Understanding IT Budgets
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1 Understanding IT Budgets Michael Pinnella Director of Network Operations Holmes District Schools - Bonifay, Florida MBA - Information Management, Microsoft Certified Systems Administrator (MCSA), CompTIA A+ & Network+ Certifed, Enterasys Certified Expert in Network Security, Enterasys Certified Specialist in Switching and Wireless, iboss ISCP June 20, 2017
2 Understanding IT Budgets In our limited time, we will seek to explain some of the more complex costs associated with IT operations and their function including: Infrastructure Virtualization Microsoft Volume Licensing Support Contracts Managed Services We will not be covering Instructional Technology and Educational Software We also will not be covering common IT purchases such as computers, printers, servers *, etc.
3 An IT Budget is a riddle wrapped in a mystery inside an enigma. - Winston Churchill Source: I just made this up he never said this.
4 Infrastructure - The Technology You Do Not See Network Switches Make up the backbone of a Local Area Network (LAN). They are used to connect computers and other wired devices to the network. Wireless Access Points also connect to network switches. Enterprise class, managed switches are designed to work in groups and require specific configurations. Switches manage a high amount of network traffic, provide network security, learn about every device on the network (which can number in the thousands), and can prioritize traffic based on type (voice, data, video, etc.)
5 Infrastructure - The Technology You Do Not See Enterprise class access (edge) layer switches range in price from $2000-$3500 depending on the manufacture, number of ports, features, and quantity purchased. Datacenter switches can cost $10,000 or more. The Average Lifespan of an enterprise switch is 5 years, but many switches have been in service longer. The primary reasons to upgrade switches are improvements in features or performance (i.e. 1 gigabit to 10 gigabit). This scenario normally requires all of the switches on a campus to be upgraded.
6 Infrastructure - The Technology You Do Not See Most Enterprise switches carry limited lifetime warranties. This means that a failed switch will replaced until the vendor deems the switch end of life which is normally 5 years from the end of sale for that model. Some manufactures offer next day replacement for an additional annual fee per covered switch as a service above and beyond their normal RMA process. In our case, we decided to pass on the $137 x 100+ switches and purchase 2 switches that are stored in stock and used as instant replacements. The failed switch is then replaced via the normal RMA process which could take 3-5 days. Your IT manager should be able to justify the best option for your environment.
7 On Premises Servers and Virtualization On Premises servers traditionally served a single purpose file server, web server, server, etc. Many of these severs use just a fraction of the CPU, RAM, and storage capacity. It is not unusual to see a $5000 mission critical server using less than 5% of its resources. Virtualization addresses this by enabling dozens of low resource servers to be virtualized on a single physical server. This is achieved by installing a hypervisor operating system (such as Vmware) on the physical server.
8 On Premises Servers and Virtualization Several instances of Windows Server, Linux, etc. can then be installed. The hypervisor simulates the hardware and presents a virtual machine to each operating system which thinks its installed on its own physical server. Vmware and Microsoft s Hyper-V are the two most widely deployed hypervisors. Hyper-V is included free with Microsoft Server. VMware incurs a cost which could run several thousand dollars per server, but offers features that Hyper-V does not. Some vendors offer preconfigured virtual servers that are only supported in Vmware. For a small environment, Hyper-V is normally sufficient, but for large, complex, and dispersed datacenters Vmware is currently the best option.
9 On Premises Servers and Virtualization In our data center, we are currently running 34 virtual servers with the capacity to add another on 4 physical servers. A single server hosting dozens of servers requires more resources in RAM, CPU, and storage. Replacing nearly three dozen $5000 servers with four $12,000 servers also saves in power consumption and reduced downtime as virtual servers can be instantly moved between physical servers in the event of a hardware failure. Virtualization saves money and improves reliability and should be used whenever possible (Not all servers can or should be virtualized).
10 The Microsoft Volume License Agreement Microsoft Volume licensing reduces costs and simplifies managing software licenses across an organization. A la carte licensing for a single computer would require a license for the Windows OS, Office, and a client access license for each individual Windows server that will be accessed this includes all file and servers. An environment with thousands of workstations and dozens or hundreds of servers each with different software and access requirements would quickly become too complex to manage efficiently. In addition, each of these licenses would not cover upgrades. A computer purchased with Windows 7 and Office 2010 would incur an additional cost to upgrade to Windows 10 and Office 2016.
11 The Microsoft Volume License Agreement Microsoft Volume licensing is an annual cost that enables all of your computers and servers to use the latest version of Microsoft products and includes all necessary client access licenses for server access. The cost to education is also significantly less than the cost to the commercial sector. Unlicensed software carries with it a potential fine of $150,000 per unlicensed software title. Once a VLA is purchased an environment can quickly fall in compliance. Be advised that current trends point to nearly all software becoming cloud hosted and/or subscription based.
12 Support Contracts Many hardware and software vendors only offer limited free support for their products. For example, some vendors of networking products will replace a product under warranty if it fails, but they will not provide software and security updates, nor will they provide technical support for issues of configuration, management, or troubleshooting. The complexity of some of these systems goes beyond the knowledge of IT Staff and requires specialized assistance from the vendor. Trying to fix unsupported software could take hours or days where the vendor could have the issue resolved in minutes. In fact, many times problems are fixed with software updates.
13 Support Contracts Systems that do not get software updates can become unstable or vulnerable to attack. Knowing about security issues, but not patching them could expose your district to litigation in the event of a breach of personal information. Critical and complex IT systems should be covered. A single incident can cost more than the support contract itself.
14 Outsourcing Some systems require in depth knowledge to design, install, and configure, but not to operate such as a Voice over IP (VoIP) telephone system or a vendor specific IT system such as SCCM or an enterprise wireless system. In situations where the majority of a system s complexity is in its design, installation and configuration, it is sometimes more cost effective to contract out its setup to trained and certified experts.
15 Outsourcing This works best with systems that do not require regular upkeep or changes. Servers and switch infrastructure are often changed or added, and require regular hands on management from IT staff. Voice over IP (VoIP) telephone systems, wireless, and other systems that are complex to install but the systems themselves change little over time can be good candidates for outsourcing the installation.
16 Managed Services IT services that have traditionally been managed in-house are now being managed by 3 rd party providers. Examples of these include Office 365 and Microsoft Azure. This is sometimes referred to as Software as a Service (Saas), Infrastructure as a Service (IaaS), Backup as a Service (BaaS), Storage as a Service (also Saas) and Security as a Service (SECaaS). If it exists in-house, chances are there is a company waiting and willing to take it over for you.
17 Managed Services - Examples SaaS: Office 365 moves Microsoft Office from a program installed on a computer to a fully functional Office suite that works inside of a web browser enabling it to be used by non- Microsoft devices such as ipads and phones. BaaS: Thanks to high speed Internet connections, some districts are backing up their operations directly to the Cloud. IaaS: Database or other servers on premises can be replicated to the Cloud where they can be available in the event of a disaster. SaaS: Files can be hosted in the Cloud and be available for users using a variety of technology platforms. Google Drive and Microsoft One Drive are some examples of this.
18 Discussion or Questions?
19 Thank You!
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