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Data Center Consolidation Strategy (4 Step Process)

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What is Data Center Consolidation?

Data Center Consolidation is the process of downsizing or consolidating many servers, storage systems, networking systems, or even locations into a more efficient set of systems; the purpose is to lower cost and improve performance, among other things.

Data center consolidation strategy: creating a plan to lower opex, improve efficiency, and bolster data security.

The consolidation of data centers is a growing trend for good reason.

Enterprises, cloud companies, and even government agencies have begun to realize tremendous benefits from consolidating their data centers.

As one example, the government started the Federal Data Center Consolidation Initiative in 2010.

“19 of the 24 agencies [involved] reported achieving an estimated $2.8 billion in cost savings and avoidances from fiscal years 2011 to 2015.”

Besides cost savings, cloud migrations are also driving consolidations.

As enterprises migrate their data centers to the cloud, many seize the opportunity to realize cost savings by consolidating on-premises data center equipment and space.

Data Center Consolidation: Getting the Business on Board

For a data center consolidation to be ultimately successful, the organization needs to be one cohesive unit.

Every department needs to be on board. Most importantly because every department will likely be affected. In short, consolidation is a business-wide project.

To get everyone on board, the implications for the whole organization must be made clear.

If everybody knows why the operation is important in the first place it will make it much easier to deal with potential issues if they arise.

Thankfully, there are plenty of benefits to data center consolidation that you can excite your organization with.

Benefits of Data Center Consolidation

Physical locations – Consolidating multiple physical locations can reduce operational expenses through lower energy consumption, fewer leases, and lower maintenance costs.

Procurement – On account of CAPEX efficiency, consolidation can reduce the quantity of necessary equipment such as servers, storage, and networking equipment. Indeed, this saves the organization significant procurement costs.

Software – Consolidation of software onto fewer systems can reduce software licensing costs as well as maintenance costs

Environmental benefits –It’s no secret that data centers are massive energy hogs and a large contributing factor to global warming. Data center consolidations reduce total energy consumption, greatly reducing the carbon footprint of the organization.

Security Consolidating data centers improves security in a few ways. You have fewer points of entry, for one. You’re also reducing the total number of programs and systems to secure. And, with less area to cover, avoiding vulnerabilities becomes simpler.

Reduce errors – Complexity breeds errors. Data center consolidation simplifies processes like system discovery and network management. As a result, the organization as a whole becomes less error-prone.

Avoiding the Risks of Consolidation

Undoubtedly, Data center consolidation does carry some risk if executed improperly. However, with the right tools, planning, and assistance from partners, the risks can be minimized. Some common issues that enterprises can experience from poor execution are:

  • Disrupted employees
  • Data loss
  • Operational downtime

In order to avoid these pitfalls and the lost customers they cause, we’ve put together a framework to follow along with actionable insights.

Steps for Data Center Consolidation

1. Evaluate

Before beginning a data center consolidation, it’s important to have an accurate map of your current environment(s), and so the team should conduct assessments of all the physical locations.

In doing so, they should not only evaluate the equipment but also get a feel for the availability of staff. 

As a result, this will help plan out present and future needs for equipment and human resources.

A proper map is also important to lay the groundwork for getting rid of unneeded servers, processors, networking, memory or other redundant hardware after the project is finished.

To that end, items in the environment to be mapped out:

Hardware Assets

  • Number of servers and percentage of virtualization
  • Total server capacity and utilization (GHz/MIPS, Peak/average%)
  • Storage systems (SANs, NAS, All-flash arrays) and capacity/% used
  • Workstations and peripherals
  • Networking Equipment (Switches, Firewalls, Routers, Hubs, etc.)

