TÜV NORD Group

37 Percent Lower TCO for Germany’s TÜV NORD with SQL Server 2005

TÜV NORD Group, based in Hannover, Germany, provides testing and certification services for more than 100 industries. With a workforce of more than 7,000 operating from 45 countries, the company relies on SAP applications deployed on Microsoft® SQL Server™ 2005 to help manage its worldwide business. Working with Microsoft Gold Certified Partner VMS, TÜV NORD analyzed the efficiency of its SAP deployment, which includes a 3.5 terabyte SAP BW hosted on a single instance of SQL Server 2005, and a 1.3 terabyte SAP ERP database on a single instance of SQL Server. The VMS study found that TÜV NORD benefited from 56 percent lower database administration costs than industry average, and that it enjoyed a 37 percent lower total cost of ownership. The study credited much of the savings to the finding that SQL Server generally cost less than Oracle to administer.

The VMS Benchmarking study helps quantify the many benefits we’ve gained from our strategy to standardize our SAP-environment on the Microsoft Application Platform.” Gunnar Thaden Chief Information Officer TÜV NORD

Situation
The TÜV NORD Group, provides a full range of testing and certification services for over 100 industries ranging from food safety, process machining, software, mining and medical products to environmental technologies. The group employs more than 7,000 experts in over 45 countries, and is one of Germany's largest technical service providers.

TÜV NORD is especially well known throughout Germany for its automobile emissions testing centers. The company, which generates annual revenue of some U.S.$718 million, has expertise in nearly all questions of technical safety, environmental protection, and the conformity assessment of management systems and product—nationally and internationally. TÜV NORD verifies compliance to respective safety and quality standards by performing inspections, tests and audits. As customers achieve compliance, TÜV NORD issues a number of domestic and internationally recognized certifications.

These certifications can cover both legal and market driven requirements. For example, a TÜV NORD USA QS-9000 Management System Registration shows compliance to an automotive market driven requirement necessary to sell components to the "Big Three". The CE Marking covers the European legal requirements for the sale of product within the European Union. TÜV NORD, Germany holds all the accreditations needed to test and verify that the requirements established by European directives are met.

As a company that is dedicated to testing and analysis, it is natural that it wanted to evaluate the efficiency of its SAP infrastructure, which runs on Microsoft® SQL Server™ 2005 Enterprise Edition (64-bit) database hosted on Intel-based servers. The company’s SAP deployment includes a SAP BW database with 3.5 terabytes of data on a single instance of SQL Server 2005, and is hosted on an HP ProLiant DL585 server with four dual-core processors and 16 gigabytes (GB) of RAM. TÜV NORD’s SAP ERP database, which totals 1.3 terabytes, also is hosted on a single instance of SQL Server.

Solution
TÜV NORD contracted with Microsoft Certified Partner VMS to analyze the efficiency of its SAP deployment, using the VMS Benchmark method to measure the utilization of the SAP system directly and in an automated way down to the transaction level. This approach, which VMS refers to as “DNA-level Benchmarking” provides a detailed analysis of an organization’s costs and efficiency in managing a SAP infrastructure.

VMS, which has focused on SAP benchmarking since 2002, has run projects for more than 50 international companies including Abbott, Bayer, DaimlerChrysler, Siemens, and Sony. The VMS Benchmark database holds more than 900 SAP system benchmarks, as of September 2006, and is growing rapidly.

VMS benchmarks aim at a continuous business improvement process and help VMS customers to run SAP with higher quality at a lower price. VMS projects have already helped organizations save more than U.S.$260 million.

Total cost of ownership is one of the most important considerations an organization should make when considering a SAP deployment. Ralph Treitz Chief Executive Officer VMS

The TÜV NORD SAP environment underwent VMS benchmarking analysis for eight consecutive weeks in July and August 2006. Concurrently VMS worked with TÜV NORD IT to determine cost structures and other operational data.

TÜV NORD has four SAP systems:
 SAP ERP (Enterprise Resource Planning)
 SAP CRM (Customer Relationship Management)
 SAP BW (Business Information Warehouse)
 SAP WAS (Web Application Server)

The company has about 4,200 SAP users. The ERP system is the most heavily used, supporting about 450,000 transactions per day. SAP applications, include MM (mainly Purchasing), SD (Sales), FI (General Ledger, Travel Management), CRM (Mobile Service) plus a significant amount of TUV special development, representing about one third of ERP transaction loads.

