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Scalability and TCO

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The project leader wants you to explain the concept of scalability to the team. How will you do that? Several managers on the team have heard of TCO but are not quite sure what it is. How will you explain it to them?

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1. Scalability

Scalability is a characteristic of a system, model or function that describes its capability
to cope and perform under an increased or expanding workload. A system that scales
well will be able to maintain or even increase its level of performance or efficiency
when tested by larger operational demands.

Scalability can be applied to businesses, financial markets, websites and systems etc.
In the financial markets, scalability is the ability that exchanges, banks and financial
institutions have to handle increased demands, such as higher trading volumes. In the
corporate sense, a scalable company is one that can maintain or improve profit margins
while sales volume increases.

In the dotcom industry, the ability for a Web site to grow at a rate comparable to that of
the business itself is known as scalability. In order to stay competitive, a site must be
able to add and drop merchandise and inventory from their online store in a relatively
short period of time. The site must also be able to handle the increasing volume of
online traffic that comes hand and hand with a successful Web business.
In telecommunications and software engineering, scalability is the ability of a system,
network, or process, to handle growing amounts of work in a graceful manner or its
ability to be enlarged to accommodate that growth. For example, it can refer to the
capability of a system to increase total throughput under an increased load when
resources (typically hardware) are added. An analogous meaning is implied when the
word is used in a commercial context, where scalability of a company implies that the
underlying business model offers the potential for economic growth within the

So scalability is a property of a system that can accommodate changes in transaction
volume without major changes to the system. Scalability most often comes into play
when a system user anticipates growth in his business. You would not want to make a
significant investment in any system, such as a fulfillment system, if it cannot grow as
your business grows. On the other hand, you do not want to pay for excess capacity
while you wait for growth to happen. A scalable system can be downsized as easily as it
can grow. A server for a Web ...

Solution Summary

The solution contains the concept of scalability; measures, types and TCO with example.