Facilities & Energy Usage

  • Racks
  • Cabling
  • Power Supplies
  • Cooling Units

Geographic Location & Real Estate

  • Leases and costs by sq ft
  • Data centers by tier
  • Total square footage

Software Assets


  1. WAN/LAN Management
  2. Help Desk Services
  3. Cyber Security Services
  4. Data Privacy Services
  5. Identity and Access Management Services
  6. IT Inventory and Asset Management Services
  7. Application Hosting
  8. Website Hosting
  9. 10.Collaboration Tools
  10. 11.Email Services
  11. 12.Electronic Records Management Services
  12. 13.Business Support Services (e.g., HR, Payroll, Acquisition, Budget)
  13. 14.Video Teleconferencing Services
  14. 15.Telephone Services
data center consolidation checklist

As you inventory your assets, you may find it valuable to take action on easy wins throughout the process.

You may come across zombie servers sapping energy costs that need to be pulled.

You may notice layout faults or obstructions to remove.

In general, creating a map can facilitate easy wins in the interim period before the consolidation is finalized.

2. Plan

As with most data center projects, such as a migration, a consolidation involves significant risk.

Nearly every aspect of a business is tied into its data center.

Whether that’s in a public cloud or the company’s own facilities, the risk is too great not to plan.

Common complications include:

  • Inadequate power supply and cooling capacity
  • Incompatibility between legacy apps and equipment
  • Lack of in-house skills and labor for the project
  • Insufficient security at the consolidated site

Taking a data center offline and moving multiple sets of servers is an undertaking that requires just as much finesse as any complex medical operation.

The medical world avoids mistakes with checklists and comprehensive planning.

To this end, the same process can be invaluable for consolidation projects.

Otherwise, it’s likely that data center sprawl and more system silos will continue to be a problem.

Data Center Consolidation Disaster Recovery Planning

Thorough disaster recovery planning is crucial in the context of data center consolidations.

When there are 50 small data centers, losing one of them isn’t necessarily a big deal.

When there are only a few data centers and disaster recovery sites however, the loss of even one can be, well, disastrous.

While this may be true, it’s not usually viable for companies to build a disaster recovery site for each consolidated data center.

A commercial disaster recovery solution would be great for this, but the solutions currently on the market are geared more towards smaller use cases.

However, these wouldn’t typically be ideal in the case of a large scale consolidated data center.

Another consideration is that in any centralized disaster recovery solution, it’s unlikely to have enough equipment in a backup facility to be able to run all of the operations for every other potential consolidated site.

While complete redundancy is impossible, consolidated data centers especially tend to be diverse as a result of the many different locations and sets of equipment that come together to form them.

For projects that will end with multiple consolidated locations housing similar equipment, one potential solution is to pair them.

Take, for example, two large scale consolidated data centers, they could be synchronized to replicate the other’s environment.

When your organization is in a position to leverage heavy virtualization, this may be more feasible.

Even so, if there is a lot of variation between the data centers, adding a separate disaster recovery facility on top of pairing may be necessary. However, this should be an option only if leaving a public cloud on standby to take the workload isn’t an option.

If it is, using a public cloud for disaster recovery is a common and straightforward option.

3. Design

Once the evaluation and planning steps are complete, the company is ready to begin architecting the consolidated location.

Depending on whether an existing location is being used, this phase will take on a different form.

Unfortunately, there is no one size fits all way to architect a data center. The fact remains that however you go about it, a data center construction blueprint will need to be created.

Reference Designs

While designing a brand new data center blueprint from scratch would be a monstrous task, thankfully it’s not necessary.

Using a reference data center design during this process saves valuable time and money for you and your contractors.

They can simply be altered to meet the specific needs of your data center consolidation project once a suitable one is found.

Because VMWare, Cisco, Juniper, Dell, HPE, and Extreme Networks all have freely available reference designs depending on your needs, this is easier than it otherwise would be.

Consult with your data center consolidation vendor, partners, and project management team to evaluate these along with other vendors.

Consequently, you can decide which design makes the most sense for your enterprise.

We also have an article that compares the benefits of HPE vs Dell servers.

