SolarWinds Cost Model

So at the end of the day, somehow the bills have to be paid. Many companies may "absorb" the cost of SolarWinds. I personally am at a crossroads where I want to

recoup the costs for SolarWinds, especially as I move the platform to a more application centric monitoring model.

The business (non -IT), development, and non-hardware users are already benefiting from our application centric model as large and complex applications and platforms move through the Development cycle, and are able to test their applications and services against the hardware they have built.

So, now I am looking for suggestions for a CostModel to recoup from Projects/Business the costs of SolarWinds. As a simple base model, one could simply add total license costs and divide per number of servers monitored - for an annual cost. I understand their is labor, SolarWinds servers, etc. also, but I am looking for any input that other SolarWinds Adminitrators have used successfully. Am also shamelessly looking to get out of begging for $$$ from one bucket as I expand my platform, I want my own bucket.

Help very much appreciated.

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rschroeder

Show that Solarwinds is not a cost or a liability, but is directly correlated with improving income and profit. It's not so bad as proving a negative, since you can show how costs go up and profits go down when systems are not monitored and customers are affected.

It's a very short step to go from there to displaying how you can actually prevent down time with Orion modules proactively warning you about future negative situations (out of CPU or memory resources, out of bandwidth, etc.).

Go even further and show how your proactive and predictive actions based on output from SAM or NPM's QoE improves and enhances customer experiences, resulting in increased efficiency of your network performance and gains in sales and reductions in complaints.

You can compare the lost revenue associated with unexpected outages or decreased performance without Orion monitoring to the decrease in lost revenues when Monitoring IS in place and acted on.

smoked_angus

Well not to sound too cheeky, while yes that is the other side of the coin (value), the bean counters still have to worry about their buckets outside the IT side of the house. I do appreciate your response, sir.

byrona

smoked_angus I am not sure how your organization is laid out; are you setup in a way where different departments can effectively bill the other departments for the services that they are providing? I know this is how some larger organizations work and if so you could consider essentially billing those other groups for the services you are providing.

There is also the option to consider baking the cost of the SolarWinds platform(s) into the cost of your services but then again, this will depend on the structure of your organization.

These are a few options off the top of my head, I hope this is helpful.

gfsutherland

smoked_angus

One model I have used in the past is a cost allocation based on usage.

A simple model.... You have 20 servers, a department has 5 servers it uses.... 25% of the cost.

Another way is user based.... The more users in an area the greater the allocation. This works great as a seed number when billing baseline IT costs across the enterprise..... (the "just to keep the doors open" model).

Hope that helps... Good luck...

zennifer

Wow .. been down this road too many times!!! You need to shove so many facts down the bean counters throat so that they choke; making them understand that absolutely every node/NIC/application/IP address/service has a value, and there is a cost associated to keep them running: Man hours, physical hardware, switches, routers, NICs, each and every port/node/application has a value ... go assign one!

I would use your solarwinds to do most all the reporting - you can now export to excel .... do every Inventory report that you can run... each item in that inventory needs to have a dollar amount assigned ... get the list set up first .. then you can tweak your numbers to match what you need... it is a total game ,.. farce ... fake out ... people have a hard time handing out money for something that is not tangible!

Once you have your list ... ask the bean counters which plugs you can pull to save them money? Obviously ... they need absolutely everything plugged in ... so .. you need your money!! This is a very tedious task ... I have done this 2 times in 20 years ... took me a couple of weeks to document ABSOLUTELY everything (and I did not have SolarWinds at the time!!!) - I then arbitrarily assigned numbers to each Inventory item - again ... I worked the numbers to my advantage ... Google is your friend when trying to estimate costs ... you can reverse engineer your current SW costs to assign a cost to each "node" - break it down however you want ... it is all about the presentation ... numbers numbers numbers ... This is what you have $$... AND this is what you need in order to achieve the Company's Mission!

I promise ... if you take your time to do this ... you WILL get the funding you need. Overwhelm them with information and the critical fact that without proper support of the technology, the business will ultimately fail!

byrona

That is freaking brilliant and hilarious at the same time!

rschroeder

Let's extrapolate what others have said in other responses (e.g.: generate justifications for Orion funding by billing other departments for the services they get from Orion):

Each source of income to your company benefits from Orion. Divide Orion's costs (not just licensing, servers, and support contracts, but also future upgrades and expansions, and more IT staff to set up and monitor and upgrade and maintain Orion) into the number of income sources. For example: if you have four internal customers-departments and your Orion costs are $20K/year, supporting those customers properly becomes a $5K/year recurring charge to them. If your company has this type of income structure, Orion becomes an easily recognizable asset--it brings in dollars to your group within the organization, while the other client groups are finally supporting their own weight on your infrastructure.
If you DON'T have this structure, start working on selling it so you DO get things working in your favor. Sell the concept to your team, your boss, the C-level, Marketing, Accounting--and do so firmly and with confidence.
Then start marketing it and selling the Orion solution to new customers--get into new areas that touch completely new customers, and you've also created a new external money maker.

