Customer Solution Case Study

Real Estate Firm Expects to Avoid $560,000 in IT Costs by Using New Operating System

OverviewCountry or Region: United StatesIndustry: Real estate

Customer ProfileBased in Carmel, Indiana, Pedcor Companies develops, constructs, and manages both market-rate and affordable housing communities. The organization employs 550 people.

Business SituationPedcor wanted to expand its virtualized environment and automate IT management tasks by building a private cloud, enabling the IT staff to deliver services that empower employees and boost business agility.

SolutionIt chose the Windows Server 2012 operating system and Hyper-V virtualization technology running on HP hardware and manages the environment with Microsoft System Center 2012.

Benefits Reduces IT costs Provides the basis for a private cloud Empowers employees to work more

productively Turns IT into a business enabler

“We use Windows Server 2012 to optimize our IT for building a private cloud and to help us manage our data center, remote users, storage, and business continuity challenges.”

Sumeeth Evans, Vice President of Information Technology, Pedcor Companies

To meet today’s economic challenges, Pedcor Companies’ IT staff uses superior virtualization, data center, and endpoint management tools to deliver better services to the business, while saving time and money. Pedcor is saving US$20,000 in licensing by retiring its VMware and Citrix solutions and deploying Windows Server 2012 with Hyper-V virtualization technology, and Microsoft System Center 2012, running on HP BladeSystem hardware. IT staffers plan to build a private cloud and expect to recapture 40 percent of their time through automation. Pedcor enabled easy access to corporate data for remote employees, avoiding $92,000 for a virtual private network and expanded its virtualized environment by 60 percent. It will also save $203,000 in hardware costs. Pedcor reduced storage requirements by 35 percent, saving $42,000 in storage costs, and is saving $12,000 in annual power costs.

SituationPedcor Companies was founded in 1987 when principals Gerald Pedigo and Bruce Cordingley developed an affordable rental housing community in central Indiana in the United States. To date, Pedcor has developed more than 17,000 apartment units in 14 states throughout the midwestern and western United States.

For many years, Pedcor enjoyed rapid growth. However, with the recent recession affecting the real estate and construction industries, Pedcor is turning to its IT department to find new technologies that reduce costs, increase business agility, and boost employee productivity—all the attributes of a company capable of competing in a tough economic environment. “We took this opportunity to evaluate our IT platform and to develop a strategy to turn IT from a cost center to a business enabler,” says Sumeeth Evans, Vice President of Information Technology at Pedcor. “Our goal was to make money by saving money.”

Remote Access IssuesThe Pedcor corporate campus consists of four buildings in Carmel, Indiana, where 150 employees work. Approximately 300 more employees work at 77 remote offices. None of the remote sites are equipped with local IT services or server infrastructure. Pedcor does not have any point-to-point connections or private networks, so every employee had to access business data, applications, and IT services using a remote access solution based on Citrix technologies and Windows Server 2003 Terminal Services. And the 11 IT professionals at headquarters had no way to monitor and manage the company’s

more than 400 PCs and laptops at the remote sites.

“We wanted to help employees become more efficient by enabling quick, easy access to business applications and data—without the overhead of a virtual private network—and by providing better managed, more secure desktops,” says Evans.

Poor Business Continuity The overly crowded data center in Carmel contained 65 HP industry-standard servers running the Windows Server operating system. The company maintained a five-year-old VMware-based virtualization solution that was attached to HP Lefthand and Dell Equalogic storage area network (SAN) solutions and included two host servers with 24 virtual machines. This amounted to only 30 percent of the servers at the data center. Frequent power spikes caused unplanned downtime that was difficult to avoid because there were no high-availability clusters and the VMware solution did not offer live migration capabilities.

“We are a midsize company, but our requirements for uptime are as paramount as those for a larger enterprise,” says Evans. “If our development team is ready to close a multimillion dollar deal and the network is inaccessible, that can cost more than six months of work. We needed to do something about better business uptime.”

