SlideShare une entreprise Scribd logo
1  sur  13
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
1
NAME: BLESSON BABU
STUDENT NUMBER:15029468
DATE: 29-MARCH-2016
FINAL REPORT OF UTILITY COMPUTING:
“DESIGN OF A MULTI-VARIABLE COMPUTATIONAL
COMPUTATIONAL MODEL FOR TOTAL COST OF
OWNERSHIP (TCO) ANALYSIS”
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
2
COMPANY DESCRIPTION:
TVS Motor Company is a renowned automotive industry in India. TVS Motor company is
the third largest two-wheeler manufacturer in India. This company was found in the year
1978. TVS motors headquarters was established in Chennai, India.
TVS Motor produce products like Motor cycles, Scooters, three wheeler vehicles and spare
parts. The production capacity is around 2.5 million units per year. The company employees
around 7800 people in various departments of work. The company is geographically being
located in India and Indonesia. It has four manufacturing plants located in North India, South
India and one in Indonesia. The company’s revenue is about US$1.5 billion and the
companies profit is around US$38 million. The company exports its products to 47 countries
round the globe.
TVS Motor is a public type business entity. TVS Motors roll out around 2.5 million vehicles
every year. TVS motors focuses on Manufacturing excellence they are driven by the five
pillars of Total Quality Management – Management Commitment, Customer Focus, Quality
Costs, Quality Systems and continuous improvement.
TVS mainly emphasis on Research and Development. TVS Automatic Transmission
Technology is one of the key success results of their innovation. This stands out to be
success of TVS Motors. The company’s strength lies in design and development for new
products. They focus on the customer satisfaction by anticipating the needs of the customer
and then presenting the quality vehicles at the right time and right price. The company has
achieved a rear feat in automotive industry by launching seven vehicles on the same day.
TVS Motors famous popular models among automobiles in motorcycles Apache Series,
Phoenix Series stand to be top whereas in Jupiter and Scooty Pep stands out to be popular
brands. TVS Group manages TVS Motors and they receive most of the profits from the
automobile industry. TVS though having a long stand history stands out be popular still date.
TVS Motors also focuses on the environment. So the company focuses on Green Bikes for a
better Greener tomorrow. This technology enables in reducing the global warming and
pollution the company has been on the forefront for bringing cleaner technology to two
wheelers. All the vehicles of TVS is 85% recyclable. TVS vehicles stand out to comply world
standards.
TVS Motors focuses on the major perspectives for making TVS to be standout they are:
 Leadership at every level
 Keen eye for Quality
 Understanding Customers
TVS work management has been a standout to achieve such a popular tag in automobile
industry. TVS Motors encourages continuous improvement in all aspects of work using
Cross Functional Teams, Supervisory Improvement Teams and Quality Control Circles so
these stand out to achieve great success in automobile industry.
TVS Motor Total assets is around US$160 million. The TVS Motor Company is a part is a
member of TVS group is the largest company in the group in terms of size and turn over with
over 2.8 crore customer riding TVS bike. TVS Motors was handed out best out standard
design by the Business Today Magazine.
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
3
Analysis of Company’s On-Premise IT State:
TVS Motor Company uses the IT infrastructure with HP rx6600 servers with HP-UX 11.31.
This is based on delivering the highest level of integrated virtualization and automation. The
functional areas of HP-UX include services like:
 LCPUS interface to dual core Intel, Itanium 2 processor Hyper-Threading
 Multi pathing & Load Balancing
 PCI Recovery error
 PCI online deletion
 On line processor and memory migration
 Network File System V4
The above mentioned some of the service using HP servers and EVA 4400 storage has also
has been in used like managing virtual disks, managing disk groups, View storage system
status, shutdown/restart the storage system etc. Hence all these services can be done.
These Servers has the installed configuration of using windows server 2003 management
server, windows server 2003 non-management server and windows server 2008 non-
management server. TVS Motor Company uses most of the Infrastructure services from HP.
So HP is the infrastructure provider for TVS Motors. This sets the company to use the floor
space of setting the infrastructure of the company. So more than 600 users work with this
system environment of HP rx6600servers and HP-UX 11.31 all these make hardware
components of the company.
TVS Motor uses the oracle products for the database management in order to implement
storage and data management optimizations. They use the oracle database release 11.2.01
for SAP. These database upgrade takes place only on UNIX/LINUX platform. The database
upgradation of SAP installation with SAP NetWeaver on oracle with only single instance. The
size would be around 2.5TB compression before advanced compression oracle 10g and
11g.
TVS Motor Company faces the problem firstly they have to extend the storage system but it
resulted in disproportionality high costs and a relatively long implementation period and
secondly use a data archiving concept and implement potential space savings. The Oracle
compression of shifting here by focused by using BR tools. So for the sake of database
management the company relies on Oracle products.
TVS Motor hereby enterprise software to manage business operations and customer
relations. So the company uses the SAP software like ERP ECC 6. 04 FI, CO, MM, PP, QM,
SM, HCM/HR. SAP set of middleware program and tools built on SAP web application
server. It also uses Net Weaver BW 7.01 and PI 7.0 all module activities involved.
NetWeaver EHP1 is the prerequisite of SAP BI solutions. This is the improved MDX
interface. It consists of SAP business objects data federator BW 7.01. This is a service
oriented and application and integration platform. It primarily uses the ABAP programming
language it uses C, C++, Java EE. SAP environment is applied interoperate with
technologies such as Microsoft .Net, IBM WebSphere and Java EE.
TVS Motor initiate so as to consolidate its storage infrastructure with a storage area network
(SAN). TVS Motors data centre has 60 servers, out of 20 HP servers are connected to the
SAN. SAN has the storage capacity of approximately 12 Terabytes (TB) so it has been
configured from Raid 1 to Raid 5. TVS Motors uses HP proprietary storage management
tools. So the company should focus on storage virtualization so as to reduce Capex costs.
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
4
TVS Motor Company use Cisco voice system remain on- premise. They use Cisco SPA9000
voice system. This has made the IP telephony made easy by setting up the internal
telephone system for the purpose of small domain of phone company. Cisco SPA9000 voice
system has these features that has multilevel access of password-protected access, support
for 16 Cisco IP phones, support for internet telephone service to remotely update the
software and the settings and it has special features like shared line appearance, call
transfer, call parking and group tagging. The company also uses Cisco SPA400 Internet
telephony with 4 FXO ports this can support 32 voice email accounts that can be accessed
through a user’s Cisco IP phone. TVS Motor uses these services of Cisco SPA400 where
they are able to meet the company’s personal needs like:
 Cisco SPA400 provides support for four RJ-11 FXO to connect to public switched
network
 One 10/100 Base T RJ-45 internet service so as to connect to local IP address
using this service the company benefits
 Provides easy installation support using SPA9000 setup wizard
TVS Motor uses the service of Cisco SPA9000 and SPA400 for providing better IP
connectivity service on premise. The Cisco voice gateways like Cisco VG202, VG202XM,
VG204 and VG204XM are used in the company.
TVS Motors use Oracle for the maintenance of database advanced data compression using
RAT (Real Application Testing) and secure files. RAT is a tool that is used for optimizing
changes to access the impact of workload before going live on the network. Secure file is
using large types of objects so as to improve the performance. So the company can
personally use the services before making it live on the network.
TVS Motor relies on the Acrobat 3D software and Adobe PDF to enable faster and more
over providing a reliable access to mission the critical engineering drawings, 3D illustrations
and designs. While taking a glance of this software in this company Adobe Acrobat 3D
Version8 and Adobe reader is used so as AutoCAD is also here by used for providing a
better illustration of designs. This software runs on Microsoft Windows XP, Professional and
Vista this software is used. With the help of Acrobat 3D, the company can integrate
AutoCAD, 3D CAD and other format design source material is hereby integrated Adobe
Portable Document (PDF) file. By using the Adobe Software, the company will be able to
integrate complex engineering design into everyday business process and the capability to
convert AutoCAD, 3D CAD design into Adobe PDF with ease. By using this Adobe software
to able to comment and edit the particular design. TVS Motor workflows in the product
lifecycle management (PLM) the systems can automatically trigger the collaboration. This
very much helps the company in document collaboration.
TVS Motor also uses the IBM Servers, it the IBMs ILOG CPLEX Enterprise Server which
enhances scalability in large scale optimization-based decision support applications. The
reason behind the company selecting IBMs ILOG Transportation Analyst solution to map the
cost effective trucking routes so as it enhances in providing most effective trucking route for
timely delivery of dealership. So the company focuses on using IBM ILOG CPLEX Enterprise
Server so it can here by support applications shared among the multiple decision makers. It
runs on DB2 Enterprise server or DB2 Express-C.
