Money is tight. Performance is declining. Your servers are all nearly three years old and pretty soon, their high-priced maintenance contract is about to kick in. What do you do?

If you're like Tim Hays, you take the money you would have spent on maintenance and instead use virtualization to not only improve performance, but increase IT efficiency, cut power and cooling costs 45 per cent, and make disaster recovery as easy as pushing a button.

"I guess I'm more of a business guy first and an IT guy second," says Hays, director of IT at Lextron, a wholesale distributor of animal health pharmaceuticals with 600 employees in 44 locations across 19 US states. "I look at IT as a business enabler. Virtualization wasn't something that we did just because it was the next cool thing. It made a lot of economic sense."

Start small

Hays, who told his story at the recent Network World IT Roadmap Conference, didn't jump into virtualization all at once. His first foray was in 2005, when he was faced with paying US$300,000 over three years to maintain the three Unix servers and direct-attached storage units supporting his ERP, inventory management and sales management functions. All told, the three servers were responsible for handling US$1.75 million in sales transactions daily.

At the time, virtualization a la VMware was not well-known. Instead, he used the US$300,000 to replace the Unix servers with one PA-RISC-based HP-UX server running HP's Virtual Partition (vPAR) software, which enabled the one server to host three virtually partitioned servers. He also put the server on a Fibre Channel-based HP EVA 5000 storage-area network.

"Cost-wise, it was a wash," he says, noting that the depreciation for the new equipment was US$100,000 per year, the same as he would have been paying for maintenance per year on the old gear.

But reports now ran 30 per cent to 40 per cent faster, and user complaints declined. "People were waiting less time to get information, and they didn't have that problem where they were outworking the ability of the system to retrieve the data," he says.

At the same time, the company also needed to upgrade its ERP databases from Informix 7 to 9.4. "We had 1,500 programs that we needed to regression test against new hardware, a new database, new development tools and a new operating system," Hays says. Buying new equipment enabled Hays to install all the new software and thoroughly test everything before cutting over. Once his team was confident everything would work, they simply switched users from the old equipment to the new. The whole process, which could have taken six months in the past, took just 45 days.

Success breeds success

Faced with a similar situation on the Wintel side of the house in August 2006, Lextron once again calculated its options. The company had been using 40 physical servers to support its Microsoft Windows environment, including Exchange, SharePoint, CRM and Web services, as well as file and print.

"We had servers that needed to be replaced and we had a track record of taking multiple physical servers and combining them into one," Hays says. "Virtualization seemed like an obvious project to at least investigate."