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April 2009

MANAGEMENT BRIEF

VALUE PROPOSITION FOR

IBM POWER SYSTEMS Platform Choices for the Enterprise SAP Infrastructure

International Technology Group

4546 El Camino Real, Suite 230Los Altos, California 94022-1069

Telephone: (650) 949-8410Facsimile: (650) 949-8415Email: [email protected]

TG



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International Technology Group i

TABLE OF CONTENTS

EXECUTIVE SUMMARY 1 Challenges and Opportunities 1 Scale-up and Scale-Out 1 Installation Example 3 Infrastructures and Innovation 5

SOLUTIONS 6

Business View 6 Technology View 6

SAP Portfolio 6

Infrastructure Implications 7 Role of Virtualization 8

Power Virtualization 9 Overview 9 Partitioning 9

System and Workload Management 11 Virtual I/O Server 12

Conclusions 13

POWER PLATFORM 15System Design 15 Scalability and Performance 15 System and Workload Management 15

IBM Solutions 15 Power Server Functions 16 IBM Tivoli Solutions 16 x86 Platforms 18

Availability Optimization 18 Power Platform 18 x86 Platforms 20

Energy Efficiency 20 Power Platform 20

x86 Platforms 21 DETAILED DATA 22

Basis of Calculations 22 Profiles and Scenarios 22 Server Costs 23 Personnel Costs 24

Costs Breakdown 24

List of Figures

1. Three-year Costs for SAP Deployments using Oracle RAC: x86 and Power Servers 2 2. x86 and Power Server Scenarios for Manufacturing Company Installation 4 3. SAP Retail Solution Portfolio: Major Processes and Functions 7 4. Power Server SAP Configuration Using LPARs: Example 10 5. Power Server Managed Virtual Resources 12 6. Examples of Power Server Dedicated Adapter and Virtual I/O Server Configurations 13 7. Processor Utilization by SAP Instances: Banking Example 14 8. Systems Director 6.1 Modules for Power Servers 16 9. IBM Tivoli Solution Categories 17 10. Hewlett-Packard Business Technology Optimization Solution Categories 18 11. Active Energy Manager and EnergyScale Functions for Power Servers 21 12. Profile Installations and Scenarios Summary 22 13. Three-year Costs Breakdown for Profile Installations and Scenarios 24



International Technology Group 1

EXECUTIVE SUMMARY

Challenges and Opportunities

What challenges face SAP users today? Although answers to this question may vary across industries and

geographies, certain common themes emerge.

For many organizations, the immediate focus is on cost cutting. But other challenges remain. Trends

toward greater volatility of markets, erosion of traditional forms of competitive differentiation, industry

concentration, and the effects of globalization have not diminished. In many cases, their impact will be

sharpened by economic downturn.

The central issue becomes how to maintain competitive momentum while reducing costs. SAP solutions

can play a major role in achieving the former. New approaches to the underlying system infrastructures

that support these solutions can contribute materially to the latter.

As SAP enterprise environments grow functionally broader, more integrated and more complex,

conventional deployment approaches are no longer appropriate. The opportunity emerges to exploit key

trends in underlying platform technologies – in particular, advances in virtualization – to create system

infrastructures that are significantly more reliable, efficient and cost-effective than in the past.

The largest advances in virtualization have occurred in the UNIX server world. Although industry debates

often center on the role of VMware and equivalents in consolidating x86 servers, UNIX server

virtualization technologies are more sophisticated and mature. Among the UNIX server vendors, the

recognized leader is IBM’s Power platform.

Server infrastructures that exploit latest-generation virtualization technologies offer the potential to

reduce IT costs while accelerating application deployment and upgrades, increasing availability and

enhancing data protection for all of their SAP systems.

Achieving these goals will require shifts in infrastructure strategy and technological focus. It will also

require that organizations avoid certain distractions.

Scale-up and Scale-Out

Consolidation has become a pervasive trend among SAP users, as well as across most segments of the IT

world as a whole. Organization-wide integration and standardization of SAP systems, and of the business

processes they support, has been paralleled by concentration of servers, storage and data centers. Large-

scale use of advanced server virtualization represents the latest phase of this trend.

From this perspective, current debates about the relative merits of “scale-up” and “scale-out” approaches

are surprising. Scale-out approaches – meaning use of multiple small servers as an alternative to larger,

more scalable platforms for deployment of major SAP systems – would reverse trends that have been

under way among SAP users for more than a decade.

The principal argument in favor of scale-out approaches is that, by enabling organizations to cluster

inexpensive “commodity” servers, they represent a lower-cost alternative to the use of UNIX servers for

major system deployments. But this assumption should be questioned.

Comparisons presented in this report show that, for SAP deployments employing Oracle Real Application

Clusters (RAC), three-year server costs for use of IBM Power AIX platforms average 32 percent less than

scale-out approaches built around commodity x86 servers.




These comparisons are for three profile installations of SAP deployments in retail, discrete manufacturing

and energy companies with from $800 million to $1.5 billion in sales and from 1,500 to 6,500 employees.

Installations are composites constructed using data supplied by 18 companies in these industries.

In these installations, three-year costs for use of Power servers ranged from 25 percent to 33 percent less

than scale-out approaches built around commodity x86 servers. Figure 1 summarizes these results.

Figure 1

Three-year Costs for SAP Deployments using Oracle RAC: x86 and Power Servers

Costs include acquisition and maintenance of server hardware, licenses and support for systems software

including operating systems and virtualization tools, as well as database and system administration

personnel and facilities – primarily energy – costs.

Server configurations, database and system administration staffing levels, costs for individual installationsand the methodology employed for these calculations may be found in the Detailed Data section of this

report.

Comparisons were based on use of two sets of platforms: Dell PowerEdge R900 and 2900 III servers

equipped with four- and six-core Intel Xeon processors and IBM Power 550 and 520 servers equipped

with dual-core POWER6 processors were employed as database servers; and Dell Xeon-based M600 and

IBM POWER6-based BladeCenter servers were employed for application serving and other functions.

Windows Server Enterprise Edition and AIX operating systems were employed on Dell and Power

servers respectively. Costs of Oracle databases and RAC cluster software were not included in

calculations, as these would be comparable for both sets of platforms if licensed from SAP.

(SAP licenses Oracle on an OEM basis for 11 percent of SAP Application Value, or 14 percent if RAC is

included. SAP Application Value is calculated based on numbers of users and workload metrics that are

independent of underlying platforms. Support costs are also the same.)

Although acquisition costs were lower for Dell servers, this was countered by the effect of Power server

virtualization and workload management capabilities. These enabled single Power servers to support

larger numbers of SAP instances and handle significantly larger workloads than Dell equivalents.




The most widely used x86 virtualization enabler, VMware, was employed in x86 server scenarios for

application serving and other production functions that do not employ Oracle databases, and for

development, test and other non-production instances. VMware is not supported by Oracle for SAP

production environments.

Other factors contributing to lower Power server costs included greater system scalability and higher

system administrator productivity compared to Windows Server environments.

Costs for RAC cluster deployments using larger Power server models such as the 570 and 595 could not

realistically be compared. Even latest-generation Dell servers are not sufficiently powerful to act as

alternatives to these Power models.

The potential role of scale-out approaches would be significantly greater if RAC enabled the creation of

large multi-node clusters. However, the typical size of RAC installations remains in the two- to three-

node range. The value of RAC is predominantly in providing failover capability for business-critical

systems. This has been the case for SAP deployments and for other commercial applications.

