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What are you announcing today?
IBM is acquiring CIMS Lab, Inc., a leading provider of technology that allocates enterprise IT hardware and software costs to business units, departments, cost centers and other functions within an organization. An important capability of CIMS Lab's is applying this to virtualized technologies including servers and storage devices. CIMS Lab, Inc. is a privately-held company established in 1999. The company is headquartered in Roseville, California (15 miles outside Sacramento) and has offices in Gibbsboro, New Jersey, and Laurel, Maryland. CIMS Lab has 21 full-time employees.
What are the trends and customer requirements that drove this acquisition?
One of the most pressing issues facing our customers is the growing complexity of the data center as the number of servers within enterprises has grown exponentially. Many customers are looking to virtualization and server consolidation on today's much larger servers to reduce this complexity. This presents a challenge for customers: keeping track of resource usage for billing and chargeback of the shared, virtualized resources. This acquisition will provide us with the tools to help customers accomplish more accurate resource usage metering, chargeback and billing.
Secondly, as customers are creating Service Oriented Architectures (SOA) and composite applications -- which span multiple virtual environments crossing departments and even enterprises -- costing and resource consumption measurement becomes critical. CIMS Lab technology, when combined with IBM, will be able to provide the technology to help customers chargeback in an equitable, visible, and auditable way in these environments.
How will IBM's ability to meet customers' needs change as a result of this acquisition?
In a few ways: 1) customers will be able to implement virtualization on distributed platforms and now analyze and chargeback costs effectively to the various departments using those resources. This assists in economically justifying virtualization of assets by eliminating a potential economic obstacle (getting compensated for usage). 2) CIMS Lab provides customers with a way to allocate costs from multiple heterogeneous platforms in a consistent, auditable way. This helps eliminate inefficient investment in resources caused by incongruities in costing approaches across platforms. 3) Customers who are implementing Services Oriented Architectures will have a way to allocate costing to those departments using their services. This assists in ensuring that investment is aligned with business benefit IT projects.
What does CIMS Lab technology do?
CIMS incorporates several functions to enable IT to effectively perform cost analysts, chargeback, billing, and ROI.
- CIMS collects raw metering data from a variety of sources including operating systems, databases, middleware, and applications.
- The accounting application associates the usage with users, applications, and views of IT recourse consumption.
- It utilizes a variety of accounting algorithms to assign a cost to usage of IT recourses. These include standard rate, cost allocations, discounting, and various differentials.
- Produces a database that will support billing, reporting, chargeback, and cost analysis.
This software helps clients:
- Consolidate workloads across the enterprise and enable shared use to optimize cost and performance
- Enable pay-per-use models
- Make IT usage and cost analysis a competitive tool in go-to-market strategies
What product, technology, and associated business benefits does this acquisition provide customers?
This acquisition provides three primary functions necessary for an end-to-end cost chargeback solution. 1) Data collectors, which gather critical usage metrics for each of the technologies being measured, including hardware and software and that are sophisticated enough to gather this data on virtualized environments. 2) Interface to accounting software to acquire aggregate costs. 3) Chargeback engine that takes the data collectors, links in the costing information from accounting software and then reports, analyzes and allocates costs, enabling customers to evaluate the information in many dimensions.
By providing this, customers can not only understand the IT costs of their business operations, but also more accurately budget and evaluate IT purchases.
Business benefits from metering, rating and billing include:
- Helps IT executive justify their expenses in terms of the business, units, products being supported by the expense.
- Facilitates the enterprise to manage IT costs as a portfolio of investments.
- Recovers IT cost and generates revenue via billing
Can you provide some specific examples where CIMS Lab technology would be used?
For example, banks often have many departments, including commercial loans, mortgage organization, credit cards, and deposits that share computing resources, whether they are shared application infrastructure or virtual servers/storage devices. By using data collectors on the key pieces of the bank's infrastructure, and integrating that information with the cost of IT resources CIMS Lab's software enables the bank to determine the amount of each IT resource each department consumed and the associated cost.
Another example would be a retailer who might have multiple applications owned by different departments running on a single server that has been virtualized. In order to correctly charge each department for the use of the server, software, as well as the shared expenses, such as power, the retailer needs a solution that can gather usage data, link it back to accounting costs and provide clear and fair chargeback reports. CIMS Lab is a leader in providing this type of solution.
How will CIMS Lab, Inc. be integrated into the IBM organization?
CIMS Lab will become part of the Tivoli® Software unit. However once integrated with existing IBM products, CIMS technology will be also sold and marketed in the IBM Systems and Technology Group, and will be packaged with certain pSeries®, xSeries®, and virtualization offerings.
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