1. Explosive Data Growth – How to Handle the Risks and Opportunities David Bregman Director November 7, 2006

2. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Data Growth  Increase in digital data growth 60-80% per year – “There is no more safe bet in the industry (technology) that you will need more storage next year” - Jonathan Schwartz, President Sun Microsystems, WSJ 11/05  Decrease in unit cost of storage devices of 20-30% per year is not keeping pace with growth – “The combined revenues of the two largest storage-specialty companies EMC and Network Appliance…grew by 26% in their latest four quarters. By comparison, the two biggest broadline computer companies, IBM and HP, had combined revenue gains of 6%” - WSJ 11/05

3. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Competing Priorities for IT User Satisfaction Risk Cost Storage User Satisfaction Internal service levels throughout the organization always have room for improvement Risk Reducing the risk of failure with scalable solutions that optimize processes and minimize the amount of human intervention necessary Costs Need to be managed and lowered to meet needs of the business Operational Complexitie s Busines s Demand s Audit and compliance

4. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Increasing Operating Complexity  Increasing complexity to operate enterprise storage environments – Natural data growth – Corporate mergers – Interconnected componentry – Business and data compliance and regulation – Increasing heterogeneity of technologies in the data center – Storage vendor consolidation, new technologies, and quickly evolving product strategies

5. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Low Utilization  Glasshouse is observing utilization rates of 5% to 17%  Utilization rates of 60% or higher are attainable – “Good utilization…is 70%-90%” (Gartner August 24 2005)  Storage device utilization measurements vary by company and by industry, but it is generally the ratio of data stored to disk space  Utilization is impacted by poor process maturity and a lack of good management tools

6. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Where does all the storage go?  Physical – Raw storage capacity – Procurement view  Logical – Storage capacity available after applying data protection policies – Storage architect view  Allocated – Storage consigned to users – Storage administrator view  Claimed - Storage assigned to servers – System administrator view  Assigned – Storage mounted by servers – Application owner view  Written - % of storage actually containing data

7. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Escalating Costs

8. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Data vs. Information  Data is the domain of storage device intelligence - placement, movement, and protection  Information is the business asset - available through applications  A vast quantity of data is stored in virtual warehouses without preexisting manifests, creating a challenge to address compliance and regulatory requirements  Compliance deals with information rather than data – new opportunities exist for products and services on the storage side to integrate information

9. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Data Protection - More  Its all about disk based backups now – The speed arguments – The dollars – The implications – Virtual Tape  Disaster Recovery – Cheaper – Faster – More full functioned  Archiving and Compliance

10. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Shifting Focus to Process Efficiency  Future focus for innovation is management processes – Unravel the complexity and articulate the real business issues – Manage the “supply chain” of data – Translate compliance issues into actionable tasks – Implement controls, policies, and procedures  New tools will support process efficiency and simplicity Focus on Functionality “Speeds and Feeds” Focus on Manageability

11. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Storage Security  54% of storage managers have no documented security procedures  70% of IT executives rated their storage security as fair to poor  80% of shops do not encrypt their backups  61% of IT executives believe external threats are greater despite the fact that internal users have greater access

12. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Data Value Model Value at Risk Total Cost of Ownership (TCO) $$$$$$ High Medium Low  The Data Value Model (DVM) is an approach to align management of data with its actual business value to the organization  Valuing data is a foundation for the development of the Service Provider Model (SPM)  Business alignment challenge: – IT understands cost (X-axis) – Business understands value (Y-axis) – Cannot succeed without both

13. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. IT Infrastructure Goals  Successful organizations are focusing on… – Offering services in conjunction with overall organizational maturity – Establishing standard services and technology implementations – Developing mature practices including policies, processes, and organization structure – Implementing effective metrics and reporting Source: Bittman, Thomas J.; Gartner Introduces the Infrastructure Maturity Model, Gartner, 2004  IT infrastructure organizations becoming more business focused – Technology no longer viewed as the solution for all IT problems – Internal and external forces demand a re-evaluation of organizational maturity

14. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Metrics Service Standards Practices A Service Provider Model  Service – A service focus separates the “what” from the “how” of service delivery – A service level agreement between IT and users of technology provides a pragmatic basis for alignment of IT capabilities with business objectives  Standards – Standard services and technical architecture – A stratification of service offerings allows different service level requirements to be satisfied at appropriate cost levels  Practices – Management practices are the processes, policies, and organizational model used to deliver services – As processes mature, they become repeatable, documented, measured, and finally have continuous review for improvement  Metrics – External and internal metrics define the progress of the service model – A complete cost model is critical to understanding the true cost of service delivery

15. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Transitioning to the Service Provider Model Current State High TCO Low Satisfaction Current State High TCO Low Satisfaction Service Provider Model (SPM) Low TCO High Satisfaction Service Provider Model (SPM) Low TCO High Satisfaction Data Value Model (DVM) Transition Foundation Data Value Model (DVM) Transition Foundation Storage Management Lifecycle (SML) Transition Activities Storage Management Lifecycle (SML) Transition Activities Continuous Alignment and Control Key Performance Indicators  The Storage Transformation Framework is a methodology for the assessment, design, acquisition, deployment, migration to, and operation of enterprise class storage  You can create a framework that correlates with key industry standards such as ITIL and COBIT. Storage Maturity Model (SMM) Transition Phases Storage Maturity Model (SMM) Transition Phases

16. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Storage Management Lifecycle Domains Strategy & Planning 1.Strategy (Business Requirements) 2.Policies 3.Discovery 4.Technical Requirements Strategy & Planning 1.Strategy (Business Requirements) 2.Policies 3.Discovery 4.Technical Requirements Operations & Maintenance 1.Service Delivery 2.Infrastructure Management 3.Service Support 4.Compliance Operations & Maintenance 1.Service Delivery 2.Infrastructure Management 3.Service Support 4.Compliance Provisioning 1.Purchasing 2.Change Control 3.Activation 4.Service Acceptance Provisioning 1.Purchasing 2.Change Control 3.Activation 4.Service Acceptance Customer Care 1.Service Requirement 2.Service Fulfillment 3.Service Quality Customer Care 1.Service Requirement 2.Service Fulfillment 3.Service Quality

17. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Storage Maturity Model State Change Characterization ReactiveMonitoredProactivePredictive Business Aligned People OrganizationApplication-Centric Platform Team Storage Team (IT Aligned) Storage Team (LOB Aligned) Business Analysts Included in Storage Team Operations Reactive Incident Management Basic Reports, Metrics, and Escalation Configuration and Change Management Capacity Forecasting Integrated Storage Budgeting and Provisioning Process Service Management None SOPs for Key Function Integrated SOPs Workflow Driven SOPs Business Driven SOPs Metrics and Reporting Exceptions Some Base Metrics Simple Performance Indicators Metrics Integrated into SOPs Business KPIs Reporting Technology Data Protection Distributed Backup and Recovery Centralized Backup Data Categorization and Policy Groups Virtualized Protection Target Business Aligned Continuance and Recovery Storage Management Distributed Storage, None Networked, Storage Network Management Tiers of Storage, SRM Tools Virtualized Storage Environment Tiers of Storage Services Business Financial Planning IT as an Overhead Fixed Asset Cost Management Administration Cost Management Total Cost Storage Ownership Management Total Cost of Data Ownership and Lifecycle Management Business Interface Annual Budgetary Informal Requests Support Desk Service Level Objectives Service Level Agreements with Business KPIs Level 1 Level 2 Level 3 Level 4 Level 5

18. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. The Typical Approach Custom Services Implementation Strategic Services Managed Services 3 1 24 Disruption

19. © 2001 - 2006 GlassHouse Technologies, Inc.This material may not be reprinted or redistributed without the express written consent of GlassHouse Technologies, Inc. Questions? Thank you! David Bregman, dbregman@glasshouse.comdbregman@glasshouse.com