Presentation v mware roi tco calculator

VMware ROI TCO Calculator:
Overview & Sample Analysis
© 2011 VMware Inc. All rights reserved

Table of ContentsTable of Contents
Calculator Overview
Sample analysis:
• Expected ROI/TCO analysis (forward looking)
• Realized ROI/TCO analysis (backward looking)
• Hybrid ROI/TCO analysis (mix of backward & forward)
Addi i l RAdditional Resources
2

VMware products covered
CapEx OpEx Business AgilityS i CapEx OpEx Business Agility
Server HW Storage HW Networking
HW
Infrastructure
Admin
Productivity
Power &
Cooling
Rack Space
& Office
Space
Planned
Downtime
Unplanned
Downtime
Business
Downtime
Cloud Services vCloud
$ $ $ $ $ $ $
Savings
Products
Journey &
Cloud Services
Delivery
vCloud
Director $ $ $ $ $ $ $
Chargeback
$ $ $ $ $
Desktop
Vi t li ti
View
$ $ $ $
3
Virtualization $ $ $ $
Business
Continuity &
Disaster
Recovery
Site
Recovery
Manager $ $ $
Operations
Management,
Security &
Compliance
CapacityIQ
$ $ $ $ $
AppSpeed
$ $
vShield App
$ $ $
2
vShield App
& Edge $ $ $
Server
Virtualization
vSphere &
vCenter
Server
$ $ $ $ $ $ $ $ $1
“$” represents possible savings
• Supported by succinct modules within calculator to help users evaluate
3

Methodology
Total Cost
Before minus
Total Cost
After equals
Savings
There are two main outputs for this calculator:
• Return on Investment
• Equals Savings / Investment
• …where investment represents the sum of incremental investment
in transition from physical to virtual (new servers, shared storage,
VMware licenses, services and training, etc.)
• Total Cost of Ownership
• Inclusive of IT Administration and downtime costs
4
Inclusive of IT Administration and downtime costs

Design & Scope
D iDesign
• We are striking a balance between simplicity and credibility
Too complex, and the
analysis becomes difficult
to explain and repeat
Simplicity
Too Simple and
customers will not find Credibility
• Cash basis: no depreciation, amortization, time value discounting
• Standardized time horizon: 5 year analysis
outputs credible
Credibility
• Standardized time horizon: 5 year analysis
Scope
• ROI TCO Calculator is not meant to generate a definitive bill of goodsROI TCO Calculator is not meant to generate a definitive bill of goods
• Our goal is to provide a credible understanding of cost and benefits
• Users may need to engage additional resources (sales / finance) for transactions that
require more custom models
5
require more custom models

Return on Investment (ROI)
% t i t t i d t t iti t i t li d% return on investment required to transition to virtualized
infrastructure
• CapEx
Total Savings
• OpEx
• Downtime
…reference slide 3 for more detail
1Total InvestmentTotal Investment
• New Servers, Storage,
Network Switches
• VMware License & Support
• Services & Training
6

Total Cost of Ownership (TCO)
C t i t d ith ti f d t tCosts associated with operation of datacenter
CapExp
• Servers
• Storage
• Network Switches• Network Switches
OpExOpEx
• Power & Cooling
• IT Administration Labor
• Rack Space• Rack Space
Business Agilityus ess g ty
• Planned Downtime
• Unplanned Downtime
• Business Downtime
7
• Business Downtime

Workflow: Server Virtualization
M A l i
Start / Login
My Analysis
(create or open prior
analysis)
Server
Virtualization
1) Server
Configuration
Define configurations of
physical servers, count of
workloads, and consolidation
Capacity IQ
Configuration
2) Server
Consolidation
ratio
Modules for 5 basic datacenter
elements: Server HW, Power &
Cooling, Storage, Networking,
Rack Space
AppSpeed
3) Product
Selection
Select edition of vSphere /
vCenter Server, and define
level of SnS, discounts, input
historical or ELA data
Based on edition of vSphere
vShield App &
Edge
4) Beyond Server
Consolidation
5) ROI
p
selected, calculator provides
additional modules to review
benefits of advanced features
Summary of vSphere & vCenter
Server Investment, Savings,
ROI and estimated Payback
Site Recovery
Manager
vCloud Director
& ChargebackROI and estimated Payback
Period over 3 years and 5 years
& Chargeback
End / Analysis
Summary
(charts, tables, export)
Choose to include additional
management products. Product
calculations leverage prior inputs
and provides incremental ROI/TCO
8

