Server Virtualization: a Method to Maximize Return on Investment

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Server Virtualization: A Method to Maximize Return on Investment
Definition of Server Virtualization
Server virtualization is an environment in which there is one physical server and there is software running, called a hypervisor, which allows several independent instances of operating systems (i.e. virtual machines) to run simultaneously. Ou (2006) states the server virtualization is the best solution for “applications that are meant for small- to medium-scale usage.” If implemented properly, organizations can use server virtualization to maximize their return on investment (ROI) in server hardware. Energy costs are rising and replacing “real estate as the primary data center expense” (Overby, 2007). Therefore, utilizing server
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Being conservative, twenty server cabinets represent a little over 200 servers. Perot Systems manages more than 150,000 servers, desktops, and laptops (“Perot Systems,” 2007). Therefore, their annual recurring costs to maintain their data centers are in the millions, especially considering how energy costs have just about tripled in the last ten years.
Furthermore, Perot Systems has thousands of servers currently in production, which are being underutilized. According to Computer Economics (2006) and as shown in Figure 2, “over 90% of the servers running the Windows operating system utilize less than 20% of their capacity.” The costs are the same to maintain both underutilized and busy servers. The underutilized servers are taking up floor space and driving up power and administration costs. Underutilized servers create another financial issue, because Perot Systems is not maximizing their return on investment. If Perot Systems continues to deploy and maintain underutilized servers and does not embrace a new strategy to save money when it comes to their data centers, then they will continue to waste millions of dollars every year.
Figure 2. Server Utilization. (Computer Economics 2006) Recommendations for the Executive Committee
Based on the current business issues and the benefits offered by