IT Management Challenges With no management tools to automate manual tasks, the IT staff had to take servers offline for updating and other administrative work. “Instead of spending

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“Instead of spending 40 percent of our time on manual tasks such as updating servers and provisioning users, we wanted to provide IT services that deliver real business value to our departments.”

Sumeeth Evans, Vice President of Information Technology, Pedcor

Companies

40 percent of our time on manual tasks such as updating servers and provisioning users, we wanted to provide IT services that deliver real business value to our departments,” says Evans. “We needed to automate time-consuming system administration in our data center and introduce self-healing and proactive management. For this, we needed powerful management tools that would improve insight into our virtual and physical environments.”

IT staff members also faced the challenge of increasing data storage requirements. “We don’t want to force our employees to go to great lengths to find their data, so we try to expose as much storage as the user requires on our file servers,” says Evans. “We needed to find a more cost-effective storage solution.”

Vision for a Private CloudTo achieve its goals, Pedcor had to expand its virtualized environment and build a private cloud. A private cloud would enable the company to use its own hardware for the delivery of on-demand IT services and applications that run on a shared physical infrastructure. The efficiencies and cost savings of private cloud computing would help Pedcor reduce IT costs through an IT management infrastructure that consolidates network, storage, and computing functions. The IT department could use the private cloud to help meet the business’s demands for faster, more reliable business application services so employees could work more productively.

“Our VMware solution was not capable of handling our mission-critical, line-of-business application, called Pedcor

Management Application [PMA],” says Evans. “PMA was developed in-house and is used by employees at all 77 sites for collecting and processing rents, so it has a direct effect on our bottom line. For the first 10 days of the month, the application is in high demand. We wanted to run PMA in a private cloud to automatically deliver the computing resources that it needs to accommodate spikes in demand and improve performance for our users.”Pedcor had reached a critical point in its evolution. To rise above a challenging economic environment, the company needed to empower the IT department to better support the business and boost employee productivity. And to do that, Pedcor had to deploy the right combination of cloud computing and data center management technologies and install them on new hardware designed to maximize their value.

SolutionIn May 2012, Pedcor found the IT solution that it was looking for. The company joined the Technology Adoption Program (TAP) for Windows Server 2012 and deployed a release candidate version of the server operating system. It used Hyper-V technology in Windows Server 2012 to build an expanded virtualized environment that consists of an eight-node cluster running 96 virtual machines in production currently on HP BL460 blade servers and HP Virtual Connect Infrastructure.

“We asked ourselves: ‘Do we upgrade our VMware solution and invest in a larger SAN solution, or do we retire VMware and upgrade to Windows Server 2012?’” says Evans. “We chose Windows Server 2012 because it has an enterprise-ready

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“We chose Windows Server 2012 because it has an enterprise-ready hypervisor built in, it offers many other features that we need, and it enables us to avoid an expensive storage solution."

Sumeeth Evans, Vice President of Information Technology, Pedcor

Companies

hypervisor built in, it offers many other features that we need, and it enables us to avoid an expensive storage solution. On the one hand was a virtualization solution that required experts we couldn’t really afford, and on the other hand was a complete operating system—primed for building private clouds—that all of us can work with easily. Choosing Windows Server 2012 was a no-brainer.”

Complementary Management Technologies and HardwarePedcor was also attracted by Microsoft System Center 2012, a product for managing data center resources, private clouds, and endpoint devices. The company is participating in the TAP for Microsoft System Center 2012 Service Pack 1 and evaluating how it will help to manage the compute, storage, and network elements of its planned private cloud. Windows Server 2012 and System Center 2012 are built to work together and come with similar, processor-based licensing options. Specifically, Windows Server 2012 Datacenter and System Center 2012 Datacenter enable Pedcor to run and manage an unlimited number of virtual machines on up to two physical processors per server.

“We compared the cost of upgrading our VMware solution with the fact that we already had Windows Server 2012 in our Microsoft Enterprise Agreement and System Center 2012 was covered by our Microsoft Enrollment for Core Infrastructure. It didn’t take a calculator to figure out the better way to go,” says Evans. “Also, we got everything into one licensing umbrella, which simplified license management.”

