Luxury hotel group saves 40% moving to Amazon cloud
Kempinski Hotels hired Cloudreach as consultants and is in the middle of a phased approach to migrate its core systems to Amazon Web Services
Kempinski Hotels, one of Europe's oldest luxury hotel groups, is in the process of moving its entire corporate IT infrastructure into Amazon Web Services' (AWS) public cloud, where it expects to save up to 40% on its costs over a five-year period.
The project began in 2009, when IT director Jeremy Ward began putting together a strategic plan for the company's IT. This started with an audit of the hotel group's assets, where it found 147 servers, all virtualised (ESX host) running VMware, with an assortment of Windows, Linux and Novel operating systems.
Ward explained to Computerworld UK that the move to AWS was motivated by wanting his IT staff to spend more time improving on productivity.
"One of the key guiding principles that we came up with was that we are a hospitality management company, we are not an IT services company. I wanted to make sure that my staff is putting their skills towards improving the productivity of applications, rather than administering applications," said Ward.
"We are a relatively lean team, but if I can free up 50% of somebody's time to get them working more closely with our partners, it actually improves the performance of Kempinski as a whole."
He added: "They can drive the efficiency of applications, rather than spending their time running a backup, changing a hard disk or patching an operating system."
Ward explained that Kempinski selected AWS out of three possible cloud providers, though he did not want to reveal the names of the other two, as the hotel group still works with them in other areas.
"After a number of meetings it became obvious to me that AWS was the best fit for our requirements. We wanted a solution where we could have a number of base servers that we knew would be running most of the time, but also have a number of servers running in a specific environment - such as a training environment - where they would be switched off for a significant amount of time during the year," said Ward.
"When we run a training course, which may be one week in any month, we are able to switch that environment on, pay for our consumption as we go, and then when the training is done we reset the images, turn those servers off and the images still sit on AWS. However, we don't pay for them whilst they are switched off."
He added: "Out of the companies we were talking to, they couldn't do that for us. With the other two, once you had committed to having an image up on their solution, you pay for it whether you are using it or not."
Ward said that he also went with AWS because they introduced Kempinski to Cloudreach, a consulting service that the hotel group is using to help get its infrastructure into the cloud, and will then manage it after the project is complete.
"We wanted a company that could provide monitoring for us, do the back-up, a more proactive type managed service," said Ward.
"However, we didn't want to be tied in from day one so we asked them to produce a report, an AWS Deployment Framework, which described the business case and return on investment scenario. We could have just used this report without actually working with Cloudreach, but we were very impressed and decided to go forward with them."
Since the beginning of 2012 Kempinski has been working with Cloudreach to deploy its infrastructure into AWS' cloud. The first two phases are complete, which involved setting up the security infrastructure, firewalls, migrating non-critical applications (such as the helpdesk), connecting all the hotels to AWS and testing VMware imports.
Ward said: "We are now moving into phase three, where we are going to start moving a lot of our live systems over. We have tested functionality, we know it's going to work, so we will get the five-month project started in September."
The company hopes to have nearly all of the corporate infrastructure in Amazon's cloud by the end of February 2013. It has so far rationalised its services down from 147 to about 60, and Ward is "fairly confident" that this will go down to 10 by the end of February.
In addition, Ward said that the company was keen to look at long-term benefits when making the business case for the cloud migration project.
"When you are looking at something like this you have to take a long-term view. If you take any given year, where you look at the infrastructure that you have already got, you have a sunk cost because of the capital investment, the licences, the staff that manage that infrastructure etc.," said Ward.
"Take all of that and move it to AWS in year one, and it is going to cost you - there are set-up costs, migration costs, depreciation costs. However, if you take a five-year view, and consider a hardware refresh in that five-year period, you can make a saving."
He added: "In year one and two we worked out we won't see any significant return on investment. After two and a half years, that's when we really start to see the benefits. If you also include non-tangible figures, such as staff efficiency, we are looking at about a 40% saving over the five years."