The value of RAC in reducing downtime may be substantial. But the architecture does not favor any

specific platform, and that value may as be realized on UNIX as well as x86 servers. Outside the SAP

world, RAC clusters have been routinely deployed on Power and other UNIX server platforms to support

business-critical systems.

For most large and midsize SAP users, a focus on x86-based RAC clusters as a means of reducing IT

costs would thus be based on a serious misconception. It could also divert attention from more important

issues. As the results of these cost comparisons indicate, the greatest opportunities to improve the quality,

efficiency and cost-effectiveness of SAP system infrastructures lie in a different direction.

Installation Example

The implications of these factors may be illustrated by Power and x86 server scenarios for one of the

three profile installations, a manufacturing company, that form the basis of the calculations presented in

this report.

In this case, which is illustrated in figure 2, the company needed to support two SAP ERP systems

serving different business units, along with SAP Business Intelligence (BI), Customer Relationship

Management (CRM), Supply Chain Management (SCM), Product Lifecycle Management (PLM) and

other applications. Business-critical production instances were clustered for availability and recovery.

A key characteristic of both Power and x86 server scenarios for this installation should be noted –

numbers and sizes of servers were determined less by “raw” server performance, than by the extent to

which SAP instances could be consolidated on individual platforms.

A combination of variables – including higher Power system-level performance, more granular workload

management capabilities, as well as the ability to employ logical partitions (LPARs) to host multiple

production instances and to provide load-balancing for these – meant that it was possible to employ only a

single RAC cluster to support the company’s business-critical systems.

In the x86 scenarios, it was necessary to employ two RAC clusters to handle the same Oracle database

workloads, resulting in higher database administration overhead. As VMware is not supported for SAP

production systems, partitioning could not be employed for business-critical systems.




Figure 2

x86 and Power Server Scenarios for Manufacturing Company Installation

Although VMware was employed for other SAP instances in the x86 scenario, greater system-level

performance and more granular workload management capabilities again resulted in higher levels of

consolidation for these in Power scenarios. These effects, along with higher system administrator

productivity, contributed to significantly lower full time equivalent (FTE) staffing for the Power scenario.

POWER SERVER SCENARIO

Power 550*5 LPARs

Power 550*6 LPARs

Power 550*Failover

RAC Cluster

Power 520*9 LPARs

Power 520*7 LPARs

BladeCenter H3 x JS22* (4 x 4.0 GHz)9 x JS12* (2 x 3.8 GHz)

26 LPARs

*PowerVM server

1.05 FTEs

X86 SERVER SCENARIO

R900 R900 R900

RAC Cluster #1

*VMware servers

R900 R900 R900

RAC Cluster #2

2.45 FTEs

R900* 2900 III 2900 III 2900 III*

M1000e16 x M600*




Infrastructures and Innovation

Business leaders worldwide argue that, in a harsh economic climate, innovation becomes more, not less

important. This argument applies at multiple levels. Business strategies must move in new directions.

New application capabilities must be exploited not only to reduce costs and improve productivity, but

also to enable faster, more flexible response to changing conditions.

For SAP users, there is also a third level of potential innovation – it involves the underlying system

infrastructures that support the SAP enterprise environment. Advances in server and storage virtualization

mean that it is time to rethink the principles that govern the design, implementation and management of

these.

This process has already begun. Since the mid-2000s, there has been a marked acceleration in the use

UNIX server virtualization for SAP systems. This has particularly been the case among Power server

users. There are three main reasons why this has occurred:

1. Power virtualization technologies have evolved . Power platforms now support more granular

partitioning. Closer integration of partitioning and workload management has also addressed user

concerns that multiple-instance workloads might interfere with each other. New load-balancing

techniques have enabled organizations to increase performance without adding capacity.

2. Users have gained experience. As users have gained experience with Power server virtualization,

they have come to better understand both the potential of PowerVM capabilities and the ways in

which these can be exploited. Technologies such as LPARs are now routinely employed even for

large, business-critical SAP production systems.

3. SAP complexity is increasing . A more basic and, from the perspective of SAP infrastructure

strategies, more significant reason why use of Power server virtualization has accelerated is that it

has proved valuable to users seeking to deal with the growing complexity of the SAP environment.

The ability to concentrate more instances onto fewer servers, and to accommodate growing workloads

without corresponding increases in server capacity, offers the potential to achieve new levels of cost-effectiveness. Virtualization, not scale-out, is the key technology trend in SAP system infrastructures.

The user examples presented in this report indicate that Power virtualization technologies may enable

significantly higher levels of infrastructure consolidation than have been achieved in the past.

Opportunities emerge not only to reduce IT costs, but also to increase infrastructure flexibility and

accelerate software migrations without impairing performance and availability, or increasing risk.

If economies may be realized in underlying system infrastructures, resources may be better focused on the

delivery of new application functionality and process changes that deliver direct business value. Funds,

skills and management attention may be channeled into the realization of business advantage, rather than

into the minutiae of implementing, maintaining and supporting underlying infrastructures.

The next few years will be critical for many SAP users. It will not be sufficient simply to mark time. If

the right decisions are made now, it will be possible to achieve efficiencies that will assist not only in

meeting short-term economic challenges, but will also prepare a solid foundation for future growth and

competitive leadership.




SOLUTIONS

Business View

When many of today’s users first deployed SAP solutions, their principal focus was on transactional

processes in logistics, distribution, procurement and other operational functions, and in finance and

human resources. Reductions in cycle times and costs were targeted.

The picture has changed a great deal since that time. A series of trends – increasing volatility of markets,

competitive shifts, industry consolidation and (contributing to and magnifying all of these) globalization –

have created business environments that are both more complex and less predictable.

Growing complexity along with new regulatory demands have meant that the volume of information that

must be collected, structured, interpreted and communicated by organizations has expanded dramatically.

Business processes that extend from the boardroom to front-line workers have been affected.

Unpredictability has meant that organizations must be able to react rapidly and effectively to changing

conditions. Flexibility must be embedded into entire application portfolios, the business processes they

address, and the system and network infrastructures that support them.

Demands for organizational agility, competitive pressures and mandates to increase productivity and

reduce costs have also led to a pervasive acceleration of business processes. Just-in-time practices and

lean inventory models have become the norm in many industries, and rapid response to customers and

trading partners has become an increasingly significant determinant of competitive performance in most.

Intersecting with these trends has been the drive for process integration across established organizational

boundaries. “End-to-end” process integration has become a central component of a growing number of

business strategies.

The original goal of SAP ERP deployments – the realization of operational efficiencies – has not

diminished in importance. Instead, recent economic developments have returned it to a central position on

corporate agendas.

The world of SAP R/3 was simple in comparison.

Business challenges have evolved, and the SAP solution portfolio has evolved to meet them. But can the

same be said of the IT strategies of SAP users? In many organizations, approaches to system

infrastructures are still governed by essentially the same principles that were applied to R/3 deployments.

But that is about to change.

Technology View

SAP Portfolio Not long ago, SAP solution portfolios could be described in terms of the transactional modules they

contained. Lists that contained such items as Financial Accounting (FI), Controlling (CO), Materials

Management (MM) and Sales and Distribution (SD) were the basis of planning.

Latest-generation SAP environments cannot be characterized in such terms. The SAP portfolio has

evolved into a functionally broader, more flexibly structured continuum of solutions. Industry-specific

functions have become more granular, while the scope of SAP offerings extends beyond transactions to

address processes that deal with information, communication and collaboration.




