What are the computing advantages for a corperate organization having blades and Virtul environement comparing with Rack Servers with flat environment

I don't know why large organizations or MNC's with TBs of data...... requires Virtual Servers Environment....... I have been working on Virtual Servers Environment for5 years now...... but I really feel the difference in performance....... If you are really budget or space concious...... then I would say you can choose a Vritual Server environment instead physical servers (Blades or Tower), Racks etc..... But if you are looking for performance....... Then I prefer the second option.