Mercy Health saves $1.2 million by moving to the cloud

Victorian-based health care provider Mercy Health has saved an estimated $1.2 million following the migration of production workloads into a hybrid cloud environment.

Mercy Health CIO Dmitri Mirvis said the cost savings resulted from not having to upgrade aging servers and IT infrastructure. The health provider was running two physical data centres in Melbourne and Sydney.

“I joined Mercy Health at the end of 2012 and I performed a review of the situation in our IT space. It was obvious that a lot of infrastructure was crumbling and was getting in the way of us implementing new systems,” he said.

The majority of Mercy Health’s servers were seven years' old. It was also running older versions of system software like Windows Server 2003.

“Instead of looking at service improvements, most of my infrastructure team was spending their time juggling pieces of hardware,” said Mirvis.

“It was clear that we had to build our technical foundation as the first step of IT strategy. The way forward would be to go to the cloud. I was fairly comfortable with the cloud concept because in my previous job, I was exposed to utility computing — as it was called in the early 2000s — which had similar principals to the cloud.”

After going to tender, the health provider selected Dimension Data. In June 2014, the vendor completed a nine-month migration of Mercy Health’s entire data centre environment to the cloud, providing the organisation with improved agility, reliability and operating efficiencies.

Mercy Health now uses Dimension Data’s Melbourne managed cloud platform (MCP) for production workloads and the vendor’s Sydney MCP as its disaster recovery site.

According to Mirvis, it chose Dimension Data as they were a “good match” for a mid-size organisation like Mercy Health. The health care provider has 5500 staff and runs 31 sites across Australia.

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“They [Dimension Data] seemed to be investing in people and time to help us. The other important thing for us was that a single team would not only take care of the data centres but help us with system analysis and design,” he said.

“We had to virtualize the environment and migrating to the latest versions of systems and software to optimise the environment for the cloud. That requires additional expertise and services that we as a company, didn’t have.”

The data centre migration was not without its challenges for Mirvis.

The first challenge was to upskill his IT staff to understand the technology and consumption based models.

For the “first time in many years” Mercy Health staff had to inventory its applications to see how much space the apps were taking up.

“We are running two large hospitals in Melbourne and this kind of [IT] migration leads to downtime. The hospitals needed to kick in to a certain mode of operation with limited IT support so we trained for that,” added Mirvis.

Aside from cost savings, Mercy Health’s IT department now has transparency.

Mirvis can explain to executives what the cost implications are of the decisions they are making rather than have the board be surprised by the cost of implementing an IT system.

In addition, the IT department can now concentrate on running applications as opposed to infrastructure.

“When you run an IT department you quickly learn that the biggest value-add is through applications. That’s because applications deliver value to the business users,” he said.

“Most of the users don’t care about networks or servers, they think about applications. A large proportion of my team was spending time dealing with infrastructure issues that were frustrating to everyone but no one really cared about.”

Mercy Health runs more than 70 applications such as emergency department information apps and palliative care apps.

Follow Hamish Barwick on Twitter: @HamishBarwick

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