Lumber Liquidators - DataXstream

insiderprofiles.wispubs.com Reprinted with permission from the APR MAY JUN 2011 insiderprofiles

This article appeared in the APR MAY JUN 2011 issue
of insiderPROFILES (http://insiderPROFILES.wispubs.com)
and appears here with permission from WIS PUBLISHING.
How Lumber Liquidators Optimized Its IT Investments
and Lightened the Demand on Its IT Organization
by David Hannon, Features Editor
Rapid business growth is a double-edged sword. On one hand,
all emerging enterprises surely aspire to grow and thrive. But
keeping up with this expansion, especially from an infrastructure
point of view, can be complex and expensive. In less than
two decades, hardwood flooring retailer Lumber Liquidators
grew from a single warehouse with no running water to
a $600 million retailer with stores in 46 US states and more
than 1,000 employees.
In 2009, Lumber Liquidators planned to open 30–40
new locations — and expected similar results for 2010. To
accommodate this growth, the business required some major
IT infrastructure changes. To this end, the business opted
to implement a new ERP system, selecting SAP ERP for its
functionality extending across finance, sales and operations,
warehouse management, merchandising, and purchasing.
Because the company was interested in a cost-efficient ERP
system, the implementation team began an evaluation process
to find a flexible server architecture that could handle its
current requirements and also scale as the business continued
to expand — especially in the areas of order capacity, transaction
speed, reporting, and process automation.
“Our goal was to deploy a solid and manageable foundation
with the ability to scale,” says Jack Kinsey, Director of Network
Operations at Lumber Liquidators. “The message from the
top of our company was to continue to deliver the way we’re
delivering, but to keep an eye toward the future.”
Moving to a Virtual Environment
A conservative estimate from an internal cross-functional
search committee showed that, to run a new ERP system, the
company would need to triple its number of physical servers
— and would then have to add more servers in the future as
the landscape expanded.
“We didn’t have a data center available in which we could
put that much additional equipment while maintaining a
reasonable reserve capacity,” Kinsey says, noting that the
additional costs of either moving servers off site or making
upgrades to its existing computer room weren’t particularly
appealing to a company planning for long-term growth. And
beyond the installation and housing of the physical servers,
ongoing maintenance was a concern.
For these reasons, the search committee recommended that
Lumber Liquidators move to a virtual environment. According
to Kinsey, the following were identified as the key business
drivers of going virtual:
• Scalability. The business wanted a system that would not
only meet its current needs, but scale with its long-term
growth.
• Physical space. Installing physical servers today, and in the
future, would require that the company maintain enough
physical space to accommodate a growing ERP system.
• Maintenance and operations costs. Running and maintaining
physical servers would require more investment
— augmenting the company’s lean IT staff — than virtual
servers would.
• Expertise. The company hoped to capitalize on the inhouse
experience it had, but also planned to seek virtualization
help from an outside partner that would mesh well
with the existing implementation team.
After considering all of these factors — and implementation
time — Lumber Liquidators decided to purchase all of
the necessary equipment and software to begin a virtual ERP
implementation, including VMware solutions, Dell servers
and storage, and Microsoft operating systems. The environment
was used throughout the project for all SAP systems —
sandbox, training, development, and quality assurance — and
that continues today, but with the addition of the production
environment, which went live in August 2010.
Because Kinsey had come to Lumber Liquidators in 2009
from a company that had virtualized extensively, he understood
the benefits and advantages of virtual implementations.
To help with the project, the business partnered with
DataXstream, a proponent of virtualization that, according
to Kinsey, provided extensive expertise in virtualization for
SAP environments. (For more information on the integral
role DataXstream played in Lumber Liquidators’ virtual
implementation, refer to the sidebar on page 35.)
insiderprofiles.wispubs.com Reprinted with permission from the APR MAY JUN 2011 insiderprofiles

