked us into learning!

Well, it turns out some of the skills we acquired while hunting bison and forging rivers can be applied to IT. Much like those 19th century settlers, modern-day IT professionals are advancing into uncharted territory.

Cloud adoption is not some far-off eventuality — it’s happening now. Security issues aren’t going away. In fact, they’re intensifying. These initiatives are real, ready and available now. New technologies present an enormous opportunity, especially when it comes to greater access to systems at lower price points. But wild enthusiasm for new solutions often overshadows the need for proper implementation and expectations.

“Everyone is a pioneer,” said Aaron Mills, Global Knowledge Vice President of Channel Sales. “The resellers are pioneers in this. The vendors and service providers themselves are pioneers. The end user customers are pioneers. So we’re all in this journey together. It’s a sensible journey but we’re collectively entering into new territory that we’re, to some extent, unfamiliar with and often lack experience in.”

In terms of the data center, a migration to the “new style of IT” presents huge opportunities in terms of value capture and return on investment. But often, the integration of legacy equipment with new cloud and security architectures leads to unintended consequences. When optimism is high and transition strategies aren’t fully developed, there’s often a rush to deploy.

Organizations are investing heavily in these modern and advanced solutions. They expect immediate payoff. That’s not realistic.

This isn’t about intentions. It’s about planning and anticipating problems. It’s about equipping your staff with the proper skillsets before deployment. It’s about investing in the right resources, not the shiniest.

Data center return on investment — which is measured by time to cost savings, time to revenue, time to break even, etc. — has proven more elusive than expected. But that doesn’t mean it isn’t attainable.

To understand the genesis of the bad and ugly parts of data center ROI, we need to recognize the good parts and appreciate why so many companies are putting their faith in these new and unfamiliar technologies.

The Good: Products, potential and lower price points

The opportunities of new technology are too great to not pursue. Ideally, transitioning to the cloud or software-defined data centers can result in:

  • Greater access to sophisticated systems at a lower price point.

  • Better security for data and intellectual property.

  • More staffing flexibility so you can devote your IT team to high value tasks.

In terms of dollars and cents, companies that have spent millions in the past on in-house application software can now outsource or use a cloud provider at a fraction of the cost. As you can imagine, that’s a rather attractive opportunity for management and stakeholders.

Cybersecurity is also increasingly imperative for companies who must remain viable and attractive to customers who trust them to secure their information.

And greater staffing flexibility means more efficiency and less mundane work. You no longer need to devote your IT professionals to time-consuming operations like payroll or backup and recovery.

“In-house data center work can be transitioned to higher value activities and efforts,” Mills said, “while many of the lower value workloads can be transitioned to the cloud.”

This all sounds great. So what’s the downside?

The Bad: Paper returns are difficult to come by

Mills says ROI calculations are “exceedingly optimistic.” Part of that is due to the pressure on organizations to cut costs. But when you’re focused almost entirely on the destination, you’re likely not prepared enough for those broken axles along the way.

“There’s this wild enthusiasm that gets picked up and evangelized every time people get behind a particular solution,” he said. “They’re quick to fall in love with the good news. That’s always with us — there are leaps of faith and rush to optimism in cases of ROI projection. But the opportunity for improvement lies in the avoidable missteps.”

When the cause-and-effect relationships of new implementation are not fully planned for, those missteps become unavoidable. As a result, goals are missed, the bottom line is affected and venture capital partners are less than pleased.

A major problem is that organizations are so focused on investment in new technologies that they shortchange their greatest resource — their people.

“The data center team that’s bringing these new technologies into the organization are underachieving because of skills gaps,” Mills said. “The slow progress and elusive ROI kind of sneaks up on them. It’s kind of like, wait a second, what do you mean we’re not seeing the kind of milestones achieved or cost savings that we had modeled? It’s really the unforeseen and unintended consequences of not addressing the skills gaps.”

The Ugly: Skills gaps exist and they aren’t going away on their own

The truth is there’s always going to be some form of “ugly” when new systems are integrated into legacy architecture. But there’s a big difference between hitting a few speedbumps and being called out by your CFO or CEO for a screw-up.

“Disappointing forays into the cloud and the rush to embrace new technologies are very real and pervasive issues,” Mills said. “I’m not suggesting for a moment that the value and the opportunity isn’t there. But first you have to invest in the human beings that are going to have to design, install and administer this stuff or it’s going to come back and bite you.”

Nobody can fully anticipate or plan for the chemical reaction that occurs when you drop a new solution into a legacy environment. So instead of trying to predict the impossible, invest in the people who know those legacy environments the best. That intersection of the vendor community and the data center is the source of tremendous uncertainty and pain. Make sure the professionals that occupy that space are as educated and knowledgeable as possible. Get them trained and certified before a deployment. Not after.

Many organizations don’t realize they have skills gaps until a project has launched or its deployment is underway. At that point it’s not necessarily too late to do anything, but it puts a lot of pressure on IT professionals and decision-makers, who have to scramble to manage a new initiative while simultaneously arming their staff with the proper knowledge. Skill shortages are standing between organizations and the true potential of their technology investments.

Global Knowledge can help prepare for the journey ahead

Settlers traveling the Oregon Trail, whether in real life or the video game, had many obstacles to maneuver around and plan for. Those that were best provisioned had the most success. In those days, proper provisions meant having a knowledgeable guide, enough food and water, and repair materials for your mode of transportation.

When it comes to IT, Global Knowledge can be your provider of enhanced preparation. We’re your knowledgeable guide.

“A lot of companies are going into that brave new territory of cloud and software-defined data centers and security without the proper toolsets, navigation, preparation and skills development,” Mills said. “As a result, they’re going in blind to box canyons, getting stuck and it’s costing them money. We’re the ones that can best prepare them for the journey ahead.”

According to Mills, IT governance is the foremost skill needed to avoid the “ugly” in data center ROI. IT governance is all about relationship management. It’s about anticipating the bumps in the road. It’s about understanding the intersection of the old and the new.

Cataloging and inventorying all components of a legacy environment are essential processes. Mapping and impact analysis of new systems is also a necessity. Understanding the collisions of these technologies is an undeveloped science, but better ROI is only going to occur when you adopt a precise and exhaustive approach. It’s not easy to create this type of game plan. And it may take longer than you’re used to. But it’s better than rushing into a launch without preparing for the fallout.

“IT governance is the ability to assess all of the connection points and the compatibility, or lack thereof, of the legacy environment, the requirements and the dependencies of the new technology,” Mills said. “Then being able to map that to organizational goals and objectives in a way that meets expectations. I think that’s the big disconnect in all of this.”

Want better returns? Invest smarter

The reality is traditional IT skillsets are getting in the way of progress. Skills gaps are very real and very disruptive. If organizations don’t invest appropriately in proper professional development up front, those skills gaps will rear their ugly head down the road when it’s least optimal.

If you don’t have the skills to repair a broken wagon wheel, then you’re in trouble on the Oregon Trail.

Before you set out on your journey, do your homework. Know the skills your team lacks. Know the ins and outs of both the legacy and new environments. Set realistic expectations for resources, budget, ROI and timeframe.

Limited planning, impractical goals and a rush to see results are indicators of an imminent failure.

Sure, you may eventually arrive at your destination. But at what cost?

“You may get to the end of the Oregon Trail,” Mills said, “but it's going to require more effort, resources, time and involve more risk, compared to the people who have the good guides and the experience.”

Visit to learn how to become a Global Knowledge channel partner to provide your clients with the essential skills required to master today’s technologies so they’ll get the best return on their investments.

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