In today’s fast-paced IT world, leaders are increasingly focused on their virtualization investments and strategies. Managing virtual environments is becoming more complex, and the pressure to save costs is more pressing than ever. The global virtualization software market was valued at USD 69.1 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 18.1%, reaching USD 317.6 billion by 2032.
Beyond the uncertainty surrounding Broadcom’s acquisition of VMware, there are new challenges like shifting from capital expenditures to operational expenditures, changing IT governance requirements, and finding the best way to optimize the cloud. These factors are pushing IT leaders to rethink their strategies to stay competitive, efficient and improve virtualization performance.
Understanding Virtualization Trends and Priorities in 2024
What does the future of virtualization look like? The landscape is rapidly evolving. While this acquisition brings potential for innovation and streamlined services, it also raises uncertainties. The main themes on the minds of IT leaders include:
- From CapEx to OpEx: Organizations are moving their IT spending from large one-time capital expenditures to ongoing operational expenses. This shift requires careful planning and strategic adjustments to ensure cost efficiency. Moving to OpEx allows for more flexible spending but necessitates new budgeting strategies.
- Changes in IT Governance: The need for more flexible and adaptive IT governance frameworks is growing. Traditional models are being replaced by approaches that can better support rapid technological advancements. Agile governance helps organizations respond quickly to changes and stay ahead of the competition.
- Cloud Optimization: As more organizations move to the cloud, optimizing these environments for performance and cost is a top priority. Balancing on-premises and cloud resources requires a strategic approach to get the best outcomes. Effective cloud optimization involves evaluating costs, performance, and business outcomes to ensure a seamless and cost-effective transition.
Presidio’s Point of View
The pace of change will continue, and complexity will continue to increase. However, significant savings can be realized by reducing the number of cores needed, eliminating unused software, accelerating cloud adoption benefits. Clients need help navigating these challenges.
The 7Rs Framework for Virtualization Strategy
To address these complexities and realize these savings, the 7Rs framework offers a comprehensive approach to managing virtualization and cloud migration strategies. This framework helps IT leaders make informed decisions about how to handle their applications and workloads. The 7Rs virtualization approach includes:
- Retain: Keep applications as they are when they still meet business needs effectively. This avoids unnecessary changes and costs.
- Rehost: Move applications to a different environment without significant changes. This is often called “lift and shift.”
- Replatform: Make minor changes to applications to take advantage of a new platform’s features.
- Repurchase: Replace existing applications with commercially available software, often SaaS solutions.
- Refactor: Rewrite or re-architect applications to improve functionality or performance.
- Retire: Phase out applications that are no longer needed or cost-effective.
- Revisit: Regularly review and assess applications and workloads to ensure they remain aligned with business objectives.
Cost Management and Optimization
Shifting from CapEx to OpEx means moving from large upfront investments in hardware and software to more manageable ongoing expenses. This change allows for more flexibility and scalability but requires new ways to budget and manage costs. Presidio assists clients in optimizing their VMware environments through several strategies:
- Reducing Core Counts: By optimizing server configurations, clients can significantly reduce the number of CPU cores needed, leading to lower licensing costs.
- Eliminating Unused Software: Identifying and removing unused software licenses helps clients avoid unnecessary expenses.
- Accelerating Cloud Adoption: Facilitating a smooth transition to cloud environments ensures clients can take full advantage of cloud benefits while controlling costs.
Here’s an example of our impact: one of our clients reduced their VMware licensing costs by $3 million. Through careful analysis and strategic adjustments, they focused on reducing core usage and eliminating unused licenses, leading to substantial savings.
IT Governance and Agile Methods
As IT environments become more complex, traditional governance models are being replaced by more agile frameworks. These new models support faster decision-making and greater flexibility, allowing organizations to respond quickly to changing business needs. Presidio supports clients in adopting new governance frameworks that align with their virtualization and cloud strategies, ensuring better control and oversight.
Cloud Optimization Strategies
Optimizing cloud environments involves a multi-faceted approach that includes evaluating costs, business outcomes, and timelines. Presidio provides tailored solutions to help clients navigate their cloud optimization journey. Whether optimizing existing cloud environments or planning new cloud migrations, Presidio’s deep understanding of cloud technologies and best practices ensures clients achieve the best possible outcomes.
The Broader Impact of Virtualization Decisions
Virtualization decisions impact more than just technology costs. They also affect people and processes within an organization. Understanding the total cost of ownership (TCO) helps organizations make informed decisions that consider all aspects of their IT investments. Virtualization strategies must account for the broader impact on people and processes, including training staff on new technologies, updating workflows, and ensuring that all changes align with business objectives.
Leveraging Expertise for Virtualization and Cloud Strategies
Presidio focuses on applications rather than just infrastructure, ensuring that virtualization and cloud strategies align with business needs. Through our consulting services, clients gain the expertise needed to navigate their virtualization and cloud journeys. We offer tailored advice and support to help clients make informed decisions and achieve their goals. Our seminars provide valuable insights and practical guidance on optimizing IT environments, serving as a vital resource for IT leaders.
Optimizing Your Virtual Environment
IT leaders today are navigating a complex landscape of virtualization investments and strategies. By understanding the current virtualization trends and employing strategic frameworks like the 7Rs, organizations can optimize their virtual environments, improve performance and achieve significant cost savings. Presidio offers tailored guidance and support through our consulting services and seminars. For more information on optimizing your virtualization and cloud strategies, contact us to learn how we can assist you in creating a competitive and efficient IT environment.
