A good target: Keep 30 percent of your data in Tier 1 storage and the rest at lower tiers, advises Burton Group’s Simpson, though the exact ratio depends on the performance and availability requirements for your data.

It’s critical for the CIO to make sure that business takes responsibility for its data demands. “It’s not the role of the storage team to define the data requirements—that has to go to business management,” Buchanan says. But the CIO has to lay the groundwork by having effective asset management in place and exhibiting efficiency.

Cheaper Storage Networks Through iSCSI
Among newer technologies that can help reduce storage costs, the most notable in recent years is iSCSI (Internet Small Computer System Interface). A type of storage that connects drives to each other and to servers using a simple, easy-to-manage protocol, it lets organizations of all sizes deploy SANs. Before iSCSI, the major SAN option was fibre channel, but “fibre channel is not suited outside larger enterprises,” Simpson notes, because of its complexity and its high management cost.

The simplicity and fit of iSCSI for a larger range of organizations make it the fastest-growing interconnect technology for storage, reports IDC (a sister company to CIO’s publisher); the research firm expects 25 percent of all external storage sold in 2011 to be iSCSI-based.

Regional accounting firm Schenck Business Solutions dropped its EMC fibre channel array three years ago because of its complexity, replacing it with an EqualLogic iSCSI-based SAN. “We had struggled with configuration and day-to-day usage,” recalls CIO Jim Tarala. Since then, the company’s storage capacity has increased about 330 gigabytes to 20 terabytes. But he’s got a handle on overall cost. “We spent approximately 120 percent of what we did on the EMC gear (330 gigabytes) to get the EqualLogic (20 terabytes) and our management costs are a maximum of 60 to 65 percent of what they were previously,” Tarala says. He expects to upgrade the storage to 30 terabytes soon.

Associated Bank, which serves several Midwestern states, had a similar experience. In 2005, it needed to rethink its storage strategy to prepare for volumes of expected image data such as electronic check images and customer records, since the bank was implementing a program to let customers start an application at one branch and finish it at any other. When the storage initiative began in 2005, the bank had about 20 terabytes of data; it now has 300 terabytes.

The bank built its SAN using iSCSI arrays because it wanted an IP-based network to take advantage of its staff’s existing networking skills, recalls Preston Peterson, the assistant vice president of infrastructure design. Still, just in case fibre channel becomes necessary later on, the bank made sure its Compellent storage arrays could support both fibre channel and iSCSI.