The basis of profitability
- Posted:
- 17:27 21 Oct 2004
- Topics:
- IT Standards & Protocols | Network Infrastructure
Not so long ago, you didn't have much choice - your IT
and communications requirements were acquired, implemented and
maintained very separately. Technological limitations meant that
you had to use distinct separate circuits for each set of
applications, such as voice and data.
These days you have choice. A lot of choice. The traditional
methods, while technically proficient and delivering the service
that you needed, were not an efficient way of utilising your
networks, and were similarly likely not to have been
cost-effective.
The onset of widely available, high-speed, always-on internet
protocol (IP) networks has enabled companies like yours to break
free of factors limiting how your services were obtained. Instead
of separate services (each with their own billing structure as
well), IP-based networks allow you to use a single unified network
infrastructure on which to base all of your data and voice (and
even video) requirements.
And this network adheres to an almost universally recognised and
adopted standard and can be constructed, operated and maintained
extremely cost-effectively.
Change agent for business
Put simply, IP and IP networks simplify your communication and
information requirements. A converged, single IP infrastructure
will very likely make extremely good technical and financial sense,
making it possible to have access to an increased number of
applications. More importantly, IP can be a change agent for your
business as a whole, making it punch way above its weight.
Not surprisingly, IP is increasingly being taken up by companies
like yours. Says Ivor Kendall, General Manager for IP
Infrastructure at BT: "IP is on the radar of SMEs these days. IP
simplifies the communication and information needs of SMEs. It can
manage more efficiently the services people require to do their
jobs and it provides additional flexibility to enhance
communication and get access to information where they need it.
Some [SMEs] use IP as a lever to bring about a level to playing
field when competing with larger companies. The perception of IP
was that it was about the internet; now it's about the services it
can deliver, with the internet being just one."
Such services are based on having just one platform for your
company to implement your business applications and services almost
regardless of location. That is to say all that you need to do is
have access to an internet connection, preferably a broadband one.
And with this connection the business advantages, whether in the
office or outside, can be huge.
Just imagine the productivity gains from having a single point of
access for all of your emails, voicemails, faxes and text and
multimedia messages. This is precisely what IP networks can
deliver, cost-effectively, to your business.
Furthermore, your IP network will allow you to set up profiles and
actions according to the importance of the message or its sender.
For example, you could set up a priority whereby certain messages,
regardless of their origin and form, get through to you, and other
data, equally form-independent, can be stored automatically.
What such capabilities do is make flexible working much more
feasible - and an increasing number of people are aiming to do
this, thanks to the Government's Flexible Working Initiative.
Taking the concept one stage further, it is now possible to set up
cost-effective, real-time collaborative conferences utilising a
variety of media using one integrated IP environment.
Mobile working in particular has consistently thrown up challenges,
and there are, in truth, a number of such issues ahead for you if
you decide to integrate mobility within an IP infrastructure. These
challenges are not just technical ones; there is also the task of
integrating the mobility technology with your business
practices.
Once integration has been achieved, imagine the benefits your sales
force could gain from being able to obtain live customer data
anywhere in the field. And imagine what your engineers could do if
they could look at maintenance records and drawings anywhere.
Even though many would associate it with large companies, business
continuity can be realised cost-effectively by companies such as
yours by using the economies of scale and robustness of IP
networks. It's relatively straightforward to set up online data
back-up using your IP network, with essential data mirrored to disk
at a remote location.
The IP solution - with the necessary IP storage and security
mechanisms - will provide far easier access to this data than would
the use of offline media in special vaults. The key is that
IP-based business continuity solutions do not have to place an
undue burden on your bottom line.
But to take advantage of such features and functionality it is
imperative that you look strategically at the whole issue of IP.
You have to consider a business continuity plan, including degrees
of priority of data, and you have to consider which staff can work
flexibly and what technologies are appropriate to them to do their
jobs within your budget requirements. You need to pay attention to
what IP-based technology your staff will be equipped with and
whether different staff use different genres of product.
Unfortunately, strategic thinking has been something of an Achilles
heel for SMEs. In a survey by Computer Weekly, in association with
BT, only 55% of SMEs said that they had a formal strategy for IT
and communications. While this is an improvement compared with a
similar survey in September 2003 which found that just under half
of SMEs had a formal strategy, it is still a cause for
concern.
If you are one of the 45% of businesses with no formal IT and
communications strategy, then you will struggle to get the benefits
that IP can deliver. It is almost inevitable that you will not be
able to effectively deploy any business critical application
system, regardless of what technological function it may offer, nor
will you get value for your investment. Explains BT's Ivor Kendall:
"Without a strategy you may spend money in one area without
realising the benefits in others; it just becomes a point purchase.
With a strategy you see how the spend contributes to your whole
solution."
IP telephony - which includes the most commonly known application
of voice services using IP technology, voice over IP (VoIP) - is
probably the best example of an application whose effective running
depends on strategic thinking. It may be tempting for companies
like yours to see the apparent benefits of replacing traditional
PBX technology with IP-based voice networks. Yet such benefits of
cost and performance, intuitiveness and ubiquity, will not be
realised without being dealt with strategically. The Computer
Weekly survey also points out that those companies with strategies
looking at voice services over IP have better managed networks
overall.
Hotspot technology
A step further is IP-based technology that will deliver voice
services using commonly available hotspot technology. Products are
already commercially available that allow seamless data transfer
across WiFi and GPRS/3G mobile phone network technologies. Once a
guaranteed quality of service is delivered, and standards evolve,
such services will be more commonplace.
But when buying such services, you should carefully consider who
you will be dealing with. With all IP networks, the key issues are
ubiquity of coverage, security, quality of service, reliability,
redundancy, guaranteed line power across the network and ease of
use.
Basing your business communications on IP-based networks will let
you have, according to Kendall "a synergy of solutions". He says:
"It's the synergy of having an overall strategy that helps you save
money on [what you] spend and which [can be utilised] for the most
benefit. It's important for SMEs to realise how to use a strategy
to be important players in the digital economy."
The fundamental message is that the usefulness of IP of stands or
falls on how you plan the technology to align itself with your
business objectives. Once you're sure that you have such a strategy
in place, then, and only then, will you reap the benefits.
Case study: Thomas Cook
Thomas Cook as an 11,000-strong corporation is not an SME by any form of definition. However, if you consider the fact there are 643 Thomas Cook shops across the country then you have a collection of businesses with an average of 17 people working in them.
Thomas Cook is half way through a process of basing the IT and communications requirements of these shops over an IP network. The IP infrastructure is now in place and the challenge is now to put in place the specific applications that will enable each shop to change how it does its business.
Says Thomas Cook IT director Carl Dawson: "We're moving [the network] with applications that shops need in the next financial year. The shops now have email and internet access, but that doesn't transform the way they work. That is going to change when we deliver to them the sales applications. We've just laid down the platform for them to deliver the business change but not yet done the change."
IP is the future for Thomas Cook and one of the next things to be initiated is a voice strategy for not just the shops but also the company's call centres. "We're a long way down the line of identifying process and knowing what they will do regarding voice over IP," says Dawson.
IP cost savings
IP-based networks present you with the opportunity to drastically cut costs. Here's a summary of where you can find significant savings:
- Combining multiple disparate networks.
- Eliminating dedicated equipment such as PBXs.
- Reducing upgrade costs.
- Lowering hardware connection costs.
- Reducing wiring at green or brown field locations.
- Centralising call processing and voice/data operations.
- Minimising stocks of disparate components and spares.
- Decreasing reliance on external vendors for service/support.
- Reducing administration costs.
Source: Omnetica
