IBM is guarding the core ERP estates of Indian CIOs

Shree Cement Limited recently purchased IT hardware and software from IBM for hosting their ERP and so have Tamilnadu Newsprint and Papers Limited (TNPL) and PN International(part of Karam group). CIOs at these companies have decided to keep their corporate data on the hardware they own in a data center within their premises or a third-party data center. And they chose IBM power 9, a very popular processor technology for the same. The power platform from IBM is an ecosystem of hardware and software enabling CIOs to have tech parity with the public clouds. Let us pay close attention to the factors that are influencing CIO choices related to systems that capture, store, and backup their core business transactions.

Corporate data ownership

Corporate data, a type of data created by the Enterprise Resource Planning system is extremely valuable to a business. Such data is high in data gravity and pulls other types of Enterprise data such as big data generated from operations towards it. The once monolith ERP is now seen as composed of a core part of ERP and edge business applications. An ERP core is that horizontal part within the ERP with an unchanging characteristic cutting across industry vertical and generic departmental functions. The core ERP is composed of a general ledger database and a common minimum set of sub-ledger transactions such as Accounts Payable, Accounts Receivable, Inventory management. In the west CRM and HCM are not considered core aspects of the ERP so is now the general perception in India as well. CRM and HCM along with many other third-party applications remain on the edge of core ERP. The ERP core by nature has a stable character and also there is nothing game-changing about it in its cloud equivalents. Therefore the most fertile grounds for digital innovation edge today is unquestionably at the edges of the core ERPs. The desire to own corporate data infrastructure is indicative of three things, the choice to have full control over one's corporate data, second, the growing appreciation for its physical form, and third is the freedom to innovate on the edges. Shree Cements has huge facilities and also has captive power generation units within their plants. “Our data centers run on the electricity we generate helping us reduce operating costs,” said Manoranjan Kumar, CIO Shree Cements. There is also no fear of missing out (FOMO) factor since IBM’s systems catalog is way superior in most cases and at a minimum ensures technology parity between private data centers and the hyperscaler public cloud systems. The pandemic has also reinstated the importance of having physical access and self-sufficiency in running the core ERP.

Server Refresh Cycles

The old joke is that IT life is measured in server years. Although there is no definite life of any server, it is in the ballpark of 5 years. A server refresh is a big-ticket item and is therefore occasionally a sporadic decision. It is planned several years ahead of time but some triggers can advance the refresh. The most common reason is when servers get old “we moved to IBM hardware after running our ERP on the old hardware for 8 long years” said Manoranjan Kumar, CIO, Shree Cements. Aged hardware runs on old technology and therefore becomes a hard constraint for software upgrades. Hardware can itself can become a constraint as it happened at a fast-growing company such as TNPL “we’ve seen an increase in the number of ERP users and a sharp rise in demand for new workloads like data analytics and the industrial internet of things [IIoT]. Our aging legacy server and storage infrastructure was reaching capacity and therefore we went ahead with a future-ready platform from IBM” said Manoharan K, CIO, TNPL. Atin Agarwal joined Karam group as Global CIO less than a year ago at a time when the company was considering upgrading its network and IT infrastructure. “the entire project is completed successfully with the help of IBM and Airtel. We upgraded from Power 8 systems to Power 9 systems”

ERP modernization with AIX & RedHat

There are several non-production instances of an ERP within the CIO estate. These are necessary to implement changes and test them before they reach production. All these systems need to be up and running all the time and therefore add to the costs of running the ERP. IBM hardware comes with IBM operating systems that allow CIOs to control IT Infrastructure costs through technologies such as virtualization and containerization. The IBM operating systems on their hardware also allow CIOs to choose an optimal backup and recovery process “IBM AIX operating system helped us with adding failover and load balancer capability to our ERP ” said Manorajan Kumar. All the big ERP systems are certified to work on Linux and AIX. Some best-of-breed edge applications may only work on Linux and IBM power systems Customers can then opt for the most open Linux distribution from IBM RedHat. “Our ERP has a new data feature that requires Linux and we have it set up alongside the AIX on which the core ERP runs,” said Manoranjan Kumar, CIO Shree Cements.

