J.P. Morgan Harnesses Power with Grid Computing System

Considered one of the largest grid computing projects in the world, J.P. Morgan Chase Investment Bank's pioneering effort to combine seven separate financial risk management systems to share computing power is on target to lower costs while increasing flexibility and service to internal customers.

The idea was hatched back in 2001 to address cost and staffing inefficiencies in the seven systems, which were designed to help traders assess and manage financial exposures such as interest rates, equities, foreign exchange and credit derivatives.

Known as the Compute BackBone, or CBB, the new system will eventually combine the power of about 2,000 CPUs that run on 50 midsize servers. Early this year, more than 700 CPUs were on the Compute BackBone in stripped-down blade servers, and 150 CPUs are being added each month.

According to CIO Michael J. Ashworth, the New York-based investment bank spent $4.5 million upfront on the project, working with Platform Computing Inc. in Markham, Ontario, to develop middleware that shares caching resources and provides management, queuing and scheduling.

"We are looking for infinite capacity in our compute [system], and that's a bit of a challenge. But this gives us more progress toward that goal. It's something which is difficult to put a price on," Ashworth says.

Still, initial accounting shows that the Compute BackBone saved the bank $1 million in 2003, and another $5 million in savings are expected this year. The savings come from lower costs for hardware, reduced development and operational costs, and more effective systems management, says Adrian Kunzle, co-head of architecture for investment bank technology.

The Compute BackBone is built on new blade hardware devices, which are "heavily cut-down machines with four processors and a bunch of memory," Kunzle says. Taking into account all areas of savings, the CBB has "taken easily 20% out of the compute-cycle costs," he adds.

Steven Neiman, senior information architect and one of the Compute BackBone's creators, says the grid approach allows the investment bank to reduce operational risk, for instance when an isolated server fails. "You have an ability to respond much more flexibly," he says.

In another show of flexibility, a new credit-trading application was built into the system in just 10 weeks instead of the five months it would have taken before the Compute BackBone, Ashworth says. And because the CBB provides a scalable infrastructure, the investment bank was immediately able to handle new business volume.

According to Ahmar Abbas, an analyst at Grid Technology Partners in South Hadley, Mass., J.P. Morgan's Compute BackBone is probably the biggest grid computing project in the world, compared with the six others that have been publicized and are currently under way. Such projects can lower costs partly because they use inexpensive servers that can be added one at a time, he says.

"The money you can save is huge," Abbas says.

Michael J. Ashworth, CIO, J.P. Morgan Chase Investment Bank
But perhaps more than the technology itself, J.P. Morgan's IT managers' enlightened thinking in creating the Compute BackBone has earned Abbas' praise.

"It's a very impressive project because of the huge mind-shift away from what they were doing before," he says. "You are pooling all kinds of IT resources from all areas of the company, and that's one huge leap."

Making the organizational shift meant overcoming skepticism from internal users who had run applications on their own dedicated servers, Ashworth says. "This was a proposed factory for high-end computing, and you were taking away the perceived flexibility that the business units think they have," he explains. "It was a lot of people to convince."

Neiman credits the creation of the CBB to bright minds at the investment bank with roots in the academic world who were encouraged to "defend their ideas in open forums." This meant that "anybody anywhere in the bank could come up and say, 'I don't think you've thought this through.' It was a self-correcting mechanism," he says.

The team of innovators "wasn't sitting here saying, 'We want to build grid computing.'" Neiman adds. Instead, he says, "we wanted to solve the problem we were handed."

J.P. Morgan Chase Investment Bank


Business: Provides investment banking and commercial banking products and services. Also advises on corporate strategy and structure, the raising of capital in equity and debt markets, and risk management.

Project champions: Michael J. Ashworth and Steven Neiman

IT department: 11,000

Project payback: Lower costs for hardware, reduced development and operational costs and more effective systems management resulted in $1 million savings in 2003. Another $5 million in savings are expected this year.

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