The company has some of the problem with the current IT infrastructure On-premise. The
company has to maintain a huge database so they have to pay high costs of storage this
exceeds the costs of the company in a drastic manner. Each year the company has to spend
lots of money for Upgradation and various other related on premise IT costs.
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
5
PROPOSED CLOUD SOLUTIONS:
TVS Motors should move to cloud and use services provided by Amazon. By using the
amazon web services, they will able reduce the total cost of ownership. It has the features
like providing flexibility, disaster recovery and capital expenditure etc.
Amazon EC2 reduces the time required to obtain and boot new server instances to minutes
and also providing the facility to scale up and down as per computing requirement whereas
using on premise it takes lot of time to build new instances and also scaling facility as per the
requirements is inadequate On- premise. Amazon EC2 also provides the facility to only pay
for the services that are utilised and as per Cloudonomics law “Utility services cost less even
though they cost more” is followed by Amazon EC2. Amazon EC2 is a web service that
provides the compute capacity in the cloud. Amazon also provides the feature of auto
scaling for EC2. Amazon EC2 eliminates the need to invest on the hardware upfront it can
develop and deploy applications. In the amazon environment the company will be handling
their instances.
TVS Motor should use Elastic Load Balancing. It automatically distributes incoming
application traffic across multiple amazon EC2 instances in the cloud. It provides the
required amount of load balancing computing needed to distribute application traffic. By
using Amazon route 53 health checking and it will enhance the availability of load application
running behind elasticity load balancer. By the route 53 can run applications in AWS regions.
Elastic Load Balancing provide the facility to distribute traffic among multiple Amazon
Services. In case of On-premise IT there is a traffic congestion of networks. So by using
Elastic Load balancing provides it works on Amazon Virtual Private Cloud (VPC) to provide
robust networking and security features.
TVS Motor can also use the Amazon S3 services. Amazon S3 to use object storage with
simple web service interface to store and retrieve any amount of data from anywhere of the
web. The other benefit is that there is no set up cost for these services. There is no minimum
fee and there is no setup cost. Amazon EC2, AWS identity and Access Management (IAM)
as well as data migration services and gateway for initial or ongoing data ingestion. In case
of On-premise building and storage representation is expensive. In the Amazon S3 the data
is stored and relative data is stored in buckets so data is stored in different places even
though the data gets deleted the replica of the data stored in another bucket. Amazon S3
employs a simple web based interface for encryption and for purpose of user authentication.
This is a solution to On-premise IT infrastructure solutions so data backup and retrieve can
easily be done so by Amazon S3. IT infrastructure on On-premise faces the issue of data
backup if some data is lost it cannot be reinstated because there is no copy of data that is
lost. So Amazon S3 standouts to be a proposal to be company.
TVS Motor for the maintenance of company’s database on cloud can rely on Amazons RDS
(Relational Database service) to make it easy to set up, operate and scale relational
database in the cloud. It provides the feature of cost efficient and resizable computing it
frees up time of managing data in the database. In the case of On-premise costs for
managing database and repository and the cost of buying racks costs rate exceeds. So by
using Amazon RDS there is no worry on its maintenance. AWS RDS has the facility of
scalability of database management during peak traffic times. Even though some disaster
occurs the replica of data is stored in region, it gives a major relief to the company and it can
employ less number of employees to work on Amazon RDS. AWS provides several
database engines like Oracle, Microsoft SQL Server etc. As the company is familiar using
Oracle so it can work on it using AWS and this would be beneficial as they need not require
to train employees as they familiar with oracle environment if so they move to other
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
6
database they have train employees to work on that database. So by using Amazon RDS for
Oracle under two licensing modes license included and bring your own license. Under the
license included the Oracle Database is licensed by AWS underlying hardware resources
and Amazon RDS management capability. So it provides a relief to company when the
license is included no needs to worry of the license of software and bring your own license
can use the existing oracle database license.
TVS Motor can use the Amazon cloud front. This integrates with other AWS services
products to give the developers and business can distribute these service to the customers
with low latency and high data transfer. It provides the facility of global content delivery.
These services of AWS can resolve networking issues. It also has no usage commitments.
The company should also use Amazon cloud watch as it provides the monitoring services for
all the resources and the applications that run on AWS. It can hereby collect and track
metrics and so they can monitor log files. By using AWS cloud watch the company can track
the running of applications.
AWS can work on all windows operating system and all Linux/Unix. So Amazon services
AWS Data Migration Service provides the facility to migrate the data to AWS database easily
and securely. The AWS uses Amazon Virtual Private Cloud (VPC). AWS resource in virtual
networking environment it can select your own IP address range, creation of subnets and
configuration of route table and network gateway. It can hereby customize Amazon Virtual
private cloud.
The company uses AWS services such as Amazon Machine Engine (AMI). It contains the
base operating system they can install the SAP software. In the AWS the SAP software on
top of it. A large section of public AMI is available for Amazon and EC2 Amazon community
it is possible to create AMIs. It can launch the instance AMI is needed. AWS supports SAP
software to work on it. AMI provide the information required to launch an instance virtual
server in the cloud.
AWS and SAP work together for providing solution for enterprise applications. Amazon
services are used by using Auto scaling service is enabled by Amazon cloud scaling the
services up and down based on the traffic network. Amazon provides services for Adobe
AutoCAD and 3D CAD design is collaborated with AWS. The company’s most of its design
have in been in the Adobe format. AWS provides the privacy and security to all of its
documents are in an encrypted manner.
The company should also tend the services of AWS Direct Connect. This amazon services
provides the location over a standard 1gigabit or 10 gigabit Ethernet fibre optic cable. Here
then by using this service amazon AWS cable is connected to the router here the other end
is connected to an AWS direct connect router. Here by Amazon virtual private cloud is done
by passing internet service provider in the network.
By moving to the cloud to on premise it reduces the cost. By using the cloud service of
Amazon. AWS and Amazon EC2 provides the stronger assurance of the customer base that
would be critical point solution is less expensive. AWS load balancing has high performance
on the hardware. AWS ELB provides the load balancing service to the customers and the
hardware is completely abstracted. Here On-premise may pay extra feature for geo-load
balancing by using AWS EC2 has the feature of Auto Scaling so there is no issues of
network traffics it can be easily managed by Amazon. Here AWS EBS IO performance is
poor and in case of On-premise options is unpredictable. TVS Motor proposed cloud
solutions can reduce the TCO (Total Cost of Ownership) as compared to On-premise.
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
7
Multi-Variable Computational Model:
CALCULATIONS OF TCO ON-PREMISE:
Total cost of Ownership Year1 Year2 Year3 Year4 Year5 Unit discountTotal Cost
On-Premise Servers
HPRX 6600 Rs.1,716,349 25% Rs.1,716,349
HP-UX-11.31 Rs.557,092 25% Rs.557,092
EVA 4400 Rs.557,092 25% Rs.557,092
Total Server Hardware Cost Rs.2,830,451 Rs.2,830,451
Networking Costs Network % Acquistion cost
Networking Harware and Software Costs Rs.2,76,976.6448 Rs.2,76,976.6448 Rs.2,76,976.6448Rs.2,76,976.6448Rs.2,76,976.644820% Rs.1,384,883.224
Network Maintenanace Rs.124639.4920 Rs.124639.4920 Rs.124639.4920Rs.124639.4920Rs.124639.4920 15% Rs.623197.46
Total Network Hardware & Software Cost Rs.2,008,081
RACK Infrastructure costs
Rack chasis with PDU @3500 Rs.127.65714 Rs.127.65714 Rs.127.65714Rs.127.65714Rs.127.65714 Rs.446800
Rack Dual 280v per rack @540 Rs.2160 Rs.2160
Top of rack switch@5000 Rs.1276800 Rs.1276800
Rack and stack one time deployment@250 Rs.478800 Rs.478800
Provisioning Space Server@5years Rs.615623 Rs.615623
Total Rack Costs Rs.6924416
Server Software Costs
Windows License List price Rs.307070 Rs.307070
Windows License discounted price Rs.230303 Rs.230303
Total Server hardware & Software Rs.6924416
Facilities cost(datacenter,space,power&cooling)
Estimated power Cost Rs.1110044.99 Rs.1110044.99 Rs.1110044.99Rs.1110044.99Rs.1110044.99 Rs.22200.998
Esimated cost to operate rack Rs.114912 Rs.114912 Rs.114912Rs.114912Rs.114912 Rs.22982.4
Total Rack Costs Rs.229824.00 Rs.229824.00
Total yearwise Facilities Rs.340828.99
Facilities Cost On-premise Rs.12269844
Server Cost break down
Category Rs.6,924,416
Hardware Rs.6,924,416
Software Rs.12,269,844
Operating System Rs.12,269,844 Rs.19,194,260
Total Rs.19,194,260
On-premise IT Labour
IT Admin Costs Rs.22500.00 Rs.22500.00 Rs.22500.00Rs.22500.00Rs.22500.00 Rs.112,500
BandWidth
On-premise bandwith Rs.638.40
bandwith in yearly Rs.957.60
Total Bandwidth Rs.34,473.60
Network Admin Costs
IT Labour Costs Rs.7500 Rs.7500 Rs.7500 Rs.7500 Rs.7500 Rs.37,500
support staff Rs.1800 Rs.1800 Rs.1800 Rs.1800 Rs.1800 Rs.9,000