Organizations now commonly implement solutions from SAP and (increasingly) partners that address

heterogeneous transactional processes as well as planning, analysis and decision-making; interaction with

employees, customers and partners through conventional media and the Internet and intranets; document

and data management; and a wide range of other business activities.

SAP retail solutions, for example, now address more than 350 distinct processes and functions that range

from executive decision-making to store checkout. Figure 3 summarizes major categories.

Figure 3

SAP Retail Solution Portfolio: Major Processes and Functions

PLANNING SUPPLY CHAIN Demand Forecast

Merchandise Planning/Optimization

Assortment Planning/Optimization

Space Planning/Optimization

Item Management

Price Management

Promotion Management

Markdown Management

Replenishment

Inventory Optimization

Order Fulfillment

Inventory Management

Warehouse Management

Transportation Management

Supply Chain Visibility

Supply Chain Tracking BUYING

Vendor Relationship Management Purchase Order Management

Global Import/Export Management STORE & MULTI-CHANNEL

Point of Sale Store Operations Catalog Management

e-Commerce Call Center Customer Service Customer Loyalty ENTERPRISE MANAGEMENT & SUPPORT

Master Data Management

Global Data Synchronization Initial Load Consolidation

Operations Analytics Workforce Analytics

Analytics

Strategic Enterprise Management Financial Analytics

Content Management Distribution

Financials

Financial Supply Chain Management Financial Accounting

Management Accounting Corporate Governance

Human Capital Management

Talent Management Workforce Process Management Workforce Deployment

Corporate Services

Travel Management Incentive & Commission Management

Operations Support

Life-Cycle Data Management Project & Portfolio Management

Quality Management Enterprise Asset Management Indirect ProcurementGlobal Trade Services Global Trade Management

Similar transitions have occurred in SAP solution sets for other industries. In most of these, the number of

functions and processes runs to hundreds.

Infrastructure Implications

From a business perspective, the expansion of the SAP portfolio has been an entirely positive

development. From an IT infrastructure perspective, it represents a plethora of new challenges.




Organizations may be faced with the need to host, manage and support dozens to hundreds of separate

application and database instances, including production as well as development, quality assurance and

other non-production systems. The entire SAP landscape becomes more complex.

Workloads with widely varying characteristics must be supported. Growing interdependency within the

SAP solution portfolio also has important implications. From a system infrastructure perspective, end-to-

end process integration translates into the need to support continuous interaction of software components

that execute diverse system processes and require high levels of concurrency.

Unless corrective action is taken, a number of trends will tend to drive up IT costs. The diversity of SAP

components will accelerate server proliferation, which will create new interoperability challenges, inflate

system administration overhead and increase management complexity.

Equally, IT organizations will tend to over-configure capacity in order to avoid disruptions that may be

caused by workload surges. This will particularly be the case where servers host multiple database or

application instances.

It might be possible to host, say, 20 different instances on a single virtualized server. But if effective

workload management capabilities are not in place, IT managers may worry – rightly – that a spike in one

workload will disrupt others. Which might impact response time for, or may crash, all applications

running on the server.

Organizations that adopt scale-out strategies risk experiencing both problems; i.e., SAP infrastructures

may be built around large numbers of servers with low levels of capacity utilization. The implications in

terms of infrastructure complexity and system administration costs would be substantial, and negative. It

would also be more difficult to maintain availability and other variables of service quality.

Role of Virtualization

There is an obvious synergy between the evolution of the SAP solution portfolio toward greater diversity

and complexity and the potential of server virtualization.

Virtualization per se, however, is not the answer to the challenges posed by today’s SAP enterpriseenvironment. Specific capabilities are required. Virtualization solutions must deliver high levels of

partition granularity, and they must be coupled with effective mechanisms for the management of diverse

concurrent workloads.

The importance of workload management should be highlighted. Partitioning creates the potential for

high levels of capacity utilization. The extent to which this potential will be realized in practice, however,

depends heavily on the mechanisms that allocate system resources between, and monitor and control

workload execution processes across partitions.

If these mechanisms are ineffective, a high proportion of system capacity may be idle at any given time.

Close integration of partitioning and workload management capabilities is also necessary to minimize

risks that surges in workloads running in individual partitions will impact performance and availability.

These are the requirements. The next question is: how well does the Power server platform meet them?




Power Virtualization

Overview

The Power server platform is the market share leader in UNIX servers. It is a recognized industry leader

in a number of areas, including virtualization as well as system and workload management, performance,

availability optimization, energy efficiency and security.

The discussion here focuses on Power server virtualization and on those aspects of system and workload

management that deal with virtualized resources. Other capabilities of this platform are discussed in the

following section.

Power servers implement what may be characterized as an integrated virtualization architecture. This

includes hardware and firmware components, as well as functions built into the AIX operating system and

PowerVM software.

The partitioning and system and workload management features of Power virtualization are more tightly

integrated than is the case for any other server platform.

Power virtualization architecture is derived from a number of design sources, including mainframe

systems. LPARs, for example, were derived from mainframe partitioning technology, and mainframesystem and workload management capabilities also contributed to their Power server counterparts. In this

and other respects, Power servers can be reasonably described as “mainframe-class.”

A number of Power virtualization features also implement IBM autonomic technologies. Autonomic

computing – meaning the application of artificial intelligence technologies to IT administration and

optimization tasks – has been a major area of IBM design focus since the 1990s. The company is the

recognized industry leader in this area.

Power virtualization capabilities have been widely employed by SAP users since 2001, when LPAR

support was first introduced by IBM for POWER-based systems. Since that time, both the breadth of

virtualization technologies and their application by SAP users have expanded significantly.

The capabilities described below are for Power servers running the latest version of the AIX operating

system, AIX 6.1. PowerVM also supports Red Hat and SuSE Linux, and the IBM i operating system.

Partitioning

Power server users may employ two complementary forms of partitioning:

1. Logical partitions (LPARs) are implemented using the PowerVM firmware-based hypervisor.

This approach – often referred to as “hard” partitioning – enables organizations to better isolate

operating system instances for security purposes, and reduces risks that workloads running on the

same physical server may interfere with each other.

LPARs may be configured in increments as small as 1/100th of a processor. Up to 254 may run ona single Power server.

System resources, including processors and memory, may be dedicated to partitions (Static

LPARs), or shared between these according to predefined application priorities (Dynamic

LPARs). Resources may be allocated and reallocated between partitions in response to changing

workload demands. The system evaluates utilization every 10 milliseconds, and may change

resource allocations as rapidly.




LPARs are widely employed to support even large-scale business-critical SAP production

systems, as well as lighter-duty applications and non-production instances. All of the Power

server users that provided input for this report employed LPARs for SAP systems. Many ran 10

or more LPARs on the same platform. One ran 32.

One organization, for example, had consolidated two separate database server instances for

production ERP systems as well as for other SAP applications, on a single 16-processor Power

570 server. Figure 4 illustrates this deployment.

Figure 4

Power Server SAP Configuration Using LPARs: Example

The numbers of processors shown refer to average utilization. In practice, use of system resources

by individual partitions varied over time; e.g., peak utilization for one of the ERP instances

exceeded 8 CPUs, while the NetWeaver Portal instance occasionally required up to 1.5 CPUs.

