Today, Transplace's production environment is almost completely virtualized, and Biddlecombe estimates it will be 95 percent virtualized by year's end. That's quite an achievement, says Burton Group research analyst Chris Wolf. "From my experience, organizations that are able to virtualize 40 percent of their servers in a year are doing really well," Wolf says.

In total, Biddlecombe's IT group now runs about 110 VMs. In fact, the only significant applications that he's not running on a VM right now are his Microsoft Exchange servers and SQL server databases—both known for being extremely I/O intensive. (They hog resources on physical servers to the point that it doesn't make sense to virtualize them in many cases).

The Mission-Critical App Goes Virtual

The thought of running mission-critical ERP applications on a virtual machine makes many CIOs nervous—too nervous to try it (even now that ERP giant SAP has announced support for its products running on VMware.) But not Biddlecombe. As for Transplace's mission-critical app, a transportation management system, the first month of its virtualized run, coming to a close now, has proven pretty uneventful, Biddlecombe says. He saw no major pitfalls or performance issues.

This transportation management system determines, for instance, which orders need to be shipped together for consolidation purposes, how the order should be best shipped (parcel, full truckload or other options), which shipping carrier is optimal, and so on. This system also handles freight audit and payment. Effectively serving as Transplace's ERP system, the transportation system handles 4 million shipments per year, or about $2.75 billion in transportation spending annually. Developed in-house using Java, it runs on BEA WebLogic application servers and Oracle for database work.

Biddlecombe has dedicated 50 VMs to support the components of the transportation system running on WebLogic, and 50 to 60 VMs for some other components and everything else.

To determine the right number of VMs and balance workloads on the servers running those crucial VMs, the IT team did extensive prototyping. But they had an advantage that not all companies have with their ERP systems: Since the transportation system software was developed in-house, Biddlecombe's team knew a lot of its performance quirks already. "We're intimately familiar with what our software needs," says Biddlecombe, who has been with Transplace for three years and served as CTO for fifteen months.

Interestingly, Biddlecombe has not found it necessary yet to invest in any new third-party management tools from any of the virtualization upstarts, though he is scoping out one emerging need. Favoring a layered monitoring approach, he currently uses HP's Business Availability Center tools at the top level, HP's SiteScope at the next level (measuring factors like memory utilization in every app in every VM) and then network and database monitoring tools. He's also using VMware's vMotion tool to move VMs around as needed.