Total Costs Rs.2,051,559
SAN Cost
Raw/GB Rs.561.79 Rs.561.79
Discount Rs.280.90 Rs.280.90
Total SAN Cost Rs.287,638 Rs.287,638
Storage backup Cost
Total Cost of Storage backup cost Rs.114912
Storage Overhead
Total Storage Data Center Rs.3447360
Storage Cost Break Down
Raw Capacity Rs.287638 Rs.287638
Backup Rs.114912 Rs.114912
Overhead Rs.3447360 Rs.3447360
Total Storage break down Rs.3849940
Total Cost On-premise Rs.25208254
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
8
CALCULATIONS OF AWS:
TOTALCOSTOFOWNERSHIP YEAR1 YEAR2 YEAR3 YEAR4 YEAR5 TOTALCOST
AWSCLOUD
EC2RESERVEDINSTANCES
m4.large Rs.248596 Rs.248596 Rs.248596 Rs.248596 Rs.248596 Rs.1242980
i2.xlarge Rs.10892689 Rs.10892689 Rs.10892689 Rs.10892689 Rs.10892689 Rs.5446349
m3.medium Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.656786
TOTALCOST Rs.7346115
EC2ONDEMAND
m4.large Rs.1572960 Rs.1572960 Rs.1572960 Rs.1572960 Rs.1572960 Rs.314592
i2.xlarge Rs.342518.6000 Rs.342518.6000 Rs.342518.6000Rs.342518.6000 Rs.342518.6000 Rs.1712593
m3.medium Rs.32973 Rs.32973 Rs.32973 Rs.32973 Rs.32973 Rs.164867
Totalcost Rs.2192052
EC2LOWEREDPRICEINSTANCE
m4.large Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.314592
i2.xlarge Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.1712593
m3.medium Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.164867
TotalCost Rs.2192052
EC2RESERVEDINSTANCES
AWSBUSINESSSUPPORT Rs.43481 Rs.43481 Rs.43481 Rs.43481 Rs.43481 Rs.219205
EC2COSTS Rs.48825 Rs.48825 Rs.48825 Rs.48825 Rs.48825 Rs.241125
AWSSTORAGECOSTS
EBSSTORAGEwithIOPS&CAPACITY Rs.28920 Rs.28920 Rs.28920 Rs.28920 Rs.28920 Rs.144604
EBSCOSTS Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.159064
AWSBUSINESSSUPPORT Rs.14460 Rs.14460
TotalAWSStorageCost Rs.159063.90
AWSDATATRANSFER
AWSBUSINESSSUPPORT(DATATRANSFER)Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.128134
DATATransferCost Rs.2819 Rs.2819 Rs.2819 Rs.2819 Rs.2819 Rs.14095
AWSITLABOURCOSTS
ITADMINCOSTS RS.5625 RS.5625 RS.5625 RS.5625 RS.5625 Rs.28125
OverallTotalCostsofAWS Rs.2612541
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
9
Total Cost of Ownership Analysis & Variables:
TCO provides the realistic and holistic measure of long term costs required to acquire and
operate technology solutions. Return of investment (ROI) is the method to evaluate and
prioritize technology investment in the company. TCO model focus on Cloud Computing to
minimize the overall cost of On-premise costs. The TCO is defined by this methodology as
TCO=Acquistion costs + Operational Costs. In the On-Premises and AWS the values of
Server Costs, Storage costs, IT Labour Costs and Network costs and IT labour. TCO adopts
the cloud based solutions reduces or eliminates traditional capital expenditure (CAPEX) in
the favour of operational expenditure (OPEX) the organizations prefer often CAPEX over
OPEX. Since then all the payments against the income statements.
AWS biiding Startegies helps in reducing the cost of TCO of an Company. AWS bidding
startegies are:
 Optimizing cost
 Bid around previous trends in history
 Bid On-demand price
 Bidding highest amount possible
These all factors contribute in reduction TCO using AWS as compared to that of On-
premise. TCO is a financial estimate intend to determine the direct and indirect costs
involved in a financial estimate. TCO methodology was first determined by Gartner Group.
TCO must be compare direct costs involve floor space, storage and IT operations while
indirect costs such as network, storage infrastructure and IT operations involved in it. TCO
include all acquisition and operating costs. TCO determines the TVM (Time value of money).
COMPRASION OF TCO ON-PREMISE VS AWS Variables:
TCO of On-premise and AWS is illustrated in the form of graph to give a clear and vivid
idea of TCO spent:
5 YEARS TCO (TOTAL COST OF OWNERSHIP)
5 Yr. Total Cost of Ownership
On- Premises AWS
Server 19,194,260 2,411,257
Storage 3,849,940 159,064
Network 2,051,554 14,095
IT- Labour 112,500 28,125
Total 25,208,254 2,612,541
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
10
This graph illustration gives a fair idea of savings using AWS as compared to On-premises.
Then by using the following to compare the costs of a server On-premises it is hereby
illustrated by as follows the hardware costs around Rs.6924416 and Overhead costs
Rs.12269844. It is illustrated as below:
Then following Pie graph illustrates the Compute EC2 Services it is illustrated by as follows
On-Demand costs around Rs.2192052 it is base on pay per usage.
The following Pie graph usage of Network bandwith where almost 50% omoney is spent on
Admin in the case of Networking On-premise and about 49% rectifying issues.
The following graph illustrates the AWS EBS storage 91% of amount is spent on EBS
Volume and about 9% is spent on snapshot.
Server On-premise
Hardware Software Overhead
Compute EC2
OnDemand
Networking On-premise
Gear Admin Bandwidth
EBS
EBS VOLUME Snapshot
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
11
RECOMMENDATIONS AND CONCULSION:
TCO (TOTAL COST OF OWNERSHIP) shows the direct and indirect costs met hereby using
the AWS services TVS Motor can reduce the TCO in an effective manner. TCO hereby
compares all the direct and indirect costs met by the company so by moving to Cloud
Services provided by AWS the company could save their resources.
By moving to AWS the company could save 90% by moving the infrastructure to AWS. The
AWS resources can cut the unwanted costs spent on the On-premises that leads to excess
dependency on CAPEX is met here.
The Company used to spend a lot of money on Infrastructure maintenance, Software
Licenses and salary of employees etc. So by moving to AWS they need not worry about the
maintenance Licenses of Software and Network all of them are well maintained in AWS. BY
using the AWS, they will be cut down the employees by doing so this reduces Financial
burden of the Company and saves lot of money.
By using the AWS resources, the Sales employees of TVS Motor on field can access the
data from anywhere and it would turn out to be beneficial while by using On-premise
resources the employees have to spent a lot of money in the company. The Cloud resources
provided by AWS is useful even for the customers they can access the resources provided
by the on any devices. So by using AWS this helps the company perspectives of providing
better services to the customers.
By using AWS data backup services could be done easily and it can retrieve and use data
as compared to On-premise resources it used to lots of time to update and backup
resources by using AWS resources these services of data storage could be done by using
AWS resources like EC2, EBS etc. By using these resources, the company saves lot of
money by using these resources. Moreover, all the AWS resources are based on pay for
what you use so there is no worry of excess of money to be spent it depends on the usage
of the firm. AWS resources provides better support to the Company and AWS support these
resources.
The better feature of AWS is that if the data is lost a replica of it is stored in other place this
provides a relief to the company. As data could be lost On-premises due to some problems
whereas AWS keep a copy of data of AWS in the resources of amazon and moreover the
geographical location of choosing the datacentre is chosen based on the company’s choice
and the company need not worry in terms of security as well as networking as AWS provides
the better services to be standout.
TVS Motor could use all their enterprise software and oracle software on AWS and there is
no need to bother about the licenses as AWS provides choices of providing licenses by AWS
or On usage licenses brought by the company and more over by using the floor space of
data Centre is not an issue with AWS so all the costs can be cut down by using AWS.
By using AWS, the company could reduce the TCO and more over by moving to Cloud the
company can save lots of money. As Cloud Services provides better Security, Reliability and
all other features. It is hereby recommended that TVS Motor should use AWS Cloud
Services so they could be leading providers in automobile industry and so they could
marginally invest the money saved from IT to other resources.
TVS Motor should opt for AWS so as to reduce financial burden spent on various resources
spent on IT and hereby using Amazon Web services they can reduce their TCO.
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
12
BIBLOGRAPHY:
https://en.wikipedia.org/wiki/Total_cost_of_ownership
https://www.business-case-analysis.com/business-case-guide.html
Michael Witting and Andreas Witting 2016, Amazon Web Services in Action, 1st Ed.,
Manning [ISBN: 9781617292880]
http://www.cio.com/article/2399248/it-organization
http://www.networkmagazineindia.com/200309/casestudy01.shtml
http://www.oracle.com/us/products/database/ocs-nl20-tvs-motor-396158.pdf
http://www.cxotoday.com/story/tvs-motors-implements-dealer-management-system/
http://www.thehindu.com/business/Industry/tvs-motor-sales
https://net.educause.edu/ir/library/pdf/ERB0401.pdf
“A Framework for Total Cost of Ownership", The International Journal of Logistics
Management
Ellram, L.M.: A Taxonomy of Total Cost of Ownership Models. Journal of Business
http://cdn2.hubspot.net/hub/49708/file-14401780pdf/docs/whitepaper_moving_to_the_cloud-
_understanding_the_total_cost_of_ownership_pdf.pdf
http://www.netsuite.com/portal/pdf/wp-hurwitztco-study-dynamics.pdf
http://ejournals.bc.edu/ojs/index.php/ital/article/view/1871
http://www.softwareadvice.com/tco/
http://www.digitalistmag.com/technologies/cloud-computing/2013/06/14/5-key-
considerations-when-comparing-the-tco-of-on-premise-and-saas-systems-043626
https://www.teacherease.com/totalcostofownership.aspx
OPERATIONS AND MANAGEMENT THEORY AND PRATICE BY B. MAHADEVAN
http://joshlowryblog.com/2014/06/08/what-is-total-cost-of-ownership-tco/
http://betanews.com/2013/11/04/comparing-cloud-vs-on-premise-six-hidden-costs-people-
always-forget-about/
AMAZON WEB SERVICES FOR DUMMIES BY A. WILEY BRAND
http://www.slideshare.net/lynnlangit/understand-aws-pricing
https://aws.amazon.com/economics/learn-more/
http://www.tvsmotor.com/tvs-in-brief.aspx
“TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
13