Workflow: Desktop Virtualization
M A l i
Start / Login
My Analysis
(create or open prior
analysis)
Desktop
Virtualization
1) Desktop
Configuration
Define configurations of
physical servers, count of
*Please Note:
Configuration
2) Desktop
Virtualization
ratio
Modules for 5 basic datacenter
elements: Server HW, Power &
Cooling, Storage, Networking,
Rack Space
• Desktop Virtualization must be
selected during New Analysis
Creation
U ill t b bl t dd
3) Product
Selection
4) Premier Edition
Select edition of vSphere /
vCenter Server, and define
level of SnS, discounts, input
historical or ELA data
Based on edition of vSphere
• Users will not be able to add
Desktop Virtualization to an
existing Server Virtualization only
analysis later
4) Premier Edition
Advanced
Features
5) ROI
p
selected, calculator provides
additional modules to review
benefits of advanced features
Summary of vSphere & vCenter
Server Investment, Savings,
ROI and estimated PaybackROI and estimated Payback
Period over 3 years and 5 years
End / Analysis
Summary
(charts, tables, export)
9

Module Elements
Example: Server Virtualization > Power & Cooling Summary table, with key metrics,
updates as users make changes and
completes each module
Key assumptions for each module are
distilled and grouped together in
1
2
1
distilled and grouped together in
hidden assumptions tab—click to
unhide
Scenario A represents extension of
environment without benefit of
vSphere
3
8
2
3
vSphere
Scenario B represents environment as
users transition workloads to
virtualized infrastructure
(A – B) is the variance in Costs
4
5
4
(A B) is the variance in Costs
calculated in two scenarios, and
represents savings for module
Each module has a text box at the
bottom to provide some context to
module analysis and or assumptions
5
6
6
module analysis and or assumptions
Links along the bottom direct users to
additional resources
Go to Analysis Summary for
supporting charts and tables, including
5
7
8
7
Green Savings, and Cost per App
comparison to competing platforms.
Users will also find document export
functions here
10

Calculator Overview
Sample analysis:
11

Server Virtualization
Define number of workloads and
configuration of host servers assuming
no virtualization (Year 0)
Define number of workloads and
1
2
1) Server Configuration
100% virtualized
Max Consolidation Ratio is a key part
of this analysis…
…Open assumptions tab and adjust
3
4
4
1
…Open assumptions tab and adjust
VM’s per Core variable to refine.
There is also an option here to change
analysis to one based on leased
servers (avg price per server then
represents the annual lease cost)
4
2
3
12

Number of workloads defined in
previous module is the starting number
in this module. Refine number of
workloads thru Year 5 in Assumptions
tab:
1
2) Server Consolidation > Server Hardware (part 1)
• Change annual growth rate (linear)
• For non-linear growth, locate switch
for “manually adjust count of
workloads”, change to “yes”, close
tab and input values into module
1
2
tab, and input values into module
By default, analysis assumes 100%
refresh based on average useful life
and average age assumptions. Define
a staggered refresh if necessary in
Assumptions tab:
2
2 Assumptions tab:
• Locate switch for “manually adjust
count of servers retired”, change to
“yes”, close tab, and input values
into module
3
By default, analysis assumes 100% of
workloads are migrated to virtualized
infrastructure in Year 1. Adjust %
virtualized to define a different
schedule for migration
3
13

Manually adjust count of workloads
• By default, calculator assumes a
linear workload growth rate—first
assumption at the top of
assumptions tab
1
assumptions tab
• For non-linear growth, locate switch
for “manually adjust count of
Manually adjust count of host servers?
constant consolidation ratio each
year, post-virtualization
2
1
2
• To define a changing consolidation
ratio each year, change to “yes”,
close tab, and input values into
module
Manually adjust host servers retired?
3
3
• By default and for simplicity,
calculator uses useful life and
average age assumptions to
determine 100% refresh of servers
T d fi t d f h (
Caution: enabling all three functions adds
great deal of flexibility to customize analysis,
but calculator may not be able to guarantee • To define a staggered refresh (eg.
1/3 of starting count of servers,
spread out over three years),
change to “yes”, close tab, and input
values into module
but calculator may not be able to guarantee
logic in module is correct under all scenarios.
Users will be required to review to ensure
changes lead to desired results.
14

