June 2007 03 -23 -05 Leveraging Virtualization at

June 2007 03 -23 -05 Leveraging Virtualization at HUD page • EDS Confidential

Office of the Chief Information Officer Our. HUD, Our. Trends Leveraging Virtualization at HUD June 2007 2

HUD Business Overview HUD IT Portfolio Distribution Invests approximately $300 M annually in IT • Increased Home Ownership $400 M • Promote Decent Affordable Housing $300 M • Strengthen Communities • Ensure Equal Opportunities in Housing New Development Staf f Development $200 M • Embrace High Standards of Ethics • Enhance Management and Accountability Maintenance $100 M • Promote Participation of Community-Faith Based Organizations Infrastructure FY-03 FY-04 FY-05 FY-06 $336 M $389 M $366 M $279 M Secretary of Housing & Urban Development HUD’s MISSION Leveraging Virtualization at HUD Federal Housing Commissioner Public & Indian Housing Community Planning & Development Fair Housing & Equal Opportunity Policy Development & Research Healthy Homes & Lead Hazard Control Government National Mortgage Assoc. Increase homeownership, support community development, and increase access to affordable housing free from discrimination. Faith-Based & Community Initiatives June 2007 3

HUD Leads The Vision of Infrastructure Optimization…. Leveraging Virtualization at HUD June 2007 4

HUD’s Leadership in Infrastructure Transformation The need for business speed means … … IT must change. Agility of Response: Respond Faster IT has unpredictable reliability and reacts slowly to business requirements. IT reliably detects/reacts in real time to the business. IT organization owns IT strategy. Business Needs Leveraging Virtualization at HUD IT strategy is tied to business strategy. CIO = manager of IT resources. June 2007 CIO = business leader. 5

The Challenge • Consolidate and transition to one streamlined and standardsbased commercial facility • Transform from rigidity and lack of integration to integrated, standards-based services. • Centralize help desk functions and support of desktops and field services, improve customer satisfaction • Ensure business continuity capability and improved disaster recovery capability, increased mobility and flexibility. • Modernize antiquated IT infrastructure without disruption – while reducing costs • Measure IT performance through SLAs Leveraging Virtualization at HUD June 2007 6

The Approach • SLA driven IT infrastructure services • Massive data center modernization • Capacity on demand • Optimum utilization for improved business application performance • Maximum standardization on fewer hardware and software platforms • Continuity of operations with minimum down-time to HUD’s critical business applications • Enterprise-wide wireless solutions • Enterprise-wide Help Desk support and centralized field dispatch Leveraging Virtualization at HUD June 2007 7

The Results • Achievement of “green” rating on the President’s Management Agenda • Received A+ on FISMA Score Card • Enterprise Architecture Ranked Number 1 by OMB • Improved customer satisfaction to 93%! • Shared IT services cost savings of 20% • New and measurable efficiencies drive increased performance • Adoption of agency-wide SOA standards • Enhanced data integrity via security • ISO 9001 and ITIL standard based services • Massive expansion of wireless services leading to increased productivity Leveraging Virtualization at HUD June 2007 8

The Roadmap to Infrastructure Optimization Service. Based Standardized Rationalized Basic Uncoordinated infrastructure Standard resources, configurations Reduce complexity Consolidate to fewer Virtualized Infrastructure resources pooled Services managed holistically Policy/Value. Based Dynamic opt. to meet SLAs Business agility Economies of scale Flexibility, reduce costs Service-level delivery Weeks to minutes Minutes to seconds Objective React Ability to Change Months to weeks Weeks to days None, ad hoc Fixed costs Reduced, fixed costs Fixed shared costs Variable usage costs Variable business costs Business Interface No SLAs Class-ofservice SLAs Flexible SLAs End-to-end SLAs Business SLAs Resource Utilization Unknown Known Rationalized Shared pools Service-based pools Policy-based sharing Organization None Central control Consolidated Pooled ownership Serviceoriented Businessoriented IT Management Processes Chaotic — Reactive Ad hoc Reactive — Proactive Life cycle management Proactive Mature problem mgmt. Proactive Prediction, dynamic capacity Service End-to-end service management Value Policy management Pricing Scheme Leveraging Virtualization at HUD June 2007 9

• Why Virtualize? • What to Virtualize? • HUD’s Virtualization Tools • Benefits of Virtualization • Lessons Learned Leveraging Virtualization at HUD June 2007 10

HUD Server architecture - Before and After Virtualization Traditional Infrastructure Virtual Environment Web Win 2003 Cust. App Win 2003 2 -CPU Server Application Solaris Physical to Virtual Converter Solaris Application Solaris 2 -CPU Server Database Win 2003 AD Win 2003 Cust. App 2 -CPU Server AD Solaris 2 -CPU Server Application Solaris VMware 2 -CPU Server Database Solaris 2 -CPU Server One OS and One App per Physical Server Leveraging Virtualization at HUD Many Independent Virtual Servers per Physical Server June 2007 11

Why Virtualize? • Large number of physical servers requiring time consuming maintenance • Low per server resource utilization • Lengthy disaster recovery times • Various development, testing and migration issues • Application outages impacting users • Business impacting downtime due to server/OS maintenance • Lengthy time to provision and deploy new services Leveraging Virtualization at HUD June 2007 12

What to Virtualize? • Production Application Servers • Test/Dev Environments • File & Print Servers • Underutilized Web and Application servers • Firewall Servers • Database servers with few to moderate users • New applications Leveraging Virtualization at HUD June 2007 13

