"A quick benchmark is $3,000 dollars per server per year - that's the rule of thumb that I use," says Gary Weiner, a senior consultant at Dallas-based ACS Healthcare Solutions (and former hospital CIO).
The cost savings come from a few areas, starting with the reduction of capital expenditures for refreshing/installing new servers.
Savings can also be recouped from reducing electrical, heating and cooling expenses and networking, along with the reduction in floor space and infrastructure, UPS requirements, rack space and maintenance costs on the servers.
"Some of the money is recouped immediately," Weiner
adds, "and a common payback is 12-18 months.
You can put a very good ROI together for virtualization."
For Ed Dullard, CIO of 458-bed Alameda County Medical Center
in Oakland, Calif., that alluring ROI led to more ambitious plans.
"We're a public hospital, the safety net hospital for Alameda County, so we really have to come up with ways to cut costs and operate on a lean shoestring," he
According to Weiner
, most midsize hospitals have about 300 servers, of which 40-60 percent can be virtualized.
St. Vincent's Hospital Manhattan (New York), part of the two-hospital St. Vincent Catholic Medical Centers system, experienced typical reductions.
According to Weiner
, staff must be trained in managing the blades.
"That's something I'm finding they're not accepting easily," Wiener says.
"It's a technology shift and you have to ensure that your staff is appropriately trained."
And when it comes to virtualization, CIOs need to remember that not all applications should be virtualized.
says that high transaction-base applications, like an Oracle database running on Windows, for example, might not pay off.
"Since virtualization is basically sharing processor and memory, an application that uses a lot of memory won't deliver economies of scale," he
"You have to decide what the diminishing return for your investment is."
advises CIOs to also be careful if an application requires external access to serial ports or specialized boards (a good example is transcription software); usually, he
says applications that need access to external equipment or additional internal boards can't be virtualized.
To ensure a "no surprises" approach, both CIOs and consultants agree it is critical to engage vendors in a virtualization discussion.
"The vendor needs to assess all your systems to make sure they have the appropriate hardware and storage design, because that becomes very critical in your virtualization environment," says Weiner
"It's about designing it properly for performance.