Top Five IT initiatives to cut costs - fast

IT managers and executives are in a tough spot. Cost reduction is a non-negotiable objective this year, while at the same time user expectations remain high, and demand continues to rise.

With the need to literally do more with less, what steps can you take that will have an immediate effect on costs? This article looks at five IT initiatives financial institutions should explore now to reduce costs and gain a competitive advantage.

Virtualization of the workspace
Virtualization at the endpoint, often referred to as workspace virtualization, makes computing for end-users extremely portable and flexible, helping IT to reduce costs and respond to rapidly changing business needs while centrally managing the endpoints for improved control and security.

In today’s challenging economy, financial institutions are taking note from their colleagues in traditional enterprises, and evaluating workspace virtualization. Institutions’ current goals are clear - implement cost-cutting measures, while improving efficiency. Virtualization will help institutions achieve these and other IT goals.

According to Andi Mann, Research Director at Enterprise Management Associates, 90 percent of enterprises report real and measurable ROI from virtualization in general. This translates to renewed opportunity for financial institutions to leverage workspace virtualization. They’re justifying investments, not only for increased security initiatives, but also for the innumerable cost efficiencies and management benefits.

Mann says lower support costs contribute to ROI. Specifically, he states that central control reduces management requirements, and limited desktop maintenance results in fewer desk-side visits, lower costs for staff, travel and the like. With workspace virtualization, one person can accomplish what used to require an entire team by automating maintenance tasks over the network. In fact, Symantec has seen its customers shorten installs and updates from 20 minutes to 30 seconds.

Additionally, institutions are better able to reclaim and redistribute licenses which results in fewer licenses and lower costs. Gone are the days of installing every conceivable application on every user’s system… just in case. Instead institutions only purchase licenses for applications that are actually used. With that license cost savings, institutions can realize an ROI in a matter of six to 18 months.

Centrally manage and protect data across branch locations
According to research and consulting firm The Alchemy Solutions Group, “Only now are technologies available that allow IT security to manage endpoints globally from a single console. This consolidation offers the opportunity to bring IT operational and economic efficiencies in line with business drivers supporting cost control and process improvement.”

That’s a lesson that has been taken to heart by Bank of Choice in Colorado, which has grown quickly from a small community bank to one that recently surpassed the $1 billion asset mark.

Three years ago, the bank started expanding and making acquisitions - bringing its branch total to 19. The bank decided to dismantle the IT infrastructures already in place and start from scratch. Today, the company has a single point of control for all 19 locations: a data center built from the ground up using best-in-class hardware and software - including solutions from Symantec. This enables a more efficient staffing structure, with the company's eight IT employees now working out of a single reporting unit.

The end result: two separate banks - and 20 locations including the data center - work together seamlessly. Bank of Choice is confident its systems are solidly protected, and company executives now can run necessary reporting and checks on one system instead of 19.

Storage virtualization
During periods of robust economic growth, organizations may be tempted to take the “quick fix” to storage management problems. The incremental cost of adding storage is relatively small and can be absorbed by the budget. Unfortunately, during periods of tight budgets, funds are not available for incremental capacity purchases.

Storage virtualization can often be the solution with the promise of a strong ROI.

According to a recent study by Computer Economics, an Irvine, Calif., IT research and advisory firm, nearly 88 percent of companies that have adopted storage virtualization in some form achieved a positive or break-even return on investment. And in their Top 10 Strategic Technologies for 2009 report, Gartner found that “virtualization to eliminate duplicate copies of data…can significantly decrease the cost of storage devices and media to hold information.”

Storage virtualization also makes a huge impact on energy consumption through improved storage utilization. Greater utilization translates into fewer disk purchases and lower operational costs. These savings are not just from using less electricity, but also from lower cooling costs, space savings and optimizing energy investments such as cooling racks.

For China Construction Bank in Beijing, the use of Symantec’s Veritas Storage Foundation enabled storage virtualization across its EMC and Hitachi disk arrays. That move improved the bank’s storage utilization by 50 percent. When the bank rolled out four new product offerings, the IT team was able to avoid the purchase of 10 terabytes in additional storage.

Data deduplication
Across the globe, enterprise IT groups have begun a transition to disk-based data protection. But as companies adopt this technology and discover its benefits, they soon realize that they can’t keep all of their backup data on disk. Despite declines in the cost of disk storage, they still lack the available capacity to recover most data from disk locally in the data center. Data deduplication is a disk-based technology that enables companies to eliminate duplicate backup data and significantly decrease storage, and in some cases bandwidth consumption.

Deduplication has already helped numerous financial institutions achieve significant administration and labor savings, including a large California-based bank with a network of more than 350 retail branch offices.

To deal with the problem of inconsistent remote office backups and size reduction of backup data at the source, the bank decided to look into deduplication technology. The goal was to administer backups centrally, and take the job out of the branch offices. There was also the added benefit of replication for offsite storage to meet disaster recovery requirements.

With the help of Symantec’s software and services, the bank was able to push deduplicated data from remote branches to its primary data center in northern California. It was then able to replicate that data to its disaster recovery location in southern California.

By eliminating tape infrastructure at the branch level, the bank saved considerable time and money by eliminating the need for hundreds of people spending up to 30 minutes of their day changing out tapes. This was in addition to the cost avoidance of tape, which is significant.

A fresh approach to backup and recovery
Data center managers continue to report room for improvement in the area of backup and disaster recovery. According to the Symantec 2008 State of the Data Center Report, just 35 percent of respondents reported their disaster recovery plan is above average, while 27 percent said it needs work, and 9 percent reported their plan is informal or undocumented. Of course, managing backup and recovery operations can be a daunting task. But invariably businesses face a simple choice - continue to manage backup and recovery operations in-house, or seek the assistance of an outsourcer.

Under certain circumstances, having an in-house backup and recovery team is an appealing option. For example, it’s thought to be less expensive than outsourcing, and it may allay fears about security, confidentiality and loss of operational control. But partnering with a reliable outsourcer brings numerous benefits that should diminish such concerns.

Recently, an international banking group made the strategic decision to transfer the ongoing management of its backup environment to Symantec Managed Backup Services. The goal was to meet demanding service levels. By using Symantec for day-to-day operational backup management and end-to-end data protection, the bank is now significantly increasing its backup rates. In addition, it is reducing the costs and IT risks associated with unmet recovery objectives, data loss and business disruption. Symantec also helps the bank adhere to stringent SLAs.

Conclusion
According to the Symantec 2008 State of the Data Center Report, reducing costs in the data center is by far the most frequently mentioned goal for 2009. In fact, reducing costs was mentioned by more managers than the next two objectives combined.

By any measure, financial institutions that are serious about reducing costs and improving efficiencies with inevitably fewer resources should begin looking into the five initiatives outlined in this article.

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