Cloud computing case study: Royal Mail Group

Discover why cloud computing has the Royal Mail Group's stamp of approval

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The Royal Mail Group (RMG) is the only organisation that delivers daily postal services to every household in the UK. It has 165,000 staff who process and deliver more than 70 million items to 28 million addresses across the country.

Each week RMG serves over 24 million customers through its network of 12,000 post offices and 3,000 separate processing sites. Its domestic and European parcels businesses - General Logistics Systems and Parcelforce Worldwide - handle some 404 million parcels a year.

Although currently government-owned, discussion are under way that could result in the organisation being partially privatised in the near future.

It recognised the pressing need to improve the efficiency and cost effectiveness of its in-house legacy technologies and began evaluating cloud computing solutions in 2008.

The elastic and flexible nature of cloud computing, which allows for capacity growth or shrinkage, together with the virtual elimination of up-front capital expenditure, were among the compelling drivers in favour of transitioning services into a cloud computing environment, according to RMG's head of infrastructure management, Adrian Steel.

Steel explained that, during the last quarter of 2008, RMG began evaluating a "complete redesign" of its email messaging service for 28,000 employees who were then tied to a legacy IBM Lotus Notes system.

The cost of running this "highly entrenched" Notes infrastructure was spiralling, while operational efficiency was being compromised because employees were struggling with the out-of-date software.

Moving legacy collaboration and email software into the cloud

Steel investigated the acquisition of a suite of business productivity tools using a flexible software-as-a-service (SaaS) approach with payment on demand from vendors, including Microsoft, Google and Lotus Live.

Over a nine-month options appraisal RMG also analysed available in-house solutions, including retaining the existing system with minor upgrades, moving to a new version of Lotus Notes, or replacing it with Microsoft Exchange Server.

After this in-depth evaluation RMG chose the Microsoft Business Productivity Online Dedicated (BPOS-D) Suite based on recommendations from its outsourcing partner CSC and its own research.

This solution, which has since been enhanced with the recent launch of Microsoft Office 365, provides Microsoft Exchange Online for email, Microsoft Office Communications Online for instant messaging, Microsoft Office SharePoint Online for collaboration, and Microsoft Office Live Meeting communications tools for web-based audio and videoconferencing.

Although cost savings were a major factor in the decision to adopt the Microsoft cloud solution, especially with the economy in recession, Steel stressed that the group was also focusing on the need to improve collaboration and give staff new more efficient and more functional communication and collaboration tools.

28,000 RMG staff migrated to cloud collaboration suite overnight

In the first eight weeks of deployment, 28,000 employees were supplied with their new collaboration suite, giving them access to tools such as instant messaging and presence awareness. Around 46 per cent of these 28,000 staff were fully migrated overnight.

"The transition was very successful, with huge customer satisfaction even though you were changing a core primary business tool. Now that we've been up and running for a good nine months, we're starting to see the full benefits of the transformation. The average on-premises mail box within Lotus Notes was constrained by disk, because point disk and backup capacity is quite expensive. So most staff had a 250MB inbox file under Lotus Notes. Everybody's got 5GB now in the cloud," Steel explained.

He added that the management overhead of maintaining these Notes inboxes was high: "We constantly had to email people out when we were on Lotus Notes, telling them to reduce their storage. Some people used to have to do a phenomenal amount of housekeeping, but now they don't have to do this they are much more productive."

Cloud computing case study: Royal Mail Group

Discover why cloud computing has the Royal Mail Group's stamp of approval

Real business benefits from virtual servers in Hyper-V private cloud

In addition to the migration to hosted email and collaboration solutions, RMG undertook a second major strategic migration to the cloud in early 2010.

This project saw the organisation initiate a project to virtualise up to 400 servers to create a private cloud based on Microsoft Hyper-V.

For this project RMG's partner CSC recommended working with Microsoft Services and HP to implement the virtualisation service for RMG using the Hyper-V feature of Microsoft Windows Server 2008 R2 Datacenter. CSC supported this decision even though VMware was its current standard service offering for virtualisation.

The solution comprised of two C7000 HP blade enclosures and two HP EVA 4400 storage arrays. CSC engaged with Microsoft and HP to aid in the design and implementation, including migrating 360 physical servers.

The solution is using the Microsoft System Center IT infrastructure management suite to provide the management and monitoring layer, not only on Hyper-V but on the new HP hardware as well.

Although cross-site disaster recovery capability was not a contractual requirement, the solution has inherent resilience to help ensure continuous access to hardware and data storage. Hyper-V is also hosting the on-premise Microsoft Office SharePoint Server environment for the Microsoft BPOS-D project at RMG.

Hyper-V private cloud on target to save £1.8m

This project is on target to deliver major savings and significantly increase the efficiency or the responsiveness of the organisation's internal IT systems, according to Steel.

"The Hyper-V project will pay back the original investment in 19 months, and, over four years, will realise savings of £1.8m compared to the previous operation," he said.

According to Steel, reliability of the cloud services has been excellent: "We're on that product now and it's great. It's delivering the availability promised – 99.99 – and above across all products. In fact, I think two of the four products have hit a 100 per cent since we've been in the cloud, so they've never been down."

Cloud computing key for RMG's future business strategy

In terms of new cloud solutions on the RMG's horizon, Steel explained that the organisation is planning to purchase cloud-based storage over the next 12 months and will start with a pilot on Azure shortly.

The transition to cloud computing will, Steel added, dramatically reduce the complexity of RMG's planned rollout of Windows 7 and Office 2010 over the next 12 to 16 months: "Office 2010 is pretty immense, but spectacular when you've got a really, really up-to-date modern Exchange environment – which we have in the cloud.

So, we're going on a huge crusade this year. There will be a revolution for RMG in the desktop space as we modernise the front end. We can do this with absolute confidence as our back-end systems are in the cloud and totally up-to-date because Microsoft keeps them up-to-date."

The next year will be a busy time for RMG in terms of technology rollouts, but it is clear that cloud computing remains at the centre of its IT and business strategies.

"So we went private cloud last year, BPOS last year, cloud storage this year. And we will get to the point in the next 12 months where we will be looking at hosting virtual applications in the cloud," Steel concluded.

"I think for the next 12 months we've got enough on doing all the desktop cloud storage and maturing the BPOS product set. I think we will concentrate on using the private cloud more and virtual desktops. That's where we'll concentrate because that's a big enough work plan for anybody to deal with for 12 months."