Title: Data Center Design Parameters and Considerations, CBA
Course: 2016FA-MCO-110-401 > Section: Module 11: Data Centers

Click here for a downloadable version of this document:(EXTERNAL) Data Center Design Parameters and Considerations, CBA

Cost-Benefit Analysis (CBA)

It can be hard to put a price on the value provided or protected by Mission Critical installations.  Is it the business value of transactions or services provided each day?  Is it the business impact of days or weeks of downtime?  Is it the cost to start from scratch and build a new facility or system?  Is it the chance that the organization simply would not survive the loss of the MCOs?

There are certainly other business considerations such as available capital or the cost of borrowed funds to bring a Mission Critical system online, but for this discussion, assume that the need for the system or facility is absolute and the organization already has the ability to buy or build the MCO to at least some scale.

So given that part of the benefit side of the equation is already answered - the organization has a critical need for the MCO - how else can you evaluate the benefits?  If the system or facility generates revenue, that should be an easy dollar figure to project.  A power plant makes this analysis easy, but it's not so clear with an R&D facility, or enterprise data center.  The latter examples are clearly vital for continued operations yet they do not provide customer/public-facing services.  They are countless outsourcing options for all types of organizational services today, so to facilitate the cost/benefit analysis for these MCOs, take a look at options to lease space/equipment or contract another firm to provide these services.

MCOs are not easily commoditized or replaced, so the cost/benefit analysis of creating, maintaining, and expanding them is never as black and white as price tag vs. sales.  Organizations regularly engage consultants to provide such analysis, which often generates hundreds or thousands of pages of reports.  It is not necessary for operators to know all of these details, but it is quite valuable - particularly as it pertains to system design - for operators to understand how and why this analysis takes place.

Site Survey / Site Selection

Thinking at a full facility level, geographic location is often the first decision that needs to be made in setting up new MCOs.  System design may already be completed (when simply adding a new plant or facility), or may take place in parallel with site evaluation.  Keep in mind, however, that utility services, access to support contractors, travel availability and more may end up influencing what types of equipment and systems will be practical for use.

Natural disasters are one of the primary factors to consider in site selection.  Aside from the obvious threats to human safety and facility damage, this topic often surfaces first because there is so much data readily available to help with the decision process.  For instance, the US Geological Survey (USGS) has troves of free data available to review the seismic activity and risks for anywhere in the country.  The National Oceanic and Atmospheric Administration (NOAA) operates the National Hurricane Center (http://www.nhc.noaa.gov/) and provides public data on hurricane forecasts and historical events. Flood zone maps have been around for centuries.  As unpredictable as tornadoes are, there is also plenty of information available on past storms and associated damage.

Transportation access is another important consideration.  While a remote site provides obvious security benefits, it can present significant cost implications for regular transit of personnel and supplies if it is an active and dynamic MCO.  Proximity to major transportation hubs, however, flips the scale on security concerns as metropolitan areas pose an increase threat from attack.  In the post-9/11 era, we know that we are not necessarily safe from violent events due to the rise of global and domestic terrorism.  The Department of Homeland Security is a great resource for researching the threat of terrorism in an area.

Municipal and government considerations are expanding in scope for site consideration in more competitive economic times.  Traditionally, MCO location may have only taken into account local/state regulations particular to entice an organization to build a multi-million project in their area.  Contractors may be able to provide labor rate breaks because of subsidies created to boost local employment opportunities.

Again, the scope of available information to take into consideration when selecting an MCO location is constantly expanding as is the existence of highly specialized consulting firms with expertise in the MCO sector.  That level of detail and the growing list of factors being analyzed is beyond the level of knowledge needed for operators, but it is still absolutely beneficial to understand at least at a high level, why they are working where they are.

Objectives met:
- C11
- 11.1
- 11.2