In addition to the GB’s of data store,
this section also incorporates
additional hardware required for
different protocols of storage:
• Fibre Channel SAN requires server
1
2) Server Consolidation > Server Storage (part 1)
• Fibre-Channel SAN requires server
HBA’s and SAN Switches
• iSCSI SAN requires server TOE
cards
• NAS will not require additional HW
1
NAS will not require additional HW
Financial impact of GB’s of data store
are calculated toward the bottom of
each scenario
2
1
1
2
15

Users can define the transition to and
increased shared storage
environment. Many of vSphere’s
advanced features such as vMotion
and Distributed Resources Scheduler
1
2) Server Consolidation > Server Storage (part 2)
are enabled by and require shared
storage. Depending on whether the
environment in this analysis starts with
no shared storage or already has
shared storage, the transition to a
virtualized infrastructure with 100%
1
virtualized infrastructure with 100%
shared storage, may require significant
investment in additional hardware (FC
SAN and iSCSI SAN). Two areas for
users to define if there will be shared
storage, and the degree of the
transitiontransition
Next, users can select applicable
shared storage protocols, and define
the mix (input box(es) for %’s) to the
right
21
2
2
Important for users to specify the
average size of workloads in the
lower-left corner of assumptions tab.
Here too, users can choose to include
storage savings from Thin Provisioning
f t ithi S h ( t if t
3
feature within vSphere (zero out if not
applicable, or leveraging at the storage
array level)
3
16

Cycling through each vSphere edition
in the list box, users will be able to see
which advanced features are included
below
1
3) Product Selection > vSphere edition selection (part 1)
1
17

Select the level of Support &
Subscription and define number of
years
Define any applicable discounts
(standard discounts available for
1
2
(standard discounts available for
government agencies and academic
institutions) for license and SnS
For Enterprise License Agreements
(ELA’s), enable checkboxes above to
input contract amounts into input
1
input contract amounts into input
boxes below.
• For a $200,000 three year ELA,
enable checkboxes above Years 1
to 3, and input $200,000 into Year 1
2
• Based on growth of workloads
defined in Server HW section,
calculator will then estimate
additional licenses and SnS required
for Years 4 and 5
1 2
3
• To exclude calculator estimates for
Years 4 and 5, enable checkboxes
for those years--the default value for
input boxes once enabled is zero
3
18

Unhide assumptions tab to
select/deselect and or adjust cost of
services and training through Planning
and Design
For annual services such as P2V
1
2 For annual services such as P2V
Acceleration and Health Checks, users
will be able to adjust cost per server to
derive total cost for each year with
input boxes in main module
If PSO credits are applicable enabling
2
3
1
If PSO credits are applicable, enabling
input boxes at the bottom of main
module will over-ride itemized costs
calculated above
3
22
3
2
3
19

Unhide assumptions tab to adjust
assumptions regarding labor savings
from faster provisioning
Labor savings, calculated as the
difference between labor required with
1
4) Beyond Server Consolidation > Server Provisioning Labor
2
and without vSphere virtualization, is
the first value calculated
Faster provisioning translates into a
reduction in end-user wait time. This
is the value of Business Agility
3
1
is the value of Business Agility.
Default assumption is that 40% of
reduction in time spent on provisioning
is returned to the business
2
3
20

assumptions regarding downtime
savings from planned server
maintenance events
Planned Downtime savings calculated
1
4) Beyond Server Consolidation > vMotion
2 Planned Downtime savings, calculated
as the difference between downtime
required with and without vSphere
virtualization, is the value calculated
2
1
22
21

savings from planned storage array
maintenance events
Planned Downtime savings calculated
1
4) Beyond Server Consolidation > Storage vMotion
2 Planned Downtime savings, calculated
as the difference between downtime
required with and without vSphere
virtualization, is the value calculated
2
1
22
22

