Among the virtues of virtualization is that the technology dovetails nicely with other, newly minted IT strategies that have captured the attention of CIOs. Fjeldheim sees a common thread running through virtualization, utility computing, grid computing and service-oriented architecture. "Everyone is starting to live in a shared world," he says. "All of these things are ways to provide better service to the customer, because you are no longer dependent on a single point of failure, and so you can bring costs down and add or take away resources as needed."

Rich Lechner, vice president of virtualization at IBM, thinks companies have just begun to see the benefits of virtualization, which he says will "insulate users from underlying infrastructure, and open the door for utility computing."

Mark Stahlman, managing director at Caris & Co., a New York City-based investment bank, believes that virtualization will allow for "the radical simplification" of computer and networking systems, and that it is kick-starting the next "fundamental shift" in the way computer and networking systems are used. That shift, he says, will be similar in scope and investment to the move to decentralized, networked computing that took place in the 1980s and 1990s. "Building virtual 'clouds' of computing, storage, networking and applications resources—permitting flexible deployment and rapid growth, as well as per-usage payments—is becoming the Holy Grail of the IT industry," Stahlman says.

Meanwhile, cheaper, faster and more reliable communications networks are forcing companies to rethink the distributed systems they worked so hard to build over the past two decades. Says Hannaford's Homa: "Retailers used to have very distributed systems in stores, but the world has turned upside down in the past five years. With virtualization, retailers are picking up their applications from stores and putting them back down in the corporate data center," where they can be used more efficiently and monitored more easily. Hannaford recently consolidated 300 servers that formerly had been located in stores and replaced them with a new mainframe system from IBM. The mainframe already has 62 virtual servers running some of its most strategic applications, including its Web-based vendor portal, which Hannaford's suppliers use to schedule docks for delivery, quote prices and more.

Virtualization also gives CIOs some wiggle room when it comes to planning for the future. "In the retail industry, the hardest thing is knowing where we are headed from the standpoint of size and growth," Homa says. "Virtualization allows me to not be all-knowing right now. It allows me to get it slightly wrong and adapt as we go. That is the greatest benefit."

Ask your IT managers:
  • What is our strategy for integrating the virtualization software products we use?

    Ask your CTO:
  • How can virtualization help advance our SOA or grid computing objectives?

    To download a Fact Sheet, click here.

  • This article was originally published on 01-06-2006
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