Outsourcing and a move towards the cloud is driving the growth of the hyperscale data centre.
Two major trends are shaping the global data centre landscape. The first is outsourcing, or the move from in-house data centres to facilities and services provided externally for organisations.
Outsourcing can be defined as the process of sourcing facilities, facility services, IT capacity or IT services from an external provider. The outsourcing of IT assets is particularly common, as it reduces payroll costs and ensures that companies remain up-to-date with the latest technological advances.
The second related trend is a move away from ‘legacy’ IT (or physical servers) towards non-physical, ‘dematerialised’ infrastructure and components. This includes components and services that are created within and sourced from virtualised, cloud-based or software-defined environments.
Instead of companies investing in physical hardware, there is a preference to ‘rent’ server space from a cloud provider, which ultimately ends up being stored in a data centre.
These trends have created a requirement for larger facilities, which can operate on the principle of the provision of standardised delivery models and services on a utility basis.
Since the business model of cloud provision is based largely on volume and efficiency of delivery, the ‘hyperscale’ data centre has emerged.
As many organisations with medium and smaller data centres have shut their own smaller facilities and migrated workloads into cloud and colocation, the profile of the world’s data centres will continue to move towards larger facilities.
Importance of scalability
To operate as a viable business model, the hyperscale facility has changed the design, construction and fit-out practices that existed during the ‘legacy’ era. This is not surprising, considering the scale of transactions that companies that operate these facilities deal with.
Furthermore, the business model of a hyperscale data centre is based on the capability of its digital infrastructure to be able to disrupt legacy business models by being extremely efficient.
To achieve this requires the provision of facilities that can deliver enormous economies of scale, and that are also, from an IT perspective, scalable and able to cope with peaks and troughs in demand. Such facilities are highly networked and sit at the centre of huge webs of connected users and devices.
Also, the hyperscale data centre is able to analyse and model the massive amounts of data flowing through their systems to offer insights into user behaviour that can be used to generate further income streams.
Lifecycle of a data centre
Data centres may have a functional life of up to 20 years which, at an average rate of IT renewal of around three years, may involve six or seven upgrades. Change is led by the evolution of the processing, storage and networking equipment and systems that are housed in the data centre and which represent the core purpose of its construction.
The major responses of data centres to IT transformation over the past decade can be summarised as growing larger, denser, more focused on efficiency and demand, and operated increasingly through software and software definition to meet a greater volume and diversity of IT workloads.
Constructing a hyperscale data centre
One of the enablers of demand/utility-based IT has been the development of modular units, which can be built progressively into facilities as demand increases.
While the debate between the benefits of modular versus more traditional construction methods has run in the industry for most of the past decade, modular will take an increasing share of global data centre build business, largely on the back of the hyperscale facilities, where staged construction programmes mean that capital costs can be matched more closely to incoming demand.
The process of constructing these huge data centres is highly commoditised – the IT end facility package is viewed as a standard product, separate to the construction of the facility. The process is modularised, whereby common commercial module/parts are deployed in a standardised and flexible configuration, which will also support online expansion.
Most components can be manufactured offsite and can be assembled, disassembled, renovated, moved easily to the site and replaced by ‘hot-pluggable’ components.
In terms of location, many of these companies choose sites close to sources of renewable power and where the climate is cool enough to reduce the need for electrically-powered cooling. Some have also made equity investments in clean energy generation as a means of offsetting their carbon footprint.
Can smaller data centres compete?
There is no technological reason why smaller data centres cannot adopt the configurations and principles used by hyperscale data centres, and many have adopted their software definition, open source data centre fabrics, and the migration to faster network speeds.
However, the issue is not one of technology but one of return on investment – for smaller data centres, the costs of refreshing an on-premise data centre environment would probably not be justified, particularly if the benefits of such environments can be accessed through outsourcing.
This, in turn, will create further demand for the hyperscale data centre which is set to dominate the global market.
Delivering projects the ‘Kirby Way’ has helped Kirby Group Engineering grow business across Ireland, the UK and continental Europe for more than half a century, tripling its annual turnover to a current figure of €167 million over the past number of years.
Founded in 1964, Kirby provides full mechanical and electrical engineering contracting services, as well as specialist high voltage (HV) and medium voltage (MV) design and construction services, to clients across several key sectors. These include data centres, life sciences, industrial manufacturing, commercial, petrochemical, and substations and renewables.
“We have developed an in-house integrated project execution process, called the ‘Kirby Way’, which involves creating and sharing value through working collaboratively and deploying highly-skilled and dedicated project teams who are committed to the success and delivery of the project,” explains Group Managing Director, Jimmy Kirby.
Kirby values and continuous improvement
As a company, Kirby embraces the following core values:
- Safety – keeping you safe through safe systems of work and a safe place of work
- Quality – eliminating waste by getting it right the first time
- Delivery – project delivery through relentless execution discipline
- Value – creating and sharing value through collaboration, innovation and operational excellence.
