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A Forrester Total Economic Impact™ Study Prepared For NetApp

The Total Economic Impact Of Deploying OnCommand Management Software As Part Of A NetApp Private Cloud Solution A Total Economic Impact Analysis

Project Director: Bob Cormier, Vice President and Principal Consultant

September 2011

Forrester Consulting

The Total Economic Impact Of Deploying OnCommand Management Software As Part Of A NetApp Private Cloud Solution

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TABLE OF CONTENTS Executive Summary ................................................................................................................................................................................. 2

Disclosures ........................................................................................................................................................................................... 4

TEI Framework And Methodology ...................................................................................................................................................... 4

Understanding The Private Cloud Concept ....................................................................................................................................... 5

Analysis ...................................................................................................................................................................................................... 6

Interview Highlights .......................................................................................................................................................................... 6

Composite Organization Description ............................................................................................................................................ 8

Costs .................................................................................................................................................................................................... 10

Benefits And Savings ....................................................................................................................................................................... 11

Risk ...................................................................................................................................................................................................... 20

Flexibility ............................................................................................................................................................................................ 21

Financial Summary ................................................................................................................................................................................ 22

Study Conclusions ................................................................................................................................................................................. 22

Appendix A: Composite Organization Description ........................................................................................................................ 24

Appendix B: About NetApp OnCommand Management Software ............................................................................................ 26

Appendix C: Total Economic Impact™ Overview ............................................................................................................................ 29

Appendix D: Glossary ........................................................................................................................................................................... 30

Appendix E: About The Project Director.......................................................................................................................................... 31

© 2011, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. For additional information, go to www.forrester.com.

About Forrester Consulting Forrester Consulting provides independent and objective research-based consulting to help leaders succeed in their organizations. Ranging in scope from a short strategy session to custom projects, Forrester’s Consulting services connect you directly with research analysts who apply expert insight to your specific business challenges. For more information, visit www.forrester.com/consulting.



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Executive Summary

In April 2011, NetApp commissioned Forrester Consulting to examine the total economic impact of deploying NetApp OnCommand management software as part of a NetApp private cloud solution. The purpose of this study is to provide readers with a framework to evaluate the potential financial impact on their businesses if they invest in NetApp private cloud solutions.

This study highlights the costs and benefits of deploying NetApp OnCommand management software as part of a private cloud solution across the enterprise of a composite Organization (see Appendix A for a description of the composite Organization). The findings in this study are in large part based on in-depth interviews conducted by Forrester with seven customers that currently use the NetApp solution. The composite Organization described in this study is based on the characteristics of the interviewed customers. This study examines the estimated ROI for the Organization and presents the aggregate findings derived from the interview and analysis process as well as our independent research.

The study found that for our composite Organization, deploying OnCommand management software as part of a NetApp private cloud solution provided quantifiable benefits and savings in the following areas (see Appendix B for NetApp solution description):

OnCommand unified manager

Labor savings from using a single dashboard to monitor alerts and take corrective action.

Labor savings from capacity planning efforts.

Savings associated with retiring third-party backup software license and server.

OnCommand plug-ins

Cost avoidance of third-party backup and recovery software license and maintenance.

FlexClone

Labor savings from the efficient replication of storage objects to multiple locations.

SnapManager

Reduced downtime impact to end users of Exchange environments.

IT labor savings from streamlined common backup tasks.

SnapDrive

Eliminates the need to pre-purchase additional storage.

OnCommand Insight Balance

Eliminates the need to purchase additional servers through the optimization of virtual machine densities.

Reduces troubleshooting time.



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Data ONTAP deduplication and thin provisioning

Storage efficiencies that reduced storage costs (cost avoidance).

For the three-year period of the financial analysis, the composite Organization experienced the costs, benefits, and net benefits and ROI shown in Table 1.

Table 1 Three-Year Summary Financial Results — The Organization

Summary financial results Unadjusted (best-case) Risk-adjusted

ROI 235% 151%

Payback period Within 9 months Within 12 months

Total costs (PV) ($284,209) ($284,209)

Total cost savings and benefits (PV) $952,767 $714,575

Total (NPV) $668,558 $430,366

Source: Forrester Research, Inc.

The three-year risk-adjusted total net present value (NPV) of $430,366 represents the net cost savings and benefits attributed to deploying NetApp OnCommand management software as part of a private cloud solution, when compared with creating a private cloud and not using these solutions (see details below in the Costs, Benefits, Flexibility, and Risks sections). In addition, the risk-adjusted ROI was a very favorable 151%.

The risk-adjustments made for the composite Organization is based on data and characteristics obtained during the customer interview process. Forrester risk-adjusts these values to take into account the potential uncertainty that exists in estimating the costs and benefits of a technology investment. The risk-adjusted value is meant to provide a conservative estimate, incorporating any potential risk factors that may later affect the original cost and benefit estimates. For this study, Forrester applied a 25% risk adjustment — i.e., a reduction of 25% — to all benefits to reflect the risks. For a more in-depth explanation of risk and the risk adjustments used in this study, please see the Risk section.

Organizations that are likely to achieve similar results have the following characteristics:

Midsize to large enterprise-size organizations willing to standardize, virtualize, and create private clouds in their large computing environments.

Are in the process of transforming a data center with a goal of reducing costs.



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Newer organizations that don’t yet have an existing infrastructure and can move easily toward a private cloud environment.

Are active in mergers and acquisitions and wish to move the acquired companies into a private cloud environment.

An IT staff with the requisite skills to manage virtual and cloud-based server and storage environments, including knowledge of VMware's ESX server and virtualization platform as well as NetApp’s Data ONTAP operating system and OnCommand management software.

The objective of this study is not to illustrate savings that other enterprises can obtain by deploying the NetApp solution but rather to identify savings that the interviewed customers experienced. These results can be used as a guide for other enterprises to determine the appropriate benefits for their particular environment.

Disclosures The reader should be aware of the following:

The study is commissioned by NetApp and delivered by the Forrester Consulting group.

Forrester makes no assumptions as to the potential return on investment that other customers will receive. Forrester strongly advises readers to use their own estimates within the framework provided in this study to determine the appropriateness of an investment in NetApp OnCommand management software.

NetApp reviewed and provided feedback to Forrester, but Forrester maintained editorial control over the study and its findings and did not accept changes to the study that contradicted Forrester’s findings or obscured the meaning of the study.

Forrester does not endorse NetApp or its storage solutions.

The study is not a direct or implied market or competitive comparison.

TEI Framework And Methodology

Introduction Based on the information gathered from the interviews with a number of companies, Forrester has constructed a Total Economic Impact™ framework for those prospective organizations that wish to deploy a private cloud solution based on NetApp storage and their OnCommand management software. The objective of the framework is to identify the costs, benefits, flexibility, and risk factors that affect the investment decision.

Approach And Methodology Forrester took a multistep approach to evaluate the business case for these NetApp solutions (see Figure 1). Specifically, we:



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Interviewed NetApp marketing personnel as well as Forrester analysts to gather data relative to NetApp private cloud solutions including OnCommand management software, and the marketplace in general.

