1. The
Software Solution
June XX, 2013
Underwritten by:

2. Introduction
Many believe Federal IT is at a tipping point – innovate or die. But, innovation is hard when nearly three fourths of your budget is devoted to life support for legacy systems.
Current IT models are falling short as agencies grapple with fewer dollars, more requirements, and faster change. Some are transitioning to more flexible “software-defined” environments.
For “The Software Solution” study, MeriTalk and VMware surveyed 150 Federal IT decision makers to explore legacy costs and challenges, and the “software-defined” opportunity. What steps are agencies taking, what are the benefits, and what have they learned? 2

3. Executive Summary
IT, We Have a Problem: Legacy IT is holding Feds back
Agencies spend $62B annually supporting legacy IT
77% say their agency needs a more flexible IT framework
More than half (58%) don’t believe their agency is able to acquire new IT resources in a timely manner
Software Solution: Feds see software-defined potential
66% of Feds believe transitioning to a software-defined enterprise will foster IT innovation in their agency
53% say shifting to a software-defined data center will reduce costs and improve performance
The Road Ahead: Agencies are taking steps to transition
More than half have started to shift to software-defined IT services
Additionally, 57% have centralized IT management; 48% have consolidated data centers; 41% have deployed virtualization
Most Feds believe a full transition to a software-defined environment will take at least three years
*Of those who say innovation is vital to their agency’s future (n=132) 3

4. Defining Software-Defined
Software-defined Datacenter
A software-defined datacenter is one where all x86/industry
standard server infrastructure is virtualized, and the
management and control of the datacenter resources is
entirely automated by software.
Software-defined Network
Software-defined Storage
A software-defined network
is identical in concept to a
software-defined data center – it functions by virtualizing network infrastructure, and therefore removing the dependency between networks and networking hardware.
Storage resources are
virtualized to enable pooling, replication, and on-demand distribution. The result is a storage layer with agility similar to that of virtualized servers: aggregated, flexible, efficient, and capable of elastic scale-out.

5. Take Away: No Innovation Opportunity
IT, we have a problem
Federal agencies spend 79% of their budget, or $62B* on the status quo
What percentage of your overall IT budget does your agency spend updating and maintaining the following?
Legacy data center hardware and software
Legacy enterprise networks
Traditional storage environments
Remaining budget
79% of IT budgets are spent updating/maintaining legacy environments
Take Away: No Innovation Opportunity
*Based on Federal IT budget for Fiscal year 2013; Calculation (79% x 78,878); Source: Slide 6

6. Take Away: IT Can’t Keep Up
Uphill Upgrades
More than half (58%) of Feds say their agency is not able to acquire IT resources in a timely manner
When your agency decides to upgrade a portion of your IT infrastructure, on average, how long does your agency spend on each of the following steps?
30 Months
Evaluation
Installation
6 Months
20 Months
6 Months
6 Months
8 Months
6 Months
5 Months
12 Months
26 Months
Definition
Procurement
Training
Take Away: IT Can’t Keep Up

7. Take Away: Time is Money
The Daily Grind
In-demand IT staff is consumed with routine tasks that could be automated
What percentage of your time do you estimate is spent waiting for and/or performing routine IT maintenance events with each of the following?
Data Center
33% of time waiting for routine events
42% of time performing routine events
Storage Environment
31% of time waiting for routine events
37% of time performing routine events
Network
34% of time waiting for routine events
40% of time performing routine events
Take Away: Time is Money

8. Take Away: Time for a Change
The Bottom Line
Most agencies are facing major hurdles with IT flexibility, budgets, and staff resources
IT Framework
Budget
Resources
77%
57%
63%
IMAGE NUMBER:
Believe their agency needs a more flexible IT framework
Believe their agency does not have adequate IT budget to accomplish its goals
Believe their agency lacks the resources to execute standard maintenance on IT systems
Take Away: Time for a Change

9. Take Away: Take the First Step
Progress
The good news – agencies are taking steps to centralize, consolidate IT
Which of the following steps has your organization taken?
57%
48%
41%
32%
22%
18%
15%
Implemented a chargeback system
Increased the use of cloud
Provided IT financial transparency
Automated standard IT maintenance
Deployed virtualization
Consolidated data centers
Centralized IT management
Take Away: Take the First Step

10. Take Away: Find a Better Way
What Stops Progress?
But, there are challenges; Budget, security, and agency politics are roadblocks
Why has the Federal government not made more progress updating legacy systems?
#1 Budgets
#2 Security
#3 Agency politics
#4 Complex procurement process
#5 Locked into vendor contracts
Take Away: Find a Better Way

11. Take Away: Bountiful Benefits
Exploring Options
Feds see software-defined potential
81% say innovation is vital to their agency's future
and
66% believe transitioning to a software-defined enterprise will foster IT innovation in their agency
81%
66%
Improve speed/performance in:
Data center – 53%
Network – 35%
Storage – 21%
Additional Software-Defined Benefits
Cost reductions in:
Data center – 53%
Network – 45%
Storage – 43%
Take Away: Bountiful Benefits
* n=132

12. Take Away: Fund Progress
Wish List
Feds suggest agencies re-direct savings to new applications, cloud, and improved program management
If your agency could save the money currently spent maintaining legacy technology and re-purpose those dollars, what would you do with the budget?
Deliver new or enhanced line of business applications
Invest in agency cloud capabilities
Improve program management
Improve digital services
Retrain IT resources
Take Away: Fund Progress

13. Take Away: Strong Support
The Right Direction
Many agencies have started the shift to software-defined IT services
Percentage Using Today
Percentage Recommending Use
65%
46%
Servers
Storage
Network
Security
Backup
59%
54%
55%
38%
50%
35%
50%
51%
Percentage who are utilizing each as a software service today
Percentage who recommend transitioning to a software-defined environment
Take Away: Strong Support 4

14. The Road Ahead
Most Feds believe the transition to a software-defined environment will take at least three years
Of those who have not transitioned* one in three (33%) have established a timeline for transition to either a software-defined data center, network, or storage system
How long do you think it will take for your agency to transition to a software-defined environment*?
Take Away: Start Now 4
* Average response across data center, network and storage

15. Recommendations Quantify legacy costs
Consider a software-defined project that will:
Centralize IT management
Automate IT maintenance
Reduce costs
Identify specific innovation opportunities

16. Methodology and Demographics
MeriTalk, on behalf of VMware, an online survey of 150 Federal IT decision makers in June This report has a margin of error of +/ at a 95% confidence level
Title Distribution
42.8%
IT Manager
19.1%
Other IT management
14.5%
IT Director/Supervisor
7.9%
Network Administrator
7.2%
Deputy CIO/CTO
4.6%
CIO/CTO
3.9%
Data Center Manager
Agency type:
60%
Federal Civilian
40%
Department of Defense or Intel
100% of respondents are familiar with their agency’s IT infrastructure operations, including servers, storage, and networking 16

17. TBD 17