Project delivery is ensured through relentless execution discipline and highest safety and quality standards. Value is created, and shared with clients, through a combination of collaboration, innovation and operational excellence.
“Our clients trust our integrity. They experience director-level involvement, characterised by a proactive approach to the projects. BIM, offsite fabrication and innovative technology have also been central to our success with lean practices becoming key components of our project delivery, bringing significant value both to us and to our customers,” says Jimmy Kirby.
“We also operate an Innovation Suggestion Scheme, with participation encouraged right across the workforce, which fosters a culture of innovation. This helps to continuously generate the kind of innovative and lean ideas that bring efficiencies into the business through cycle time reduction,” he says.
Recent completed projects include electrical works for 18MW data centre in Dublin, which involved the conversion of a former manufacturing facility to a modern Tier 3 data centre facility, as well as full civil and electrical turnkey delivery of the 110kV transmission connection.
In Scotland, Kirby was awarded the contract for the electrical infrastructure requirements for Kilgallioch Wind Farm, a 94 wind turbine generator site capable of generating an output of up to 289MW, to be exported to the grid network.
For the Solvay Group in Wales, Kirby delivered full mechanical, electrical and instrumentation, as well as process piping services for a new purpose-built adhesive manufacturing facility, with significant involvement from project initiation right through to handover stage.
By successfully applying lean construction principles, Kirby designed, prefabricated offsite, delivered in modular sections and installed a fully loaded pipe bridge at the same time as the building steelwork. This early activity greatly assisted with front-loading the schedule, reducing onsite construction hours, and ensuring maximum efficiency.
Over the past number of years, Kirby has tripled its annual turnover to a current figure of €167 million. To meet this growth, the direct employee numbers were significantly increased to 700 including 100 apprentices. Kirby opened its first international office in 2008 and today the company has seven offices across Ireland, the UK, and continental Europe. In 2010, Kirby secured its first European project and since then it has continued to develop and grow its international operations.
The company has recently announced a further expansion in its international operations to include the new geographical area of Sweden. “Expansion into the Nordics market is proving to be successful for us, having secured high-profile data centre projects, with more projects in the pipeline,” says Jimmy Kirby.
Kirby currently has the capability to execute projects in Ireland, UK, Sweden, Finland, Denmark, Netherlands, and Belgium. To meet growing demand for its services, the company is also developing the capability to execute projects in Norway, Germany, Switzerland and Luxembourg.
“Currently our key focus is on data centres, life sciences, industrial manufacturing, and substations and renewables,” says Jimmy Kirby, who has overseen significant growth at the company in recent years.
Earlier this year, Kirby was awarded gold accreditation against the Investors in People Standard, the international standard for people management, demonstrating their commitment to high performance through good people management, which is a critical component for a growing business. Kirby also made a significant investment in senior management and announced a number of key appointments at senior level to support its growth and success.
“The company has excellent future prospects due to the strength of our management team, our staff and associated capabilities, our strategy formulation and implementation capability and our customer value proposition,” Jimmy Kirby concludes.
Irish suppliers have much to offer customers in Singapore and the ASEAN region, according to Smruti Inamdar, Director ASEAN at Enterprise Ireland Singapore.
Affinities shared by Singapore and Ireland are making Irish companies increasingly attractive to ASEAN partners and customers.
Coming from a small open economy, Irish companies inherently understand that the region cannot be treated as a cohesive or homogeneous bloc and that each individual market is unique.
Irish companies also appreciate the need to spend time building relationships with local customers and partners. When delivering long-term projects, Irish companies are known for adopting a flexible approach, working in partnership with customers to deliver the best solution, even when unexpected challenges or changes arise.
The appeal of this approach is evident in the growth of Irish exports to, and presences in, Singapore and ASEAN. There are now approximately 300 Irish companies exporting to the region, with 130 companies having at least one presence on the ground. That number continues to grow.
Exports from Ireland to the region reached €320 million last year, following five consecutive years of double-digit growth. Enterprise Ireland, the national export agency, has demonstrated its confidence in the development of the relationship, aiming to increase total exports to €500 million by 2020.
If you are interested in discussing the advantages of sourcing an Irish partner, Enterprise Ireland can help you to assess which innovative products, services, and solutions may be best suited to your requirements.
Let’s take a close look at key sectors in which Irish companies offer a particularly strong advantage to partners in Singapore and ASEAN.
Aerospace and Aviation
With investment in aerospace and aviation continuing to grow, Ireland is emerging as a global hub servicing the needs of rapidly developing industries. Over 250 Irish companies are actively engaged in aerospace and aviation and over 40% of the world’s fleet of leased aircraft are owned and managed from Ireland. That performance has helped Ireland to become widely regarded as a global centre of excellence for aviation, with its proud history of pioneering developments and dynamic innovation.
