By Charles King, Pund-IT, Inc. January 30, 2018
Over the past 2-3 years, the ascendance of multi-cloud as a primary cloud consumption model for enterprises, has become increasingly evident. However, why that’s the case is often muddled with IT jargon and PR clichés. Thankfully, that’s not correct concerning the recently announced multi-cloud partnership between food processor Smithfield Foods and cloud service and software provider Virtustream. The details of their successful multi-cloud effort are worth a closer look.
Smithfield by the numbers
A subsidiary of WH Group, Smithfield Foods (based in Smithfield, VA) is a $15B business best known for brands, including Armour, Nathan’s Famous, John Morrell and Farmer John. The company is the world’s largest pork processor and hog producer, with some 40,000 workers employed at 50 U.S. facilities. Smithfield is also recognized as the #1 supplier of pork products for retail, food service and export markets, making it a global enterprise by any definition.
Not surprisingly, Smithfield is also a major consumer of IT products and services, including SAP solutions and systems supporting core business processes. Like many other organizations, the company has been exploring ways to more efficiently integrate its on-premises IT infrastructure and cloud-based data and applications with the aims of improving performance and lowering costs. As noted in the companies’ press release, that puts Smithfield in line with over half of the enterprise respondents in a recent Forrester study on multi-cloud trends.
Virtustream multi-cloud trims the fat from corporate IT
Smithfield determined that Virtustream offered the multi-cloud expertise its strategy required. After several months of what the pair describe as “meticulous preparation”, they launched a “One SAP” project in July 2018 that was designed to move all of Smithfield’s operations on SAP to a single, unified S4/HANA SAP platform on Virtustream Enterprise Cloud. Virtustream and Smithfield announced the project’s successful completion on January 24, 2019.
Will significant benefits result from the finished project? Absolutely. The most practical effect is that by having access to Virtustream’s dynamic, scalable multi-cloud resources, Smithfield will only pay for the services it consumes. In other words, partnering with Virtustream has enabled the company to embrace multi-cloud enabled, on-demand IT services and pricing schemas, improving IT consumption and performance efficiencies. That, in turn, will result in substantial savings. In fact, Smithfield estimates it will save $3 million in IT costs over the next three years, a tidy sum by most any measure.
There are numerous points to take away from Virtustream and Smithfield’s One SAP project. First and foremost, it’s critically important for an organization to clarify the goals it hopes to attain, and meticulously prepare prior to embarking on so large and significant an effort. Just as important is engaging expert partners that understand your goals, possess the skills your project requires and have the means to deliver the results you seek.
Like any other trending IT service or solution, the fine details and requirements of multi-cloud are often hard to separate from promotional pronouncements and technical jargon. But successes do exist, particularly when they involve the efforts of knowledgeable, experienced muti-cloud vendors and businesses that understand the importance of careful, rigorous preparation.
Smithfield’s One SAP project stands out today as an excellent example of what an enterprise can accomplish with multi-cloud solutions and services. But it is neither the first nor is it likely to be the last such success announced by a Virtustream partner.
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