The ability to reallocate resources dynamically, however, meant that these peaks could be

reasonably accommodated. As a further precaution, two processors were treated as a backup

resource, to be activated if the others were unable to handle unexpected peaks.

A common variant of this approach involved IBM Capacity Upgrade on Demand (CUoD)

agreements. Under these, organizations were able to activate additional processors on an “as

needed” basis. Activation was automatic, and could be initiated directly by the system.Organizations paid for additional capacity only while it was in use.

The Virtual I/O Server (VIOS), which enables LPARs to share I/O adapters, is described later in

this section. Two LPARs are employed to host VIOS instances in order to provide redundancy in

the event of a hardware or software failure.

Several users had implemented Live Partition Mobility, which allows users to move LPARs

between Power servers with no application downtime. This capability was employed to maintain

operation of business-critical systems when it was necessary to shut a server down for

maintenance, upgrades or other reasons.

SRM: Supplier Relationship Management

NP: NetWeaver Portal

XI: Exchange Infrastructure

VIOS: Virtual I/O Server

LPARs

VIOS – 0.5 CPU

ERP #1 – 5.3 CPUs

SCM – 2.2 CPUs

ERP #2 – 3.7 CPUs

CRM – 0.7 CPU

NP – 0.5 CPU

XI – 0.4 CPU

SRM – 0.2 CPU

BACKUP – 2 CPUs

VIOS – 0.5 CPU

ERP: Enterprise Resource Planning

SCM: Supply Chain management

CRM: Customer Relationship Management




2. Workload partitions (WPARs). These allow users to create multiple software-based partitions

within a single AIX instance. WPARs provide additional flexibility and capacity utilization

improvements, and simplify patching and other operating system maintenance tasks. There is no

architectural limit to the size or number of WPARs that may run on a single Power server.

Two types of WPAR are supported: (1) System WPARs incorporate application-specific system

administration, filesystem and security services; and (2) Application WPARs offer a simpler

approach that encapsulates application logic to improve manageability. Application WPARs aretypically employed for applications that do not need to be separately administered.

WPAR capability is comparatively new – it was introduced in 2006 – and is typically employed

for development, test, quality assurance and other non-production instances, and for light-duty

production applications.

An extension of WPAR capability, Live Application Mobility , enables users to move WPARs

between Power servers. A brief service interruption may occur – the norm appears to be

approximately 20 seconds. However, as Live Application Mobility is rarely employed for

availability-sensitive systems, such delays are normally regarded as acceptable.

WPAR capability is not currently supported by SAP for use with Oracle databases or RAC,

although support for Oracle 10g is planned. In Power server scenarios presented in this report,

WPARs are employed for production as well as non-production application serving.

In comparison, VMware and other x86 server virtualization solutions employ a single software-based

partitioning method.

System and Workload Management

System and workload management capabilities for Power servers are provided by IBM Systems Director

6.1, the company’s principal server management solution. The Power version of this solution supports the

full range of PowerVM capabilities, and allows administrators to manage all physical and virtual

resources through a common interface using a single set of high-productivity tools.

Systems Director 6.1 interfaces to a number of operating system-level management facilities, including

WPAR Manager , which allows administrators to manage WPARs across multiple physical servers.

Granular control is provided for such functions as Shared Processor Pools and Active Memory Sharing,

which enable sharing of processor and memory resources respectively.

Support is also provided for Virtual I/O Servers, Integrated Virtual Ethernet and virtual LANs and disks.

The overall set of managed virtual resources is illustrated in figure 5.

Systems Director 6.1 also interfaces directly with embedded Flexible Service Processors (FSPs), which

provide local resource monitoring, data collection and alerts, and with Active Energy Manager with

EnergyScale controllers, which provide advanced energy management capabilities.

Systems Director 6.1 also acts as an overlay to the earlier IBM Hardware Management Console (HMC)

and its entry-level variant, the Integrated Virtualization Manager (IVM), which are still widely used to

manage Power server virtual resources. Multiple HMCs and IVMs can be managed transparently through

the Systems Director 6.1 administrator interface.




Figure 5

Power Server Managed Virtual Resources

Virtual I/O Server

A further set of Power server virtualization capabilities is provided by the Virtual I/O Server, an LPAR-

based appliance that allows for the creation of virtual Ethernet and SCSI adapters.

The principal benefit of the Virtual I/O Server is that it allows operating system instances running in

multiple partitions to share a common pool of LAN adapters as well as Fiber Channel, SCSI and RAID

devices. It is not necessary to dedicate adapters to individual partitions.

As figure 6 illustrates, the number of physical adapters required may be significantly reduced.

Virtual I/O Servers interface to a virtual LAN or multiple virtual LANs that provide high-speed

interconnection between LPARs. Virtual LAN capability further reduces network complexity and

vulnerability. Virtual LANs may also significantly reduce throughput times for interaction between

LPAR-based systems, as well as for replication and other data movement processes.

AIX 6.1

SYSTEM & WORKLOAD MANAGEMENT

IBM Systems Director

Workload Partition Manager

Shared Processor Pools

Active Memory Sharing

HYPERVISOR

Integrated Virtual Ethernet

Physical Adapters

VIRTUAL I/O SERVER

Virtual Ethernet Adapters Virtual SCSI Adapters

LPARLPAR

WPARs

LPAR

WPARs

Virtual LAN

LPAR

LPARs

Virtual disks




Figure 6

Examples of Power Server Dedicated Adapter and Virtual I/O Server Configurations

A more basic form of I/O virtualization is provided by Integrated Virtual Ethernet . This is a standard

feature on most Power server models. It employs a dedicated adapter and hypervisor- and software-based

functions to enable sharing of Ethernet adapter capabilities by LPARs without a Virtual I/O Server.

Conclusions

As this description of Power server capabilities suggests, virtualization is not a simple manner.

The comparative ease with which early adopters were able to deploy VMware has left a misleading

impression on many users. The early consolidation gains reported for use of VMware and other x86

virtualization tools were often achieved for light-duty applications running on old, underpowered servers

or PCs.

Organizations have found that effective large-scale use of x86 server virtualization requires investments

in management tools and skills that increase cost and difficulty far beyond their initial expectations.

VMware, like Oracle RAC, does not make scale-out approaches built around commodity servers a simple

or inexpensive alternative to the use of UNIX servers.

Core SAP systems are among the most demanding applications in today’s IT world, and the trends toward

greater complexity and interdependence described earlier will make them even more so in the future.

Commodity servers are not a viable alternative for the production or even, in many cases, the

development, test and quality assurance systems of large SAP users.

In SAP enterprise environments, use of virtualization to increase cost-effectiveness will depend upon the

ability to achieve high levels of partition granularity, and to integrate granular system and workload

management functions in a manner that enables high levels of capacity utilization to be realized without

unacceptable levels of risk.

Adapters

DEDICATED ADAPTER CONFIGURATION

Partitions

1 2 3 654

Partitions

VIRTUAL I/O SERVER CONFIGURATION

1 2 3 654

Adapters

VIRTUAL I/O SERVER




The importance of both sets of capabilities may be illustrated by the example of a bank IT organization

supporting a number of different SAP applications for different operating units. Processor utilization

varied widely between different production and non-production instances of individual applications, as

shown in figure 7. Utilization of memory, I/O and other system resources showed similar fluctuations.