As the world’s fastest-growing air hub, Singapore must expand its infrastructure to meet growing demand. In July 2017, Singapore to Jakarta and Singapore to Kuala Lumpur were included in the top five of the world’s busiest international air routes. The development of a T5 mega passenger terminal remains on the drawing board, which, when completed, would have the capacity to handle 132 million passengers a year, a huge jump from the 82 million passengers currently served.
To demonstrate Irish capability in the sector, Enterprise Ireland participated alongside nine client companies in the Aviation Festival Asia in Singapore in February 2018.
As one of the most dense and vibrant urban areas in the world, Singapore is very much leading the way internationally in creating a sustainable building environment. There is much potential for Irish companies to help deliver the government’s ambitious agenda in this area. Singapore is striving towards a target of ‘greening’ 80% of new and existing buildings by 2030 (currently at approximately 30%). The power consumption of Tanjong Pagar Centre, Singapore’s tallest building, is managed by Dublin-headquartered Cylon Controls. Dortek hygienic doors have been used in an inflight catering kitchen facility in Singapore’s Changi Airport, providing hygienic and low temperature sealing solutions to the facility. Enterprise Ireland is also actively working with the Singapore Green Building Council to build awareness of Irish technologies in the area. The growing Irish green-build cluster includes firms such as Kingspan Insulated Panels and LED Group ROBUS.
Irish companies in the high-end construction sector are well positioned to support Singapore’s transformation as a data centre hub for the Asia Pacific region, with the country’s colocation data centre market expected to grow at 13% year-on-year 2017 – 2018 (Source: Structure Research, 2017). Global and regional data centre providers such as Global Switch, Digital Realty, Equinix, Microsoft and Amazon are all operating in Singapore as well as Irish companies active in data centre development, including Linesight, PM Group, and E+I Engineering.
Ireland and Singapore are relatively similar, with both having a small number of local banks and several hundred international financial institutions also located in the market. That shared ecosystem makes for a highly competitive arena in which innovation is a crucial driver.
Ireland is home to one of the most important financial services centres in the EU and one of the world’s largest concentrations of technology companies.
As the main financial services hub in the ASEAN region, a strong cohort of Irish companies are active in Singapore having secured significant wins with SGX (Singapore Exchange), United Overseas Bank (UOB), and Standard Chartered Bank. Ireland’s global leadership in the fintech, regtech and insurtech spaces is also making an impact in other financial hubs in the broader region.
With over 40% of global hedge fund assets serviced in Ireland, its resulting regulatory expertise is leveraged by Irish fintech companies to help funds, banks and insurance companies deal efficiently with compliance, and make better, data-driven management decisions. An established sector of payments technology companies has a strong track record of helping major banks and marketplaces to respond to rapid digitisation and changing consumer demand.
Telecommunications and IoT
Another key offering from Ireland is in telecommunications and Internet of Things (IoT), with Irish technology companies delivering high-end solutions to mobile network operators (MNOs) across the ASEAN region. Irish technology providers have progressed from the provision of SMS technologies and services to more sophisticated data analytics, IoT solutions and technologies used to enhance customer experience.
Irish companies in the sector have been active in the ASEAN region for many years, developing leading solutions to meet the evolving needs of local operators. The Irish telco cluster in ASEAN includes Accuris Networks, Anam, Asavie, Nasctech, Openmind, Tango, and Openet, which has more than 250 staff based in their regional HQ in Kuala Lumpur, Malaysia. Many are now doing business with major operators such as Axiata Group , Globe Telecom in the Philippines, Singtel in Singapore, and Vietnamobile in Vietnam.
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The strategies behind data centre investment reflect overall best practice in investment, which is to balance risk against return in the context of specific requirements of time and outlay. There are certain idiosyncrasies in terms of data centres, in particular the fact that the cost of the equipment going into the data centre may be greater than the initial cost of land and construction, and the cost of operations (power, water, refit and refresh) will be greater than initial outlays. DatacenterDynamics (DCD) has calculated that less than 15% of the costs in a 20-year life will be incurred pre-commission (although an average figure cannot be easily calculated across the large number of possible variations). Investment decisions therefore need to focus as much on access to resources and the costs of these, and to establish a ‘whole of life’ view of the investment. An important aspect of this is the frequency of refit and refresh as the IT and network equipment housed by the data centre will evolve over time. As a rule of thumb, IT and networking equipment will update every three years and the infrastructure supporting it may need to also be updated.
The Business Case
As with any investment, a business case needs to be drawn up for the data centre based on demand for the services it will supply and the costs and the risk of delivering these. On this basis it may be more difficult to build a business case for either enterprise or for retail colocation than for cloud, IT services or wholesale colocation, since the key demand trends are towards the latter.