Contenu connexe

Tendances

2nd year Summer Training Report
2nd year Summer Training Report2nd year Summer Training Report
2nd year Summer Training Report
Souham Biswas
 

Tendances (7)

OOW16 - Personalizing Oracle E-Business Suite: The Next Generation [CON6716]
OOW16 - Personalizing Oracle E-Business Suite: The Next Generation [CON6716]OOW16 - Personalizing Oracle E-Business Suite: The Next Generation [CON6716]
OOW16 - Personalizing Oracle E-Business Suite: The Next Generation [CON6716]
 
Otn siebel obrm integration
Otn siebel obrm integrationOtn siebel obrm integration
Otn siebel obrm integration
 
2nd year Summer Training Report
2nd year Summer Training Report2nd year Summer Training Report
2nd year Summer Training Report
 
Technology Update
Technology UpdateTechnology Update
Technology Update
 
Technology update
Technology update   Technology update
Technology update
 
Best oracle adf online training institute india
Best oracle adf online training institute indiaBest oracle adf online training institute india
Best oracle adf online training institute india
 
Emperor Solutions Pvt. Ltd.
Emperor Solutions Pvt. Ltd.Emperor Solutions Pvt. Ltd.
Emperor Solutions Pvt. Ltd.
 

Similaire à Total Cost Of Ownership Analysis

Technical Compentency Document
Technical Compentency DocumentTechnical Compentency Document
Technical Compentency Document
amitdesai
 
SARP Enterprise Suite 6.1-Corporate Profile
SARP Enterprise Suite 6.1-Corporate ProfileSARP Enterprise Suite 6.1-Corporate Profile
SARP Enterprise Suite 6.1-Corporate Profile
Malik Zee Awan
 
Greg Ohlsen_Resume_021216
Greg Ohlsen_Resume_021216Greg Ohlsen_Resume_021216
Greg Ohlsen_Resume_021216
Greg Ohlsen
 
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_KumarSAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
aravindkvs
 

Similaire à Total Cost Of Ownership Analysis (20)

Bosch Final Ppt
Bosch Final PptBosch Final Ppt
Bosch Final Ppt
 
Employee attendance details & medical expenses software project to TVS pvt ltd
Employee attendance details & medical expenses software project to TVS pvt ltd Employee attendance details & medical expenses software project to TVS pvt ltd
Employee attendance details & medical expenses software project to TVS pvt ltd
 
Technical Compentency Document
Technical Compentency DocumentTechnical Compentency Document
Technical Compentency Document
 
SARP Enterprise Suite 6.1-Corporate Profile
SARP Enterprise Suite 6.1-Corporate ProfileSARP Enterprise Suite 6.1-Corporate Profile
SARP Enterprise Suite 6.1-Corporate Profile
 
SAP Extended ECM by OpenText 10.5 - What's New?
SAP Extended ECM by OpenText 10.5 - What's New?SAP Extended ECM by OpenText 10.5 - What's New?
SAP Extended ECM by OpenText 10.5 - What's New?
 
Adapt software introduction jan2017
Adapt software introduction  jan2017Adapt software introduction  jan2017
Adapt software introduction jan2017
 
Adapt software introduction jan2017
Adapt software introduction  jan2017Adapt software introduction  jan2017
Adapt software introduction jan2017
 
Adapt software introduction jan2017
Adapt software introduction  jan2017Adapt software introduction  jan2017
Adapt software introduction jan2017
 
Recharge Portal Development Company
Recharge Portal Development CompanyRecharge Portal Development Company
Recharge Portal Development Company
 
CoreToEdge Company Presentation
CoreToEdge Company PresentationCoreToEdge Company Presentation
CoreToEdge Company Presentation
 
Sugarcane management system
Sugarcane management systemSugarcane management system
Sugarcane management system
 
SAP NetWeaver.ppt
SAP NetWeaver.pptSAP NetWeaver.ppt
SAP NetWeaver.ppt
 
Smarter Retail
Smarter RetailSmarter Retail
Smarter Retail
 
Chainsys Accelerate Presentation
Chainsys Accelerate PresentationChainsys Accelerate Presentation
Chainsys Accelerate Presentation
 
NarasimharaoJV
NarasimharaoJVNarasimharaoJV
NarasimharaoJV
 
Greg Ohlsen_Resume_021216
Greg Ohlsen_Resume_021216Greg Ohlsen_Resume_021216
Greg Ohlsen_Resume_021216
 
Jari P. Ängeslevä - Ai the new kid in the block
Jari P. Ängeslevä - Ai the new kid in the blockJari P. Ängeslevä - Ai the new kid in the block
Jari P. Ängeslevä - Ai the new kid in the block
 
Intel-altoweb-caseStudy
Intel-altoweb-caseStudyIntel-altoweb-caseStudy
Intel-altoweb-caseStudy
 
ZiniosEdge Company Overview
ZiniosEdge Company OverviewZiniosEdge Company Overview
ZiniosEdge Company Overview
 
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_KumarSAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
SAP_BASIS & HANA_with_Yrs_Exp-10.7_Aravind_Kumar
 

Dernier

Dernier (20)

Strategies for Unlocking Knowledge Management in Microsoft 365 in the Copilot...
Strategies for Unlocking Knowledge Management in Microsoft 365 in the Copilot...Strategies for Unlocking Knowledge Management in Microsoft 365 in the Copilot...
Strategies for Unlocking Knowledge Management in Microsoft 365 in the Copilot...
 
