What CFOs Need to Know: Capacity Planning is About Finding the Balance

 In Capacity Planning, CFO

Managing technology means making sure you have the capacity you need to run your business applications and process a day’s transactions with reasonable performance. Limited capacity, whether CPU, storage, or network bandwidth, limits your ability to get business done.

Because of the time it takes to add capacity, most businesses add spare capacity to their infrastructure before it is needed, but this means spending money to buy equipment that isn’t currently being used.

Both overprovisioning and under-provisioning have costs for the business. The challenge of capacity planning is finding the right balance.

Benefits of Capacity Planning

There are benefits to capacity planning beyond simply keeping IT processes running smoothly. Effective capacity planning helps you manage your IT budget. Capacity planning can also help your IT team meet its service commitments to business units and reduce the number of crises the support team needs to handle. Because capacity planning requires analyzing trends in demand, it creates an understanding of usage patterns that helps determine the root cause of production issues.

When you perform capacity planning, you’ll know:

  • where your future bottlenecks will be
  • the cost of public cloud compared to your own equipment
  • where you have underutilized equipment that can be repurposed
  • which workloads can share a physical server and let you consolidate applications
  • which configurations are cost-effective for your applications

Performing Your Capacity Analysis

Capacity planning requires understanding the demand for IT services, both current and anticipated, and how your IT resources will perform under that demand. This requires deep insight into both your business requirements and your technical capabilities.

The business estimate of demand can come from forecasting and trends analysis. New demand resulting from new business offerings will need to be estimated. On the technical side, monitoring tools can capture utilization and provide data supporting trend analysis as well.

Once you have estimates of demand and measures of performance, you can evaluate deploying new demand to your existing infrastructure and evaluate the anticipated performance.

The response to growth in demand doesn’t need to be a growth in resources. Existing equipment can be repurposed and applications consolidated to make additional capacity available. Virtual machines let you create fully separate machines without adding physical servers. You can also manage the business’ demand for resources through different chargeback schemes that shift some processing requirements to off-peak hours.

It’s also important to note that you don’t necessarily have to build out capacity to handle peak demand. You may be able to leverage cloud to gain extra capacity to handle spurts in demand rather than permanently adding additional capacity on premises.

The expert team from Prescient Solutions can perform an infrastructure assessment to identify under- and over-utilized resources. With this data, we can develop a complete capacity plan and work with you to bring your resources in line with your demand. Contact us to learn more about how capacity planning can help you manage your critical infrastructure.

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