However, in established markets, the majority of large organisations will eventually operate a combination of their own ‘on-premise’ facilities, leased colocation facilities and a hybrid cloud platform to optimise their data infrastructure.
Since the global financial crisis, there has been an increased awareness of the need for risk management to drive decisions, and cost has become a greater factor, which means that the need to reduce risk is balanced against the need to constrain cost to a greater degree than was seen previously. At an enterprise level, this can result in lower levels of redundancy, reduced capacity or a lower-quality solution.
The first major factor in defining risk and return is the location where the data centre will be constructed. This needs to be looked at not over the short-term but throughout the life of the data centre. The focus of power availability has shifted from grid power to renewable energy sources and to guarantees about power pricing over time. The increasing primacy of cloud and networked data centres means a location that offers high levels of connectivity is an additional priority. It is also important to select a location that guarantees a quality of build and a quality of supply chain (vendors, consultants).
Where all of these factors coincide, data centre hubs are created – Singapore, Amsterdam, Hong Kong, Dublin, and a number of locations across Scandinavia are all examples of where the asset base is influenced by foreign inward investment, rather than local demand.
As with any form of construction-based investment, companies need to evaluate financial, operational, project execution, physical and regulatory risk. Risk management policies need to be aligned with compliance and regulatory policies, and should encompass technical and business continuity management and security. For issues such as data protection or compliance, the legal department will need to be involved.
Supply versus Demand
With investment decisions under increasing pressure and scrutiny, companies may be less willing to pay for building capacity that is not yet taken up. Modularity of build, and the construction of data centres in Lego-like units means that build can be synchronised with uptake. The process of matching revenue estimates against investment has to be revisited on a regular basis to take into account changing business conditions, particularly in a world where developments in software, cloud and miniaturisation may impact investments that are based on the leasing of space.
Forecasting is becoming ever more complex because the number of applications used are increasing exponentially as they are implemented and updated more regularly, which is proving to be more demanding of compute resources. For example, the aggregated power demand of the compute for cryptocurrencies is estimated to be already greater than the total energy consumption of Venezuela (placing it within the 40 largest electricity consumers globally). For this reason, ensuring security of supply for the data centre is a major investment priority, and colocation investors may spend as much as 20% of the overall investment on power coming into the data centre. Global cloud providers have already invested in renewable energy sources, as have major investors in data centres such as Goldman Sachs.
Supply/demand forecasting for a company with a very large data centre footprint will be easier than for a company with just one or two small DCs, because spare capacity will be easier to bring online. Forecasting must also take into account technological change and technology refresh, because new equipment is more powerful and able to manage higher compute loads without increasing footprint and potentially reducing power consumption. It must also take into consideration the different hosting models available today, or those that will possibly be available in the future, assessing what future workloads are likely to be hosted on a cloud platform or on SaaS.
Soft Risk Issues
Just as data centres and the IT world have moved on, so too have the requirements for investment. Location has to some extent been superseded by interconnection, the quality of facility has been balanced against access to quality service providers, and resource provision against the technology and expertise to deliver efficiency. Investment needs also to understand emerging factors such as data sovereignty, legislation on foreign business interests, or skills as a resource. As the data centre industry gets more adept at dealing with the resource issues that marked its legacy phase through better practice, more efficient technologies and through cloud computing, data sovereignty represents a new and less tangible challenge to the international free-flow of data.
Political stability, the ease of doing business, freedom from corruption and predictable taxation levels are also considered instrumental in reducing the risks of development and costs as well. The need to factor in a long-term view across all issues can be demonstrated by the costs faced to comply with the EU’s General Data Protection Regulation (GDPR) legislation and the considerable potential costs of non-compliance.
Levels of Return from Data Centres
Specific rates of expected return from data centres vary according to the factors identified through this article and also by the different measures. Most investors and investment advisers view data centres as offering above-average rates of return on investment when compared to other commercial property types. But the lower rates of return calculated for retail compared to wholesale, together with the higher rates expected for any form of colocation that will house cloud, indicate that the investment market is developing target niches as it matures.
It is estimated that, by 2021, 95% of data centre traffic will take place in the cloud, compared with today’s 88%, which will lead to an increase in demand for data centres. With help from Enterprise Ireland, the state-owned agency responsible for the growth of Irish companies on the world market, high-tech construction and engineering companies are creating the most innovative and large-scale data centres around Sweden.
On 15 March, Enterprise Ireland is holding an afternoon seminar on the topic of Construction at the World Trade Centre in Stockholm, in which around thirty Irish and Swedish companies will be participating.