From Event to Action: Accelerate Your Decision Making with Real-Time Automation
From Event to Action: Accelerate Your Decision Making with Real-Time AutomationFrom Event to Action: Accelerate Your Decision Making with Real-Time Automation
From Event to Action: Accelerate Your Decision Making with Real-Time Automation
 
Slack Application Development 101 Slides
Slack Application Development 101 SlidesSlack Application Development 101 Slides
Slack Application Development 101 Slides
 
Exploring the Future Potential of AI-Enabled Smartphone Processors
Exploring the Future Potential of AI-Enabled Smartphone ProcessorsExploring the Future Potential of AI-Enabled Smartphone Processors
Exploring the Future Potential of AI-Enabled Smartphone Processors
 
A Domino Admins Adventures (Engage 2024)
A Domino Admins Adventures (Engage 2024)A Domino Admins Adventures (Engage 2024)
A Domino Admins Adventures (Engage 2024)
 
How to Troubleshoot Apps for the Modern Connected Worker
How to Troubleshoot Apps for the Modern Connected WorkerHow to Troubleshoot Apps for the Modern Connected Worker
How to Troubleshoot Apps for the Modern Connected Worker
 
How to convert PDF to text with Nanonets
How to convert PDF to text with NanonetsHow to convert PDF to text with Nanonets
How to convert PDF to text with Nanonets
 
Boost Fertility New Invention Ups Success Rates.pdf
Boost Fertility New Invention Ups Success Rates.pdfBoost Fertility New Invention Ups Success Rates.pdf
Boost Fertility New Invention Ups Success Rates.pdf
 
Axa Assurance Maroc - Insurer Innovation Award 2024
Axa Assurance Maroc - Insurer Innovation Award 2024Axa Assurance Maroc - Insurer Innovation Award 2024
Axa Assurance Maroc - Insurer Innovation Award 2024
 
Advantages of Hiring UIUX Design Service Providers for Your Business
Advantages of Hiring UIUX Design Service Providers for Your BusinessAdvantages of Hiring UIUX Design Service Providers for Your Business
Advantages of Hiring UIUX Design Service Providers for Your Business
 
Raspberry Pi 5: Challenges and Solutions in Bringing up an OpenGL/Vulkan Driv...
Raspberry Pi 5: Challenges and Solutions in Bringing up an OpenGL/Vulkan Driv...Raspberry Pi 5: Challenges and Solutions in Bringing up an OpenGL/Vulkan Driv...
Raspberry Pi 5: Challenges and Solutions in Bringing up an OpenGL/Vulkan Driv...
 
Data Cloud, More than a CDP by Matt Robison
Data Cloud, More than a CDP by Matt RobisonData Cloud, More than a CDP by Matt Robison
Data Cloud, More than a CDP by Matt Robison
 
A Call to Action for Generative AI in 2024
A Call to Action for Generative AI in 2024A Call to Action for Generative AI in 2024
A Call to Action for Generative AI in 2024
 
08448380779 Call Girls In Diplomatic Enclave Women Seeking Men
08448380779 Call Girls In Diplomatic Enclave Women Seeking Men08448380779 Call Girls In Diplomatic Enclave Women Seeking Men
08448380779 Call Girls In Diplomatic Enclave Women Seeking Men
 
04-2024-HHUG-Sales-and-Marketing-Alignment.pptx
04-2024-HHUG-Sales-and-Marketing-Alignment.pptx04-2024-HHUG-Sales-and-Marketing-Alignment.pptx
04-2024-HHUG-Sales-and-Marketing-Alignment.pptx
 
2024: Domino Containers - The Next Step. News from the Domino Container commu...
2024: Domino Containers - The Next Step. News from the Domino Container commu...2024: Domino Containers - The Next Step. News from the Domino Container commu...
2024: Domino Containers - The Next Step. News from the Domino Container commu...
 
Handwritten Text Recognition for manuscripts and early printed texts
Handwritten Text Recognition for manuscripts and early printed textsHandwritten Text Recognition for manuscripts and early printed texts
Handwritten Text Recognition for manuscripts and early printed texts
 
Factors to Consider When Choosing Accounts Payable Services Providers.pptx
Factors to Consider When Choosing Accounts Payable Services Providers.pptxFactors to Consider When Choosing Accounts Payable Services Providers.pptx
Factors to Consider When Choosing Accounts Payable Services Providers.pptx
 
Real Time Object Detection Using Open CV
Real Time Object Detection Using Open CVReal Time Object Detection Using Open CV
Real Time Object Detection Using Open CV
 
Tata AIG General Insurance Company - Insurer Innovation Award 2024
Tata AIG General Insurance Company - Insurer Innovation Award 2024Tata AIG General Insurance Company - Insurer Innovation Award 2024
Tata AIG General Insurance Company - Insurer Innovation Award 2024
 

