Building a Strong Technology Foundation for Equipment Dealerships

Legacy infrastructure is a big problem — especially in industries that are hesitant to adopt new technologies. Old systems groan under their own weight after decades of uptime, while new systems demand valuable time and money to avoid obsolescence within mere months of deployment. IT leaders look to stay ahead, seeking efficiencies through outsourcing and cost-cutting. However, enterprise systems don't always thrive under these conditions, forcing us to spend beyond our means or risk jeopardizing the longevity of these high-touch applications.

This talk outlines a holistic approach to balancing cost and flexibility when executing digital transformation projects. Understanding the “standardize or specialize” paradigm helps determine when to cut back and when to invest in IT systems. Additionally, a strong grasp of different models for IT infrastructure fosters a more realistic view of long-term TCO. Changing how we approach IT projects enables us to invest heavily in key areas by cutting back safely in others.

Transcript

1. Infrastructure Essentials: Building a Strong Technology Foundation for Equipment Dealerships Thayer Luscian, Above The Fray • January 18th, 2024
2. Pro tip: don’t get your infrastructure education from stock photos on Google images
3. Thayer Luscian Head of Engineering abovethefray.io • thayer.dev Based in Lancaster, PA Infrastructure expert Cat lover
4. Agenda Infrastructure & You Types of Infrastructure The State of Infrastructure Three Models for Infrastructure Right-Sizing Your Infrastructure Let's Get to Work!
5. Infrastructure & You Almost every part of our daily lives, at work and at home, involves technology. And, every piece of network- connected software runs on some sort of infrastructure. Projected IT spend $5.1T In 2024, worldwide1 Projected datacenter spend $260B In 2024, worldwide1
6. Types of Infrastructure
7. Types of Hardware NETWORK EQUIPMENT END USER COMPUTE SERVERS
8. Common Server Workloads Application Server Database Server File Server Mail Server Network Server
9. Key Point IT infrastructure is becoming increasingly tied to the applications it hosts.
10. Virtualization •Allows for the deployment of many diverse types of infrastructure within a physical server or cluster •Can scale from single server to thousands of servers •Spans both on-prem and cloud models • Often deployed on-prem via VMware or Microsoft Hyper-V • Most clouds employ some form of virtualization •Has existed in some form for decades
11. The State of Infrastructure
12. Legacy Infrastructure •All systems eventually become legacy •Prevalence varies by industry •Maintenance, upgrades, & patching are often deprioritized in favor of business initiatives •Delayed upkeep is often more difficult & risky, up to the point of no return Mainframe usage 67% of the Fortune 1002 Employee productivity 54% feel restrained by legacy systems3
13. Critical State: The Point of No Return •Most applications are designed for gradual patches & upgrades, with a full- on migration every several years •Delaying several patches/upgrades can increase LoE to rival full migration •Delaying full migrations can have lasting consequences that set organizations back & are very difficult to overcome Example I: Windows Server 2008 •Released 2008 •R2 EOL: 2020 •Upgrade path: migrate to new OS Example II: IBM AS/400 + ERP •Released 1988 •7.5 EOL: Still supported •Upgrade path: migrate to Modern ERP
14. IT Outsourcing •IT outsourcing is skyrocketing •Modern architectures enable both systems & people to be outsourced •Legacy architectures struggle under an IT outsourcing model
15. Outsourcing Cost cutting High-touch systems + Recipe for legacy infrastructure
16. What I’m not Saying Avoid outsourcing Increase your IT spend Avoid bespoke software Quit your job and give up
17. Three Models for Infrastructure
18. Hardware Slice ‘n dice No matter where (or if) you manage your infrastructure, it’s still there! * With an on-prem model, you can also choose to rent space in a datacenter and outsource the task of maintaining the physical hardware; this is known as colocation Operating System & Services Application On-prem*
19. Hardware Slice ‘n dice No matter where (or if) you manage your infrastructure, it’s still there! Operating System & Services Application Cloud IaaS
20. Hardware Slice ‘n dice No matter where (or if) you manage your infrastructure, it’s still there! Cloud PaaS Operating System & Services Application
21. Hardware Slice ‘n dice No matter where (or if) you manage your infrastructure, it’s still there! Operating System & Services Configuration Cloud SaaS Custom Code
22. Cost vs. Flexibility On Prem Cloud IaaS Cloud PaaS Cloud SaaS Hard Costs Soft Costs Flexibility
23. Right-Sizing Your Infrastructure
24. Define What Matters STANDARDIZE For systems & processes that should conform to industry standards… •Modify business process to conform to industry standards & fit workflows of standard systems •Outsource to third-party vendors •Use the 80/20 rule to identify & eliminate the 20% of exceptions that introduce 80% of the complexity SPECIALIZE For systems & processes that set your business apart from competitors… •Develop a clear understanding of the competitive advantage and work to improve it further •Invest in bespoke systems that conform to your unique mode of operations •Spare no expense on building custom capabilities
25. Talk about TCO •Ask the right questions: • What is the expected lifespan of the application/system? • How frequently will patches & upgrades needed? • When is the EOL? •Get realistic about TCO early & don’t sidestep questions during sales cycle •Consider long-term costs of services & asset amortization vs. subscriptions •Prepare to spend more than you plan
26. Be Realistic About Growth •Understand different ways your infrastructure can scale • Horizontally • Vertically •Predict how your needs may evolve • Capability • Capacity •Allow realistic margins where it counts •Don’t overbuy because of unrealistic growth/expansion goals
27. Let’s Get to Work!
28. Prioritize Your Projects4 •Importance •ROI impact •Growth impact •What if we don’t do this? •Urgency •Security / stability concerns •Scalability concerns •What if we don’t do this now?
29. Find the Right Tool
30. Pick the Right People IF YOU BRING IN-HOUSE… •How big of a team do I need? •How do I structure my team? •What type of expertise do we need? IF YOU OUTSOURCE… •How many vendors should I use? •Will they help me pick the right tool, or are they trying to sell me? •Have they done this before? •Will their engagement style enable us to collaborate well?
31. References 1. “Gartner Forecasts Worldwide IT Spending to Grow 8% in 2024.” Gartner,18 Oct. 2023 https://www.gartner.com/en/newsroom/press-releases/2023-10-18- gartner-forecasts-worldwide-it-spending-to-grow-8-percent-in-2024. 2. Wang, Ray. “Why the Mainframe Is Alive and Thriving.” ZDNET, 5 Mar., 2021. https://www.zdnet.com/article/inside-why-the-mainframe-is-alive-and-thriving. 3. “State of Workplace Technology.” Freshworks, n.d. https://www.freshworks.com/resources/reports/workplace-tech. 4. Cmglee. Eisenhower Matrix. Own work, Wikimedia Commons, https://commons.wikimedia.org/wiki/File:Eisenhower_matrix.svg.