Figure 7

Processor Utilization by SAP Instances: Banking Example

SYSTEM PRODUCTIONQUALITY

ASSURANCEDEVELOPMENT

Finance & Controlling #1 0.8 – 4.0 0.3 – 0.8 0.2 – 0.5



Business Intelligence #1 0.8 – 8.0 0.2 – 0.5 0.1 – 0.5



IFRS Accounting #1 0.4 – 4.0 0.4 – 4.0 0.2 – 0.9

IFRS Accounting #2 0.2 – 2.0 0.1 – 2.0 0.1 – 2.0

IFRS Accounting #3 0.1 – 2.0 0.1 – 2.0 0.2 – 2.0

Collateral Management #1 0.1 – 2.0 0.1 – 2.0 0.1 – 2.0

Collateral Management #2 0.1 – 0.5 0.1 – 0.5 0.1 – 0.5

Bank Analyzer 0.4 – 0.8 0.1 – 0.5 0.1 – 0.5

Procurement 0.2 – 1.0 – 0.1 – 0.5*

*Combined quality assurance & development

IFRS: International Financial Reporting Standards

The overall workload, which included other applications with even lower levels of utilization, ran on four

older-technology IBM System p servers using 85 LPARs. With latest-generation POWER6-based Power

servers and virtualization capabilities, this workload could be handled by a single large physical server, or

two smaller machines clustered for redundancy purposes.

One might reasonably ask – how would this workload be supported using VMware? From this perspective, the comparative performance of Power and x86 servers is irrelevant. Even if a scale-out

approach could handle the workload, dozens of separate physical servers would be required, and it would

be necessary to employ more than a few RAC clusters to enable failover of production systems.

The implications in terms of complexity and management overhead would be substantial, and it is

unlikely that such an approach would deliver anywhere near the same availability level as a Power server-

based solution.

This is, moreover, a comparatively small-scale SAP installation. In a large corporate or government

installation, challenges would be orders of magnitudes greater.

It may be that, in the future, scale-out approaches will be a viable alternative for large SAP deployments.

But that is not the case today.




POWER PLATFORM

System Design

The basic Power system design may be characterized as a high-performance Reduced Instruction Set

Computing (RISC) server platform with highly developed features in virtualization, system and workload

management, energy efficiency, security and other areas. These are derived from a variety of sources,including IBM mainframe systems and autonomic technologies.

The strengths of the Power platform are a function not only of individual components and technologies,

but also of the manner in which these are integrated and optimized in a mutually reinforcing manner. The

overall impact is such that “the whole is more than the sum of the parts.”

Scalability and Performance

Power servers equipped with the IBM AIX operating system are recognized performance leaders.

Industry benchmark tests, as well as user experiences, show that Power servers outperform UNIX- and

Intel-based competitors by wide margins.

This is partly a function of POWER6 processor technology, which is the latest iteration of the IBM

POWER RISC design originally introduced in 1990. Current POWER6+ processors include dual-core

units with clock speeds of 3.5 gigahertz (GHz) to 5.0 GHz.

Processor performance, however, is only part of the picture. In Power server designs, system-level

performance potential has been optimized at all levels of design and implementation – including

microelectronics, module- and subsystem-level components, internal communications, I/O, and system-

level hardware and software.

Key capabilities include highly effective compiler- and operating system-level performance acceleration,

including chip symmetric multithreading; low levels of SMP overhead; and extensive system-level

integration and optimization of performance-related features.High levels of system-level performance are reflected in Power server leadership in a wide range of

industry benchmark results.

In terms of scalability, POWER6+ servers range from the JS12 blade server with a single dual-core 3.8

GHz processor to the high-end Power 595, which may be configured for up to 64 5.0 GHz cores. The AIX

6.1 and IBM i operating systems, along with Red Hat and SUSE Linux distributions may be employed on

all models. All are supported by SAP.

System and Workload Management

IBM Solutions

IBM’s principal management offerings for Power Servers are Systems Director 6.1, which was

announced in September 2008 and replaces the earlier IBM Director product, and IBM Tivoli solutions,

which provide higher-level enterprise management capabilities.

Systems Director 6.1 is designed by IBM to provide a common solution for management of physical and

virtual resources across the full range of IBM server platforms. A common management console and

browser-based administrator interface as well as common agent types are employed for all platforms.




In addition to AIX, Linux and i for Power servers, Systems Director 6.1 supports management of System

x and BladeCenter Windows and Linux servers and System z Linux guests, along with PowerVM,

VMware ESX, Microsoft Virtual Server, Xen and z/VM virtualization enablers.

Systems Director 6.1 may also be used to manage IBM distributed disk resources, including server RAID

controllers; the company’s DS3000, DS4000 and DS6000 lines of low-end and midrange disk systems;

the SAN Volume Controller (SVC) disk virtualization enabler; and IBM and third-party SAN devices.

Power Server Functions

For Power server environments, Systems Director 6.1 provides a set of core and advanced modules whose

functions are summarized in figure 8.

Figure 8

Systems Director 6.1 Modules for Power Servers

ADVANCED MODULES

Tivoli Provisioning Manager for OS Deployment (TPMfOSD)

Automated deployment of AIX & Linux images on Power servers

BladeCenter Open Fabric

Manager (BOFM)

Management of I/O & network interconnects for up to 100

BladeCenter chassis Service & Support Manager Identification & reporting of hardware-related problems; IBM

Electronic Service Agent interface

CORE MODULES

Discovery Manager Discovery/inventory of physical & virtual resources; visualization of network relationships

Status Manager Monitoring of hardware, power & update status; creation &installation of custom threshold notifications

Configuration Manager Automatic system parameter & hardware settings

Update Manager Distribution & installation of firmware, device driver, HMC &operating system updates

Automation Manager Event-based system automation & scheduling

Remote Access Manager Remote server management

Virtualization Manager Discovery, visualization & management of PowerVM resources,including LPARs & Virtual I/O Server; integrates with HMC & IVM

IBM has also announced plans to deliver two new advanced Systems Director modules for Power servers

in 2009: a virtual server image manager that will enable customization and automated distribution of

PowerVM virtual system images using a template-based approach; and an enhanced version of Active

Energy Manager will be integrated into System Director 6.1.

Systems Director 6.1 supports the full Power server line, including JS12 and JS22 blades and BladeCenter

chassis, and is compatible with the standard AIX Console and with Power server configuration design and

management tools, including IBM System Planning Tool, Cluster Systems Management and Performance

Management for Power Systems.

IBM Tivoli Solutions

More sophisticated service management capabilities for Power servers as well as for other IBM and non-

IBM platforms may be realized using IBM Tivoli solutions.

The Tivoli portfolio consists of more than 450 major products covering all of the major disciplines of

enterprise IT management. The principal categories of Tivoli solutions are summarized in figure 9.




