NASCIO Delivers 10 Tips to Smooth Data Center Consolidation

Data center consolidation offers benefits in efficiency and cost, but as any state CIO will tell you, it’s no easy feat. To help avoid consolidation headaches, the National Association of State Chief Information Officers has released “Shrinking State Data Centers: A Playbook For Enterprise Data Center Consolidation,” to pave the way for CIOs taking on the task. The document revisits and updates a 2007 paper on the issue.

Already, state CIOs are making progress. In fact, 42 percent reported that they had completed data center consolidations in 2016, a giant leap from the 14 percent that had consolidated in 2007. Moreover, 47 percent said consolidation was ongoing and 11 percent were planning to consolidate.

“Over the last two decades, as state chief information officers have been tasked with finding cost savings, enterprise data center consolidation has been a prime target and consistent priority driven by cost savings and efficiency. Reducing the diversity and complexity of the states’ information technology environment, while leveraging enterprise infrastructure, has been a common theme,” the report states.

Data center consolidation can help to meet these goals. Specifically, the report calls out several benefits to consolidation, including:

• Stronger IT security
• The chance to introduce process standards, such as Information Technology Infrastructure Library (ITIL) and Information Technology Service Management (ITSM)
• The promotion of enterprise integration and applications
• Better support for legacy systems
• A chance to centralize infrastructure maintenance and upgrades
• Improved disaster recovery and business continuity

Challenges persist, however, including issues that arise when moving localized devices away from the customer base, customer backlash, unexpected costs and issues with exemptions.

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10 Steps to Data Center Consolidation

To help minimize issues and risks, the playbook points out 10 steps to smoother consolidation.

1. Understand what is needed — Before initiating consolidation efforts, it’s important to sit down with stakeholders to ensure the consolidation will address needs and regulations. “The team should assess agencies’ requirements for data processing, storage and backup, continuity of operations, and future needs or expansion. A state should understand needs, requirements and potential issues before setting a target date or launching any initiatives,” the report states.
2. Engage agency stakeholders early and continuously — “In our discussions, CIOs with consolidated data centers repeatedly stressed the importance of relationships. The biggest challenge and resistance to consolidation will inevitably come from agency CIOs who will likely be hesitant to give over control of their data center,” the report states.
3. Create a roadmap with reasonable milestones set in waves — The more planning, the more fluid the consolidation will be. In developing a detailed plan, the team should identify “facilities, technologies, organizations, services, people and processes that will be impacted by the consolidation.”
4. Document the baseline of assets — The more detailed states are when documenting state assets, the better they will be at predicting post-consolidation outcomes.
5. Conduct a cost analysis — Before pursuing any project, it’s important to understand where all costs will go. “It is helpful to be able to show agencies what they are saving by no longer having to maintain a data center despite the new fee associated with participating in the state data center,” the report states.
6. Address cost allocation and funding issues — CIOs will need to explore funding resources, including state legislatures and the federal government, as well as whether or not vendor contracts will need to be renegotiated.
7. Implement standards where they exist — “Implementing ITSM and ITIL can reduce costs, improve efficiency and increase security,” the report finds.
8. Manage expectations and expect surprises — Keeping all stakeholders in constant communication can help to keep expectations in check and mitigate some surprises, but not all. “Even after consolidation you must be prepared for the worst,” the report states.
9. Make it sustainable — No one wants to pursue a major project that won’t last. Ensuring political buy-in as well as better services and securities for agencies will help to ensure that the project and its benefits stick around.
10. Capture and report cost savings — “For all states, the main motivation for consolidation is the significant cost savings. Consolidated states have a lot to be proud of. They are working in new state-of-the-art data centers, reporting greater efficiencies, stronger security and millions of dollars in savings,” the report states.