Home > Articles > Cisco Network Technology > General Networking > The Business Case for Storage Networks

The Business Case for Storage Networks

  • Sample Chapter is provided courtesy of Cisco Press.
  • Date: Nov 18, 2004.

Chapter Description

This chapter covers the copious non-technical reasons for preferring storage networks, from the legal implications of Sarbanes-Oxley to the economy of scale created by their usage. Discover the other advantages storage networks could provide to your business within.

Just as the effects of the recent economic downturn have been universally felt across all sectors and industries, likewise do the principle concepts discussed in this chapter—the commoditization of hardware and storage utilization efficiencies—apply to all IT environments, regardless of the size or the nature of the business application. This chapter sets the stage for understanding the storage network as a value-add to the firm insofar as it is capable of alleviating the management and financial burdens associated with direct-attached storage (DAS).

Networked storage offers significant business advantages over DAS, and the impact of these benefits can be quantified and measured. To understand the nature of the business benefits of networked storage, a brief, general discussion of overall IT spending and the specifics of storage spending is required and provides a basis for the remainder of the analysis performed in later chapters.

This chapter covers the following topics:

  • Storage management

  • Implementing a storage vision

  • The commoditization of hardware

  • The impact of industry trends and legislation on storage consumption

  • Storage utilization, storage yield, and the Cost of Poor Quality (COPQ)

Storage Management Matters

In May, 2003, author Nicholas Carr garnered much attention with a Harvard Business Review article on the strategic worth of information technology. The article's provocative title, "IT Doesn't Matter," bespoke Carr's argument that the commoditization of information technology solutions has essentially depleted the strategic advantage of information technology as a whole. In "IT Doesn't Matter," Carr states succinctly, "What makes a resource truly strategic—what gives it the capacity to be the basis for a sustained competitive advantage—is not ubiquity, but scarcity."1 Carr points to innovations, such as electricity and rail transportation, which offered competitive advantages to early adopters, but whose value diminished over time as the use of these technologies became common place.

In 2004, Carr expanded his position in his book, Does IT Matter? Information Technology and the Corrosion of Competitive Advantage, in which he urges readers to decrease IT spending, to avoid being an early adopter whenever possible, and to focus on "vulnerabilities" instead of "opportunities" where critical services are at risk.2

Carr could not be more accurate. It is also important to understand, however, that investment in storage networks allows firms to decrease storage spending and focus on service vulnerabilities. In addition, Fibre Channel SANs are well past the early adopt phase. Investment in storage networking technologies (not just Fibre Channel, but IP-based storage solutions as well) can help companies become more efficient and therefore more competitive.

NOTE

Everett Rogers originally outlined the concept of the early adopter in his work The Diffusion of Innovations. Detailed discussion of Rogers' work and how it applies to product adoption life cycles follows in Chapter 4, "How It Should Be Done: Implementation Strategies and Best Practices."

Understanding competitive forces is a fundamental premise of business leadership. Harvard Business School professor and author Michael Porter is a renowned expert on strategy and competition. He has written extensively on the nature of competition between rival firms and nations. Porter's groundbreaking essay, "How Competitive Forces Shape Strategy," was first published in 1979; twenty-five years later, Porter's "Five Forces," as they have come to be known, still aptly describe the interplay between rival firms' strategic endeavors.

As Porter outlined, the five main forces shaping competition between firms in similar industries are the following:

  • Buyer bargaining power

  • Supplier bargaining power

  • The threat of substitute products

  • Rivalry

  • Barriers to entry

In his essay, Porter lists "economies of scale" and "cost disadvantages independent of size" as two of the major sources of "barriers to entry."3 Although "learning curves," "experience curves," and "economies of scale" are concepts typically applied to manufacturing environments, these concepts also have distinct applications in IT, relative to the management of IT assets, and storage assets in particular.

Without a doubt, one of the most significant vulnerabilities facing companies today is the state of enterprise storage, now in overwhelming disarray following the deployment at breakneck speed of over two million DAS external disk units worldwide between the years of 1999 and 2003. The total number of DAS versus networked storage units sold between 1999 and 2003 is shown in Table 1-1.