Figure 9

IBM Tivoli Solution Categories

BUSINESS SERVICE MANAGEMENT

Business Service Manager Service Request Manager Service Level Advisor

OMNIbus Data Integration Tools

CHANGE & CONFIGURATION MANAGEMENT

Change & Configuration Management Database Application Dependency Discovery Manager

PROCESS AUTOMATION

Availability Process Manager Business Continuity Process Manager Capacity Process Manager

Change Process Manager Release Process Manager Storage Process Manager

MONITORING & EVENT MANAGEMENT

IBM Tivoli Monitoring (ITM) Composite Application Manager Performance Analyzer

WORKLOAD AUTOMATION PROVISIONING HIGH AVAILABILITY

Dynamic Workload Broker

Workload Scheduler

Provisioning Manager

Intelligent Orchestrator

System Automation for Multiplatforms

System Automation for z/OS

STORAGE MANAGEMENT NETWORK MANAGEMENT

Archive Manager

Storage Manager

TotalStorage Productivity Center

SAN Volume Controller

IP Networks Mainframe Networks

Network Manager NetView for z/OS

• IP Edition NetView Distribution Manager

• Transmission Edition NetView Performance Monitor

ASSET & FINANCIAL MANAGEMENT

Usage & Accounting Manager License Compliance Manager Asset Management for IT

License Metric Tool License Compliance Manager for z/OS Maximo Suite

SECURITY, RISK & COMPLIANCE

Access Manager Federated Identity Manager Key Lifecycle Manager

Identity Manager Directory Server Compliance Insight Manager

Identity Manager for z/OS Directory Integrator zSecure Suite

DATA CENTER TRANSFORMATION

Energy ManagementITM for Energy Management

Systems Director 6.1 interfaces to Tivoli solutions through IBM Tivoli Monitoring (ITM), which collects

a broad range of hardware metrics from Systems Director 6.1 and other sources. These may then be

integrated with operating system, middleware, application, network and other data to provide a unified

view of infrastructure resources.

Monitoring, along with event management, performance and capacity management, reporting and other

tasks, may then be undertaken in a coordinated manner across all resources. This yields significant

efficiency improvements, and materially reduces the time and difficulty required to identify, diagnose and

resolve problems.

Data collected from Systems Director 6.1 may also be consolidated and combined with other metrics in

the Tivoli Data Warehouse for analytical and planning purposes.

Tivoli solutions, as well as Systems Director 6.1, are important offerings in IBM’s Dynamic

Infrastructure strategy. This combines IBM software and services offerings in a manner designed to

achieve potentially transformational improvements in data center efficiency, and to more effectively align

management of enterprise IT infrastructures with the achievement of business objectives.




x86 Platforms

System management solutions with features that are generally similar to those of Systems Director 6.1 are

offered by vendors such as Dell (OpenManage) and HP (Systems Insight Manager) for their x86 server

platforms. Systems Director 6.1, however, is differentiated in a number of areas.

Monitoring and health checking functions, for example, are more sophisticated in Systems Director 6.1,

as are automation facilities, which implement IBM autonomic technologies. The Systems Director 6.1

administrator interface is also more integrated (Systems Insight Manager continues, in particular, to

require use of multiple consoles), and dashboard views and analytical functions are more granular.

A broader differentiator is that, while the HP and Dell offerings are designed primarily for conventional

server management functions, Systems Director 6.1 is intended to form part of a broader enterprise

management environment.

Integration between Systems Director 6.1 and IBM Tivoli solutions, for example, is closer than is the case

for HP’s Systems Insight Manager and suite of enterprise service management solutions, the HP Business

Technology Optimization (BTO) solutions portfolio.

The BTO portfolio, which is illustrated in figure 10, includes a number of HP internally developed

products originally marketed under the OpenView brand, along with solutions resulting from a number of tool vendor acquisitions made by the company. The functional scope of the portfolio is more limited than

Tivoli solutions, and its various components are less well integrated.

Figure 10

Hewlett-Packard Business Technology Optimization Solution Categories

Dell does not offer enterprise service management solutions.

Availability Optimization

Power Platform

In addition to capabilities such as Live Partition Mobility, Live Application Mobility and clustering

solutions including PowerHA Cluster Manager, Veritas Cluster Server and Oracle RAC, Power servers

benefit from numerous reliability, availability and serviceability (RAS) features.

BUSINESS SERVICE AUTOMATION Data center automation Client automation

BUSINESS SERVICE MANAGEMENT

Configuration Management Database Availability management

Discovery & Dependency Mapping Operations management

Network management

IT SERVICE MANAGEMENT

Change management Service level management

Problem management Service request management

IT ASSET MANAGEMENT

Chargebacks Procurement Contract management

Software asset management Financial management




These features, which are designed to reduce the potential for unplanned outages and to limit the

frequency and duration of planned outages, include the following:

• Basic capabilities include high levels of component reliability and redundancy, along with hot

swap capabilities enabling devices to be replaced without taking systems offline. Redundant and

hot swap components include disk drives, PCI adapters, fans, blowers, power supplies. and (on

Power models 560, 570 and 595) system clocks, service processors and power regulators.

Server firmware may also be updated without taking systems offline, and a new AIX 6.1 feature,

Concurrent Kernel Maintenance, enables some kernel fixes to be installed without rebooting. In

most Power server environments, Concurrent Kernel Maintenance can be employed for

approximately 80 percent of required single module kernel updates.

• Monitoring, diagnostic, and fault isolation and resolution facilities are built into all major

Power server components, including processors, main memory, cache and packaging modules, as

well as adapters, power supplies, cooling and other devices. In many cases, multiple layers of

protection and self-test are implemented.

Key functionality is provided by IBM-developed Chipkill and First Failure Data Capture

(FFDC) technologies. Chipkill, which performs error checking for memory devices, is

significantly more reliable than conventional error correction code (ECC) techniques. FFDC

employs thousands of embedded sensors that identify and report failures to a separately powered

Service Processor , which also monitors environmental conditions.

The Service Processor can automatically notify system administrators or contact an IBM Support

Center (electronic support or “call home” service) to report events requiring service intervention.

• Fault masking capabilities prevent outages in case failures do occur. For example, in the event

an instruction fails to execute due to a hardware or software fault, the system will automatically

repeat the operation. If the failure persists, the operation will be repeated on a different processor

and, if this does not succeed, the failed processor will be taken out of service.

Three additional capabilities are supported on Power 570 and 595 servers. Dynamic Processor Sparing allows idle CUoD processors to be automatically activated as replacements for failed

processors. Memory Sparing enables alternate dual in-line memory modules (DIMMs) to be

activated in the event of memory failures. Enhanced Memory Subsystem provides broader

capabilities including memory controller and cache sparing.

• Concurrent maintenance includes new capabilities for Power 570 and 595 servers. Hot node

add/repair allows processor units, memory cards and adapters to be replaced, upgraded or

serviced without taking systems offline.

Additional RAS features, including Dynamic System Clock Failover , are provided for Power 595 servers.

In addition to preventing unplanned outages, use of redundant, hot-pluggable devices and functions such

as sparing and concurrent maintenance reduce planned outages. LPARs reduce them further. Software

upgrades, for example, may be performed in one LPAR while the original instance continues operating in

another. Backups may also be executed in this manner while systems remain in operation.




x86 Platforms

Similar hardware-based RAS functions are in some cases implemented in x86 servers offered by vendors

such as Dell and HP, and are supported by OpenManage and Systems Insight Manager respectively.

VMware and third-party clustering solutions also offer high availability capabilities.

The microelectronics technologies employed to implement Power RAS features, however, are a great deal

more sophisticated than for commodity x86 servers. This is particularly the case for Power 570 and 595servers. The level of integration of availability optimization functions across hardware, firmware, and

AIX and Systems Director 6.1 is also significantly greater.

These strengths are reflected in industry surveys that have shown that Power servers and AIX typically

deliver levels of availability that are, by wide margins, higher than for commodity x86 servers running

Windows or Linux.

Many organizations have realized extremely high levels of availability – in some cases, 99.999 percent

(“five nines”) or better – even for very large database- and transaction-intensive workloads.