Pedcor evaluated multiple vendors for a hardware solution that would optimize the value of all the new features in Windows Server 2012. It chose HP. “We were impressed with the HP BladeSystem, especially the Gen8 series, where we saw great power and efficiency savings equating to [US]$1,000 a month,” says Evans. “So we decided to make our whole network backplane based on HP switches. [A system's backplane acts as a communication link between the boards and subsystems that make up a complex device, such as a router or a server blade.] We created a 10-gigabit-per-second backplane network using the HP 2910 al Switch Series, which supports up to four optional 10-gigabit Ethernet ports per blade, to connect the four buildings on our corporate campus.”

An Expanded Virtual EnvironmentWithin three months of joining the Windows Server 2012 TAP, Pedcor had expanded its virtualized environment, including the PMA solution, from 30 to 90 percent of its data center. The eight-node Hyper-V cluster will host on average 35 virtual machines per node, offering performance and scale not possible before.

“With Windows Server 2012, you can allocate up to 64 virtual processors per virtual machine. With that kind of processing power per virtual machine we are able to virtualize our PMA solution,” says Evans. “And because the HP blade servers can take more than 240 gigabytes of RAM and we use HP Virtual Connect Flex-10 NICs [network interface cards] for networking, we are sure to have enough

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overhead and future expansion for peak periods of use.”

Pedcor also uses HP Insight Control infrastructure management solution to deploy, migrate, monitor, control, and optimize its HP BladeSystem servers through a single, simple management console.

By the time Windows Server is released to manufacturing, Pedcor expects to have virtualized almost 100 percent of its data center. To back up production workloads, the IT staff uses System Center 2012 running on an HP BL460c server connected to an HP MDS600 direct-attached storage solution.

New and Improved Capabilities That Deliver Business ValuePedcor is evaluating additional new and improved features in Windows Server 2012 that the company expects to deliver business value, including:

DirectAccess. Using DirectAccess, Pedcor can enable secure tunneling from any computer at any of the 77 remote sites, as well as for mobile users, back to the corporate network without the overhead of a virtual private network. DirectAccess automatically establishes a bidirectional connection from client computers to the corporate network—without requiring any management agent—so remote employees are always connected and the Pedcor IT staff can manage their computers.

Hyper-V over Server Message Block 3 (SMB3). Pedcor gains a new storage option for Hyper-V that is a flexible,

easy-to-use, and cost-effective alternative to expensive storage hardware. Windows Server 2012 supports SMB file storage on Hyper-V virtual machines running on industry-standard servers. For high availability, the shared storage can be placed on a failover cluster. “We have configured Hyper-V over SMB3 running on an HP BL460c server connected to HP MDS600 direct-attached storage, and we are getting the performance that we need,” says Evans.

File and Storage Services. These features make file-based storage for critical applications (including Microsoft SQL Server and Hyper-V workloads) a less expensive option than SAN solutions. “We are running File and Storage Services on two HP BL460c blade servers connected to an HP MDS600 direct-attached storage solution that can take up to 70 drives,” says Evans. “At this point, we have approximately 27 terabytes of storage that can be expanded to 40 terabytes just by using off-the-shelf HP 3.5-inch SAS/SATA drives. We are using Storage Spaces to preallocate virtual storage space, only adding hard drives as needed. We use data deduplication to reduce storage requirements and save on hard disk space.” Storage Spaces uses inexpensive drives and their controllers, and turns them into a pool of storage that is divided into spaces that are used just like regular disks. Data deduplication is a data compression technique for eliminating duplicate copies of data.

Hyper-V live migration and storage migration. Pedcor can use these

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“Windows Server 2012 and our HP MDS600 storage solution give us the capability to double our storage capacity without adding hardware except for hard drives as needed.”

Sumeeth Evans, Vice President of Information Technology, Pedcor

Companies

capabilities to move multiple running virtual machines and virtual hard disks between physical hosts or storage locations with no downtime. “All the blade servers in our cluster come with two 10-gigabyte network interface cards and they are all on the same backplane, so the movement of virtual machines from one node to the other is so fast that users don’t detect it,” says Evans.