The Power of Prefab

Overall one of the most novel options for data center consolidation, modular or prefabricated data center constructions are now available.

These can be used as an addition or component of a larger data center architecture scheme. They can also be used as the basis of the whole data center design depending on scale, scope, and need.

When implemented properly, prefab data center designs can reduce infrastructure and lifecycle costs and time to deployment for data center consolidation projects. Prefab data center designs can also simplify the entire process.

While mostly for the smaller use case -forgive the pun- micro data centers have grown in adoption to help reduce latency and costs. This all helps to keep end users happier.

They house all of the elements and infrastructure in a typical data center, but in a microformat. This lowers overhead costs and space requirements.

Markedly, Gartner estimated that by 2021, 25% of enterprises will have implemented a micro data center.

With this in mind, consider implementing them in your data center design or consolidation project.

4. Build and Commission

When a data center design has been finalized, it’s time to determine the logistics of transportation, procurement, and construction.

Before you can build the data center, you’ll need to build your consolidation project team.

For a smaller consolidation project to simply close down one facility and move equipment to an existing location it need not be as involved.

In this case, enterprises don’t necessarily need more than an ITAD vendor or the services vendor they contracted the design from.

However, for a data center consolidation of moderate size and up, other contractors, services and consultants will be needed as core team members:

Specifically, construction contractors, subcontractors, commissioning agent(s), power/energy consultants, legal counsel, and OEM vendors. Also, an architect or design company

Additionally, other project management consultants, ITAD vendors, real estate counsel, virtualization specialists, and other data center specialists may be brought on as needed.

For a project of this scale, it makes sense to bid out certain positions and not rush to fill team slots before vetting all possible candidates, deadlines permitting.

Finalizing the Data Center Consolidation Team

Before proceeding with a finalized team, it’s important to get everything in writing.

Furthermore: outline key expectations, deliverables, and protocols for key processes for each group of the project team.

  • How disputes will be resolved
  • Responsibilities of each stakeholder
  • Insurance requirements
  • Grounds and procedures for termination
Construction Team
  • Schedule and construction deliverables timetable
  • Critical path activities
  • Billing procedures
  • Budget
ITAD Vendor
  • Expected IT asset remarketing returns and profit share
  • Data security and e-waste compliance documentation
  • Reconciled asset lists for decommissioning and relocation

All things considered, the construction team should consult with energy consultants and the design team to verify implementation, and more specifically its viability and how closely the build can adhere to the original design.

Undeniably, having every member of the team sign off on their responsibilities and expected performance helps to keep the project team all on the same page and avoid surprises.

In Conclusion: Commencing Construction

Finally, with everything locked in place, the construction team is set to begin deploying the consolidation plan.

During the construction process, the construction team, auditors, and commissioning agent(s) should be putting together regular quality assurance and audit reports to ensure adherence to deadlines and expectations.

The construction team should also be laying the groundwork for operations by providing manuals, safety data, warranty documentation, and a punch list for anything not created to spec.

In addition, hands-on training during or after the build process will be used along with the documentation, as this will help determine emergency and operating protocols.

Before the new facility is ready for operation, having a commissioning agent put the facility through its paces is a good idea.

Furthermore, test runs can help prevent unexpected system-level issues down the line.

A commissioning agent will test the data center with similar operating conditions as it might experience with high workloads during standard operation.

This helps find issues with the environment as a whole that might be missed when testing on just a component basis.

Frequently asked Questions:

Trustworthy Data Center Consolidation & ITAD Solutions

While there are many companies that provide ITAD services, few are family owned with over 25 years of experience like exIT technologies.

Even more, we can be on-site the next day and handle all the logistics of decommissioning and liquidating your data center equipment.

Get a head start and read our blog on Best Places to Sell Used IT Equipment Before Year End!

Finally, contact us today to find out what you can get for your used IT equipment if you are consolidating your data center.

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