A key principle applies. The challenges of maintaining high availability are substantial under any

scenario. As database and workload sizes increase, however, these challenges are magnified. The ability

of a platform to maintain uptime in low-volume, comparatively undemanding workload conditions does

not necessarily translate into the ability to do so for large-scale, business-critical systems.

Energy Efficiency

Power Platform

Power virtualization capabilities can deliver significant energy savings by enabling organizations to

employ fewer physical servers. This impact is magnified by a number of advanced energy efficiency

features, which include the following:

• Active Energy Manager software provides energy conservation functions that may beimplemented at the rack, server or (for Power blades) enclosure level.

These include monitoring, recording and analysis of energy usage and thermal loading; and the

ability to allocate energy on a server-by-server basis as well as to set thresholds for individual

server energy usage based on application priorities, time of day and other factors.

Interfaces to intelligent PDUs such as IBM PDU+ units and third-party equivalents may be used

to monitor older System p models not equipped with PowerScale technology, as well as other

IBM and non-IBM platforms.

Active Energy Manager can also monitor power distribution systems, uninterruptible power

supplies (UPS), computer room air conditioning (CRAC) and other data center infrastructure

components. Interfaces are also supported to SynapSense wireless sensor nodes and to leading

facilities management systems.

• EnergyScale technology is a set of built-in capabilities that are unique to POWER6-based

servers, including blade models. An embedded controller, temperature sensors located at key

points within systems, and firmware are employed to provide additional energy conservation

functions. EnergyScale technology is managed using Active Energy Manager.

Combined use of Active Energy Manager and EnergyScale technology enables the functions

summarized in figure 11. Power saver mode is supported only for 4.0 GHz and faster processors.




Figure 11

Active Energy Manager and EnergyScale Functions for Power Servers

FUNCTION DESCRIPTION

Thermal monitoring &reporting

Monitor & display ambient temperatures, including inlet & exhausttemperatures; display & analyze trends

Power trending Track & display power usage data; display & analyze trends

Power saver mode Set/schedule reduction of voltage & frequency by fixed percentage within

pre-determined to be safe operating limit

Power capping Set/schedule “hard” & “soft” (flexible) energy usage caps; automaticallythrottle back voltage & frequency if system approaches cap

CPU trending Determine actual CPU speed of processors for which power saver or power capping is active; display & analyze trends

Dynamic power savings* Automatically adjust voltage & frequency settings based on workload;select whether server operations should be optimized for energy efficiencyor performance

Power efficient fan control* Setting of fan speed based on server usage & ambient temperatures;altitude input

Processor core nap mode* Automatic processor stop when idle

EnergyScale for I/O Automatic power-off of pluggable PCI adapters when idle

Guaranteed Safety* Features designed to ensure continued operation of the system during

adverse power or thermal conditions.

*EnergyScale-specific functions

A key advantage of employing these solutions is that they allow organizations to measure actual, rather

than “nameplate” energy consumption. Nameplate ratings are required measurements of power

consumption by Underwriters Laboratories in the United States and equivalent bodies in other countries

that assume maximum workloads and “worst case” environmental conditions.

Many data centers continue to plan and operate using nameplate values, with the result that facilities

infrastructures are over configured, and server bases are overpowered. Industry tests have shown that

nameplate ratings for IT equipment are typically at least 33 percent higher than actual consumption.

x86 Platforms

The comparative picture for Power and commodity x86 servers in this area is in many respects similar to

that for system management and availability optimization. Although some functionally similar energy

efficiency capabilities are implemented in hardware, software, or both by vendors such as Dell and HP,

EnergyScale microelectronics technology is significantly more advanced.

Energy efficiency features are also more effectively integrated and optimized across Power hardware,

firmware and software. Finally, Active Energy Manager – which forms an integral part of Systems

Director 6.1 – allows for a level of interaction with the enterprise-level energy management capabilities of

the Tivoli solution that is unrivalled by any other vendor.




DETAILED DATA

Basis of Calculations

Profiles and Scenarios

The cost comparisons presented in this report based on three composite profiles of server installations

supporting major SAP systems in retail, discrete manufacturing and energy companies. Theseinstallations are summarized in figure 12.

Figure 12

Profile Installations and Scenarios Summary

COMPANY RETAIL MANUFACTURING ENERGY

BusinessProfile

Apparel & footwear chain$800 million sales6,500 full-time employees250 stores4 distribution centers

Fabricated metal products$1.2 billion sales5,000 employees6 plants & distribution centers

Oil & gas exploration,production & distribution$1.5 billion sales1,500 employees

Applications SAP for RetailERP, CRM, EPM, EWL, FR, GRC, GTS,

MDM, ME, POS, SCM, SM, TO, XI

SAP for Mill ProductsBI, CRM, ERP, MII, NP, PLM,

SCM, SM, SRM, XI

SAP for Oil & GasBI, CRM, ERP, GTM, NP, SCM,

SM, SRMUsers 2,500 1,500 600

POWER SERVER SCENARIOS

Servers RAC Cluster

550 4/8 x 4.2 GHz – 6 LPARs550 4/8 x 4.2 GHz – 3 LPARs550 4/8 x 4.2 GHz – failover

AIX, GPFS, PowerVMOracle 10g + RAC

Other Servers

550 4/8 x 4.2 GHz23 LPARs & WPARs

520 2/4 x 4.2 GHz13 LPARs

2 x BladeCenter H5 x JS22, 11 x JS1233 LPARs & WPARs

AIX, PowerVM, Oracle 10gBOFM (BladeCenter)

RAC Cluster



Other Servers

2 x 520 2/4 x 4.2 GHz16 LPARs & WPARs

BladeCenter H3 x JS22, 9 x JS12

26 LPARs & WPARsAIX, PowerVM, Oracle 10gBOFM (BladeCenter)

RAC Cluster



Other Servers

520 2/4 x 4.2 GHz18 LPARs & WPARs

BladeCenter H2 x JS22, 10 x JS12

13 LPARs & WPARsAIX, PowerVM, Oracle 10gBOFM (BladeCenter)

Personnel 1.4 FTEs 1.05 FTEs 0.8 FTEs

x86 SERVER SCENARIOS

Servers RAC Clusters

3 x R900 4/24 x 2.4 GHz3 x R900 4/24 x 2.4 GHzWindows, Oracle 10g + RAC

Other Servers

7 x 2900 III 2/8 x 2.0 GHz2 x M1000e – 16 x M600

Windows, Oracle 10g, VMware

RAC Clusters

3 x R900 4/24 x 2.4 GHz3 x R900 4/16 x 1.6 GHzWindows, Oracle 10g + RAC

Other Servers

R900 4/16 x 1.6 GHz3 x 2900 III 2/8 x 2.0 GHz

M1000e – 14 x M600Windows, Oracle 10g, VMware

RAC Cluster

3 x R900 4/16 x 2.4 GHzWindows, Oracle 10g + RAC

Other Servers

2 x 2900 III 2/8 x 2.0 GHzM1000e – 12 x M600Windows, Oracle 10g, VMware

Personnel 3.15 FTEs 2.45 FTEs 1.3 FTEs

BI: Business Intelligence

CRM: Customer Relationship Management

EPM: Enterprise Performance Management

ERP: Enterprise Resource Planning

EWL: Extended Warehousing & Logistics

FR: Forecasting & Replenishment

GRC: Governance, Risk & Compliance

GTM: Global Trade Management

GTS: Global Trade Services

MII: Manufacturing Integration &Intelligence

MDM: Master Data Management

ME: Merchandising

NP: NetWeaver Portal

POS: Point-of-Sale

SCM: Supply Chain Management

SM: Solution Manager

SRM: Supplier RelationshipManagement

TO: Transportation Operations

XI: Exchange Infrastructure




In this presentation, numbers of processors and cores are shown for all servers – e.g., “550 4/8 x 4.2 GHz”

refers to an IBM Power 550 server with four dual-core POWER6 4.2 GHz processors, while “R900 4/24

x 2.4 GHz” refers to a Dell R900 server with four six-core Xeon 2.4 GHz processors.