savings from unplanned events
• High Availability does not require
any additional capital expenditures
1
4) Beyond Server Consolidation > High Availability & Fault Tolerance
any additional capital expenditures,
and helps to automatically restart
servers due to OS or HW failures
• Downtime savings from virtualization
and High Availability are not always
positive due to consolidation ratios
2
1
positive due to consolidation ratios—
when a virtualized host server fails,
it will bring down multiple workloads
which may not be completely offset
by ability to restart VM’s faster
• This downtime can be fully mitigated3 • This downtime can be fully mitigated
with Fault Tolerance (FT) for
mission critical workloads, but
requires additional servers to host
live shadow VM’s for failover—
additional capital expenditures are
3
calculated when FT is enabled in
assumptions tab
Application downtime mitigated
translates into a reduction in end-user
wait time. This is the value of
4
Business Agility. Default assumption
is that 40% of reduction in downtime
savings is returned to the business2
3
4
23
4

assumptions applicability of distributed
power management to further
consolidate inactive workloads and
power down excess servers during
1
4) Beyond Server Consolidation > Distributed Power Mgmt
nights and weekends
Incremental Power & Cooling savings
calculated here
2
1
22
24

assumptions regarding labor savings
from advanced management features
in vSphere
Labor savings calculated as the
1
4) Beyond Server Consolidation > Server Admin Labor (part 1)
2 Labor savings, calculated as the
and without vSphere virtualization, is
the first value calculated
Faster administration translates into a
reduction in end user wait time This
2
3
1
reduction in time spent on
administration is returned to the
business
22
3
25

The number of Workloads per FTE
Administrator, regardless of silo
(server, storage, network, application,
etc.), is the measure of administration
productivity here. Most VMware
1
4) Beyond Server Consolidation > Server Admin Labor (part 2)
customers have already virtualized a
portion of their datacenters, and can
readily speak to the difference
productivity—input values here.
For users who are new to2
1
virtualization, we have surveyed
customers and VMware’s own IT
Administrators, and have provided a
way to calculate incremental added
productivity from various advanced
management features available inmanagement features available in
vSphere Enterprise+. Enter the
“Existing – unvirtualized” metric in
section 1, and adjust values in section
2 to derive metric for “New –
virtualized.”
2
Faster administration translates into a
reduction in time spent on
d i i t ti i t d t th
3
administration is returned to the
business
3
26

The final module in Server
Virtualization provides details into the
ROI starting with required Investments
at the top. For VMware Software
License & Support in this example,
$
1
5) ROI (part 1)
$129K of spend is required in Year 1.
Then depending on time horizon (3
Years vs. 5 Years), users can see
additional spend required for Years 2
and beyond, due to workload growth
defined in Server Hardware module.
1
defined in Server Hardware module.
Users will find input boxes for Other
Investments not accounted for in the
calculator. Also, should there be any
sales tax considerations, tax rates can
be adjusted here.
2
3
be adjusted here.
Click on this button to bring up menu
of additional server virtualization
management products to add to
analysis:
3
• CapacityIQ
• AppSpeed
• Site Recovery Manager
• vShield EdgevShield Edge
• vShield Endpoint
• Chargeback
• vCloud Director
2
27

Towards the bottom half of this
module, users will find detail on
Savings calculated
Users will also find input boxes for
Other Savings not accounted for in the
1
5) ROI (part 2)
2
Other Savings not accounted for in the
calculator
Finally, Investment and Savings
enable for the calculation of ROI as
well as Payback Period
3
1
2
3
28

Analysis Summary provides additional
charts and tables to collect and
present results of all products
reviewed
• Cumulative Investment Savings &
1
Analysis Summary
• Cumulative Investment, Savings &
ROI provides a view into results,
each year, over the 5 year analysis
horizon
• Distribution of Savings: 5 Year Total
provides a quick snapshot of where
2
1
provides a quick snapshot of where
users can expect to savings
• Distribution of Investment: 5 Year
Total provides a quick snapshot of
where users will need to invest
• Total Cost of Ownership: 5 Year
Total (1) compares CapEx, OpEx,
and Other (downtime, tax, other
user-defined costs) expenses
between a fully Physical datacenter
and one with the benefits ofand one with the benefits of
Virtualization
• Total Cost of Ownership: 5 Year
Total (2) again compares CapEx,
OpEx and Other expenses, but with
d d l itexpanded granularity
Charts Data provides all back-up data
behind charts
2
29