Benefits
The VMS DNA-level Benchmarking study identified significant benefits for TÜV NORD’s SAP deployment, including a 37 percent lower TCO, 70 percent lower database administration costs, lower service costs, and reduced costs from deploying an integrated solution.

“The VMS Benchmarking study helps quantify the many benefits we’ve gained from our strategy to standardize our SAP-environment on the Microsoft Application Platform,” says Gunnar Thaden, Chief Information Officer at TÜV NORD. “We made the right decision in building upon the Microsoft Application Platform to achieve a modern and scalable IT-landscape while minimizing costs.”

37 Percent Lower TCO
The eight-week VMS DNA-level Benchmarking found that TÜV NORD’s TCO for operating its SAP infrastructure was 37 percent lower than industry average, and that much of the savings could be traced to the lower licensing costs and administrative costs of SQL Server 2005 compared to Oracle.

“Total cost of ownership is one of the most important considerations an organization should make when considering a SAP deployment,” says Ralph Treitz, Chief Executive Officer of VMS. “Today’s SAP users, during the first five years of deployment, pay about seven times the price of the SAP license in running the enterprise software.”

TÜV NORD was able to deploy SQL Server without adding a dedicated database administrator. SQL Server tends to take care of itself … Ralph Treitz Chief Executive Officer VMS

The VMS TCO calculations focused on the cost of running SAP. The cost pattern included everything necessary for the day-to-day business, but excluded large projects and the rollout phase itself. Excluding rollout costs provides a more precise TCO picture, because the effort of rolling out new enterprise software includes to a large and varying part the cost of business process reorganization. Such costs depend on where a company is coming from and what it is aiming at. So looking at the day-to-day costs of ownership provides a better guide to what TCO will be.

VMS measured TCO on the basis of customizing and adapting SAP applications; the cost of monitoring and managing SAP technology; database monitoring, configuration, and tuning; operating system management; and hardware costs for hosting the solution and storage.

As shown in Chart 1, the greatest cost of a SAP infrastructure is the cost of personnel,  for administrative and support functions. This effect is stronger at TUV than at other companies because of the usage patterns that include:

 A large user community, in this case a total of 4,200 users, among them 3,400 on SAP ERP and more than 400 on SAP BW spread over an area as large as one third of Germany.
 Most of the users are not “power users.” They use mobile devices to access and enter data into the systems. Transaction rates per user are moderate to low.

Such a user community, which is a prototype for modern service-oriented companies, presents special challenges. The per-user request for hardware power is rather low, but such users require a higher effort for support per user for incident responses as well as for general application management. With TÜV NORD the comparatively large number of users is a cost driver. This makes it all the more impressive that the company is able to run its SAP environment at just 63 percent of industry average for a similar deployment—yielding the 37 percent savings. The company comes very close to matching a best practice scenario.

56 Percent Lower Database Administration Costs with SQL Server 2005
A major factor in TÜV NORD’s lower TCO is that SQL Server, according to VMS findings, costs less to administer than Oracle and other databases.

The lower database administration, combined with a lower SAP basis and lower costs for hardware and operating system, helped TUV achieve a technology stack cost that was only 57 percent of the market average and very near an ideal best practices scenario, according to the VMS study.

The study found that TÜV NORD’s database administration costs were only 30 percent of the average and equal to best practice. The savings were a result of TÜV NORD’s strategy of deploying a robust and easy to manage infrastructure.

“When the TÜV NORD CIO Gunnar Thaden and his team were selecting the platform for running SAP, beside all technological requirements, they aimed at a platform with the lowest possible demand for runtime efforts,” says Treitz. “So TÜV NORD decided on an all Microsoft strategy, and the VMS benchmark shows the positive results of this decision.”

VMS has found, as shown in Chart 2, that SQL Server costs considerably less to manage than Oracle because it is less likely than Oracle to require a dedicated database administrator. “TÜV NORD was able to deploy SQL Server without adding a dedicated database administrator,” says Treitz. “We have seen this in other companies we have studied. SQL Server tends to take care of itself as long as there are no exceptional events such as a shortage of disk space or a significant change in the application behavior. We have found that Oracle tends to need more ongoing attention.”