Virtualization Tools Used • On Unix servers, used the Solaris 10 OS container technology which allows the creation of “zones” • Grouping of application processes and tasks with resource controls applied • Provides virtualization, isolation and granularity Leveraging Virtualization at HUD • On Windows servers, used VMware technology • Hosts multiple Virtual Machines, virtualized processors and a network accessible management interface • Provides secure logical partitioning, strong fault and security isolation and dynamic allocation of system resources June 2007 14

Key Business Benefits Achieved • Reduced infrastructure costs • Increased capacity utilization • Reduced applications outages due to server failures • Enabled seamless and uninterrupted support of HUD’s business in developing new business applications • Ensured compliance with OMB and FISMA standards • Reduced complexity resulting in improved recoverability of HUD's business applications from logical and physical disasters • Increased stakeholder satisfaction Leveraging Virtualization at HUD June 2007 15

Data Center Benefits • Reduction of hardware costs for servers, HBAs, network cards • Reduction of space usage and power consumption • Improved asset utilization • Automated monitoring reduces human error and outages • Improved disaster recovery • Reduction of technical support needed due to automated processes • Reduction of server/OS maintenance downtime • Rapid provisioning and deployment of new servers Leveraging Virtualization at HUD June 2007 16

Increased Agility and Flexibility • Address changing business and infrastructure requirements more rapidly • Automate and reduce time for resource provisioning and problem resolution Fudge Factor Growth Buffer Peak Utilization • Dynamic workload distribution based on application demand asset availability Average Utilization • Increase/decrease compute capacity as workloads vary • Faster deployment of new servers • Quicker recovery times on existing non-high availability environments Leveraging Virtualization at HUD June 2007 17

Improved Service and Delivery • Automated monitoring and management reduces human error and outages • Re-provisioning application environments quickly when failures occur • Dynamic workload movement between servers prior to problem detection • Achieve affordable business continuity and disaster recovery solutions • Management of environment becomes easier (change management, software provisioning, DR planning, IT cost mgmt, availability planning) • Virtual relocation prevents planned downtime from affecting performance Leveraging Virtualization at HUD June 2007 18

HUD Vision 2010: What Has Been Accomplished The HUD National Housing Locator • The Business Challenge: Lessons Learned from Katrina – No Centralized Location to Search for Available Properties • The Solution: Single Web Portal to Locate Affordable Housing Nationwide • The Results: Implemented in January 07 – Over 30, 000 Properties now available For Though real-time web search by PHAs and First Responders Leveraging Virtualization at HUD June 2007 19

HUD Vision 2010: What Has Been Accomplished Enterprise Income Verification System The Business Challenge: HUD’s rental assistance programs designated as high-risk by GAO - estimated high level of improper rental subsidy payments of $3. 2 billion in fiscal year 2000 - 70% of these errors were attributable to tenant under reporting of income. The Solution: HUD created EIV to match/verify income data for all public housing programs with the existing HHS National Directory of New Hires The Results: The annual subsidy loss associated with administrative errors and unreported income was reduced by ~$1 B, which representing a 52% decrease in the annual subsidy error, and correct subsidy determinations has increased from 55. 7% to over 66% Leveraging Virtualization at HUD June 2007 20

HUD VISION Past - 2004 Rigidity 2010 ROADMAP 2005 – 2006 Consolidation 2007 – 2009 Streamlining 2010 Agility Technology Business • Lack of Standardization • Outdated IT Infrastructure • No Documented Enterprise • • Build Once, Service Many • Elimination of Duplicate Data Entry • Enterprise Business Solutions • Real-time Access to HUD • • Architecture Heavy Dependence on Proprietary Technology Inefficient Use of IT Capacity Limited IT Integration Low Awareness of Infrastructure Problems Business • • • Many Silos/limited Integration Inconsistent Standards Limited IT Governance Limited Enterprise Solutions Lack of Consolidation and Integration of Business Systems • Under Utilized Data Sharing Work Force • No Measurement of Satisfaction • Limited Problem Resolution ISO 9001 Standards Massive IT Modernization Improved Web Applications E-authentication Nationwide IT Help Desk E-mail Modernization Wireless Solutions Business • Technology Solutions for Core Business Needs • Interactive Business Processes • Improved IT Governance Work Force • • • Tracking • Paper Intensive Processes • Inefficient Work Flow 84% Satisfied With HITS Support Access to Problem Resolution Tracking Enabled Mobile Workforce Upgraded 5000 Desktops / Tools Expanded Network Connectivity Electronic Access to Core Business Data • • Red on PMA High IT Cost Low ROI Low Confidence COOP Technology Driven Architecture Access • Enterprise Identity Management • Enterprise Content Management Work Force • Self Service Solutions • Web-enabled Tele-worker • Integrated Access to Collaboration Tools • • Green on PMA Predictable IT Spending High-confidence COOP Measurable SLA Performance Rapid Disaster Relief Mobilization Significant Paperwork Reduction Improved Core Business Transaction Times Knowledge Repository Work Force • Increased Ability to Perform Business Functions Technology • Predictive Scaling of IT • Zero Dependence on Proprietary Technology • Edge Computing • Always On IT Resilience Technology • ITIL Standards • Continuous Technology Refreshment • Integrated Approach to Remote Access • Integrated IT Enterprise Architecture • Secure Wireless Access to HUD Data Outcome to Multiple Systems • Convenient Web-based, End-user • Increased Compliance • Improved Program Effectiveness Through Financial and Performance Data • Adoption of HSPD-12 • Assured COOP • Decreased Development Time for New Requirements Outcome • Faster Time From Policy to Implementation • Increased Stakeholder Productivity • • • Through Self-service Solutions Streamlined Access to HUD Data Maximized Resource Utilization Agency-wide SOA Standards Enhanced HUD Data Integrity Centralized Data Management Simplified End-to-end Business Processes Business Driven Architecture page • EDS Confidential