“Ireland has become one of the most important data centre hubs for many of the world’s technology giants, including Microsoft, Amazon, Google, Dell EMC, Yahoo, IBM, HP, Facebook, Equinix, InterXion and Digital Realty. In addition, the biggest data centre operators in the world have been working together with Irish construction companies to develop innovative and large-scale data centres all around the world, with Sweden continuing to be a priority area,” says Karin Angus, Senior Market Adviser at Enterprise Ireland.
There are many reasons why Sweden is a suitable location for data centres. One of the main reasons is the relatively chilly climate, while another is the stable electricity supply, thanks to a production mix of hydro and nuclear power. These then attract companies wanting to set up and manage sustainable data centres. Today, Sweden is ranked number three in the world of the most suitable countries in which to locate a data centre.
During the seminar on 15 March, participants will also be given the opportunity to listen to speaker Thomas O’Connor from Irish company Collen Construction, as well as representatives from Business Sweden, the Swedish Construction Federation, the Swedish Transport Administration and the Swedish Association of Public Housing Companies in Stockholm. Ireland’s ambassador to Sweden, Dympna Hayes, and Ireland’s Minister for Culture, Josepha Madigan, will also be present.
For further information, please contact: Karin Angus, Senior Market Adviser Enterprise Ireland, telephone: +46 (0)70 99 00 353, email: Karin.Angus@Enterprise-Ireland.com
The project manager is seen as critical to the most effective process of data centre delivery. Of all the job functions in the construction phase, it is seen as the one where specific data centre experience is most critical and which is most responsible in terms of coordinating the different groups involved in the delivery and enabling the process of translating a design into a data centre.
The changing profile of major data centre investment decision making
The decision-making process for data centres has always been cautious due to the high capital costs involved in the build and fit out, and the fragility of the systems and equipment that the data centre houses. The evolution of the role of the data centre from facilities built to meet the specialist computing needs to those now – enabling a new world of communication, information, leisure and business – puts added urgency into data centre investment decision making. There is a consensus that inadequate or compromised data storage, processing or transmission can threaten the life of an organisation. In a recent DCD survey, 93% of the data centre community agrees that data is an organisation’s most valuable asset.
Correct decisions at the pre-commissioning phase will also enable more efficient operations and maintenance through the life of the data centre, thereby improving return on investment as well as future-proofing for new generations of data technology. It also ensures that the project meets legislative requirements that will over time become more stringent.
The decision making behind building a data centre is, therefore, changing to reflect the increased importance to the business and the increased risks associated with the process. DCD research conducted over the past decade indicates that more people are involved in the process. The number of parties involved in major data centre decisions (build, extension, major refit/refresh) has increased from an average range of 7-10 per project (2007 research) to 15-20 in 2016. This reflects the increased numbers of technologies and disciplines that the data centre now encompasses, the increased connection with the business, heightened risk aversion and legislative requirements. The major global players with established build programs have therefore made it a priority to ensure they have the resource and skills base necessary to execute those future build programs.
Decision making also appears to have become more formalised, less reliant on an open tender and more involved down to items of lower value. Therefore, formal policies, service-level agreements, preferred supplier and tendering and preferred supplier processes have become standard procedures.
The people involved in the process reflect the increasing complexity of the process. There has been a move away from dependence on personnel directly involved with IT and facilities within the corporate hierarchy. Now C-Level and senior managers across the organisation are more likely to be actively involved. Broadly, involvement in decisions now reaches far more widely across the organisation and is based more on the skills that staff or partners can contribute and will include external specialists within specially constituted project teams. If the construction is relying on external financing, then investors will also require involvement throughout decision making.
Research conducted as part of the Data Centre White Paper indicates no pattern as to the length of the decision-making process. It is subject to the number of decisions that have to be made as part of the process. For example, if the location and the site have already been decided, then the process can focus on the design and construction of the facility.
The importance of project management
To work best, the data centre investment decision process needs to balance a number of factors:
- Skills and resources that are available in-house against those that need to be outsourced
- Centralised control over the process against the devolution of responsibilities which may allow independent evaluation of work that has been completed so far
- The use of specialist data centre designers, builders and subcontractors against generalists
- Obtaining supply from a single source rather than a number
- Driving the process without compromise towards its original outcome rather than allowing factors that emerge through the process (e.g. legal, site-related, technological, budgetary) to add time and/or cost
Project management is seen by the market as the means of achieving the proper balance between these factors and also to be the key area in which specialist data centre experience and skills are seen to be critical. While it is considered that a specialist project manager may organise generalist builders and subcontractors in building a data centre, the reverse situation is considered much less likely to be possible. Data centre experience will enable the project manager to add value through reviewing the process and making suggestions for improvement and working out how revisions to the project can be incorporated with minimum disruption into the build process.