The VMS study also found that TÜV NORD is a bit more efficient than average SQL Server users in reducing the cost of database administration.

Sven Otromke, SAP System Manager of TÜV NORD Group, spoke of some of the ways in which SQL Server 2005 makes it easier to manage the SAP BW.

“Our SAP system has perhaps 35,000 tables, and every table has three or four indexes,” says Otromke. “As we customize the system we add more indexes, but after several years it is difficult to remember exactly why any given index was added. With Dynamic Management Views you can see how long it has been since an index has been used, and this helps us decide when indexes can be removed. Every time we can remove an extraneous index, it means one less index needs to be maintained, and this in turn improves performance.”

Database maintenance also is enhanced by the Online Indexing feature of SQL Server 2005. Prior to upgrading to SQL Server 2005, the SAP system could slow quite drastically while generating indexes, requiring that such tasks be performed during the evening hours.

Now indexing can be done during the day. Additionally the SQL Server 2005 Dynamic Management Views feature records which indexes are actually still being used and makes suggestions for additional indexes to improve system performance. The Database Tuning Advisor enables the company to perform an analysis of specific workload situations. “The ability to identify and eliminate expensive queries and unnecessary indexes from the database has enhanced performance noticeably," says Otromke.

Lower Service Costs
The VMS benchmarking found that, in addition to experiencing lower database administration costs, TÜV NORD benefited from lower service costs in the other areas of its deployment. VMS defined service costs as all costs involved in running SAP, with the exception of hardware and software acquisition. The three areas of service were categorized as:
 Database administration
 SAP administration
 User and application support

As shown in Chart 3, all three service areas cost less with TÜV NORD’s deployment. “The study revealed that the service expenditures to run the SQL Server database were almost negligible,” says Treitz. “When we looked closer we found that TÜV NORD’s deployment didn’t require dedicated SAP database administration support.”

Ease of use also factored into the savings, according to the study.

“This savings in database support is quite important,” says Treitz. “We found that, first of all, SQL Server at TÜV NORD runs without needing a permanent caretaker. And secondly, the staff looking after the SAP database is not especially trained on maintaining a database for SAP. The same staff takes care of all kinds of SQL Server instances. This is good news, especially for companies that want to run their own data center. The additional cost for dedicated SAP database administration would add significant load to the budget. SQL Server helps TÜV NORD avoid this burden.”

Reduced Costs from Deploying an Integrated Solution
The VMS study identified the value of deploying SAP on a well integrated platform. As shown in Chart 4, the company used a tightly integrated foundation of SQL Server running n Windows operating systems and hosted on Intel-based servers.

“The study demonstrated that a consistent implementation of a vendor and technology strategy pays off,” says Treitz. “From a wide variety of studies, we have seen that focusing on integrated platforms for hardware, operating system, database, and business applications is key to efficiency. Choosing HP servers, Microsoft Windows and SQL Server and SAP applications is not the only way to implement the paradigm, but our study found that this combination is very reasonable and effective.”

Treitz noted that the strategy seems to pay off for organizations regardless of size. “Small and midsize organizations certainly benefit from a tightly integrated infrastructure,” Treitz says. “We are finding the same is true at the large end of the scale. Even the large IT service providers that are running huge data centers refrain from old-style cherry picking strategies of matching databases or operating systems to different applications. Consolidation and streamlining is at the top of every organization’s agenda.”

Microsoft Server Product Portfolio
For more information about the Microsoft server product portfolio, go to:
www.microsoft.com/servers/default.mspx

Microsoft SQL Server 2005
Microsoft SQL Server 2005 is comprehensive, integrated data management and analysis software that enables organizations to reliably manage mission-critical information and confidently run today’s increasingly complex business applications. By providing high availability, security enhancements, and embedded reporting and data analysis tools, SQL Server 2005 helps companies gain greater insight from their business information and achieve faster results for a competitive advantage. And, because it’s part of Windows Server System, SQL Server 2005 is designed to integrate seamlessly with your other server infrastructure investments.

For more information about SQL Server 2005, go to:
www.microsoft.com/sqlserver  

Fast Facts

© 2006 Microsoft Corporation. All rights reserved. This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. Microsoft, Windows, the Windows logo, and Windows Server are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks are property of their respective owners. Document published February 2007