Transcript YORK, Larry ITPS 2015 Planning for IT Transformation

Planning for IT
Transformation
Larry York
Agenda
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Introduction to Transformation
Keys to Successful Transformation
WAN Technology Opportunities
INTRODUCTION TO
TRANSFORMATION
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Transformation and Innovation
are current buzzwords, but...
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The term transformation has resonance
with CIOs, CTOs, IT Executives and
business unit representatives
• It is important to have a view on what it might mean
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Many organizations are seeking
procurement projects that drive
transformation, and transformational
projects need competitive sourcing
• Easier to justify a transformation project than an asis sourcing project (which can be viewed more as
“normal business”)
• Can also be more attractive for vendors
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Transformation and Innovation
are current buzzwords, but...
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Transformation can drive lower costs
than simple price-down
• But cost reduction may not be the primary
driver
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In procurements, innovation is about
allowing vendors to present different
solutions to meet the organization’s
requirements
• But, think of innovation as a transformation
enabler
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Transformation can mean many
things…
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In telecom, Telecom Transformation, or IP
Transformation, is a term that describes
the evolution of the telecommunications
industry from a capital-intensive,
technology-focused model to a usercentric service-delivery model
• But much of this is provider/carrier focused, in dealing
with competitive threats from disruptive technologies and
solutions such as Google, Skype, and the Internet in
general
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For enterprises, transformation
can be whatever you want it to
be…
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IPT, Lync and UC&C*
Cloud based services
Internet as a ubiquitous alternative to MPLS
Outsourcing and extending managed services
BYOD for wireless services
Including some, arguably, less
transformational activities:
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Ethernet access
Equipment refresh
SIP Trunking
Changing supplier mix – regional vs. global
* Unified Communication and Collaboration – or the Microsoft coined Universal Collaboration!
You might have to deal with the
hype…
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It can be difficult to work out what is
truly relevant
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Let’s take a snap-shot view on a few
common “transformation” drivers
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Transformation starts with
strategy…
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Not simply talking gap / opportunity
analysis on the current state
• It is more than a “Sourcing Strategy” for more of
what you already have
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About being prepared to engage earlier
in
• The vision and mission (for delivering IT and
telecom services)
• Helping and influencing the vision in translating
this into goals and strategic objectives
• Developing a strategic plan, and business
case(s)
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Transformation starts with
strategy…
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We support facilitation session /
workshops for clients trying to pull
this strategy together
• Background and current landscape
• Strategy objectives
• Opportunity / actions identification
• Actionable road-map based on opportunity
assessment
• Basis for ongoing iterative development of
strategy
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KEYS TO SUCCESSFUL
TRANSFORMATION
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What’s a Successful
Transformation?
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Deal built on measurable business
outcomes
A focus on performance, customer cost
and provider margin
• Business affecting innovation only works if it works
for everyone – cost reduction and performance /
process improvements for the customer and
attractive profits for the provider
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Heightened risk and reward
• Transformations need buy-in by all stakeholders
• The best provider often wins over the low bidder
What’s a Successful
Transformation?
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The provider is closely bound to the
customer
• Relationships are less “transactional” and more
interdependent
• Emphasis on aligning customer and provider
interests
• Governance designed to find improvements
and make realignments
• This heightens “valued partner” lock-in risk
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Foundations for Success
A Strategy Tailored to Specific
Objectives
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The strategy should be well-defined and agreed
upon, encompassing
SOURCING
• Sole sourcing vs competitive sourcing
• Providers to engage
• Structure of the sourcing program
• Scope of program (including outsourcing or
managed services)
• Pricing model and requirements
TECHNOLOGY
• Degree to which design / solution is pre-determined
vs will be determined by the sourcing process
• Basic principles of the required solution and
requirements set
• Defined and specified managed services
And should be founded on well-defined needs
and objectives
Foundations for Success
A Competitive Procurement
Process
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Transformation projects are intensely
competitive
• They are attractive to providers because
change projects level the playing field
• Not taking advantage of that would be a crime!
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Structuring procurements so you can
compare competing solutions / bids
without stifling innovation is important –
and not easy
Plan for a longer procurement process
Foundations for Success
Business Case Supporting
Desired Outcomes
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Successful transformation projects start
with a robust business case
The business case should address
• Current costs, future state costs, and the cost
to move from the current to the future state
• Operational resilience, performance,
functionality and usability
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The business case should be refined
and updated as the project moves from
procurement to contracting to
implementation
Foundations for Success
Disciplined, Collaborative,
Flexible Sourcing Plan
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Preparation
• RFP / requirements document
• Stakeholder management
• Communications management
Structure your procurement and
negotiation process
• Provide feedback verbally and in writing
• Engage collaboratively with the providers
• Document your communications
WAN TECHNOLOGY
OPPORTUNITIES
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Introduction
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Increased network capacity is demanded
by transformational technologies like
collaboration, UC, and video, and by
exploding growth in use of web content
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Flat or declining network budgets require
new approaches, solutions, and
technologies to meet this demand
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We’re going to examine some approaches
which may help address this gap
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Ethernet Access – What is it?
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Last-mile transport using the Ethernet
protocol for the local loop
• Standards-based (but there are multiple
standards)
• Underlying bandwidth multiples of 10Mbps
(10Mb/100Mb/1Gb/10Gb, etc.)