Cluster-Aware Updating. This feature supports automatic updating of clustered servers with little or no loss in availability during the update process. Pedcor IT staffers can use Cluster-Aware Updating to take one node of the cluster offline, install updates, perform a restart, and brings the node back online, without interrupting service.

Hyper-V Replica. Hyper-V Replica provides a storage-agnostic and workload-agnostic solution that replicates virtual machines over IP-based networks to a remote site. Pedcor is using Hyper-V Replica to replicate key virtual machines, such as Microsoft Exchange Server 2010 messaging and collaboration software, Microsoft SharePoint Server 2010, and Active Directory Domain Services (the directory service that is an integral feature of the Windows operating system). “We found a colocation facility and installed a couple of our decommissioned servers to run Hyper-V Replica for 30 virtual machines. This is a great feature that we didn’t have to pay for because it is built into Windows Server 2012,” says Evans.

Pedcor has also deployed the Windows 8 operating system to 25 people in different

departments who are using HP Z420 workstations, HP 8200 series PCs, and HP 8400 series portable computers. “All the Windows 8 users love the clean user interface and the available modern interface apps,” says Evans. “Even employees in our design group who used Mac computers are thrilled with the interoperability that they now have with the Microsoft Office applications that everyone uses. We will be deploying Windows 8 to all our 150 corporate client computers by the end of October 2012.”

BenefitsPedcor is relying on Windows Server 2012, System Center 2012, and HP Insight Control running on up-to-date HP hardware to achieve its IT and business goals: to run a well-managed data center that takes advantage of private cloud computing to deliver the business applications and user experience that employees expect. “We use Windows Server 2012 to optimize our IT for building a private cloud and to help us manage our data center, remote users, storage, and business continuity challenges. System Center adds data-center and desktop management capabilities. And we couldn’t have achieved what we have without HP BladeSystem hardware,” says Evans. “Today, we have a platform that meets our expectations for the future.”

Windows Server 2012 has already delivered significant business value, helping Pedcor reduce costs, get ready for a cost-effective private cloud, and deliver better IT services to empower employees and improve business efficiency.

Reduces IT Costs

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“Hyper-V Replica was another reason we avoided paying $65,000 for a SAN solution."

Sumeeth Evans, Vice President of Information Technology, Pedcor

Companies

If Pedcor had decided to upgrade its VMware solution to build its private cloud, the company would have had to spend approximately $65,000 for a larger SAN solution. Most of this cost—$53,000—was avoided by using Hyper-V over SMB3 and HP direct-attached MDS600 storage solution. Choosing Windows Server 2012 helped Pedcor save more than $20,000 on software licensing by retiring its VMware and Citrix solutions. By using DirectAccess, Pedcor avoided the $92,000 cost of implementing a VPN while improving employee access to corporate resources. Using data deduplication and Storage Spaces, Pedcor reduced storage requirements by 35 percent, saving an estimated $42,000 in storage costs.

“Windows Server 2012 and our HP MDS600 storage solution give us the capability to double our storage capacity without adding hardware except for hard drives as needed,” says Evans. “So we avoid the costs of overbuying storage ahead of time, just to have it available.”

By expanding its virtualized environment using Windows Server 2012, Pedcor avoided approximately $150,000 in replacement costs for 18 servers. This saving will increase to $175,000 when the company finishes virtualizing up to 150 servers in its data center by October 2012. Thanks to server consolidation, Pedcor is reclaiming space in its data center, reducing the number of racks required by 75 percent and saving an estimated $12,000 a year in power and cooling costs. With Hyper-V Replica, Pedcor used decommissioned servers from the data center, saving $28,000 in buying new hardware for a business continuity solution.

“Hyper-V Replica was another reason we avoided paying $65,000 for a SAN solution. We were thinking about a SAN solution because it offered off-site disaster recovery capabilities, but now we don’t need it,” says Evans.