Interviewed seven customers that have developed a private cloud based on NetApp’s solutions to obtain data with respect to costs, benefits, and risks.

Designed a composite Organization based on characteristics of the interviewed customers (see Appendix A).

Constructed a financial model representative of the interviews using the TEI methodology. The financial model is populated with the cost and benefit data obtained from the interviews as applied to the composite Organization.

Figure 1 TEI Approach


Forrester employed four fundamental elements of TEI in modeling the deployment of OnCommand management software as part of a NetApp private cloud solution:

1. Costs.

2. Benefits.

3. Flexibility.

4. Risk.

Please see Appendix C for additional information on the TEI methodology.

Understanding The Private Cloud Concept

Building a private cloud has to start with a basic understanding of how a cloud differs from a traditional virtualized environment. Forrester defines cloud computing as:

A standardized IT capability (services, software, or infrastructure) delivered in a pay-per-use, self-service way.

In most cases, a private cloud is a shared IT infrastructure set up in a corporate data center and dedicated to just that company. Let’s break down the cloud computing definition to better understand its implications to IT operations:

Construct financial model using TEI framework

Write case study

Perform due diligence

Conduct customers interviews

Formulate composite Organization



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Standardized capability. The value of a cloud comes in the flexibility it brings to the business — how rapidly and predictably applications can be deployed to this infrastructure. That value comes from provisioning and managing the environment in a consistent manner every time. It’s done successfully by standardizing what is deployed — which means prioritizing user options — and by automating as many processes as possible. It’s not customized or configured uniquely for each client, each time — that raises complexity, slows down processes, and is much harder to make repeatable. There may be options for consumers to choose some lightweight customizations they can apply atop the service, but the capability delivered is repeated, religiously.

Pay-per-use. A second core tenet is that the cloud is a shared environment where customers “pay” for the resources they use only when they use them. Efficiencies come from how much sharing takes place and how high one can drive the utilization of cloud resources as often as possible. A big reason why clouds invoke pay-per-use costing is to keep the cloud efficient by incenting resource efficiency from the customer themselves. Although many enterprises won’t implement this model the same way public clouds do, they should account for and either show back or chargeback cloud consumption to maximize the overall cloud investment.

Self-service. For cloud services, self-service doesn’t mean a web page where you request the service. Self-service is about providing self-service access through a portal to request services that have been defined in a service catalog. Thus, it provides automation that requires minimal IT interaction so that the IT team can focus on more strategic business needs rather than routine tasks.

Forrester’s research shows that most IT organizations focus on the server parts of their private cloud instead of optimizing each component to achieve maximum cost benefits. The storage architecture is commonly overlooked, which leaves lots of efficiencies out of reach. Ideally, cloud storage should handle both latency-sensitive and latency-insensitive applications at the lowest possible cost while taking advantage of thin provisioning, deduplication, life-cycle management, automated tiering, and live migration.

Cost efficiency of storage comes from reducing both the amount of capacity consumed and the acquisition and management cost per unit of capacity; this translates into direct reductions in expenditures on storage and maintenance costs as well as additional savings on power, cooling, and floor space. Efficient storage improves service quality while reducing the cost to internal customers.

Analysis

Interview Highlights Forrester derived its conclusions in large part from information received in a series of in-depth interviews with executives and personnel at seven customers currently using NetApp OnCommand management software as part of a NetApp private cloud solution. The following is a brief description of each of the interviewed customers; all were promised anonymity:

An international specialty insurance and benefit management company headquartered in the United States. It has been using NetApp OnCommand management software as part of a private cloud for more than 12 months. This includes OnCommand unified manager, SnapManager, and NetApp Virtual Storage Console.



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A global provider of networking and technology solutions headquartered in the United States. It has been using NetApp OnCommand management software as part of a private cloud for more than 12 months, including SnapManager and OnCommand Insight.

A US cooperative bank with more than $50 billion serving the financial needs of the agriculture, power, and water industries. It has been using NetApp OnCommand management software as part of a private cloud for between six and 14 months including OnCommand unified manager, SnapManager for Exchange, SnapDrive, and OnCommand Insight.

A midsize central-US university offering 35 undergraduate and graduate degree programs and graduating 1,500 students per year. It has been using NetApp OnCommand software as part of a private cloud for almost two years including OnCommand unified manager and the backup and recovery feature of NetApp Virtual Storage Console.

A large European-based provider of enterprise application solutions servicing more than 100,000 customers worldwide. It has been using NetApp OnCommand software as part of a private cloud for two years including OnCommand unified manager, NetApp Virtual Storage Console, and SnapDrive.

A California-based nonprofit healthcare organization with more than 900 physicians serving more than 600,000 patients. It has been using NetApp OnCommand as part of a private cloud solution for two years including OnCommand unified manager, SnapDrive for Windows, OnCommand Insight, SnapManager, and NetApp Virtual Storage Console.

A US-based business technology services provider drawing on a mix of 13,000 onshore, offshore, and nearshore professionals serving customers in 20 countries. It has been using NetApp OnCommand management software for a private cloud for up to four years including OnCommand unified manager, SnapManager for SQL and NetApp OnCommand Pro plug-in for Microsoft System Center Operations Manager.

Common Challenges Of Interviewed Customers The interviewed customers had several common storage management challenges attributed to rapid growth in storage within their respective organizations, which contributed to an unmanageable storage environment. These challenges are part of what is often overlooked when organizations transition from highly virtualized to private cloud environments. The interviewed customers shared some of the following common issues and challenges before implementing NetApp private cloud solutions:

Difficulties managing a highly virtualized environment.

o Lack of visibility into both physical and virtual infrastructure.

o Multiple management interfaces for storage infrastructure.

Management of storage growth was not scalable.

o Growth of storage support resources could not keep up with the rapid growth in storage in terms of budget availability and ability to hire to meet the need.



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o Growth of storage capacity within the existing environment created more complex, harder to manage storage with management divisions by application, division, or geography.

o Low utilization of file storage infrastructure was associated with higher than needed hardware, software, and administration costs.

Backups and file recovery were time-consuming.

o Larger scale backup environments required many media servers, significant staff time, and complex processes for consistent management. Each individual application or file server required additional tape hardware, management server and software, network and staff resources to configure effective backups.

o For most organizations, backup windows are shrinking because of demand for 24x7 availability but the ability to complete backups within the short windows is diminishing.

Storage accessibility and availability were not meeting business needs.

o Before virtualization manual processes for storage provisioning on physical machines led to long delays and reduced cooperation between application teams and storage teams because of dissatisfaction.

o Storage solutions were rarely right-sized, instead either too big or too small, causing cost overruns or poor performance and availability.

Composite Organization Description The Organization is an enterprise with 10,000 employees worldwide, two major data centers, 10 remote facilities, and a mix of storage platforms from multiple vendors. The IT department manages both infrastructure and applications, with some of the infrastructure physically located at a third-party hosting facility. The Organization has virtualized more than 50% of the IT applications and has begun to deploy a private cloud on top of a shared infrastructure that will be expanded as legacy infrastructure is retired. The private cloud houses a mix of tier one Microsoft applications as well as some development and test workloads, and it provides services to approximately 1,500 users.

