Virtualization and the Cloud: Magical Technologies that Benefit CUs from the Get Go

There has been a lot of talk and discussion lately about one cloud and server virtualization capabilities. But if you are like most people, you're probably wondering what all the fuss is about. After all, the virtual cyber world, Second Life, has been around for almost a decade now and most of us have probably been told a time or two in our lives to get our "heads out of the clouds". All kidding aside, what do these two trendy terms really mean and why should credit unions care?

Let's talk about server virtualization first, as it has a direct bearing on the cloud. Virtualization by definition means replacing something physical with something virtual, or in other words, switching out a tangible for an intangible. With respect to technology and your credit union's current physical server environment, it means decreasing the number of physical servers to fewer machines but having the ability to run multiple "virtual server instances" on them instead.

How does it work?

By taking the physical components of the hardware, which are typically underutilized, they can be allocated among the other virtual servers that reside on the physical box. Typically, your average server is only using around 10% of its entire computing capacity to run applications. By effectively dividing the physical resources such as memory, processing power, and disk, a VM machine can effectively run many virtual server instances on a single device.

There are a number of products already in the marketplace that allow companies to offer this seemingly magical capability. These products allow multiple virtual servers to reside and run on a single physical platform, thus eliminating the need for many other physical devices.

What does this virtualization mean for your credit union? It means working smarter in today's post-recession environment when companies are still hypersensitive about their budgets – as they should always be. Virtualization allows credit unions – along with any organization that requires the use of multiple servers – to save money, time and space to reallocate to other pressing areas such as technology research, increased marketing, additional staff, higher productivity, better rates, etc. That's using technology to work smarter for the longevity of your credit union.

Now for the cloud.

When we speak of the cloud, many of us may think of those Microsoft commercials of a year ago where the actors would get caught in some sort of "I can't access my files" predicament and quickly resolve it simply by saying, "…to the cloud!" and, presto, access to files are granted. Based on those commercials, we might immediately think of this online capability as information residing up in the heavens somewhere – a magical mystical place of infinite access to wisdom and data.

Actually, that's not far from the truth. The cloud is the infrastructure where the data resides. In the case of your VM environment, it is the physical and virtual environments where your applications, as well as your data, are stored. The cloud can also include storage devices such as SANs (storage area networks) or NAS (network-attached storage), both of which allow the VM environment to operate in a near perfect 99.999 percent up-time mode.

When you think about your credit union's own cloud, you are describing both the internal environments if you are running in-house systems and/or the external cloud environments if you are running in a service bureau environment. However, both statements concerning in-house or service bureau would be correct relative to the cloud.

What can the cloud do for your credit union?

So how would a VM environment and the cloud do for your credit union?

Better utilization of one resource spread out against many.
Improve and possibly reduce overall IT workload.
Reduction in physical power requirements, cooling requirements and physical space.
Easier manageability; different virtual servers can be managed from a single terminal console.
Adding additional server resource can be as simple as purchasing additional VM and O/S licenses.
Improved backup and failover capability. Depending on the chosen configuration, disaster recovery, backup and failover capability is greatly enhanced and the complexity greatly reduced.
Over time, there can be significant financial savings.
Technology replacement schedules can be easier to setup and maintain without wholesale disruption.
Allows all Windows-based applications to be easily managed in a homogenous rather than disjointed fashion.

As you can clearly see, virtualization can offer tremendous capabilities – and savings – to your credit union by consolidating your technology environment without limitations. The cloud conversely maximizes the expensive hardware resource and gives your organization a more reliable, fail-safe environment for both your critical and non-critical applications and data storage.

In terms of your credit union's archival and storage environments, for example, it really means the administration, management, utilization and redundancy concerns diminish as you put together a more streamlined, cost-effective environment. As a result, building your own cloud using a VM environment can allow your credit union to better use IT resources, potentially reduce utility costs, and possibly hold in check your technology expenditures well into the future. That's working smarter while better serving your members.

Scott Cowan is vice president of sales and marketing at Millennial Vision Inc. in Salt Lake City, Utah.

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