Table 1-1 Worldwide External Non-OEM Factory Revenue ($M) and Shipments, 1999-2003 (Source: IDC, 2004)4

Worldwide External Non-OEM Factory Revenue ($M) and Shipments, 1999-2003

 

2003

2002

2001

2000

1999

 

$M

$M

$M

$M

$M

DAS

$5504

$5932

$9357

$14,452

$13,773

DAS Units

270,379

298,264

425,255

509,667

503,608

Networked*

$8087

$7165

$7838

$7299

$4368

Networked Units

128,599

141,148

140,902

138,455

74,215

*Denotes SAN and NAS storage.

Jon William Toigo outlined the storage management problem facing IT managers in his book, The Holy Grail of Storage Management, published in 2000. Toigo stated clearly and early on that corporate IT departments would face serious challenges in the coming years with managing data storage. The need for online or near-online data and the lack of a rational strategy for dealing with storage growth indicated that in a short amount of time, companies would have their hands full of storage problems.5 Few in corporate IT today are in a position to disagree with Toigo.

Storage networks allow firms to drive down operational costs and increase economies of scale to remain competitive. At the same time, storage networks allow firms to address critical business vulnerabilities. Although storage networks alone do not magically solve all storage-related problems, a networked storage infrastructure does help increase operational and utilization efficiencies, which ultimately lowers the overall storage total cost of ownership (TCO).

NOTE

Storage networks do not intrinsically solve the problems related to data and information management, but in later chapters I demonstrate how economies of scale with regard to storage management (and the cost advantages of increased storage utilization) have a significant impact on the firm's bottom line.

The ubiquity of information technology resources in corporate datacenters underscores the drop in prices for IT products and the diminished magnitude of the capital outlays required to build an enterprise-level IT infrastructure. This ubiquity is the tangible evidence—the hangover, if you will—from the party that heralded the advent of the New Economy.

2. Implementing a Storage Vision | Next Section

Cisco Press Promotional Mailings & Special Offers

I would like to receive exclusive offers and hear about products from Cisco Press and its family of brands. I can unsubscribe at any time.

Overview

Pearson Education, Inc., 221 River Street, Hoboken, New Jersey 07030, (Pearson) presents this site to provide information about Cisco Press products and services that can be purchased through this site.

This privacy notice provides an overview of our commitment to privacy and describes how we collect, protect, use and share personal information collected through this site. Please note that other Pearson websites and online products and services have their own separate privacy policies.

Collection and Use of Information

To conduct business and deliver products and services, Pearson collects and uses personal information in several ways in connection with this site, including:

Questions and Inquiries

For inquiries and questions, we collect the inquiry or question, together with name, contact details (email address, phone number and mailing address) and any other additional information voluntarily submitted to us through a Contact Us form or an email. We use this information to address the inquiry and respond to the question.

Online Store

For orders and purchases placed through our online store on this site, we collect order details, name, institution name and address (if applicable), email address, phone number, shipping and billing addresses, credit/debit card information, shipping options and any instructions. We use this information to complete transactions, fulfill orders, communicate with individuals placing orders or visiting the online store, and for related purposes.

Surveys

Pearson may offer opportunities to provide feedback or participate in surveys, including surveys evaluating Pearson products, services or sites. Participation is voluntary. Pearson collects information requested in the survey questions and uses the information to evaluate, support, maintain and improve products, services or sites; develop new products and services; conduct educational research; and for other purposes specified in the survey.

Contests and Drawings

Occasionally, we may sponsor a contest or drawing. Participation is optional. Pearson collects name, contact information and other information specified on the entry form for the contest or drawing to conduct the contest or drawing. Pearson may collect additional personal information from the winners of a contest or drawing in order to award the prize and for tax reporting purposes, as required by law.

Newsletters

If you have elected to receive email newsletters or promotional mailings and special offers but want to unsubscribe, simply email information@ciscopress.com.

Service Announcements

On rare occasions it is necessary to send out a strictly service related announcement. For instance, if our service is temporarily suspended for maintenance we might send users an email. Generally, users may not opt-out of these communications, though they can deactivate their account information. However, these communications are not promotional in nature.

Customer Service

We communicate with users on a regular basis to provide requested services and in regard to issues relating to their account we reply via email or phone in accordance with the users' wishes when a user submits their information through our Contact Us form.

Other Collection and Use of Information

Application and System Logs

Pearson automatically collects log data to help ensure the delivery, availability and security of this site. Log data may include technical information about how a user or visitor connected to this site, such as browser type, type of computer/device, operating system, internet service provider and IP address. We use this information for support purposes and to monitor the health of the site, identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents and appropriately scale computing resources.