Calculator Overview
Sample analysis:
30

For a Realized ROI analysis a key
assumption is the virtualization
schedule that defines how many
physical workloads are transitioned to
virtual machines each year
1
Adjust percentages until count of
workloads matches known history
1
31

Manually adjust count of workloads
linear workload growth rate—first
assumption at the top of
assumptions tab
1
assumptions tab
• For non-linear growth, locate
switch for “manually adjust count of
Manually adjust count of host servers?
constant consolidation ratio each
year, post-virtualization
2
1
2
• To define a changing
consolidation ratio each year,
values into module
Manually adjust host servers retired?
3
3
• By default and for simplicity,
calculator uses useful life and
average age assumptions to
determine 100% refresh of servers
T d fi t d f h (
Caution: enabling all three functions adds
great deal of flexibility to customize analysis,
but calculator may not be able to guarantee • To define a staggered refresh (eg.
1/3 of starting count of servers,
spread out over three years),
values into module
but calculator may not be able to guarantee
logic in module is correct under all scenarios.
Users will be required to review to ensure
changes lead to desired results.
32

To input historical spend for VMware
Software + SnS, toggle check boxes to
enable applicable input boxes
• For a three years of history with
$50 000 in spend each year enable
1
$50,000 in spend each year, enable
checkboxes above Years 1 to 3, and
input $50,000 into Years 1, 2 and 3
for those years the default value forfor those years--the default value for
• If analysis is expanded to include
server management products,
include historical costs of those
products here and set discounts toproducts here and set discounts to
100% in respective management
product modules to zero out
additional calculator spend
estimates
11
33

To input historical spend of Services +
Training, toggle check boxes to enable
applicable input boxes
1
for those years the default value forfor those years--the default value for
11
34

In Analysis Summary > Charts Data >
Distribution of Investments, users can
verify that inputs of historical spend for
VMware Software + SnS and Services
+ Training have been aggregated
1
Analysis Summary (part 1)
accurately by the calculator
1
35

In Analysis Summary > Charts > Chart
1, Realized results (Investment,
Savings, ROI) for Years 1, 2 and 3 are
graphed
Cumulative results for three years of
1
2
2 Cumulative results for three years of
history can also be found in small
upper-right table, in the Over 3 yrs.
column
2
1
36

Calculator Overview
Sample analysis:
37

To input historical spend for VMware
Software + SnS, toggle check boxes to
enable applicable input boxes
1
Leaving Years 4 and 5 unchecked will
enable the calculator to estimate
additional cost of vSphere and vCenter
2
additional cost of vSphere and vCenter
Server required for those years based
on workload growth and virtualization
schedule defined in Server Hardware
Be sure to define any applicable
discounts for Years 4 and 5 or
3
3
discounts for Years 4 and 5 or
calculator will estimate costs at list
price
1 21 2
38

To input historical spend of Services +
Training, toggle check boxes to enable
applicable input boxes
1
Leaving Years 4 and 5 unchecked will
enable the calculator to estimate
additional cost of services required
2
additional cost of services required
based on selections defined in
Assumptions Tab (unhide to adjust)
In this case, the annual vSphere
Health Check was selected, and
incremental costs of $62 324 haveincremental costs of $62,324 have
been added to the original $30,000
1 2
$ 92,324
39

In Analysis Summary > Charts Data >
Distribution of Investments, users can
verify that inputs of historical spend
and calculator estimates for VMware
Software + SnS and Services +
1
Training have been aggregated
accurately by the calculator
1
40

In Analysis Summary > Charts > Chart
1, Realized results (Investment,
Savings, ROI) for Years 1, 2 and 3 are
graphed.
Results for Years 4 and 5 include
1
2
Results for Years 4 and 5 include
projections of additional investments
and savings
Cumulative results over 3 years and
over 5 years can also be found in
small upper right table
2
1
small upper-right table
41

Calculator Overview
Sample analysis:
42

Additional Resources
ROI TCO Calculator Website: roitco.vmware.com
Frequently Asked Questions: FAQ document
Feedback & Questions: roitco.vmware.com/vmw/account/FeedbackQuestions
43

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