Example: Let's say your company has been making or marketing or selling widgets to the farming industry for years, and everyone in the organization experiences marketing myopia--all they can see is farmers for customers. But you know there are extra cycles available on your pollers that could monitor and manage anything. So across the street from your nearest farmer customer is the grocery store, and next to them is the general store, and down the street is the welder's shop, who's next to the canvas cutter . . . All of them have network resources they rely on to get their product advertised, to shop for product and place orders, to send / receive e-mails, even if it's a simple broadband connection for just doing e-mail and browsing. Some of your business neighbors may even have outsourced IT resources to local small town Mom & Pop ISP's or to "The Cloud" (Application Service Providers). And these neighbors of yours have no way to monitor availability or latency--no way to measure or enforce SLA's with their ISP's. Worse, they might not even KNOW about SLA's.

How much of your time would it take to do the most basic of monitoring for them--ICMP polling of the outside of their broadband DSL gateway or cable modem? And then send them an automated weekly or monthly Up Time Report?

Considering Orion's already up and running for you, how much more trouble & time would it be to set up a DMZ'd VPN to them and sell them an application performance monitor service using your SAM or QoE in NPM?

Probably a lot less time than it takes to get Accounts Receivable to set up billing for your service--and I bet they'd be only too happy and ready to get another source of income going.

The beauty is that all this is already running in your internal operation. Certainly your internal customers should be paying for the service, buy why not receive additional income from other businesses who need those up time reports to prove their ISP's are providing the services for which they've contracted? Sure, it's not for everyone, but has anyone in your organization even considered going beyond your traditional income and marketing customers?

Everyone has an Internet connection, and everyone knows folks or businesses who complain they're not getting what they paid for. And you have the tools and expertise that can shine a light on those ISP's issues.

If you get Management's blessing to set up a DMZ'd VPN tunnel to new customers, you can monitor their own internal servers via WMI, or report on the status of their databases and web performances. This could become a income producer, if there are those at your C-Level who have shed their blinders to remove their marketing myopia.

Internally, charging your Orion NPM services to other internal departments might feel like smoke & mirrors to the bean counters, even though it's not. But once you bring in 1$ from a client external to your organization, you've broken the flood gates wide open, and now instead of being focused on industry X, you've made everyone in the world your potential customers.

(And I don't even take in caffeine!)

gerardodada

It's interesting that organization still question the value of their investments in IT and in monitoring, given how much of the every day work in every function of a company depends on technology.

We understand this is a common problem, so we created a document to help you justify the investment in SolarWinds, but applies to many things in IT:

Why SAM is a smart investment for your team I hope you find it useful. Your feedback is welcome.

zennifer

It works !!! I have had to do a scaled-down version a couple of times .. presented to the board or directors ... and they ultimately say ... Jennifer, I think we would be foolish not to implement the solution you have presented!!! I take great pride in securing funding!!! I started in business then migrated to technology ... I have had my fill of politics and game playing .... I have finally matured (I am a woman.. on behalf of all of us ... I am sorry ... we are way too emotional and passionate!!) instead of arguing with passion, I now overwhelm then with hard facts, and a lot of information! In the last 5 years .... I have not failed to secure funding for any project!!! Very proud of what I have done in my current position! In less than 5 years I have: Implemented VM Ware Data Center with a phenomenal NetApp Storage repository, PCoIP clients running VM Ware Horizon, on all flash storage (NetApp), a totally new Network Infrastructure, switch from Cisco to Brocade, and I just implemented the Palo Alto NextGen Firewall Solution. For the first time in my life... I am actually having fun at work! I feel like I have the upper hand... finally!!!! Knowledge!!! Experience ... a lot of Experience!!!! There are way too many games being played in business... a lot of folks are totally driven by greed ... I try to stay a couple of steps ahead of those folks ... I now anticipate the antics!!! Experience!!!!!

Which reminds me of a project getting ready to kick off... new facility ... new cabling ... Political Figure - pay to play .... unfortunately ... I have no re-course, but to play the game out and not give the vendor an inch of wiggle room. Sometimes, we are forced to walk down a path that we know is wrong... I have wasted too much time grieving in the past... I now approach it as a "game" - it is not hard to out wit an idiot... it take a lot of effort to stay on top of things.. but if your hear is in the right place ... things WILL work out!

zennifer

Information is a powerful tool!!! Thanks for sharing! Falls right in line with my new facility ... SAM is one of the components that I will need to up the licensing on ... thanks for placing the document on a silver platter for me!!! I WILL INCORPORATE!!! Again ... overwhelming them with information appears to be our strongest argument when securing IT funding!

Technology is not tangible until it fails!

smoked_angus

Great feedback, thank you all!