Through the process, good project management is seen to coordinate all the contractors and suppliers who will be involved in delivering the facility and to ensure that timing and costing requirements are met. Consistent with this position, they will ensure that the client’s interests are followed in all decisions. In the words of one company that has recently completed a data centre build:
“They can see the whole project – even if they are not responsible for elements of it. One example of this: the project manager we used for the internal work was thorough with the structural design checks before undertaking the work and noticed some issues and potential areas for improvement. He then liaised directly with our structural team to have them implement changes that ultimately saved us time and long-term maintenance costs.”
In terms of project management software, little is known about this, and it is considered very much ‘back office’ – the means to an end. Such software is seen to have value in visualising the process and modelling the impact of changes as well as a source of sharing and updating information. As with design software, the value is seen in the consultants and managers using it and making recommendations on the basis of the information it provides.
Learn about the top five trends affecting the future data centre design and construction in our FREE white paper below.
Hanley Energy’s integrated approach to power supply solutions protects data centres across the globe from loss of service
“If a data centre loses connectivity for just three minutes, it can have a devastating effect on a company’s business,” says Dennis Nordon, co-founder of Irish power management specialist Hanley Energy. “Reliability is crucial – not just for Google, Facebook, Amazon and Microsoft, the giants of the data centre world, but for companies that sell data processing and storage capacity to other enterprises.”
Hanley Energy plays a key role in protecting data centres from problems caused by power supply issues. Vast amounts of data – including the photos, videos and business documents we upload every day to ‘the cloud’ – are stored in these centres on reams of servers, running day and night. Any brief power outages, slumps or spikes could do lasting damage to equipment, and to a company’s reputation.
Ireland has become a popular location for data centres, and Hanley Energy first began working with a large data provider in 2012. The company now provides, on average, four megawatts of backup power to data centres every six weeks, having installed 120 and 150 megawatts of UPS (uninterruptible power supply) so far.
“Anyone can supply hardware,” Nordon comments, “but we bring integration expertise. Along with hardware and peripheral equipment, we provide the control layer which tells the system when to switch over to UPS.” As a result, the company has racked up customers across Europe, opening its European headquarters in Frankfurt in 2014, United States headquarters near Washington DC in 2016 and setting up a sales and service office in Stockholm in 2017. A South Africa office will open shortly.
Hanley’s system monitors power usage and power anomalies, recording and time-stamping outages or equipment failures so that maintenance teams can get to work and ensure the problem doesn’t recur. “While our competitors tend to provide standardised, off-the-shelf products, without customisation or tweaking, we can take anyone’s product and integrate it for the customer to give them what they want,” Nordon explains. “A bespoke service.”
The company is also proud of its speed and flexibility regarding customer service. “We’re constantly coming up with new products, such as an EPMS (event and power management system), designed from the ground up, for one of our larger data centre clients,” says Nordon. This system hooks into all the hardware, monitoring the power situation and giving live updates on a user-friendly interface. If there’s an issue, Hanley Energy has a two-hour call-out promise for many of its customers.
With its strong reputation and good network in the data centre world, Hanley has a growing number of global customers, including Continent 8 Technologies – a company with data centres across Europe, Asia and the Americas. “Hanley Energy’s service as a supplier is invaluable to the data centre environment we operate in,” says Wesley Smith, Head of Global Facilities at Continent 8. “It’s essential that Continent 8 has a knowledgeable, fluid supplier that can react quickly to the critical nature of our business.
“I have consistently found that Hanley Energy are always informed regarding the latest developments in technology and Hanley staff are always on hand to offer the correct solution for our business,” adds Smith.
Dublin, along with London, Frankfurt and Stockholm, is now a key European data centre hub, ensuring the flow of information across the continent – a flow that is set to continue with the further digitisation of home consumer items and cloud storage. Hanley Energy will be there to help keep it running smoothly.
John Hunt, Senior Market Adviser for the Construction Sector at Enterprise Ireland, describes the top trends that will shape the data centre sector in 2018.
In an ever-evolving digital world, rapid technological change is driving data centre growth, creating facilities which are larger, denser, more converged and scalable than ever before.
According to a new Enterprise Ireland white paper, produced in conjunction with Data Centre Dynamics Group, the population’s insatiable appetite for secure, connected, mobile information has led to the evolution of ‘hyperscale facilities’, which has important implications for data centre procurement, design and construction.
Ireland is at the forefront of change in this area, having quickly established itself as one of the world’s most influential data centre hubs. Microsoft, Google, Yahoo, HP and Dell EMC all acknowledge Ireland’s expertise, innovation and capabilities to deliver complex data centre solutions , giving Ireland an increasingly competitive edge.
Emerging trends to watch out for in 2018 include:
1) The growing importance of data
As cloud-based technologies, the Internet of Things and 5G continue to drive demand, ‘digital twinning’ between the real and cyber world will grow. This will facilitate the development of smart communities, towns and cities, highlighting an increase in the value of data and demand for larger data facilities.