Environment, Goals, and Objectives The infrastructure for the private cloud is based on a reference architecture that specifies the server, network, storage, and virtualization components and can be configured for smaller or larger workloads by scaling any element of the architecture. The reference architecture can be deployed with a choice of hypervisors and a variety of workloads, including Microsoft Exchange, SQL Server, SharePoint, virtual desktops, SAP, and Oracle. The Organization recently implemented a “virtual and cloud first” strategy in which all new application workloads will be deployed on virtual machines and in a private cloud environment unless there is an overriding reason for using physical servers.

Over the past two years, the Organization has seen data growth rates in the 30%-plus range, which has increased both primary storage requirements and the data protection infrastructure. The Organization is seeking to optimize the performance and capacity of its virtual and physical data center infrastructure while transitioning workloads to a private cloud. The Organization’s IT leadership wants the ability to transform itself into a service delivery business with



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efficient monitoring and management of complex shared virtual infrastructures with high service expectations while also achieving the following goals and objectives:

Enable and leverage cloud architecture to deliver business services more quickly and be more responsive to customer needs.

Improve efficiency and utilization in a dynamic data center environment laying the foundation for a virtualized, cost-efficient, and service-oriented environment that scales and grows with the business.

Consolidate and virtualize its servers and storage in a unified approach to boost utilization, efficiency, and effectiveness, particularly across its large, geographically dispersed facilities.

Improve business agility with a standardized approach to storage architecture, reducing the expense and complexity of maintaining multiple storage systems for different departments or domains.

Automate regular administrative and management practices such as provisioning, backup, and replication management to manage more capacity with fewer resources.

Drive down storage, power, cooling, and data center expansion costs, and build a predictable future cost model.

Add and automatically deliver storage capacity on demand for new and expanded business applications.

Maintain data security and quality of existing services and leverage an end-to-end secure multitenancy solution for virtual environments to securely share, reuse, and dynamically allocate resources at promised service levels.

Eliminate solution deployment risks by leveraging the storage vendor’s expertise in developing a private cloud.

Framework Assumptions Table 2 provides the model assumptions that Forrester used in this analysis.

Table 2 General Assumptions

General assumptions Value

Discount rate used to compute NPV 10%

Length of analysis Three years

Annual fully loaded cost of a storage administrator

$110,000

Hourly fully loaded cost of a storage administrator

$53.00




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The discount rate used in the present value (PV) and net present value (NPV) calculations is 10%, and the time horizon used for the financial modeling is three years. Organizations typically use discount rates between 8% and 16% based on their current environment. Readers are urged to consult with their respective company’s finance department to determine the most appropriate discount rate to use in their own environment.

Costs Costs are an important part of the TEI model. Costs, or IT impact, are calculated as a change in costs primarily for IT as a result of the introduction of the technology to the Organization. Therefore, deploying NetApp OnCommand as part of a NetApp private cloud solution requires an upfront investment that affects IT budgets negatively because of the purchase of the solution; it also affects the Organization positively, in terms of the potential cost savings and efficiencies created (see the Benefits And Savings section below).

The impact of cost is accrued in two general areas described below: NetApp solution costs (see below for product details) and the Organization’s internal preparation, planning, and training costs, which altogether total $284,209.

The Organization’s costs for the NetApp solution: $237,209. The Organization will invest a total of $237,209 for the following NetApp solutions including software licenses and three years of software maintenance:

OnCommand (no charge license)

o OnCommand unified manager (formerly offered separately as Operations Manager, Protection Manager, and Provisioning Manager).

o OnCommand host software including OnCommand plug-ins for VMware and Microsoft.

FlexClone

SnapManager Application Integration Suite

o Formerly offered separately as SnapManagers for: Exchange, SQL Server, SharePoint, Oracle or SAP, and SnapManagers for VMware or Microsoft, SnapDrive, and SMBR.

OnCommand Insight Balance (formerly Akorri BalancePoint).

Three years software maintenance — FlexClone, SnapManager Application Integration, OnCommand Insight Balance.

NetApp pricing is based on normal and average discounts off NetApp’s list price as of September 2011. Forrester assumes that the Organization had a pre-private cloud environment that included various NetApp products bought previously and are therefore not included in this analysis. See Appendix A for a list of NetApp components in the Organization’s preexisting shared IT infrastructure (pre-private cloud investments).

The Organization’s costs for internal preparation, planning, and training: $47,000 described as follows:

As part of implementing the NetApp solution, the Organization first performed a current baseline assessment of its pre-private cloud management practices associated with its existing NetApp virtualized storage environment.



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This readiness assessment looked at costs, benefits, and risks and was followed by a vendor selection process and a detailed implementation plan. This implementation plan addressed current state of the virtualization, data center and network environments. Based on the experience with the seven interviewed customers, our Organization required three individuals (storage, network and system engineers) to perform the readiness assessment, vendor selection and detailed implementation plan. They each spent one day a week for 6 months (78 equivalent days) equating to 30% of a full-time equivalent (FTEs) or $33,000. In addition, two IT staff travelled to attend a weeklong Data ONTAP course which cost $4,500 per attendee plus $2,500 in travel costs for a total training cost of $14,000. Total costs for internal preparation and training was $47,000.

Total Costs The total costs of deploying NetApp OnCommand management software as part of a private cloud solution at the Organization are listed in Table 3.

Table 3 The Organization: Total Costs Associated With OnCommand Management Software As Part Of A NetApp Private Cloud Solution

Costs Initial Year 1 Year 2 Year 3 Total PV

NetApp solution – software and maintenance

(179,303) 0 0 0 ($179,303) ($179,303)

NetApp software maintenance – three years (paid in advance)

(57,906) 0 0 0 ($57,906) ($57,906)

Costs for internal preparation, planning, and training

(47,000) 0 0 0 ($47,000) ($47,000)

Total ($284,209) 0 0 0 ($284,209) ($284,209)


Benefits And Savings In addition to the costs associated with the NetApp solution, there were positive cost savings and benefits that resulted from the implementation of the NetApp private cloud solutions including OnCommand management software. Each benefit listed below will vary depending on an organization’s unique environment, and readers are urged to apply their own estimates to quantify the impact of the NetApp solutions. Readers should also keep in mind that no one interviewed customer had achieved all of the benefits listed below, and most NetApp customers are realizing a subset (about half) of the possible benefits.



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The study found that for our composite Organization, the NetApp private cloud solutions including OnCommand management software provided quantifiable benefits and savings in the following areas (quantification begins after this list):





OnCommand plug-ins


FlexClone


SnapManager



SnapDrive







Benefits Of NetApp OnCommand Unified Manager OnCommand unified manager benefits: Interviewed customers using OnCommand unified manager reported that from a central console, it delivers comprehensive monitoring and management for NetApp storage with alerts, reports, performance, and configuration tools. Specific benefits mentioned include:

Simplify management: centralize and automate storage management workflows.

Maximize availability: detect potential problems and take corrective action to prevent downtime.

Reduce TCO: optimize resource utilization and increase the efficiency of the storage management.



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Enable business policy compliance: standardize enterprisewide NetApp configuration management.