Web Analytics

Pearson may use third party web trend analytical services, including Google Analytics, to collect visitor information, such as IP addresses, browser types, referring pages, pages visited and time spent on a particular site. While these analytical services collect and report information on an anonymous basis, they may use cookies to gather web trend information. The information gathered may enable Pearson (but not the third party web trend services) to link information with application and system log data. Pearson uses this information for system administration and to identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents, appropriately scale computing resources and otherwise support and deliver this site and its services.

Cookies and Related Technologies

This site uses cookies and similar technologies to personalize content, measure traffic patterns, control security, track use and access of information on this site, and provide interest-based messages and advertising. Users can manage and block the use of cookies through their browser. Disabling or blocking certain cookies may limit the functionality of this site.

Do Not Track

This site currently does not respond to Do Not Track signals.

Security

Pearson uses appropriate physical, administrative and technical security measures to protect personal information from unauthorized access, use and disclosure.

Children

This site is not directed to children under the age of 13.

Marketing

Pearson may send or direct marketing communications to users, provided that

  • Pearson will not use personal information collected or processed as a K-12 school service provider for the purpose of directed or targeted advertising.
  • Such marketing is consistent with applicable law and Pearson's legal obligations.
  • Pearson will not knowingly direct or send marketing communications to an individual who has expressed a preference not to receive marketing.
  • Where required by applicable law, express or implied consent to marketing exists and has not been withdrawn.

Pearson may provide personal information to a third party service provider on a restricted basis to provide marketing solely on behalf of Pearson or an affiliate or customer for whom Pearson is a service provider. Marketing preferences may be changed at any time.

Correcting/Updating Personal Information

If a user's personally identifiable information changes (such as your postal address or email address), we provide a way to correct or update that user's personal data provided to us. This can be done on the Account page. If a user no longer desires our service and desires to delete his or her account, please contact us at customer-service@informit.com and we will process the deletion of a user's account.

Choice/Opt-out

Users can always make an informed choice as to whether they should proceed with certain services offered by Cisco Press. If you choose to remove yourself from our mailing list(s) simply visit the following page and uncheck any communication you no longer want to receive: www.ciscopress.com/u.aspx.

Sale of Personal Information

Pearson does not rent or sell personal information in exchange for any payment of money.

While Pearson does not sell personal information, as defined in Nevada law, Nevada residents may email a request for no sale of their personal information to NevadaDesignatedRequest@pearson.com.

Supplemental Privacy Statement for California Residents

California residents should read our Supplemental privacy statement for California residents in conjunction with this Privacy Notice. The Supplemental privacy statement for California residents explains Pearson's commitment to comply with California law and applies to personal information of California residents collected in connection with this site and the Services.

Sharing and Disclosure

Pearson may disclose personal information, as follows:

  • As required by law.
  • With the consent of the individual (or their parent, if the individual is a minor)
  • In response to a subpoena, court order or legal process, to the extent permitted or required by law
  • To protect the security and safety of individuals, data, assets and systems, consistent with applicable law
  • In connection the sale, joint venture or other transfer of some or all of its company or assets, subject to the provisions of this Privacy Notice
  • To investigate or address actual or suspected fraud or other illegal activities
  • To exercise its legal rights, including enforcement of the Terms of Use for this site or another contract
  • To affiliated Pearson companies and other companies and organizations who perform work for Pearson and are obligated to protect the privacy of personal information consistent with this Privacy Notice
  • To a school, organization, company or government agency, where Pearson collects or processes the personal information in a school setting or on behalf of such organization, company or government agency.

Links

This web site contains links to other sites. Please be aware that we are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of each and every web site that collects Personal Information. This privacy statement applies solely to information collected by this web site.

Requests and Contact

Please contact us about this Privacy Notice or if you have any requests or questions relating to the privacy of your personal information.

Changes to this Privacy Notice

We may revise this Privacy Notice through an updated posting. We will identify the effective date of the revision in the posting. Often, updates are made to provide greater clarity or to comply with changes in regulatory requirements. If the updates involve material changes to the collection, protection, use or disclosure of Personal Information, Pearson will provide notice of the change through a conspicuous notice on this site or other appropriate way. Continued use of the site after the effective date of a posted revision evidences acceptance. Please contact us if you have questions or concerns about the Privacy Notice or any objection to any revisions.

Last Update: November 17, 2020