All Photos Courtesy of Lumber Liquidators
“During evaluation, implementation, and ongoing
operations, having DataXstream on our side relieved
a lot of pressure — because not only had they done
it themselves, they were willing to put their stamp of
approval on our virtualization project and provide examples
of other companies that had been successful
with virtualized SAP implementations,” Kinsey says. “A
lot of our internal staff didn’t come from SAP shops, so
it was a lot of change. Having DataXstream as such a
proponent of virtualization relieved a lot of angst.”
Reaping the Benefits of Virtualization
While still in the early stages of its implementation,
Lumber Liquidators is seeing big benefits from its decision
to go virtual. For starters, according to Kinsey,
the ongoing maintenance and operation of a virtualized
environment significantly lightens the demands
on the internal IT organization. The reduction in
physical servers and their related cooling systems
reduces the maintenance requirements and costs.
And the process of adding new servers is significantly
streamlined in a virtualized environment. “We can
provision additional servers for SAP installations in
less than 30 minutes,” says Greg Hubof, Senior Basis
Administrator at Lumber Liquidators. “With a physical
server, that process could take anywhere from two
weeks to two months.” That benefit is particularly useful
when it comes to ramping up additional servers
for specific time-sensitive projects.
Prior to this project, Hubof had been involved in
several SAP implementations — but none in virtual
environments. “When you get into data conversions
with non-virtualized implementations, you always
wish you had a little more horsepower,” he says. “With
our new environment, we could — and did — spin up
additional virtual machines temporarily while those
data conversions were running, and then tore it down
when the conversions were done.”
Another example of the flexibility that comes
with virtualization was the ability to create isolated
research and testing environments using exact replicas
of the servers running the SAP systems. This
allowed multiple teams to work concurrently on different
tasks on the “same” servers, while removing the
insiderprofiles.wispubs.com Reprinted with permission from the APR MAY JUN 2011 insiderprofiles

DataXstream’s Virtualization
Solution for Lumber Liquidators
complexity of coordination between groups. In a
physical environment, such accommodations are
both costly and complicated, but in the virtual
landscape, the IT team simply cloned the necessary
servers and placed them in the isolated sandbox.
“We were able to give the project team what it
needed faster than would have been possible with
physical hardware,” says Kinsey. “It’s a great example
of the flexibility you have to flip machines around
and make adjustments that are completely unrealistic
in a physical environment.”
Down the Virtual Road
The most important benefits of the virtualized environment,
according to Kinsey, are yet to come. Going
forward, Lumber Liquidators can quickly and efficiently
expand its IT landscape with greatly reduced
concerns about where to put the servers and who
will maintain them.
At a Glance
“We were able to give the
project team what it needed
faster than would have been
possible with physical hardware.”
— Jack Kinsey, Director of Network
Operations, Lumber Liquidators
Lumber Liquidators
Headquarters: Toano, Virginia
Industry: Hardwood flooring retailer
Revenue: $620 million (2010)
Employees: 1,000+
Company details:
• Founded in 1994 in a single warehouse
• Now operates stores in 46 US states and will
soon open stores in Canada
• Opened 37 new stores in 2010, with 40–50
planned in 2011
• NYSE ticker: LL
SAP solutions:
• SAP for Retail
• SAP NetWeaver BW
• SAP NetWeaver Portal
• SAP NetWeaver PI
• SAP Solution Manager
As an SAP systems integration and consulting firm
with over 14 years of experience implementing SAP
solutions, DataXstream specializes in the areas of integration,
upgrades, virtualization, cloud computing,
.NET Connector, SAP Solution Manager, and project
management. DataXstream’s rare combination of
project leadership, business process knowledge, and
SAP technical expertise lets its clients achieve higher
business performance and maximize their return
on investment.
Lumber Liquidators needed to deploy a hardware
platform that would support not only the company’s
initial implementation, but also future incremental
growth. Because this would be a new implementation,
the company was concerned with minimizing
total cost, delivering high availability and consistent
performance to an increasing number of users, and
simplifying the system maintenance for its streamlined
IT staff.
Leveraging its longstanding expertise with SAP
software, DataXstream tuned a virtualization solution
specifically to support current SAP needs, while
remaining flexible enough to grow incrementally as
new deployment phases started. As a result, Lumber
Liquidators reduced the amount of hardware by
two-thirds compared to a traditional solution, thereby
lowering its TCO.
Since 2002, DataXstream has leveraged the full
flexibility and cost-saving features of virtualization to
better meet the needs of its SAP customers. With a
thorough understanding of virtualization technology
coupled with SAP technical expertise, its experts have
developed best-practice techniques to successfully
architect SAP virtual storage infrastructures that can
meet even the most rigid uptime and business continuity
requirements.
For more information, visit www.dataxstream.com.
insiderprofiles.wispubs.com Reprinted with permission from the APR MAY JUN 2011 insiderprofiles