The production of comprehensive reports of utilization and trend information to support capacity planning, space usage, and backup allocation. See how physical resources are affected by data utilization and deduplication.

Monitor system performance and health to resolve potential problems before they occur. Deploy, provision, and manage a complete enterprise storage network from a central location.

Quantified benefits from the use of OnCommand unified manager (formerly Operations Manager, Provisioning Manager and Protection Manager) by the Organization include:

Labor savings using a single dashboard to monitor alerts and take corrective action — $66,000 ($22,000 annually) equating to 20% of an FTE in time savings versus the prior manual effort of monitoring alerts. Total savings is $66,000 over three years.

Labor savings to support capacity planning efforts — $108,900 ($36,300 annually) equating to 33% of an FTE saved versus previous manual efforts to forecast storage needs. Total savings is $108,900 over three years.

OnCommand unified manager benefits: Customers using OnCommand unified manager were automating data protection operations with policy-based management, global monitoring, and reporting. Specific features called out by the interviewed customers include:

OnCommand unified manager simplifies common data protection tasks and automates management across Snapshot, SnapMirror, SnapManager, SnapVault, and Open Systems SnapVault operations. It automates storage provisioning and provides global policy-based management, monitoring, and alerting.

OnCommand unified manager makes it easier to define, apply, and update data protection policies across the enterprise. It minimizes effort, cuts administrative overhead, and guarantees that best practices as well as service-level agreements are met globally.

A dashboard shows comprehensive data protection information, including unprotected data, alerts, and utilization, at a glance.

Quantified benefits from the use of OnCommand unified manager by the Organization include:

The use of OnCommand unified manager replaced a third-party backup license and server — $120,000 ($40,000 annually). The Organization was able to retire third-party backup software at an annual “net” savings of $30,000 ($90,000 over three years); plus it did not have to replace the server running the third-party software saving another $10,000 annually ($30,000 over three years) saving costs associated with hardware, operating system license, and warranty. Total savings is $120,000 over three years.

Several interviewed organizations indicated that the use of OnCommand unified manager facilitated deduplication and thin provisioning and the resulting storage hardware savings. These benefits are consolidated in the Storage Efficiency - Deduplication and Thin Provisioning section below.



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Benefits Of NetApp FlexClone With OnCommand Unified Manager NetApp FlexClones and OnCommand unified manager benefits: The customer using OnCommand unified manager provisioning features emphasized its ability to speed provisioning workflows and boost capacity utilization with policy-based automation to provision NetApp SAN and NAS infrastructure from a single console. This customer has experienced the following benefits:

OnCommand unified manager can speed the creation of new NetApp storage resources and help improve capacity management of existing storage resources.

Storage administrators utilize OnCommand unified manager's policy-based automation to create repeatable, automated provisioning processes to improve the availability of data and enable provisioned storage to comply with policies.

These processes are faster than manually provisioning storage, easier to maintain than scripts, and help minimize the risk of data loss due to mis-configured storage.

These processes can leverage built-in capabilities such as FlexClones, data protection policies and storage efficiency features such as thin provisioning and deduplication.

OnCommand unified manager applies user-defined policies to consistently select the appropriate resources for each provisioning activity. The use of a centralized management console allows administrators to monitor the status of their provisioned storage resources.

OnCommand unified manager can help improve business agility and capacity utilization, shrink provisioning time, and improve administrator productivity.

Quantified benefits from the use of NetApp FlexClones and OnCommand unified manager by the Organization include:

Labor savings using NetApp FlexClone — $330,000 ($110,000 annually). Before implementing OnCommand unified manager, customer records were replicated to four different environments overnight which took 8 hours with one second-shift SQL database administrator (DBA) starting the process before she went home; and a first-shift SQL DBA checking the results in the morning. Using NetApp FlexClones, it now takes a total of 15 minutes; saving the SQL DBAs a combined 8 hours per weeknight equating to 100% of an FTE. With NetApp’s FlexClone feature, any storage object (file, LUN, or volume) can be cloned and made available for access. With FlexClone, common storage blocks between the clone and the original data set consume no additional physical storage space. Total savings is $330,000 over three years.

Benefits Of NetApp SnapManager SnapManager benefits: Interviewed customers were using SnapManager for the following: Microsoft SQL Server, Microsoft Exchange, Oracle, or the backup and recovery feature of Virtual Storage Console (formerly SnapManager for Virtual Infrastructure). Customers described the following benefits associated with SnapManager:

Execute fast backups without taking databases offline.



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Add storage capacity and expand volumes with minimal impact to the availability of the NetApp storage system.

Increase productivity by automating common tasks to let administrators spend less time on data and storage management.

Use NetApp Snapshot technology to store more than 250 copies of data to get fast, granular recovery.

Restore from a wide range of options such as full content, individual, storage group, individual database, and virtual disk recovery.

Quantified benefits from the use of SnapManager for Exchange by the Organization include:

Reduced downtime impact to end users of Exchange — $129,600 ($43,200 annually). SnapManager for Exchange minimizes disruptions through faster backups and restores of the organization’s Exchange environment. Replication of snapshots to a secondary system can be achieved without manual intervention, further reducing the downtime impact to end users. For our Organization, we estimate a 20% reduction in Exchange downtime as a result of improved manageability of the Exchange environment. Assuming roughly 10% of the 10,000 users are affected, the total annual savings from reduced downtime equates to $43,200. Total savings is $129,600 over three years.

IT labor savings from streamlined common backup tasks — $45,000 ($15,000 annually). Interviewed customers IT administrators reported benefits from using SnapManager for Exchange through better manageability of snapshot replication and more efficient backup and restore windows. The overall impact is to streamline management by automating common tasks to let administrators spend less time on maintenance. For our Organization, we estimate the improvement in the time to recover from 24 to 2 hours, reducing the burden on IT administrators and providing a total annual savings of $15,000. Total savings is $45,000 over three years.

Benefits Of NetApp SnapDrive SnapDrive benefits: One interviewed customer who was using SnapDrive indicated that it simplifies and automates storage and data management. Specific benefits include:

Automate storage-provisioning tasks and simplify the process of taking error-free, host-consistent data Snapshot copies.

Add more storage as necessary and eliminate the need to pre-allocate storage resources based on forecasted demand.

Automate OS-consistent backups of application data.

Quantified benefits from the use of SnapDrive by the Organization include:

Eliminate the need to pre-purchase additional storage (pre-allocate storage resources) — $90,000 ($30,000 annually). The use of SnapDrive allows the Organization to phase in storage via cloud-based provisioning and eliminates the need to purchase approximately 6 TB’s (high-capacity SATA drives) per year at $5,000 per TB ($30,000 per year), saving the Organization $90,000 over three years.



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Benefits Of NetApp OnCommand Insight Balance OnCommand Insight Balance. Streamlines IT’s ability to transform itself into a service delivery business with efficient monitoring and management of complex shared virtual infrastructures with high service expectations. Specific benefits include:

OnCommand Insight Balance (formerly Akorri BalancePoint) optimizes and boosts the quality and efficiency of storage environments through near-real-time visibility, multivendor and multiprotocol support, and end-to-end service-level views of the storage service path.

