Flash Research Paper #1
Thomas Redman
Data Centers and Networking
The company is currently losing about $25.7 million due to data center downtime cost. By upgrading from Tier I data center to a Tier III, we would have an annual saving of about $24 million due to the reduction in our downtime. Implementing a Tier III data center will decrease the number of outages through the use of multiple independent distribution paths. The upgrade would greatly benefit the company by not only offering a significant cost reduction, but allowing for scalable growth.
The key benefits of the Tier III data center is the concurrently maintainable infrastructure and multiple independent distribution paths, which increases system uptime availability from 99.67% to 99.98% availability. Unlike our Tier I data center’s one distribution path, the Tier III has independent distribution paths means that if one path is shut down for maintenance or disturbed, our ERP system will remain active. Because of the redundant power supply and multiple distribution paths, the Tier III data center can provide a business with 72 hours of power backup if the power fails.
Upgrading our system to a Tier III data center will cost roughly $35 million and take one year to build. We will be able to capture an annual savings of about $24 million. The three year project horizon shows the company will gain a net savings benefit of about $13 million and a ROI of 38%. The 0.31% increase in availability is significant because it costs $14,800 each minute that the data center is down. By maintaining a better uptime, we will see a reduction in downtime costs resulting in more annual revenue. With our company rapidly growing, now is the best time to upgrade our data center to Tier III because our downtime is only going to cost more each year.
Work Cited
Giaquinta, John. “Data Center Tier Levels.” DataCenterAndColocation. N.p., 22 Oct. 2012. Web. 3 Feb. 2015. <http://www.datacenterandcolocation.com/data-centers/data-center-tier-levels/>.
Neudorfer, Julius. “Understanding “Uptime” and Data Center Tier Levels.” Data Center
Knowledge. N.p., 21 Mar 2012. Web. 3 Feb 2015.
<http://www.datacenterknowledge.com/archives/2012/03/21/understandinguptime-and-data-center-tier-levels/>.
“Tier Standards Overview.” Colocation America. N.p.. Web. 3 Feb 2015.
<http://www.colocationamerica.com/data-center/tier-standards-overview>.