Performance

Business applications tie together people from various business functions and therefore are high concurrency applications. Performance matters and does become a bottleneck in an ERP. Karam group has always looked at IBM power systems to address the performance requirements of their massive ERP. After their recent upgrade to Power 9 systems, Atin said “we have experienced a 25% improvement in ERP report execution time.”

ERP systems often require an enterprise-grade database and the database vendors most often provide several licensing options but the most economical one remains the per processor core. IBM power systems allow CIOs to reduce their database licensing costs since they need fewer processor cores for the same performance in comparison to x86 based systems. Siddhesh Naik, Associate Director, IBM Storage Sales, India/South Asia clarifies “ultra-low latency data retrieval means the CPU has a less wait time and therefore can do more operations in the same time. For an ERP installation, this would mean faster reports and transaction querying and processing.” Database vendor audits can surprise if measures are not taken to contain the use planned use of the database. CIOs with IBM systems can limit the no of Power processor cores used by the ERP database thus helping them reduce the upfront licensing cost but also the annual support costs which are often a % of the licenses bought. Hyperthreading which is an x86 concept does impact the core count for database licensing purposes while Multithreading does not. IBM power is the only platform that provides 8 simultaneous multi-threads per core which makes it well placed to deliver the based performance for OLTP database workloads.

Data Protection and Storage

ERP systems have a goal to streamline business and therefore a conversation around them typically does not sound technical. But that is a myth because deploying and running an ERP involves enormous technological rigor. Business processing is the tip of the iceberg compared to the mammoth infrastructure on which they sit. Backing up ERP data is an extremely important activity. So is restoring the ERP after an outage. An economical backup strategy is a prerequisite for an economical ERP recovery strategy. CIOs discern the best failover recovery time objectives (RTO) for their ERP deployments. Not all ERP deployments require a near-zero RTO although the same can be set up “our backup and recovery process has a 2-4 hr RTO with DR is at another plant 40 km from the primary data center” said Manoranjan Kumar, CIO Shree Cements. TNPL is also on a similar Active/Passive high availability configuration “we have brought down the RTO from 4 hours to 1 hour using IBM systems” said Manoharan K, CIO, TNPL.

Some IBM customers such as Karam group have also opted for managed services from IBM for the day in life maintenance of their ERP systems “everything that we need from firewalls to hardening of the boxes and day today hygiene of our power systems placed in their data center at Airoli, Maharashtra is in the scope of the managed services we receive from IBM. We have witnessed a 20% reduction in planned downtime of the ERP”. Karam group historically had several vendors manage their IT infrastructure which did not give the management a cockpit view of IT. This is something they wanted to change “with IBM we have integrated end to end infrastructure management under one roof reducing co-ordination effort and improving overall IT efficiency.” said Atin.

Backups are equally vulnerable to ransomware attacks. Compounding that is the problem of unrecoverable backups. “CIO's will need a mechanism to detect any malware on backup data", said Siddhesh Naik from IBM. He further added, “An enterprise should have the flexibility to choose hardware to deploy the database backup solution and not be tied to one vendor.” When asked about sharing an optimal backup and restore strategy he said “For customers intending to have zero data loss, it is advisable to implement a three-site backup solution. Enterprises can opt for synchronous data replication to the near-site, asynchronous replication to a far site, and implement a minimal Recovery Time Objective (RTO) in case of any disaster on the primary site; so the enterprise can quickly come back online from either a near-site or a far disaster recovery site.”

IBM ‘Openness’ means CIO Freedom

The decision to procure, set up, and run the Enterprise IT fabric is extremely complex. CIOs unwillingly have to accept a good number of technological fences within their IT estates. IBM's vision for the hybrid cloud is a liberating force for the CIOs giving them the necessary freedom to organize their IT estates. IBM is huge but the Hybrid cloud credo is all-encompassing and ties together everything they bring to market on the hardware software and services front. Power platforms by IBM are shaping the future of IT by bringing new ideas to the market and thus adding to the ‘computing’ diversity.