Total Cost Of Ownership Analysis

  • 1. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 1 NAME: BLESSON BABU STUDENT NUMBER:15029468 DATE: 29-MARCH-2016 FINAL REPORT OF UTILITY COMPUTING: “DESIGN OF A MULTI-VARIABLE COMPUTATIONAL COMPUTATIONAL MODEL FOR TOTAL COST OF OWNERSHIP (TCO) ANALYSIS”
  • 2. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 2 COMPANY DESCRIPTION: TVS Motor Company is a renowned automotive industry in India. TVS Motor company is the third largest two-wheeler manufacturer in India. This company was found in the year 1978. TVS motors headquarters was established in Chennai, India. TVS Motor produce products like Motor cycles, Scooters, three wheeler vehicles and spare parts. The production capacity is around 2.5 million units per year. The company employees around 7800 people in various departments of work. The company is geographically being located in India and Indonesia. It has four manufacturing plants located in North India, South India and one in Indonesia. The company’s revenue is about US$1.5 billion and the companies profit is around US$38 million. The company exports its products to 47 countries round the globe. TVS Motor is a public type business entity. TVS Motors roll out around 2.5 million vehicles every year. TVS motors focuses on Manufacturing excellence they are driven by the five pillars of Total Quality Management – Management Commitment, Customer Focus, Quality Costs, Quality Systems and continuous improvement. TVS mainly emphasis on Research and Development. TVS Automatic Transmission Technology is one of the key success results of their innovation. This stands out to be success of TVS Motors. The company’s strength lies in design and development for new products. They focus on the customer satisfaction by anticipating the needs of the customer and then presenting the quality vehicles at the right time and right price. The company has achieved a rear feat in automotive industry by launching seven vehicles on the same day. TVS Motors famous popular models among automobiles in motorcycles Apache Series, Phoenix Series stand to be top whereas in Jupiter and Scooty Pep stands out to be popular brands. TVS Group manages TVS Motors and they receive most of the profits from the automobile industry. TVS though having a long stand history stands out be popular still date. TVS Motors also focuses on the environment. So the company focuses on Green Bikes for a better Greener tomorrow. This technology enables in reducing the global warming and pollution the company has been on the forefront for bringing cleaner technology to two wheelers. All the vehicles of TVS is 85% recyclable. TVS vehicles stand out to comply world standards. TVS Motors focuses on the major perspectives for making TVS to be standout they are:  Leadership at every level  Keen eye for Quality  Understanding Customers TVS work management has been a standout to achieve such a popular tag in automobile industry. TVS Motors encourages continuous improvement in all aspects of work using Cross Functional Teams, Supervisory Improvement Teams and Quality Control Circles so these stand out to achieve great success in automobile industry. TVS Motor Total assets is around US$160 million. The TVS Motor Company is a part is a member of TVS group is the largest company in the group in terms of size and turn over with over 2.8 crore customer riding TVS bike. TVS Motors was handed out best out standard design by the Business Today Magazine.
  • 3. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 3 Analysis of Company’s On-Premise IT State: TVS Motor Company uses the IT infrastructure with HP rx6600 servers with HP-UX 11.31. This is based on delivering the highest level of integrated virtualization and automation. The functional areas of HP-UX include services like:  LCPUS interface to dual core Intel, Itanium 2 processor Hyper-Threading  Multi pathing & Load Balancing  PCI Recovery error  PCI online deletion  On line processor and memory migration  Network File System V4 The above mentioned some of the service using HP servers and EVA 4400 storage has also has been in used like managing virtual disks, managing disk groups, View storage system status, shutdown/restart the storage system etc. Hence all these services can be done. These Servers has the installed configuration of using windows server 2003 management server, windows server 2003 non-management server and windows server 2008 non- management server. TVS Motor Company uses most of the Infrastructure services from HP. So HP is the infrastructure provider for TVS Motors. This sets the company to use the floor space of setting the infrastructure of the company. So more than 600 users work with this system environment of HP rx6600servers and HP-UX 11.31 all these make hardware components of the company. TVS Motor uses the oracle products for the database management in order to implement storage and data management optimizations. They use the oracle database release 11.2.01 for SAP. These database upgrade takes place only on UNIX/LINUX platform. The database upgradation of SAP installation with SAP NetWeaver on oracle with only single instance. The size would be around 2.5TB compression before advanced compression oracle 10g and 11g. TVS Motor Company faces the problem firstly they have to extend the storage system but it resulted in disproportionality high costs and a relatively long implementation period and secondly use a data archiving concept and implement potential space savings. The Oracle compression of shifting here by focused by using BR tools. So for the sake of database management the company relies on Oracle products. TVS Motor hereby enterprise software to manage business operations and customer relations. So the company uses the SAP software like ERP ECC 6. 04 FI, CO, MM, PP, QM, SM, HCM/HR. SAP set of middleware program and tools built on SAP web application server. It also uses Net Weaver BW 7.01 and PI 7.0 all module activities involved. NetWeaver EHP1 is the prerequisite of SAP BI solutions. This is the improved MDX interface. It consists of SAP business objects data federator BW 7.01. This is a service oriented and application and integration platform. It primarily uses the ABAP programming language it uses C, C++, Java EE. SAP environment is applied interoperate with technologies such as Microsoft .Net, IBM WebSphere and Java EE. TVS Motor initiate so as to consolidate its storage infrastructure with a storage area network (SAN). TVS Motors data centre has 60 servers, out of 20 HP servers are connected to the SAN. SAN has the storage capacity of approximately 12 Terabytes (TB) so it has been configured from Raid 1 to Raid 5. TVS Motors uses HP proprietary storage management tools. So the company should focus on storage virtualization so as to reduce Capex costs.
  • 4. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 4 TVS Motor Company use Cisco voice system remain on- premise. They use Cisco SPA9000 voice system. This has made the IP telephony made easy by setting up the internal telephone system for the purpose of small domain of phone company. Cisco SPA9000 voice system has these features that has multilevel access of password-protected access, support for 16 Cisco IP phones, support for internet telephone service to remotely update the software and the settings and it has special features like shared line appearance, call transfer, call parking and group tagging. The company also uses Cisco SPA400 Internet telephony with 4 FXO ports this can support 32 voice email accounts that can be accessed through a user’s Cisco IP phone. TVS Motor uses these services of Cisco SPA400 where they are able to meet the company’s personal needs like:  Cisco SPA400 provides support for four RJ-11 FXO to connect to public switched network  One 10/100 Base T RJ-45 internet service so as to connect to local IP address using this service the company benefits  Provides easy installation support using SPA9000 setup wizard TVS Motor uses the service of Cisco SPA9000 and SPA400 for providing better IP connectivity service on premise. The Cisco voice gateways like Cisco VG202, VG202XM, VG204 and VG204XM are used in the company. TVS Motors use Oracle for the maintenance of database advanced data compression using RAT (Real Application Testing) and secure files. RAT is a tool that is used for optimizing changes to access the impact of workload before going live on the network. Secure file is using large types of objects so as to improve the performance. So the company can personally use the services before making it live on the network. TVS Motor relies on the Acrobat 3D software and Adobe PDF to enable faster and more over providing a reliable access to mission the critical engineering drawings, 3D illustrations and designs. While taking a glance of this software in this company Adobe Acrobat 3D Version8 and Adobe reader is used so as AutoCAD is also here by used for providing a better illustration of designs. This software runs on Microsoft Windows XP, Professional and Vista this software is used. With the help of Acrobat 3D, the company can integrate AutoCAD, 3D CAD and other format design source material is hereby integrated Adobe Portable Document (PDF) file. By using the Adobe Software, the company will be able to integrate complex engineering design into everyday business process and the capability to convert AutoCAD, 3D CAD design into Adobe PDF with ease. By using this Adobe software to able to comment and edit the particular design. TVS Motor workflows in the product lifecycle management (PLM) the systems can automatically trigger the collaboration. This very much helps the company in document collaboration. TVS Motor also uses the IBM Servers, it the IBMs ILOG CPLEX Enterprise Server which enhances scalability in large scale optimization-based decision support applications. The reason behind the company selecting IBMs ILOG Transportation Analyst solution to map the cost effective trucking routes so as it enhances in providing most effective trucking route for timely delivery of dealership. So the company focuses on using IBM ILOG CPLEX Enterprise Server so it can here by support applications shared among the multiple decision makers. It runs on DB2 Enterprise server or DB2 Express-C. The company has some of the problem with the current IT infrastructure On-premise. The company has to maintain a huge database so they have to pay high costs of storage this exceeds the costs of the company in a drastic manner. Each year the company has to spend lots of money for Upgradation and various other related on premise IT costs.