• Provided as Ethernet over Fiber (EoF) and
Ethernet over Copper (EoC)
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1Mbps to 10Mbps can be provided over voice-grade
copper
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Higher speed services usually provided over fiber
Ethernet handoff / interface at the
premises instead of TDM (UNI)
Tale of Copper, Fiber
& Coaxial Cable
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The physical layer – historically (in the
US)
• “Business locations” have not been as well
served by broadband facilities as have
residences
• No more than 10%-15% of all business
locations were on anything better than copper
• DSL was limited, e.g., weak SLAs because of
distance-from-CO restrictions
• “NxT1” – the multiplexed go-to service for those
needing more than 1.5M
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Industry Players
Top 4 Ethernet US Providers by
Segment
Rank
Incumbent
Providers
Competitive
Providers
Cable MSOs
1
AT&T
Level 3
Time Warner
2
Verizon
XO
Cox
3
CenturyLink
Cogent
Comcast
4
Windstream
Zayo
Charter Business
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Industry Players
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Incumbent providers are pushing
Ethernet
Competitive providers have success with
• Larger “transformational” contexts (many sites
moving at once)
• Installation of FastE/GigE (100Mb/1Gb) for
connectivity to data centers and/or cloud
services providers
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Rates are continuing to fall due to capacity
growth and increased competition
Benefits and Issues
Enterprise Experience Has Been
Mixed
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Benefits / Advantages
• Standardized interface – straightforward and
accepted globally
• Recurring charges are often less than
competing services (lower equipment, service,
operational costs)
• Scalable – permits the addition of bandwidth
incrementally (can even be done remotely)
• Effective E2E protocol from LAN to WAN
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supports multimedia services
Benefits and Issues
Enterprise Experience Has Been
Mixed
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Issues / Challenges
• Less available than legacy TDM service
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Enterprises with many locations in remote areas will
likely find low-speed availability limited (even if
promised initially)
Diversity for multiple circuits can be a challenge
• Lower speeds over EoC can deliver
inconsistent performance
• Longer installation intervals
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Ethernet installations are typically 75-120+ days
Special Construction at a site can takes 6+ months
• Higher than expected costs for Special
Construction
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Use of Multiple VRFs with MPLS
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VRFs (Virtual Routing and Forwarding)
provides network segmentation and
control between segments
• Without the need for multiple ports or devices
• Provisioned as an additional feature; check for
capability and additional charges
• Sites in different VRFs cannot communicate
with each other without additional configuration
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Improves network security; can
eliminate the need for encryption and
authentication
May allow consolidation / optimization
MPLS Bandwidth on Demand
(BoD)
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Dynamic port or CoS bandwidth changes
(VzB)
• Portal based access to change either port speeds
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(within existing access limitations) or Gold CAR
Process immediately or schedule up to 365 days in
advance
Can change once per 24 hour period
Not available with OSPF, EIGRP, DSL access or NxT1
access
Charges are blended based on days at different
speeds
Not to be confused with usage based
billing options such as HiCap Flex w/ AT&T
On-Net Access to the Cloud
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Providers have been integrating network
services with their own cloud services for
some time
• E.g., Terremark, Savvis, AT&T Hosting, BT One Cloud
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Such integration (via MPLS) is now being
extended to 3rd party cloud services such as
• Salesforce.com, AWS, Azure, Google Compute
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Benefits include
• MPLS is more secure than Internet access to the cloud
• Predictable network performance and reduced latency (normal
MPLS any-to-any benefits)
• Dynamic scalability to match cloud usage variability
• Security and control
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VPLS – Virtual Private LAN
Service – MPLS alternative
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Layer 2 VPN technology – Ethernet only
Best fit for high bandwidth requirements at
selected sites (it is not universally
available)
• Can provide better price performance ($/Mb) than MPLS at
higher bandwidths
• Lower latency and higher security
• Simplifies LAN/WAN boundaries (and equipment) –Ethernet
interface looks like a regional or national LAN
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Requires a higher level of management
(routing is controlled by the customer vs.
by the provider)
Broadband VPN MPLS Access
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As broadband speeds and performance
improve, customers are looking at leveraging
broadband for cheaper MPLS connectivity
• Can leverage DSL, Cable, Wireless
• Access MPLS core network via a secure gateway
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Gateway should be in-region with user communities
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Look out for extra charges
• Often used as a back-up to primary MPLS circuit
• Important to review SLAs
• Watch out for complex contracting / product structures
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E.g., no integration with broadband aggregation products
Internet Off-load
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As Internet traffic grows exponentially
Enterprises are starting to look
seriously at Internet off-load
• Providing Internet access at remote locations –
rather than carrying traffic to the data center
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Cisco’s iWAN technology (becoming
available on the latest routers) is an
enabler
• Allows more sophisticated routing of network
traffic and management of routing plans
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Internet Off-load
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Once in place, Internet off-load can also be
leveraged for non-critical business
applications
• Can allow reduction in MPLS network capacity, or
simply accommodate growth
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Cost savings rely on use of low cost
(business grade) local broadband
technologies / providers
It’s common to examine broadband
aggregation services rather than contracting
with multiple local providers
• SPOC for ordering, managing and invoicing
Summary Points
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Transformation is a current buzzword
CIOs (sic) can find transformation more
appealing (or at least very helpful) than
cost reduction as justification for
important sourcing initiatives
You need to think about what
transformational solutions and services
might be relevant
Try to have a view on what
transformation means to you
Questions?
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