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Reducing the Cost of IT Operations – Is automation always the answer

Reducing the Cost of IT Operations – Is automation always the answer. Aaron Brown and Joseph Hellerstein. Salvation Through Automation. Businesses want to drive down the cost of IT administration 50% - 80% of IT budgets devoted to operational costs

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Reducing the Cost of IT Operations – Is automation always the answer

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  1. Reducing the Cost of IT Operations – Is automation always the answer Aaron Brown and Joseph Hellerstein

  2. Salvation Through Automation • Businesses want to drive down the cost of IT administration • 50% - 80% of IT budgets devoted to operational costs • People are expensive, so it would be better if they could be disposed of • If a college drop-out can get an MCSE in a week, then surely an automatic administration system should be possible

  3. Irony of Automation • Cost automation is often more expensive than manual operation • Automation full of hidden costs • Adapting systems to automation • Up front costs • Automatic-System administration cost • More complex failure scenarios • We need a way to determine when automation is cost effective

  4. Example Case • Software distribution • Common to all IT operations • Most significant activity performed by IT • Operations can be distilled to into a process or processes • Described by a swim-lane chart

  5. Hidden Costs • Automated operation is more complex than manual operation • New roles for human operators • Develop packages suitable for the automation system • New failure possibilities • Still have to manually check that the automated system actually worked • Diagnosis is more complicated • What happens if the automated system fails? • 7% of the time it does

  6. Automation Cost • Fixed costs • Costs relating to the setup of the automation system • Variable costs • Costs relating to the per-instance operation of the system • Fixed costs continue to factor into the system • IT operations often have limited lifetimes • Requires reconfiguration of the Automation System • IT processes are not always widely replicated • 25% of packages installed on fewer than 15 targets

  7. Automation Cost Model • Variables • Cmf => Fixed cost for manual process • Cmv => Variable cost for manual process • N => Lifetime of the Process • Caf => Fixed cost for automatic process • Cav => Variable cost for automatic process • Then: • Cm = Cmf + NCmv • Ca = Cmf +Caf + NCav

  8. Qualitative Observations • Cmv > Cav • The whole point for Automation • Cmv <= Caf • Replication is necessary to see the benefits of automation • N > Caf / (Cmv – Cav) • Where Ca < Cm

  9. Typical cases • Cmv = 10 – 20 hours • Cav = 1 – 5 hours • Therefore • 5 – 20 targets per install to be cost effective • Typical department: 15% - 30% of installs

  10. Leverage and Generalization • L = Cmv / Cav • Benefit obtained from automation • G = Caf / Cmv • If setting up automation is more difficult than doing the installs manually • G/N = 1 – 1/L

  11. Making it work • Reduce G • Modularity in Caf • Increase L • Increase N • Increase uniformity among hardware and software

  12. Obvious Observations • Automation creates extra systems to deploy and manage • Automation introduces extra system setup cost • Automation failure is more complicated to analyze and deal with

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