  • 5. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 5 PROPOSED CLOUD SOLUTIONS: TVS Motors should move to cloud and use services provided by Amazon. By using the amazon web services, they will able reduce the total cost of ownership. It has the features like providing flexibility, disaster recovery and capital expenditure etc. Amazon EC2 reduces the time required to obtain and boot new server instances to minutes and also providing the facility to scale up and down as per computing requirement whereas using on premise it takes lot of time to build new instances and also scaling facility as per the requirements is inadequate On- premise. Amazon EC2 also provides the facility to only pay for the services that are utilised and as per Cloudonomics law “Utility services cost less even though they cost more” is followed by Amazon EC2. Amazon EC2 is a web service that provides the compute capacity in the cloud. Amazon also provides the feature of auto scaling for EC2. Amazon EC2 eliminates the need to invest on the hardware upfront it can develop and deploy applications. In the amazon environment the company will be handling their instances. TVS Motor should use Elastic Load Balancing. It automatically distributes incoming application traffic across multiple amazon EC2 instances in the cloud. It provides the required amount of load balancing computing needed to distribute application traffic. By using Amazon route 53 health checking and it will enhance the availability of load application running behind elasticity load balancer. By the route 53 can run applications in AWS regions. Elastic Load Balancing provide the facility to distribute traffic among multiple Amazon Services. In case of On-premise IT there is a traffic congestion of networks. So by using Elastic Load balancing provides it works on Amazon Virtual Private Cloud (VPC) to provide robust networking and security features. TVS Motor can also use the Amazon S3 services. Amazon S3 to use object storage with simple web service interface to store and retrieve any amount of data from anywhere of the web. The other benefit is that there is no set up cost for these services. There is no minimum fee and there is no setup cost. Amazon EC2, AWS identity and Access Management (IAM) as well as data migration services and gateway for initial or ongoing data ingestion. In case of On-premise building and storage representation is expensive. In the Amazon S3 the data is stored and relative data is stored in buckets so data is stored in different places even though the data gets deleted the replica of the data stored in another bucket. Amazon S3 employs a simple web based interface for encryption and for purpose of user authentication. This is a solution to On-premise IT infrastructure solutions so data backup and retrieve can easily be done so by Amazon S3. IT infrastructure on On-premise faces the issue of data backup if some data is lost it cannot be reinstated because there is no copy of data that is lost. So Amazon S3 standouts to be a proposal to be company. TVS Motor for the maintenance of company’s database on cloud can rely on Amazons RDS (Relational Database service) to make it easy to set up, operate and scale relational database in the cloud. It provides the feature of cost efficient and resizable computing it frees up time of managing data in the database. In the case of On-premise costs for managing database and repository and the cost of buying racks costs rate exceeds. So by using Amazon RDS there is no worry on its maintenance. AWS RDS has the facility of scalability of database management during peak traffic times. Even though some disaster occurs the replica of data is stored in region, it gives a major relief to the company and it can employ less number of employees to work on Amazon RDS. AWS provides several database engines like Oracle, Microsoft SQL Server etc. As the company is familiar using Oracle so it can work on it using AWS and this would be beneficial as they need not require to train employees as they familiar with oracle environment if so they move to other
  • 6. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 6 database they have train employees to work on that database. So by using Amazon RDS for Oracle under two licensing modes license included and bring your own license. Under the license included the Oracle Database is licensed by AWS underlying hardware resources and Amazon RDS management capability. So it provides a relief to company when the license is included no needs to worry of the license of software and bring your own license can use the existing oracle database license. TVS Motor can use the Amazon cloud front. This integrates with other AWS services products to give the developers and business can distribute these service to the customers with low latency and high data transfer. It provides the facility of global content delivery. These services of AWS can resolve networking issues. It also has no usage commitments. The company should also use Amazon cloud watch as it provides the monitoring services for all the resources and the applications that run on AWS. It can hereby collect and track metrics and so they can monitor log files. By using AWS cloud watch the company can track the running of applications. AWS can work on all windows operating system and all Linux/Unix. So Amazon services AWS Data Migration Service provides the facility to migrate the data to AWS database easily and securely. The AWS uses Amazon Virtual Private Cloud (VPC). AWS resource in virtual networking environment it can select your own IP address range, creation of subnets and configuration of route table and network gateway. It can hereby customize Amazon Virtual private cloud. The company uses AWS services such as Amazon Machine Engine (AMI). It contains the base operating system they can install the SAP software. In the AWS the SAP software on top of it. A large section of public AMI is available for Amazon and EC2 Amazon community it is possible to create AMIs. It can launch the instance AMI is needed. AWS supports SAP software to work on it. AMI provide the information required to launch an instance virtual server in the cloud. AWS and SAP work together for providing solution for enterprise applications. Amazon services are used by using Auto scaling service is enabled by Amazon cloud scaling the services up and down based on the traffic network. Amazon provides services for Adobe AutoCAD and 3D CAD design is collaborated with AWS. The company’s most of its design have in been in the Adobe format. AWS provides the privacy and security to all of its documents are in an encrypted manner. The company should also tend the services of AWS Direct Connect. This amazon services provides the location over a standard 1gigabit or 10 gigabit Ethernet fibre optic cable. Here then by using this service amazon AWS cable is connected to the router here the other end is connected to an AWS direct connect router. Here by Amazon virtual private cloud is done by passing internet service provider in the network. By moving to the cloud to on premise it reduces the cost. By using the cloud service of Amazon. AWS and Amazon EC2 provides the stronger assurance of the customer base that would be critical point solution is less expensive. AWS load balancing has high performance on the hardware. AWS ELB provides the load balancing service to the customers and the hardware is completely abstracted. Here On-premise may pay extra feature for geo-load balancing by using AWS EC2 has the feature of Auto Scaling so there is no issues of network traffics it can be easily managed by Amazon. Here AWS EBS IO performance is poor and in case of On-premise options is unpredictable. TVS Motor proposed cloud solutions can reduce the TCO (Total Cost of Ownership) as compared to On-premise.
  • 7. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 7 Multi-Variable Computational Model: CALCULATIONS OF TCO ON-PREMISE: Total cost of Ownership Year1 Year2 Year3 Year4 Year5 Unit discountTotal Cost On-Premise Servers HPRX 6600 Rs.1,716,349 25% Rs.1,716,349 HP-UX-11.31 Rs.557,092 25% Rs.557,092 EVA 4400 Rs.557,092 25% Rs.557,092 Total Server Hardware Cost Rs.2,830,451 Rs.2,830,451 Networking Costs Network % Acquistion cost Networking Harware and Software Costs Rs.2,76,976.6448 Rs.2,76,976.6448 Rs.2,76,976.6448Rs.2,76,976.6448Rs.2,76,976.644820% Rs.1,384,883.224 Network Maintenanace Rs.124639.4920 Rs.124639.4920 Rs.124639.4920Rs.124639.4920Rs.124639.4920 15% Rs.623197.46 Total Network Hardware & Software Cost Rs.2,008,081 RACK Infrastructure costs Rack chasis with PDU @3500 Rs.127.65714 Rs.127.65714 Rs.127.65714Rs.127.65714Rs.127.65714 Rs.446800 Rack Dual 280v per rack @540 Rs.2160 Rs.2160 Top of rack switch@5000 Rs.1276800 Rs.1276800 Rack and stack one time deployment@250 Rs.478800 Rs.478800 Provisioning Space Server@5years Rs.615623 Rs.615623 Total Rack Costs Rs.6924416 Server Software Costs Windows License List price Rs.307070 Rs.307070 Windows License discounted price Rs.230303 Rs.230303 Total Server hardware & Software Rs.6924416 Facilities cost(datacenter,space,power&cooling) Estimated power Cost Rs.1110044.99 Rs.1110044.99 Rs.1110044.99Rs.1110044.99Rs.1110044.99 Rs.22200.998 Esimated cost to operate rack Rs.114912 Rs.114912 Rs.114912Rs.114912Rs.114912 Rs.22982.4 Total Rack Costs Rs.229824.00 Rs.229824.00 Total yearwise Facilities Rs.340828.99 Facilities Cost On-premise Rs.12269844 Server Cost break down Category Rs.6,924,416 Hardware Rs.6,924,416 Software Rs.12,269,844 Operating System Rs.12,269,844 Rs.19,194,260 Total Rs.19,194,260 On-premise IT Labour IT Admin Costs Rs.22500.00 Rs.22500.00 Rs.22500.00Rs.22500.00Rs.22500.00 Rs.112,500 BandWidth On-premise bandwith Rs.638.40 bandwith in yearly Rs.957.60 Total Bandwidth Rs.34,473.60 Network Admin Costs IT Labour Costs Rs.7500 Rs.7500 Rs.7500 Rs.7500 Rs.7500 Rs.37,500 support staff Rs.1800 Rs.1800 Rs.1800 Rs.1800 Rs.1800 Rs.9,000 Total Costs Rs.2,051,559 SAN Cost Raw/GB Rs.561.79 Rs.561.79 Discount Rs.280.90 Rs.280.90 Total SAN Cost Rs.287,638 Rs.287,638 Storage backup Cost Total Cost of Storage backup cost Rs.114912 Storage Overhead Total Storage Data Center Rs.3447360 Storage Cost Break Down Raw Capacity Rs.287638 Rs.287638 Backup Rs.114912 Rs.114912 Overhead Rs.3447360 Rs.3447360 Total Storage break down Rs.3849940 Total Cost On-premise Rs.25208254
