Andrew Doumith
MIS2501 – Enterprise IT Architecture
Flash Research Paper #1
Professor Doyle
4 February 2014
Flash Research Assignment: Data Centers and Networking
You are the CTA of a small but rapidly growing manufacturing company. Over the past year
your organization has experienced 10 unscheduled outages to its ERP system. The vast
majority of these outages have been caused as a result of inadequate facilities in your existing,
primitive data center. When this system is down your organization cannot process orders,
cannot make product, and cannot ship product! Outages cause serious operational problems
and impact both the top and bottom line of the income statement.
Prepare a paper for the CIO in which you propose building a “Tier III” data center. Describe
the key capabilities of a tier III data center and describe the business case for making this
investment. Crude estimates indicate that building this data center will take 1 year and cost
approximately $35,000,000. Assume that you are currently running a “Tier I” data center
with 99.67% availability. You are proposing building a “Tier III” data center with 99.98%
availability. Assume that downtime costs your organization $14,800 per minute. Assume
that the organization looks at all investments in technology over a period of three years.
The maximum length of the body of this paper is 1 page. Additional pages may be used for
optional diagrams and required references.
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A Tier III datacenter will provide our company with 99.98% availability, resulting in
less downtime costs. Our Tier I datacenter, which hosts our vital ERP system, has failed
unexpectedly 10 times over the past year. Upgrading our current Tier I datacenter to Tier III
will significantly reduce this major downtime issue, generating a net savings of $37,343,584
over a three-year period.
Our ERP system plays critical roles in our business’ day-to-day functions. When our
ERP system is down our organization cannot process orders, cannot make product, and
cannot even ship products – this negatively impacts our business from every angle. We need
to find a means by which we can reduce this reoccurring downtime if we want our company
to continue growing at its rapid pace, and here is the solution. According to Cuppuccio, Tier I
datacenters have 99.67% availability, causing 28.9 hours of downtime a year. As opposed to
Tier I, upgrading to a Tier III datacenter will provide our company with 99.98% availability.
This new Tier III datacenter will only allow our ERP system to be down for no more than 1.7
hours a year. 93% of companies that lost the use of their datacenter for 10 days or more filed
for bankruptcy within one year of the disaster (Cost Justification White Paper). Thus, this
upgrade is vital for our company’s overall protection. According the Uptime Institute, every
component in a Tier III datacenter is redundant, meaning it can be swapped out if it
malfunctions or for maintenance without effecting the capacity or availability of the
datacenter.
Upgrading our current Tier I datacenter to Tier III will significantly reduce our
downtime issue, generating a net savings of $37,343,584 over a three-year period. Downtime
costs our company $14,800 a minute. Our current Tier I datacenter costs our company
$25,670,304 every year. It is within the company’s best interest to upgrade to a Tier III
datacenter as soon as possible.
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Year
Tier I Datacenter
Downtime Cost
Tier III Datacenter
Downtime Cost
Savings
1
25,670,304
1,555,776
24,114,528
2
25,670,304
1,555,776
24,114,528
3
25,670,304
1,555,776
24,114,528
3-Year Savings
72,343,584
Cost of Datacenter
(35,000,000)
Net Savings
37,343,584
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References
Cuppuccio, David J. “Data Center Availability: Tier Design Costs and Benefits Can
Vary Greatly.” Gartner. Web. 12 Nov. 2008.
"Data Center Site Infrastructure Tier Standard: Topology." Uptime Institute, LLC.
Uptime Institute Professional Services, LLC, 2010. Web. 3 Feburary 2014.
“Cost Justification White Paper.“ 21st Century Software, Inc. 2003. 3 Feburary 2014.
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