Wells Fargo's Storage Strategy

Wells Fargo is one of the nation's largest banks and mortgage lenders. It faces a long list of challenges coping with the problems in the economy, the financial services arena, and real estate markets, many of which you can read about in the business sections of newspapers or hear about on the nightly news every day. And it has to incorporate the recently acquired Wachovia into its business structure. All of those factors make running an efficient IT infrastructure more important than ever, and upgrading and modernizing the company's storage infrastructure is a crucial ingredient in accomplishing that task.

A big part of that job falls on Scott Dillon, executive VP and head of technology infrastructure services at Wells Fargo, and he has developed a strategy that he describes as stabilization, standardization, and optimization. In a recent interview, he called storage "one of the top areas for us and a critical component of our infrastructure because it affects the customer experience."

Wells Fargo, with $1.3 trillion in assets, spends millions a year on storage and has more than 10 PB under management. Its IT infrastructure provide services to more than 11,000 branches, 12,000 ATMs, online and phone banking services as well as for investment, mortgage, insurance, finance, and other operations. Dillon didn't want to discuss specific vendors or provide a detailed description of the company IT infrastructure, other than to say it uses a lot of just about everything that is available. The company has a large SAN and uses a lot of NAS, and has centralized, as well as distributed, IT operations. Dillon called the storage infrastructure "very complex... and growing very fast."

Storage virtualization is one of the key technologies that Wells Fargo is counting on, but the company is taking a slow and steady approach. "By putting multiple storage devices behind a virtualization device we have the ability to improve availability and give people the right amount of storage," he says.

Virtualization and standards are crucial to bringing order to the chaos that currently characterizes the storage industry, which Dillon calls "fragmented. Some vendors are focused on providing end-to-end solutions with their logos on the products. We are more interested in vendors that are focusing their strategies around standards. We like the level of abstraction that we are starting to see come into storage products."Wells Fargo analyzes new and innovative storage technologies, but doesn't rush to deploy them in its production environment. He called Fibre Channel over Ethernet "very intriguing. We have it in the labs and the simplicity it brings to the IT environment is appealing. But it will take a long time before we deploy it in our infrastructure." Solid-state storage is another one that is "very interesting on many, many fronts. But it will take a lot of maturation before it's production ready." He also sees promise in data de-duplication and compression, but thinks those technologies need to mature and become more robust before there will be widespread adoption.

The key for large enterprise IT infrastructures in general, and storage in particular, is to understand where the technology is heading, understand where the business is heading, and then develop a plan to make the best use of technology to serve the needs of the business. "Where most organizations make a mistake is to try to provide an optimized solution with new technology when the technology is in its early stages," he says. "You have to be thoughtful in the migration."

Wells Fargo is still working to better understand how storage virtualization operates and how to best deploy and monitor it over the long term. The long-range goal is to turn storage into a tiered service that can be offered to business units in a standardized manner. "We want to give business decision makers options, and some may want to take advantage of the low costs of Tier 3 storage. One of the nice things about the level of abstraction that virtualization provides is that we can dynamically move an application from Tier 1 to Tier 3 or back very quickly depending on needs," he says.

Dillon takes some pride in the fact that Wells Fargo's storage utilization rate is "north of 40 percent" while estimates put the industry average at around 25 percent. "Our goal is to continue to drive that up," he says.

The big conflict in storage is between the demands of customers for more standardization and commoditization and the desire of vendors to avoid the competition and low margins that result from those trends. Storage vendors saw what happened in the server and PC markets and will resist those developments in storage as long as they can.But Dillon believes that resistance is futile and that customer demands will move storage down the same path that other parts of IT have traveled. "Businesses are looking to drive down storage costs while increasing availability and efficiency. The development of consistent standards will let us start to commoditize the technology and the environment, and that will give us the ability to deploy and move storage around much faster. This is an area of technology that is starting to mature and the challenge for IT managers is to advance the technology in a thoughtful way. In the end, it is all about providing customers with the best service and the best experience."

InformationWeek Analytics has published an independent analysis of the challenges around enterprise storage. Download the report here (registration required).