Profile installations were constructed using data on SAP applications and landscapes, server

configurations, use of virtualization tools, database and system administrator staffing and other variables

supplied by 18 companies in the same industries and approximate size ranges, with similar business

profiles. Companies employed IBM Power and/or System p servers, or x86 servers. Five companiesemployed Oracle RAC clusters.

A composite approach was employed to ensure that data was representative of current-generation SAP

enterprise environments, to protect confidentiality and to compensate for limitations in the data available

from individual organizations.

For each installation, scenarios were developed for use of Power and x86 servers to support the same

applications, landscapes and workloads. For scenarios for both sets of platforms, the most efficient user

configurations and operating practices were selected as the basis of comparisons.

Some of the companies upon which installations were based employed older models of IBM System p

and x86 servers. Where this was the case, configurations were translated to current generation IBM Power

and Dell PowerEdge models using vendor and industry comparative performance data, and best practice

configuration norms for the SAP applications and workloads supported.

Power blade platforms were employed for application serving and other functions. Equivalent Dell

M1000e enclosures and M600 Xeon-based blade servers were used in x86 server scenarios. Costs for both

sets of platforms were generally similar.

In Power server scenarios, LPARs are employed for production as well as non-production systems. In x86

server scenarios, VMware is employed for smaller, non-critical production functions that do not involve

use of Oracle databases, and for non-production instances. This reflects usage in the companies upon

which profiles were based.

Power servers were equipped with AIX Version 6.1 and, where appropriate, IBM General Parallel FileSystem, which is required for use of Oracle RAC, and PowerVM. BladeCenter systems were equipped

with BladeCenter Open Fabric Manager (BOFM). Dell servers were equipped with Windows Server

Enterprise Edition and, where appropriate, VMware Infrastructure 3.

In Power and x86 server scenarios, RAC clusters consist of two active and one failover servers.

Server Costs

Server costs were calculated for the models, configurations and software shown in figure 12. Costs for

hardware acquisition and maintenance, and for software licenses and support, were based on vendor list

prices discounted to reflect prevailing “street” prices for SAP deployments comparable to those in profile

installations.

Power server software costs include IBM Software Maintenance (SWMA) for a three-year period, while

x86 server software costs include Microsoft Software Assurance for the same period.

Facilities costs include data center occupancy, power and cooling equipment, and energy consumption

over a three-year period. Occupancy cost calculations were based on EIA 42U rack mount units and

service clearances for these, plus allowance for inactive areas. A conservative assumption for annual cost

per square foot for existing facilities was employed (i.e. costs do not include new facilities construction).




Costs for power and cooling equipment were based on configurations of such equipment appropriate for

the servers employed in each installation and scenario. Costs were calculated for acquisition and

maintenance over a three-year period, using discounted list prices for equipment from leading vendors.

Costs were based on prorated values; e.g., if servers required 15 percent of the output of a 10-ton chiller

(“ton,” in this context, is a standard metric for cooling capability), calculations were for 15 percent of

three-year costs for this equipment.

Energy costs were calculated using vendor electricity consumption values for server configurations.

Specific utilization levels and hours of operation for each profile installation were then applied, and a

conservative assumption for average price per kilowatt/hour was employed to determine three-year costs.

Personnel Costs

Personnel costs are for the numbers of full time equivalent (FTE) staff shown in figure 12. Calculations

were based annual salaries of $79,316 for AIX system administrators and $72,640 for Windows system

administrators, including allowance for PowerVM and VMware skills respectively; and $107,381 for

Oracle database administrators, including allowance for RAC skills.

Salaries were increased by 49.7 percent to allow for benefits, bonuses, training and other personnel-

related overhead, and overall costs were calculated for a three-year period.

All values for server and personnel costs are for the United States.

Costs Breakdown

A detailed breakdown of three-year costs for all installations and scenarios is presented in figure 13.

Figure 13

Three-year Costs Breakdown for Profile Installations and Scenarios

INSTALLATIONRETAIL

COMPANY

MANUFACTURING

COMPANY

ENERGY

COMPANYPOWER SERVER SCENARIOS ($000)

Hardware 358.0 263.0 106.2

Maintenance 33.6 29.6 14.5

Systems software 133.4 108.9 74.9

Personnel 561.7 424.4 322.8

Facilities 27.4 23.3 19.2

TOTAL ($000) 1,114.1 849.2 537.6

x86 SERVER SCENARIOS ($000)

Hardware 164.5 129.3 100.2

Maintenance 32.3 22.3 19.0

Systems software 190.6 139.9 93.4

Personnel 1,214.8 939.7 478.7

Facilities 56.0 42.1 28.5

TOTAL ($000) 1,658.2 1,273.3 719.8



ABOUT THE INTERNATIONAL TECHNOLOGY GROUP

ITG sharpens your awareness of what’s happening and your competitive edge

. . . this could affect your future growth and profit prospects

The International Technology Group (ITG), established in 1983, is an independent research and

management consulting firm specializing in information technology (IT) investment strategy, cost/ benefitmetrics, infrastructure studies, deployment tactics, business alignment and financial analysis.

ITG was an early innovator and pioneer in developing total cost of ownership (TCO) and return on

investment (ROI) processes and methodologies. In 2004, the firm received a Decade of Education Award

from the Information Technology Financial Management Association (ITFMA), the leading professional

association dedicated to education and advancement of financial management practices in end-user IT

organizations.

The firm has undertaken more than 100 major consulting projects, released approximately 160

management reports and white papers, and delivered nearly 1,800 briefs and presentations to individual

clients, user groups, industry conferences and seminars throughout the world.

Client services are designed to provide factual data and reliable documentation to assist in the decision-

making process. Information provided establishes the basis for developing tactical and strategic plans.

Important developments are analyzed and practical guidance is offered on the most effective ways to

respond to changes that may impact or shape complex IT deployment agendas.

A broad range of services is offered, furnishing clients with the information necessary to complement

their internal capabilities and resources. Customized client programs involve various combinations of the

following deliverables:

Status Reports In-depth studies of important issues

Management Briefs Detailed analysis of significant developments

Management Briefings Periodic interactive meetings with management

Executive Presentations Scheduled strategic presentations for decision-makers

Email Communications Timely replies to informational requests

Telephone Consultation Immediate response to informational needs

Clients include a cross section of IT end users in the private and public sectors representing multinational

corporations, industrial companies, financial institutions, service organizations, educational institutions,

federal and state government agencies as well as IT system suppliers, software vendors and service firms.

Federal government clients have included agencies within the Department of Defense (e.g. DISA),

Department of Transportation (e.g. FAA) and Department of Treasury (e.g. U.S. Mint).

International Technology Group

4546 El Camino Real, Suite 230Los Altos, California 94022-1069

Telephone: (650) 949-8410Facsimile: (650) 949-8415

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