Reduce operating and capital expenditures by improving capacity management and operational efficiencies and optimizing usage of NetApp efficiency technologies.

Optimize virtual infrastructure environments and reduce the risk of over-provisioned storage, enable VMs to perform with the highest possible availability and performance.

View trending and reports for capacity planning and capacity management of virtualized and cloud environments.

OnCommand Insight Balance benefits: Two interviewed customers who are using OnCommand Insight Balance indicated that it provides direction to optimize the performance and capacity of virtual and physical data center infrastructure. Specific reported benefits include:

Reduces the costs and risks of deploying and managing a shared virtual IT infrastructure.

Provides visibility across heterogeneous VMs, physical servers, and storage.

Balances performance and utilization to optimize capacity and reduce capex.

Reduce troubleshooting time by 50%.

Optimize VM densities with reports that identify physical boxes that have capacity for more VMs.

Improve server and storage utilization.

Manage service levels.

Quantified benefits from the use of OnCommand Insight Balance by the Organization include:

Eliminate the need to purchase additional servers through the optimization of VM densities — $90,000 ($30,000 annually). OnCommand Insight Balance will identify underutilized server environments and allow for more aggressive loading of VMs on physical boxes. The Organization anticipates reducing its physical machine purchases by one server per year (attributable to OnCommand Insight Balance, saving the costs associated with hardware, installation, operating system license, and maintenance, which were reported to average $30,000 annually). Total savings is $90,000 over three years.

Reduce troubleshooting time by 8 hours per week — $66,000 ($22,000 annually). OnCommand Insight Balance can help the Organization identity performance issues within the virtualized environment by collecting raw data



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from individual elements, i.e., pinpointing latency causes, infrastructure response times, performance index, and disk utilization and applies analytics and actionable advice. The interviewed customers reported savings averaging 8 hours per week, or 20% of an FTE, or $22,000 annually. Total savings is $66,000 over three years.

Benefits Of IT Integration — NetApp OnCommand plug-ins for VMware and Microsoft NetApp Virtual Storage Console (VSC), an OnCommand plug-in for VMware. Two interviewed customers are using NetApp VSC which is designed to simplify storage management and reduce costs in both SAN- and NAS-based VMware infrastructures. NetApp VSC operations include discovery, health monitoring, capacity management, provisioning, cloning, backup, and recovery. Specific reported benefits include:

NetApp VSC provides storage discovery, health monitoring, capacity management, and storage configuration according to best practices.

VSC backup and recovery (formerly NetApp SnapManager for Virtual Infrastructure) automates data protection processes by enabling VMware administrators to centrally manage backup and recovery of data stores and VMs without affecting guest performance, and to rapidly recover from backups at any level of granularity-data store, VM, Virtual Machine Disk (VMDK) format, or guest file.

A quantified benefit from the use of NetApp VSC by the Organization is:

Cost avoidance of third-party backup and recovery software license and maintenance — $39,200 ($28,000 license plus $5,600 in annual maintenance for years 2 and 3). The Organization avoided third-party license cost by using VSC backup and recovery which automates data protection processes by enabling VMware administrators to centrally manage backup and recovery of datastores and VMs. Total savings is $39,200 over three years.

NetApp OnCommand plug-in for Microsoft. The NetApp plug-in for System Center Operations Manager is designed to monitor NetApp storage systems using existing management tools and skills. The interviewed customer reported using the following features and functionality, but was not able to quantify any benefits.

Isolate problems quickly using Microsoft Operations Manager’s alert and health explorer views, analyze trends, and create reports with the Reporting Management Pack and automate and simplify disaster recovery with the MetroCluster Management Pack.

Monitor storage availability and capacity as they pertain to virtual machines running on a Microsoft Hyper-V host.

Create new virtual machines in minutes using rapid provisioning and cloning cmdlets and enable rapid provisioning of space-efficient VMs.

Storage Efficiency — Deduplication And Thin Provisioning The Organization was able to take advantage of deduplication and thin provisioning before creating a private cloud environment, and we did not quantify those benefits in this study. However, the Organization was able to gain added storage efficiency benefits in a post-private cloud environment as described below.



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Deduplication and thin provisioning — $62,500 ($20,833 savings annually).The interviewed organizations reported using combinations of these two NetApp technologies, described below, that reduced their storage costs in conjunction with their private clouds. For our composite Organization, we assumed that one-half of the total savings will occur following the transition from virtualization to a private cloud. The interviewed customers using these technologies reported significant storage efficiencies that can be quantified based on data collected by the NetApp “phone home” support service called AutoSupport. The deduplication feature is described below:

Data deduplication. NetApp provides the benefit of sharing identical data among multiple virtual machines that reside on disk storage through its data deduplication technology, resulting in the contents of virtual machines being reduced to a single copy per data store. Analysis of a NetApp provided report for 29 storage systems using NetApp’s deduplication across all storage protocols supported by VMware (NFS, FC, and iSCSI) indicated storage efficiencies of 20% for the organizations interviewed.

The interviewed customers reported additional savings in private cloud primary storage hardware using NetApp thin provisioning feature. Although it was difficult for these customers to segregate and quantify the savings between deduplication and thin provisioning. The thin provisioning feature is described below:

Thin provisioning. The seven interviewed customers each described a traditional (pre-virtualization, pre-private cloud) environment where server administrators would overprovision storage to avoid running out and to avoid the downtime related to expanding the provisioned storage. NetApp’s thin provisioning feature provides storage on demand by treating storage as a shared resource that is consumed only when individual virtual machines require it. This sharing increases the total utilization rate of storage by eliminating the unused but provisioned areas of storage that are associated with traditional storage.

Thin provisioning and data deduplication are mutually inclusive features designed to reduce the need for more storage by increasing the utilization rates of existing storage. Thin provisioning allows one to only consume on demand, with deduplication removing any redundancy subsequently added to the array. Both deduplication and thin provisioning can be enabled or disabled on a data object basis and can be defined as part of a storage service catalog using the OnCommand software to automate the provisioning process. Our Organization was able to avoid purchasing another 12.5 TB of storage hardware (disk shelves and drives) over three years at an average cost of $5,000 per terabyte or $62,500 over three years.

Total Quantified Benefits The total quantified benefits of deploying NetApp private cloud solutions including OnCommand at the Organization are listed in Table 4.