2) Parallels and connections between hyper-scale facilities and smaller data centres
While advancements in cloud-based technologies are the driving forces behind the new data centre era, there are connections and learnings between hyperscale and smaller facilities. Make sure you capitalise on these parallels for maximum impact.
3) The rise of edge computing
Build sector companies should ensure they are prepared for a new era of digital transformation and edge computing which are rapidly gaining momentum.
4) Future-proof facilities
For enterprise companies looking to move from in-house data centres provided externally and juggling outsourcing options, it is important to implement processes to better manage data centre facilities.
As 2018 unfolds, make sure you keep an eye on these trends, which may help shape your business.
To find your Irish partner today, contact John Hunt, Senior Market Adviser at Enterprise Ireland.
Best practice in the management of data centre construction can be summarised as enabling the process and the relationships that best deliver the outcome specified by design. Research conducted among clients as part of this project focused on the logistics and process of delivering a data centre and indicated that the projects that are deemed successful share a number of characteristics:
- Capability – that the role and contribution of project parties lie within their expertise and capabilities, and that these are optimised through the process.
- Flexibility – that the process is able to accommodate changes whether these come from the client, from within the process (for example, through review and Continuous Quality Improvement systems (CQI), or from outside the process (weather, financial or compliance issues etc.).
- Process control and integration – ensuring that the logistics of the process are directed to the agreed delivery outcomes efficiently, on-time and on-budget.
- Validation and quality improvement so that the expertise and resources deployed on the project can be used to improve the outcome.
The capabilities of the commissioning company act as the starting point for the logistics of the construction process. Companies will vary enormously in their expertise in data centre design, project management and operations and will need to adapt their role accordingly and to rely on external experts where necessary. If they wish to minimise their involvement with the design/build process, then the option of buying ‘off the shelf’ from a developer, a Real Estate Investment Trust (REIT) or in modular form may be preferable.
The traditional design – bid – build model puts the onus on the client to manage the process and integrate the players within it as well as dealing with some of the project variations and revisions that may emerge as issues are passed from one stage to the next. Some of the complexities can be reduced by using fewer contractors and developing a truer partnership than is usually the case with the established customer/supplier model. This can, however, put greater pressure on the client company to oversee and validate the process.
Internal management is reported in the research as leading to problems with subcontractors, particularly where there is no prior working relationship, where logistical problems occur and where there is the need to work through and validate approaches independently before commissioning. This accounts for the very high use of specialist project management professionals and companies across construction activity since the project manager is seen as a key point of intersection between the strategy driving the construction and the process of delivery.
Very few data centre construction projects move from design through to commission without some change caused by the re-definition of client requirement, changing legal or compliance requirements, cost/financial issues or modifications made as the project takes shape or as elements of it are tested. There is a consensus among the research that projects which do not build in alternative or contingency scenarios are more likely to suffer major disruption through cost and time overruns and this compromises the ability to work the asset sooner and achieve a more rapid return on investment. The need for flexibility is also mentioned as a major reason for considering modular construction methods.
Flexibility is seen to be made further possible through the attributes of networks, particularly at the subcontractor level so that if there is a problem with a particular element of construction or fit-out, then a replacement can be found. It is also associated with expertise and specialist experience in data centre construction so that learnings from previous projects can be applied to unforeseen situations on the current build.
Process control and integration
The final two attributes – integration and validation – represent two sides of the same coin. As projects get more complex and involve greater numbers of people and companies, integration will be more critical and more demanding. Yet the greater number of parties involved also creates a greater possibility of review of the process so far and suggestions for improvement.
Integration is described in almost ‘symphonic’ terms – as the coordination of different skills and functions towards a shared construction goal. Again, a number of things that have worked are identified as well as a few that have not.
One of the keys to successful integration is to involve all relevant contractors and suppliers with all the information they need to know. This does not mean that every subcontractor needs full details of the business strategy behind the construction, but it does mean that there is an understanding among the key personnel of the thinking behind the project. This sharing opens up the potential for greater validation and improved outcomes. It may also prevent the project looping when the same problems need to be dealt with repeatedly. Conversely, integration is only seen to work if the client is kept informed of all decisions made that impact the core delivery, and, perhaps obviously, any that represent a variation from the original agreement.
Partly as a result of the increased capabilities offered by major global suppliers and towards standardisation, modularity and convergence, there is a trend toward a single provider of facility components, including enclosures, power distribution and protection, cooling, cabling and monitoring, rather than relying on different specialist providers. This is designed also to make the data centre maintenance/upkeep process afterwards more streamlined.
Effective integration is considered as most critical in the event of problems since it will enable a clear path back to the source and cause of a problem, and a course of remedial action.
Validation and quality improvement
The process of validation needs to be part of a wider and agreed quality control system through the project. While the focus of validation would be on the delivery of the construction, it may also cover the review of decisions on equipment, subcontractors and working conditions and ensure that the client’s interests are maintained.
