SMBs face many and diverse IT and business challenges, such as cost control and reduction, data center footprint expansion, power consumption, and insufficient IT talent directed at the business priorities of differentiation and competition. On June 13, 2007, Alex Yost, IBM Vice President and Business Line Executive, IBM BladeCenter, announced a new IBM server that addresses some of those challenges. The fifth model in the BladeCenter line (which incidentally was introduced in 2002), the IBM BladeCenter S is designed specifically for SMBs or those larger enterprises that operate in a distributed environment.

Honey, I Shrunk the BladeCenter

An accompanying press release, IBM Shrinks Integrated Blade Computing System for Smaller Firms, cites statistics from IDC that indicate that the blade server market is predicted to grow from $3 billion in 2006 to $11 billion by 2010. According to Gartner "mid-size businesses run 25 to 45 servers on average to power business functions." (While I believe that the actual numbers do vary, there are likely small businesses running upwards of 20 servers and there are medium-sized businesses running more than 45 servers.) IBM believes the "new BladeCenter S can help reduce the 25 to 45 servers used by an average mid-size company by up to 80 percent." However, at the time of this writing, it appears that IBM does not yet have any official benchmarks to support this theory, and since the new BladeCenter S won't be released until 4Q07, SMBs should petition for, and expect, benchmarks to be forthcoming. Those considering the purchase thereof should ensure that the IBM Business Partner with whom they are engaged can perform a customized benchmark for their organization.

A Multi-Purpose Blade

Not since the advent of AS/400 has IBM announced a system that is designed to integrate most systems management applications/functions and run as an office system without need for specialized cooling and power or raised-access flooring. The BladeCenter S can scale to six blades, plugs into a 110/220 volt outlet, is compatible with five blade types and five I/O fabrics—including Ethernet, fibre channel, Serial Attached SCSI (SAS), and InfiniBand—and works with third-party technology.

IBM BladeCenter S is optimized for SMBs as well as larger businesses, which are distributed, and those with remote branch offices such as retailers, insurance companies, and/or other financial institutions. Much like AS/400, IT administrators at a central location can pre-configure blade systems and ship to remote sites.

So Easy a Caveman Can Do It

The IBM BladeCenter S was designed to be installed in three easy steps: unpack, plug in, and run the install "wizard" to customize. While this minimizes "administrative" work, problems for SMBs lie with the installation of the systems management software and the vertical enterprise application software. Most important will be the data migration and/or data conversion, which are the biggest issues and greatest obstacles along with testing and being able to resume business functions in an acceptable timeframe. These are areas in which ISVs and other Business Partners should perform benchmarks to aid SMBs and other companies that might consider purchasing or leasing a BladeCenter S. By working with customers to develop test cases and/or other scenarios, ISVs could begin to get a better sense of the amount of time (and impart that sense and confidence to their customers) it would take for an entire soup-to-nuts implementation from out-of-the-box to installation and data migration of Oracle JD Edwards EnterpriseOne applications, for example.

Big Blue Goes Green

A surprising, but not altogether unexpected, aspect of the BladeCenter S announcement is the focus on the BladeCenter E's eco-friendliness. BladeCenter E, as reported by IBM, reduces a company's carbon footprint, can reduce energy consumption by 34 percent, and can deliver 11 to 19 percent greater energy efficiency than competitors. It is quite possible that during the next decade, especially after the current administration departs office (and please don't get me started on this subject), legislation will be introduced that requires companies to implement more eco-friendly practices. What better way than to begin doing so in the data center? IT is (or at least should be) a leader in any organization. Adopting a "green" policy now may demonstrate prescience on the part of the IT department and be yet another salvo that elevates IT in the organization.

A Double-Edged Blade

A recent article by Ziff Davis Media entitled "Blade Servers – So What's The Hurry?" brings a compelling and complementary perspective to blade technology. The article refers to analyst group Wikibon.org, which opines that there are circumstances under which blades are not the optimum server. For example, Wikibon.org avers that "blade servers simply don't perform very well for large-scale transaction processing applications." In addition, the article points out that blades may not be "economical for applications requiring less than five to 10 servers...[and] vendor lock-in issues" can arise.

The bottom line: caveat emptor. Before considering the purchase of any new technology, the company must conduct a thorough assessment of the existing technology, evaluate its existing IT talent, and determine whether application and data migration/conversion will be required—and what the impact will be on the business.

Know Thy Customer

During the last several years, and especially with IBM's Built on Express Advantage program for its Business Partners, IBM has gained SMB market share and trust. While about 50 percent of SMB revenue is generated through IBM Business Partners, IBM is still courting the elusive SMB. Why? Analyst colleagues continue to speculate, but it boils down to this: Larger enterprises normally have areas within IT that handle the various pieces of the overall IT architecture, which include hardware, middleware, and software. Because IT departments in these organizations have an articulated infrastructure, they can also mix and match vendors and buy hardware and software based on various criteria. They also have the people power to integrate disparate components. This is rare in medium-sized businesses and nonexistent in smaller companies. As one colleague noted during the analyst call on June 13, SMBs are not about buying hardware—or software for that matter. They are about price, bundling, turnkey, and return on investment.

The price of the new BladeCenter S was discussed only in comparative terms. That is, the cost of a BladeCenter S will be comparable to the cost of a rack-mounted system. IBM preferred to stress the fact that customers will save on all the adjuvant and ancillary cables and switches that are de rigueur with rack-mounted systems. Customers are also likely to save somewhat on administration and undoubtedly on power consumption and space, which is a precious commodity these days and which is appealing to the SMB community. What IBM did not talk about and what is near and dear to the SMB after pricing is how to pay for the new BladeCenter. IBM Express Advantage for SMBs—offered by the exceptional yet always under-touted IBM Global Financing (IGF)—offers below-normal market rates and other competitive amenities. If you and your company are not familiar with IGF, it is worth taking the time to speak to representatives regarding financing rates. IGF is among the best, if not the best, financing institution in the United States.

Look into My Crystal Ball

BladeCenter S definitely fills a niche heretofore unfilled, but this niche has other demands, such as bundling and pre-loading of systems management software and eventually vertical enterprise application software. I think IBM understands this and is, or will be, working with Business Partners to develop such options and offerings.

Maria A. DeGiglio is President of, and Principal Analyst for, Maria A. DeGiglio & Associates, an advisory firm that provides clients with accurate and actionable information on business and technology initiatives. You can reach Ms. DeGiglio at This email address is being protected from spambots. You need JavaScript enabled to view it..

Maria DeGiglio is president and principal analyst of Maria A. DeGiglio & Associates. Current clients of Maria A. DeGiglio & Associates include the Visiting Nurse Service of New York ; Experture, LLC; and MC Press. Ms. DeGiglio has more than 20 years of experience as an IT consultant, industry analyst, and executive. From 1997 to 2005, she worked for Andrews Consulting Group and the Robert Frances Group.

 

Ms. DeGiglio received her Masters Degree in Health Advocacy from Sarah Lawrence College and graduated Cum Laude from Cornell University with a Bachelor of Arts Degree.

 

 

Ms. DeGiglio has worked with IT and C-level executives to enable IT alignment with business goals and to implement best practices. She has experience and expertise in both large enterprises and in small- and medium-sized business. Ms. DeGiglio has authored over one hundred articles, reports, and white papers.

 

 

Since 2004, she has worked in the healthcare industry and in health IT investigating the legal, ethical, and regulatory aspects of creating, implementing, and exchanging electronic health records (EHRs). Ms. DeGiglio is an expert in security, privacy, and HIPAA regulatory compliance.

 

 

Ms. DeGiglio may be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..