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Table 4 The Organization: Total Benefits Associated With OnCommand Management Software As Part Of A NetApp Private Cloud (Non-Risk-Adjusted)

Total Quantified Benefits Year 1 Year 2 Year 3 Total PV

OnCommand unified manager — labor savings from using a single dashboard to monitor alerts, take corrective action

22,000 22,000 22,000 $ 66,000 $54,711

OnCommand unified manager — labor savings using Operations Manager to support capacity planning efforts

36,300 36,300 36,300 $108,900 $90,273

OnCommand unified manager — savings associated with retiring backup software license and server

40,000 40,000 40,000 $120,000 $99,474

Labor savings from using NetApp FlexClone to replicate data for four environments overnight

110,000 110,000 110,000 $330,000 $273,554

SnapManager for Exchange — reduced downtime impact to Exchange users

43,200 43,200 43,200 $129,600 $107,432

SnapManager for Exchange — IT labor savings from streamlined common backup tasks

15,000 15,000 15,000 $45,000 $37,303

SnapDrive — eliminate the need to pre-purchase additional storage

30,000 30,000 30,000 $90,000 $74,606

OnCommand Insight Balance — eliminate the need to buy additional servers through the optimization of virtual machine densities

30,000 30,000 30,000 $90,000 $74,606

OnCommand Insight Balance — reduce troubleshooting by 8 hours per week

22,000 22,000 22,000 $66,000 $54,711

NetApp VSC — cost avoidance of third-party backup and recovery software license and maintenance

28,000 5,600 5,600 $39,200 $34,290

Deduplication and thin provisioning 20,833 20,833 20,834 $62,500 $51,809

Total non-risk-adjusted benefits $397,333 $374,933 $374,934 $1,147,200 $952,767




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Risk Risk-adjusted and non-risk-adjusted ROI are both discussed in this study. The Organization’s individual costs and benefits are quoted in non-risk-adjusted (best case) terms and before risk adjustments are made. The assessment of risk provides a range of possible outcomes based on the risks associated with IT projects in general and specific risks relative to private cloud storage projects. In our research, we discovered that implementing private clouds was a relatively low-risk endeavor if organizations took the time to plan the implementation and train the appropriate IT staff.

Risk factors are used in TEI to widen the possible outcomes of the costs and benefits (and resulting savings) associated with a project. Because the future cannot be accurately predicted, there is risk inherent in any technology-related project. TEI captures risk in the form of risks-to-benefits and risks-to-costs.

Measurement of risk is a way of incorporating the levels of confidence and uncertainty regarding the cost and benefit estimates of a given investment. Higher confidence that the costs and benefit estimates will be met implies that the level of risk is lower, and the variation between the risk-adjusted and non risk-adjusted outcomes is minimized.

The following general risks were considered in this study:

Lack of organizational discipline in creating processes and procedures to best take advantage of the benefits.

Lack of appropriate training for IT personnel who will be responsible for optimizing the full benefit potential from the solution.

Failure to reduce, transfer, or redeploy IT support headcount made redundant by labor efficiencies.

The potential that the benefits will not be measured and quantified in the future, and as a result, no TEI benefit would be captured and acknowledged.

Internal inertia, conflicting priorities, and turnover, which reduces the organization’s ability to achieve the benefits.

The following risk associated with NetApp private cloud solutions was considered in this study:

There is risk in readers assuming that their organization can match the benefits of the Organization depicted in this study. The seven interviewed customers were not yet fully utilizing the NetApp solution, as reflected by their somewhat limited use of all the products within OnCommand. On average, the seven interviewed customers were using about half of the products and features which were quantified in this study. Each intends, however, to take advantage of additional functionality (and benefits) in the future.

The inability of an organization to find, train, and retain administrators of the NetApp OnCommand management software, the Data ONTAP operating system, and other related products.

For this study, Forrester applied a 25% risk adjustment (reduction of 25%) to all benefits to reflect the risks listed above. We have not risk-adjusted costs as a majority were fixed quotes from NetApp.



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Table 5 The Organization: Total Risk-Adjusted Benefits Associated Deploying OnCommand As Part Of A NetApp Private Cloud Solution (Risk-Adjusted By 25%)

Total Quantified Benefits Year 1 Year 2 Year 3 Total PV

Total risk adjusted benefits 298,000 281,200 281,201 $860,400 $714,575


Table 5 represents the total of Table 4 (total non-risk-adjusted benefits) less 25% risk adjustment as described above.

If a risk-adjusted ROI still demonstrates a compelling business case, it raises confidence that the investment is likely to succeed because the risks that threaten the project have been taken into consideration and quantified. The risk-adjusted numbers should be taken as “realistic” expectations because they represent the expected value considering risk. Assuming normal success at mitigating risk, the risk-adjusted numbers should more closely reflect the expected outcome of the investment.

Flexibility Flexibility, as defined by TEI, represents investing in capacity or agility now that can be later turned into business benefits for some future additional investment. The value of flexibility is clearly unique to each organization, and the willingness to measure its value varies from organization to organization. For the purpose of this analysis, we have assumed that the Organization sees the value in being able to reduce future backup storage acquisition cost or achieve longer intervals between storage capacity upgrades using deduplication. The value of the option (when calculated) is based on the Black-Scholes option pricing formula. (For additional information regarding the flexibility calculation, please see Appendix C.)

The seven interviewed customers were not yet fully utilizing NetApp private cloud solutions including OnCommand management software, as reflected by the somewhat limited use of all the products within OnCommand. For example, on average, the seven interviewed customers were using only half of the products and features which were quantified in this study. Granted, not all products and features lend themselves to every environment; however, there are significant future flexibility options for each customer to broaden its use of the remaining products within this NetApp solution. Customers need to take advantage of the appropriate flexibility options to optimize their private cloud environments. Each customer indicated that it would leverage more of the OnCommand products and functionality to derive even greater benefits in the future. These options, once exercised in the form of additional licensing of products and taking advantage of NetApp formal training courses, would create future quantified benefits. Forrester will not be quantifying flexibility options in this study, as we have already quantified selected benefits for each NetApp product.



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Financial Summary

The total costs and benefits experienced by the Organization are shown in Table 6.

Table 6 Three-Year Summary Financial Results — The Organization

Summary financial results Unadjusted (best-case) Risk-adjusted

ROI 235% 151%

Payback period Within 9 months Within 12 months

Total costs (PV) ($284,209) ($284,209)

Total cost savings and benefits (PV) $952,767 $714,575

Total (NPV) $668,558 $430,366


Study Conclusions

As the data in this study indicates, NetApp private cloud solutions including OnCommand management software have the potential to provide a good ROI. In addition, the very favorable risk-adjusted ROI of 151%, along with a 12-month payback period (breakeven point), raises confidence that the investment is likely to succeed, as the risks that may threaten the project have already been taken into consideration and quantified. In this study, risks have been modeled conservatively in the hopes of showing worst-case expectations.

Organizations that are likely to achieve similar results have the following characteristics:

Enterprise-level organizations willing to standardize, virtualize, and create private clouds in their large computing environments.

In the process of transforming a data center with a goal of reducing costs.

Newer organizations that don’t yet have an existing infrastructure and can move easily toward a private cloud environment.

Are active in mergers and acquisitions and wish to move the acquired companies into a private cloud environment.



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An IT staff with the requisite skills to manage virtual and cloud-based server and storage environments, including knowledge of VMware’s ESX server and virtualization platform, as well as NetApp’s Data ONTAP operating system and OnCommand management software.

A successful, well-planned implementation have allowed benefits and cost savings to accrue to the Organization in the following areas:





OnCommand plug-ins


FlexClone


SnapManager



SnapDrive







For our Organization, deploying OnCommand management software as part of a NetApp private cloud solution carried a low –moderate level of risk, a very favorable 151% risk-adjusted ROI, and a 12-month horizon to recoup the investment.