Provides the Basis for a Private Cloud As a first step toward building a private cloud, Pedcor used Hyper-V in Windows Server 2012 to expand its virtualized environment from 30 percent to 90 percent of the data center, and is managing both virtual and physical machines using System Center 2012. IT staff is already saving time thanks to live migration and Cluster-Aware Updating.

“Our private cloud is the next step for Windows Server 2012, and we envision it to be elastic, self-healing, and managed through a single console,” says Evans. “We expect to recapture 40 percent of IT staff time by reducing manual labor, thanks to Windows Server 2012 and System Center 2102 working so well together. With a private cloud, we can automate the management and delivery of healthy applications to boost employee productivity. Windows Server 2012 is the most efficient way to get us there.”

Empowers Employees to Work More Productively IT staffers use Windows Server 2012 features and the time that they save through automation to empower employees with better IT services. With DirectAccess, remote employees enjoy always-available access to their corporate resources and the IT staff can use System Center to access remote computers to keep

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them up-to-date so employees can work more productively.

Pedcor has already virtualized the PMA application and is using System Center to monitor its health and enable proactive support so the application is running at reliable performance levels. “We used to have many instances where PMA performed inefficiently and affected our employees’ ability to collect rents,” says Evans. “Now we have better insight into its health and when we build our private cloud, we’ll be able to automatically scale computing and storage resources to keep this critical business application at peak performance.”

With better control over endpoints and insight into servers, the IT staff can ensure that employees are not as frequently inconvenienced by computer issues. The company has already noticed a reduction in planned and unplanned downtime by 40 percent. Support calls are also on the decline. “We used to leave work with an average of 25 unresolved issues every day,” says Evans. “Now it’s down to 5.”

Turns IT into a Business EnablerBy using Windows Server 2012, the IT department at Pedcor has all the tools that it needs to evolve from a cost center into a business enabler. It has already delivered a business continuity solution where none existed before, using existing servers and with no extra cost to the company. The company started out with a goal to reduce costs and drive business efficiency, and the IT department is making that happen.

“With Windows Server and System Center taking care of things in the data center, the

IT staff will be free to create solutions for our departments and help the company save money,” says Evans. “Our banking department uses an application that costs $60,000 a year and I know that we can replicate that functionality with SharePoint Server 2010, which we already own. But until now, the IT staff has been too busy to work on a new solution and so every year we renew that $60,000 license. The department that manages properties has high employee turnover and until now had to wait for us to provision up to six new accounts in Active Directory every week. With System Center, we can provide the department with a self-serve console and staffers can add employees themselves. This is just the beginning of a new way of working.”

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“With Windows Server and System Center taking care of things in the data center, the IT staff will be free to create solutions for our departments and help the company save money.”

Sumeeth Evans, Vice President of Information Technology, Pedcor

Companies

Windows Server 2012Windows Server drives many of the world’s largest data centers, empowers small businesses around the world, and delivers value to organizations of all sizes in between. Building on this legacy, Windows Server 2012 redefines the category, delivering hundreds of new features and enhancements that span virtualization, networking, storage, user experience, cloud computing, automation, and more. Simply put, Windows Server 2012 helps you transform your IT operations to reduce costs and deliver a whole new level of business value.

For more information, visit:www.microsoft.com/en-us/server-cloud/windows-server/2012-default.aspx

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For More InformationFor more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers in the United States and Canada who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to:www.microsoft.com

For more information about HP products and services, visit the website at:www.hp.com

For more information about Pedcor Companies products and services, call (317) 587-0320 or visit the website at:www.pedcorcompanies.com

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Document published September 2012

Software and Services Microsoft Server Product Portfolio− Windows Server 2012− Microsoft Exchange Server 2010− Microsoft SharePoint Server 2010− Microsoft System Center 2012

Technologies− Active Directory Domain Services− Hyper-V

Hardware Servers: HP BL460c Storage: HP MDS 600; HP 3.5-inch

SAS/SATA drives Network: HP Virtual Connect

Infrastructure Desktop: HP Z420 workstations; HP 8200

PCs; HP 8400 portable computers

Partners HP