  • 8. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 8 CALCULATIONS OF AWS: TOTALCOSTOFOWNERSHIP YEAR1 YEAR2 YEAR3 YEAR4 YEAR5 TOTALCOST AWSCLOUD EC2RESERVEDINSTANCES m4.large Rs.248596 Rs.248596 Rs.248596 Rs.248596 Rs.248596 Rs.1242980 i2.xlarge Rs.10892689 Rs.10892689 Rs.10892689 Rs.10892689 Rs.10892689 Rs.5446349 m3.medium Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.131357.2 Rs.656786 TOTALCOST Rs.7346115 EC2ONDEMAND m4.large Rs.1572960 Rs.1572960 Rs.1572960 Rs.1572960 Rs.1572960 Rs.314592 i2.xlarge Rs.342518.6000 Rs.342518.6000 Rs.342518.6000Rs.342518.6000 Rs.342518.6000 Rs.1712593 m3.medium Rs.32973 Rs.32973 Rs.32973 Rs.32973 Rs.32973 Rs.164867 Totalcost Rs.2192052 EC2LOWEREDPRICEINSTANCE m4.large Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.62918.4000 Rs.314592 i2.xlarge Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.342518.6000 Rs.1712593 m3.medium Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.32973.4000 Rs.164867 TotalCost Rs.2192052 EC2RESERVEDINSTANCES AWSBUSINESSSUPPORT Rs.43481 Rs.43481 Rs.43481 Rs.43481 Rs.43481 Rs.219205 EC2COSTS Rs.48825 Rs.48825 Rs.48825 Rs.48825 Rs.48825 Rs.241125 AWSSTORAGECOSTS EBSSTORAGEwithIOPS&CAPACITY Rs.28920 Rs.28920 Rs.28920 Rs.28920 Rs.28920 Rs.144604 EBSCOSTS Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.31812.8 Rs.159064 AWSBUSINESSSUPPORT Rs.14460 Rs.14460 TotalAWSStorageCost Rs.159063.90 AWSDATATRANSFER AWSBUSINESSSUPPORT(DATATRANSFER)Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.25626.8 Rs.128134 DATATransferCost Rs.2819 Rs.2819 Rs.2819 Rs.2819 Rs.2819 Rs.14095 AWSITLABOURCOSTS ITADMINCOSTS RS.5625 RS.5625 RS.5625 RS.5625 RS.5625 Rs.28125 OverallTotalCostsofAWS Rs.2612541
  • 9. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 9 Total Cost of Ownership Analysis & Variables: TCO provides the realistic and holistic measure of long term costs required to acquire and operate technology solutions. Return of investment (ROI) is the method to evaluate and prioritize technology investment in the company. TCO model focus on Cloud Computing to minimize the overall cost of On-premise costs. The TCO is defined by this methodology as TCO=Acquistion costs + Operational Costs. In the On-Premises and AWS the values of Server Costs, Storage costs, IT Labour Costs and Network costs and IT labour. TCO adopts the cloud based solutions reduces or eliminates traditional capital expenditure (CAPEX) in the favour of operational expenditure (OPEX) the organizations prefer often CAPEX over OPEX. Since then all the payments against the income statements. AWS biiding Startegies helps in reducing the cost of TCO of an Company. AWS bidding startegies are:  Optimizing cost  Bid around previous trends in history  Bid On-demand price  Bidding highest amount possible These all factors contribute in reduction TCO using AWS as compared to that of On- premise. TCO is a financial estimate intend to determine the direct and indirect costs involved in a financial estimate. TCO methodology was first determined by Gartner Group. TCO must be compare direct costs involve floor space, storage and IT operations while indirect costs such as network, storage infrastructure and IT operations involved in it. TCO include all acquisition and operating costs. TCO determines the TVM (Time value of money). COMPRASION OF TCO ON-PREMISE VS AWS Variables: TCO of On-premise and AWS is illustrated in the form of graph to give a clear and vivid idea of TCO spent: 5 YEARS TCO (TOTAL COST OF OWNERSHIP) 5 Yr. Total Cost of Ownership On- Premises AWS Server 19,194,260 2,411,257 Storage 3,849,940 159,064 Network 2,051,554 14,095 IT- Labour 112,500 28,125 Total 25,208,254 2,612,541
  • 10. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 10 This graph illustration gives a fair idea of savings using AWS as compared to On-premises. Then by using the following to compare the costs of a server On-premises it is hereby illustrated by as follows the hardware costs around Rs.6924416 and Overhead costs Rs.12269844. It is illustrated as below: Then following Pie graph illustrates the Compute EC2 Services it is illustrated by as follows On-Demand costs around Rs.2192052 it is base on pay per usage. The following Pie graph usage of Network bandwith where almost 50% omoney is spent on Admin in the case of Networking On-premise and about 49% rectifying issues. The following graph illustrates the AWS EBS storage 91% of amount is spent on EBS Volume and about 9% is spent on snapshot. Server On-premise Hardware Software Overhead Compute EC2 OnDemand Networking On-premise Gear Admin Bandwidth EBS EBS VOLUME Snapshot
  • 11. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 11 RECOMMENDATIONS AND CONCULSION: TCO (TOTAL COST OF OWNERSHIP) shows the direct and indirect costs met hereby using the AWS services TVS Motor can reduce the TCO in an effective manner. TCO hereby compares all the direct and indirect costs met by the company so by moving to Cloud Services provided by AWS the company could save their resources. By moving to AWS the company could save 90% by moving the infrastructure to AWS. The AWS resources can cut the unwanted costs spent on the On-premises that leads to excess dependency on CAPEX is met here. The Company used to spend a lot of money on Infrastructure maintenance, Software Licenses and salary of employees etc. So by moving to AWS they need not worry about the maintenance Licenses of Software and Network all of them are well maintained in AWS. BY using the AWS, they will be cut down the employees by doing so this reduces Financial burden of the Company and saves lot of money. By using the AWS resources, the Sales employees of TVS Motor on field can access the data from anywhere and it would turn out to be beneficial while by using On-premise resources the employees have to spent a lot of money in the company. The Cloud resources provided by AWS is useful even for the customers they can access the resources provided by the on any devices. So by using AWS this helps the company perspectives of providing better services to the customers. By using AWS data backup services could be done easily and it can retrieve and use data as compared to On-premise resources it used to lots of time to update and backup resources by using AWS resources these services of data storage could be done by using AWS resources like EC2, EBS etc. By using these resources, the company saves lot of money by using these resources. Moreover, all the AWS resources are based on pay for what you use so there is no worry of excess of money to be spent it depends on the usage of the firm. AWS resources provides better support to the Company and AWS support these resources. The better feature of AWS is that if the data is lost a replica of it is stored in other place this provides a relief to the company. As data could be lost On-premises due to some problems whereas AWS keep a copy of data of AWS in the resources of amazon and moreover the geographical location of choosing the datacentre is chosen based on the company’s choice and the company need not worry in terms of security as well as networking as AWS provides the better services to be standout. TVS Motor could use all their enterprise software and oracle software on AWS and there is no need to bother about the licenses as AWS provides choices of providing licenses by AWS or On usage licenses brought by the company and more over by using the floor space of data Centre is not an issue with AWS so all the costs can be cut down by using AWS. By using AWS, the company could reduce the TCO and more over by moving to Cloud the company can save lots of money. As Cloud Services provides better Security, Reliability and all other features. It is hereby recommended that TVS Motor should use AWS Cloud Services so they could be leading providers in automobile industry and so they could marginally invest the money saved from IT to other resources. TVS Motor should opt for AWS so as to reduce financial burden spent on various resources spent on IT and hereby using Amazon Web services they can reduce their TCO.
  • 12. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 12 BIBLOGRAPHY: https://en.wikipedia.org/wiki/Total_cost_of_ownership https://www.business-case-analysis.com/business-case-guide.html Michael Witting and Andreas Witting 2016, Amazon Web Services in Action, 1st Ed., Manning [ISBN: 9781617292880] http://www.cio.com/article/2399248/it-organization http://www.networkmagazineindia.com/200309/casestudy01.shtml http://www.oracle.com/us/products/database/ocs-nl20-tvs-motor-396158.pdf http://www.cxotoday.com/story/tvs-motors-implements-dealer-management-system/ http://www.thehindu.com/business/Industry/tvs-motor-sales https://net.educause.edu/ir/library/pdf/ERB0401.pdf “A Framework for Total Cost of Ownership", The International Journal of Logistics Management Ellram, L.M.: A Taxonomy of Total Cost of Ownership Models. Journal of Business http://cdn2.hubspot.net/hub/49708/file-14401780pdf/docs/whitepaper_moving_to_the_cloud- _understanding_the_total_cost_of_ownership_pdf.pdf http://www.netsuite.com/portal/pdf/wp-hurwitztco-study-dynamics.pdf http://ejournals.bc.edu/ojs/index.php/ital/article/view/1871 http://www.softwareadvice.com/tco/ http://www.digitalistmag.com/technologies/cloud-computing/2013/06/14/5-key- considerations-when-comparing-the-tco-of-on-premise-and-saas-systems-043626 https://www.teacherease.com/totalcostofownership.aspx OPERATIONS AND MANAGEMENT THEORY AND PRATICE BY B. MAHADEVAN http://joshlowryblog.com/2014/06/08/what-is-total-cost-of-ownership-tco/ http://betanews.com/2013/11/04/comparing-cloud-vs-on-premise-six-hidden-costs-people- always-forget-about/ AMAZON WEB SERVICES FOR DUMMIES BY A. WILEY BRAND http://www.slideshare.net/lynnlangit/understand-aws-pricing https://aws.amazon.com/economics/learn-more/ http://www.tvsmotor.com/tvs-in-brief.aspx
  • 13. “TOTAL COST OF OWNERSHIP (TCO) ANALYSIS” 13