We make no assumptions regarding the effects of deploying OnCommand management software as part of a NetApp private cloud solution at other organizations. This study examines the potential impact attributable to the seven customers that participated in our examination and applies the common costs and benefits to a representative



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composite Organization. The underlying objective of this document is to provide guidance to technology decision-makers seeking to identify areas where value can potentially be created based on using OnCommand management software as part of a NetApp private cloud solution.

Appendix A: Composite Organization Description

The Organization is an enterprise with 10,000 employees worldwide, two major data centers, 10 remote facilities, and a mix of storage platforms from multiple vendors. The IT department manages both infrastructure and applications, with some of the infrastructure physically located at a third-party hosting facility. The Organization has virtualized more than 50% of the IT applications and has begun to deploy a private cloud on top of a shared infrastructure that will be expanded as legacy infrastructure is retired. The private cloud houses a mix of tier one Microsoft applications as well as some development and test workloads and provides services to approximately 1,500 users.

Environment, Goals, And Objectives The infrastructure for the private cloud is based on a reference architecture that specifies the server, network, storage, and virtualization components and can be configured for smaller or larger workloads by scaling any element of the architecture. The reference architecture can be deployed with a choice of hypervisors and a variety of workloads, including Microsoft Exchange, SQL Server, SharePoint, virtual desktops, SAP, and Oracle. The Organization recently implemented a “virtual and cloud first” strategy in which all new application workloads will be deployed on VMs and in a private cloud environment unless there is an overriding reason for using physical servers.

Over the past two years, the Organization has seen data growth rates in the 30%-plus range, which has resulted in both an increase in primary storage requirements and the data protection infrastructure. The Organization seeks to optimize the performance and capacity of its virtual and physical data center infrastructure while transitioning workloads to a private cloud. The Organization’s IT leadership wants the ability to transform itself into a service-delivery business with efficient monitoring and management of complex shared virtual infrastructures with high service expectations while also achieving the following goals and objectives:

Enable and leverage cloud architecture to deliver business services more quickly and be more responsive to customer needs.

Improve efficiency and utilization in a dynamic data center environment laying the foundation for a virtualized, cost-efficient, and service-oriented environment that scales and grows with the business.

Consolidate and virtualize its servers and storage in a unified approach to boost utilization, efficiency, and effectiveness, particularly across its large geographically dispersed facilities.

Improve business agility with a standardized approach to storage architecture reducing the expense and complexity of maintaining multiple storage systems for different departments or domains.

Automate regular administrative and management practices such as provisioning, backup and replication management in order to manage more capacity with fewer resources.



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Drive down storage, power, cooling, and data center expansion costs now, and build a predictable cost model for the future.

Add and automatically deliver storage capacity on demand for new and expanded business applications.

Maintain data security and quality of existing services and leverage an end-to-end secure multitenancy solution for virtual environments to securely share, reuse and dynamically allocate resources at promised service levels.

Eliminate solution deployment risks by leveraging the storage vendor’s expertise in developing a private cloud.

In all instances, the solution must support and provide integration with server virtualization software to enable long-term movement to a shared, private cloud storage environment. As part of the private cloud project, the Organization purchased and implemented the following NetApp management software:

NetApp OnCommand Solution For Private Cloud OnCommand unified manager —formerly offered separately as Operations Manager, Protection Manager and

Provisioning Manager

OnCommand plug-ins for VMware and Microsoft

FlexClone

SnapManager Application Integration Suite — formerly offered separately as SnapManagers for: Exchange, SQL, SharePoint, Oracle or SAP; and SnapManagers for VMware or Microsoft, SnapDrive, and SMBR.

OnCommand Insight Balance — formerly Akorri BalancePoint

Example Pre-Private Cloud Configuration

NetApp Components In The Preexisting Shared IT Infrastructure (Pre-Private Cloud Investments) System type

o FAS3210 HA Cluster with Flash Cache

Raw capacity

o 195 TB

Shelf type

o DS4243

Drive size

o 600 GB SAS (84x)

o 2 TB SATA (72x)



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Shelves

o 7x

Software

o Data ONTAP 8 with SnapShots, SnapRestore, SnapMirror, deduplication, APIs

Services

o SupportEdge Premium 24x7, 4-hour on-site for 36 months

Other System Components Refer to the document at the link below for detailed information on the reference architecture, including server,

network, storage and virtualization components

http://media.netapp.com/documents/tr-3884.pdf

Appendix B: About NetApp OnCommand Management Software

According to NetApp, its OnCommand management software improves storage and service efficiency through functions that help control, automate, and analyze shared storage infrastructure.

http://www.netapp.com/us/products/management-software/

Manage NetApp OnCommand management software offers effective, cost-efficient management of shared storage infrastructure to help optimize utilization, meet SLAs, minimize risk, and boost performance.

Control: Optimize data center storage devices to meet business requirements.

o System Manager —System Manager exploits the power of NetApp storage as follows:

Manage NAS and SAN system and network configuration.

Perform basic controller setup (DNS, NIS, networking, AutoSupport, SNMP, security, date/time/time zone).

Provision storage for NetApp SAN and NAS for both physical and virtual environments.

Discover unconfigured NetApp appliances using SNMP.

Get real-time views of system performance.



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o My AutoSupport — My AutoSupport is a suite of web-based applications hosted on the Support website and accessible via a web browser.

Evaluate, model, and deploy more efficient storage solutions.

Enable improved system availability and avoid disruptions to the business with proactive system health checks.

Save time and money with faster and more efficient incident resolution.

Optimize system operations with storage efficiency profiling.

Avoid end-of-support hardware exposure.

Automated and accelerated parts dispatch.

Free 24x7 web-based access with valid product warranty.

Automate: Deliver operational and storage efficiency and simplify administration.

o OnCommand unified manager — centralize the ability to deploy, automate, protect and monitor all storage with OnCommand unified manager software — unified management for NetApp storage systems.

o SnapManager software — streamline storage management and simplify configuration, backup, and restore operations for leading enterprise applications and operating environments with our SnapManager, SnapDrive, and related storage management products.

Analyze: Gain insight into the storage infrastructure and optimize service delivery.

o OnCommand Insight — OnCommand Insight (formerly BalancePoint and SANscreen) helps to proactively manage multivendor environments, optimize resources and workloads, measure IT costs, efficiency and value, and bring greater cost awareness to IT consumers.

o OnCommand Insight Balance — (formerly Akorri BalancePoint) provides directions to optimize the performance and capacity of virtual and physical data center infrastructure providing a stepping stone to the private cloud.

o OnCommand Insight Assure — Insight Assure (formerly SANscreen Service Assurance) provides end-to-end visibility into heterogeneous storage infrastructure availability, performance, and utilization service levels and correlate resources in the context of applications and businesses.

o OnCommand Insight Perform — Insight Perform (formerly SANscreen Application Insight) improves storage resource utilization and application performance to defer capital expenditures, increase operational efficiency, and maximize returns on current storage resource investments.



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o OnCommand Insight Plan — Insight Plan (formerly SANscreen Capacity Manager) allows IT to make capacity purchases based on definitive business requirements. With a view into storage performance, usage, and utilization, align and optimize resources to meet business needs.

IT Integration NetApp OnCommand open management interfaces offer fast integration and greater storage abstraction to leverage all the capabilities within NetApp’s management family of products.