Validation will bring in specialists across the process – in structural/‘shell’ work, heating, ventilation, and air conditioning (HVAC), power distribution, equipment fit-out and infrastructure, and testing of components for efficiency or resilience prior to commission. Further specialists will be needed in particular situations, for example, to increase the connectivity to and from the site, particular requirements of utilities or government. Other required expertise includes skills in modifying within existing buildings. While most headline data centres are green field construction projects, the vast majority of data centres, especially enterprise are located in buildings they share with other corporate activities.
As with any commercial undertaking, it is important to establish the methodology for validation and for quality control from the outset and communicate that to all parties. Just as the design will provide the blueprint for the end construction, so the quality model will provide the blueprint for the process whereby it is achieved.
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Six years ago, Linesight chose the Netherlands as a hub for the expansion of its Data Centre focus. Paul Butler, one of the company’s Directors explains, “After delivering multiple Data Centre projects for US multinationals in Ireland, we looked to the Netherlands, as Amsterdam is such a hub of activity in the sector.”
A global construction consultancy firm with over 40 years’ experience and 17 offices around the world, Linesight supports Tier One clients in a range of sectors, including Data Centres, Commercial, Life Sciences, Transportation and Infrastructure, Healthcare and Retail. To date, Linesight has worked on 158 data centre facilities, delivering over 2300MW of critical power and 20 million sq.ft. of white space.
Over the past six years, Linesight has grown its dedicated team in the Netherlands from four to 30 people, 95% of whom are based there full-time, and integrated into the local community and tax system. Butler describes the importance of the move, “To deliver Data Centre projects in Europe, it is vital to have a presence on the ground, whether that is a subsidiary company, an office or a dedicated team based in the market.”
The People Advantage
Linesight’s proven track record for quality and timely delivery of projects helped them to quickly build the business in the Netherlands. The firm adopts a partnership approach with clients that is built on clarity and consistency. Excellence in service and personnel have proven to be a key differentiator.
“For our first clients developing projects in the Dutch market, we were preferred bidders and travelled with them as part of their team, offering the same service as we had in the Irish market,” Butler explains. “We were also highly competitive at winning projects that involved bidding with companies with in-house auditing functions.”
Some of the company’s multinational clients requested that specific members of the Linesight team work on projects in the Netherlands. Butler comments, “Our people are key. Senior Project Managers oversee projects from beginning to end. Directors oversee projects on a 24/7 basis. Relationships built over time are very important.”
What High-Tech Construction partners need in Europe
While building their presence in the Dutch market, Linesight invested time in ensuring it had the right contractors and partners to deliver projects to the required standard, and established local regulatory expertise in relation to construction, planning codes and timeframes.
Butler advises, “It is essential to gain a good understanding of local regulations and codes of practice for the industry. That is best achieved by becoming part of the local environment with your on-the-ground presence. Within the Netherlands, for example, construction regulations vary by region. There is a lot of heavy industry activity near the German border, which contrasts with the Amsterdam area.”
Over the last six years, Linesight has grown its network across the Netherlands, “We stretched our web of contractors beyond the Amsterdam area. We have highly trusted partners in the Netherlands that we know will deliver for us.”
The company has replicated the approach across the world, working on 47 data centre projects in the US, 24 in the Middle East, 43 in the UK and Ireland, 18 across Europe, and many more across Australia, Southeast Asia and South Africa.
The whole Data Centre Construction package
Linesight works with 9 out of 10 of the largest data center owner occupiers, colocation and cloud providers in the world, with clients in recent years including Global Switch, Digital Realty and RagingWire.
Butler describes the advantage that has helped them to achieve that position, “What differentiates us, in addition to our people, is the fact that we are an ‘all-in’ company and can provide Cost Management, Project Management, and Risk and Schedule Assessment. This is vital for a lot of big multinationals,” explains Butler.
“Many of our team members have backgrounds in civil, electrical or mechanical engineering. Our service is not just about number crunching – our team understands design. They can go through drawings with clients in great detail and are fluent in engineering language.”
Partnering in Construction across Europe
As projects in the Netherlands neared completion, Linesight extended its network to continue working with clients in additional locations. Gaining a foothold in the Netherlands helped the company to expand in Germany, Belgium and the Nordics, with the Dutch Data Centre business acting as a hub for growing additional sectors and European markets.
Butler explains the benefits for clients, “Clients prefer the consistent, clean approach of dealing with one partner across markets, rather than spending time educating new local providers about what they need and how they work. The flexibility of our people and operation has been key to our success.”
Butler advises that flexibility is essential to partnering with multinational companies in particular, “You have to adapt to the client’s needs in each local market. That means being willing to travel and being available at whatever time the client needs to deal with you. Our senior people travel regularly to meet clients in European markets.”