Access: Employ key NetApp management capabilities using popular virtualization and IT management platforms and plug-ins.

o OnCommand plug-ins for VMware — Virtual Storage Console provides integrated, comprehensive storage management for a VMware infrastructure, including discovery, health monitoring, capacity management, provisioning, cloning, backup, restore, and disaster recovery. VMware administrators can access and execute all of these capabilities directly from VMware vCenter, enhancing both server and storage efficiencies without affecting the policies created by the storage administrators.

o OnCommand plug-ins for Microsoft — consists of NetApp products and toolkits that enable management and monitoring of physical, virtual, and cloud infrastructures using Microsoft System Center. OnCommand plug-in for Microsoft can streamline infrastructure management, automate provisioning, and enable cost-effective disaster recovery for NetApp storage systems using existing management tools and skills.

Develop: Integrate NetApp data center management features using custom software and third-party tools with the NetApp manageability SDK.

o Open Management — manage NetApp storage through existing third-party management tools, including tools from virtualization management, IT service management tools, or homegrown tools. Leverage the specially developed plug-ins and easy-to-use SDK to integrate NetApp management into the tools.

o SDK community — NetApp Manageability (NM) SDK provides resources to develop applications to monitor and manage NetApp storage systems using APIs. The NM SDK bundle provides detailed API documentation along with sample codes and a design guide.

NetApp OnCommand unified manager delivers a unified experience to manage physical and virtual storage environments using integrated workflows and policy-driven automation. From a single interface, OnCommand enables the consolidation and simplification of shared IT storage management, delivering greater flexibility and efficiency than that of competing approaches.

OnCommand manages the shared IT infrastructure as one or more pools of storage using policy-based automation for provisioning and data protection, resulting in up to 50% savings in storage costs. A centralized dashboard enables storage transparency while using intuitive point-and-click drill-downs. OnCommand integrates with third-party management suites and hypervisors, allowing management from the platform of choice.



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Appendix C: Total Economic Impact™ Overview

Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders.

The TEI methodology consists of four components to evaluate investment value: benefits, costs, risks, and flexibility.

Benefits Benefits represent the value delivered to the user organization — IT and/or business units — by the proposed product or project. Often product or project justification exercises focus just on IT cost and cost reduction, leaving little room to analyze the effect of the technology on the entire organization. The TEI methodology and the resulting financial model place equal weight on the measure of benefits and the measure of costs, allowing for a full examination of the effect of the technology on the entire organization. Calculation of benefit estimates involves a clear dialogue with the user organization to understand the specific value that is created. In addition, Forrester also requires that there be a clear line of accountability established between the measurement and justification of benefit estimates after the project has been completed. This ensures that benefit estimates tie back directly to the bottom line.

Costs Costs represent the investment necessary to capture the value, or benefits, of the proposed project. IT or the business units may incur costs in the form of fully burdened labor, subcontractors, or materials. Costs consider all the investments and expenses necessary to deliver the proposed value. In addition, the cost category within TEI captures any incremental costs over the existing environment for ongoing costs associated with the solution. All costs must be tied to the benefits that are created.

Risk Risk measures the uncertainty of benefit and cost estimates contained within the investment. Uncertainty is measured in two ways: 1) the likelihood that the cost and benefit estimates will meet the original projections, and 2) the likelihood that the estimates will be measured and tracked over time. TEI applies a probability density function known as “triangular distribution” to the values entered. At minimum, three values are calculated to estimate the underlying range around each cost and benefit.

Flexibility Within the TEI methodology, direct benefits represent one part of the investment value. While direct benefits can typically be the primary way to justify a project, Forrester believes that organizations should be able to measure the strategic value of an investment. Flexibility represents the value that can be obtained for some future additional investment building on top of the initial investment already made. For instance, an investment in an enterprisewide upgrade of an office productivity suite can potentially increase standardization (to increase efficiency) and reduce licensing costs. However, an embedded collaboration feature may translate to greater worker productivity if activated. The collaboration can only be used with additional investment in training at some future point in time. However,



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having the ability to capture that benefit has a present value that can be estimated. The flexibility component of TEI captures that value.

Appendix D: Glossary

Discount rate: The interest rate used in cash flow analysis to take into account the time value of money. Although the Federal Reserve Bank sets a discount rate, companies often set a discount rate based on their business and investment environment. Forrester assumes a yearly discount rate of 10% for this analysis. Organizations typically use discount rates between 8% and 16% based on their current environment. Readers are urged to consult their respective organization to determine the most appropriate discount rate to use in their own environment.

Net present value (NPV): The present or current value of (discounted) future net cash flows given an interest rate (the discount rate). A positive project NPV normally indicates that the investment should be made, unless other projects have higher NPVs.

Present value (PV): The present or current value of (discounted) cost and benefit estimates given at an interest rate (the discount rate). The PV of costs and benefits feed into the total net present value of cash flows.

Payback period: The breakeven point for an investment. The point in time at which net benefits (benefits minus costs) equal initial investment or cost.

Return on investment (ROI): A measure of a project’s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits minus costs) by costs.

A Note On Cash Flow Tables The following is a note on the cash flow tables used in this study (see the example table below). The initial investment column contains costs incurred at “time 0” or at the beginning of Year 1. Those costs are not discounted. All other cash flows in Years 1 through 3 are discounted using the discount rate (shown in Framework Assumptions section) at the end of the year. Present value (PV) calculations are calculated for each total cost and benefit estimate. Net present value (NPV) calculations are not calculated until the summary tables and are the sum of the initial investment and the discounted cash flows in each year.

Table [Example] Example Table

Ref. Category Calculation Initial cost Year 1 Year 2 Year 3 Total




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Appendix E: About The Project Director

Bob Cormier Vice President, Principal Consultant Bob is a vice president, principal consultant for Forrester’s Total Economic Impact™ (TEI) service. He is a leading expert on deriving business value from technology investments, specializing in advising clients on the TEI framework — services that help organizations understand the overall financial value of IT strategies and investments. He serves the following client role:

Technology vendor sales enablement professionals. Bob works with these professionals in their efforts to clearly articulate the unique value proposition of their solutions to prospects and customers using Forrester’s TEI methodology.

Bob has authored numerous TEI case studies for Forrester’s vendor clients. He has also delivered his acclaimed Justifying Technology Investments (JTI) workshop to more than 800 participants representing 400 organizations.

Bob has more than 25 years experience in the IT and consulting industries. Prior to joining Forrester, he held senior-level positions at two leading eBusiness consulting firms, ZEFER and Cambridge Technology Partners. Bob has successfully led company efforts to optimize financial, operational, and resource planning activities, incorporating leading-edge, professional service automation (PSA) applications and enterprise resource planning (ERP) systems. He has also held senior financial management positions at Digital Equipment and Anixter International.

During his career, Bob has consulted with global users and vendors of IT and has been a frequent speaker at conferences, events, and seminars.

Education Bob earned an M.B.A. from Bentley University and a B.S. in business from the University of New Hampshire. As an adjunct professor, he has taught finance and economics courses for more than 10 years at Southern New Hampshire University and Daniel Webster College.

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