Managed network services mean that Chivas can toast
future success
When Pernod Ricard and Diageo jointly acquired Seagram’s wines
and spirits business in 2001, included in the purchase was Chivas
Brothers, one of the world’s best-known whisky makers. With
headquarters in Paisley near Glasgow, and employing more than 800
people, Chivas produces a number of prestigious whisky brands
including Chivas Regal, the Glenlivet and Royal Salute.
Following the acquisition, Pernod Ricard and Diageo split
Seagram’s business between them. Chivas, including its
manufacturing and bottling facilities in Scotland, went to Pernod
Ricard – one of the world’s top three wine and spirits companies
with sales of €3.5bn (£2.4bn) in 2003.
But when ownership of Chivas changed, the whisky maker urgently
needed a new data network to connect multiple sites – from rural
distilleries in the Highlands of Scotland to export offices in
London. A modern, flexible, cost-effective solution was sought that
could be implemented without disrupting business.
Rather than subsume its new whisky-making subsidiary into its
global operations, Pernod Ricard sensibly gave Chivas a degree of
autonomy in managing its own affairs. The group firmly believes
that having a decentralised organisation differentiates it from the
competition and is one of the keys to its success.
For Chivas, being a separate entity again as opposed to part of
a wider business had repercussions that had to be addressed without
delay. Among the most important was the selection and
implementation of new communications networks. While Chivas does
not operate 24 hours a day, seven days a week, having a robust data
network is still crucial to its business. Some 800 employees rely
on access to the data network to perform their daily jobs.
Also, being a whisky producer, Chivas is required by Customs
& Excise to track its products from the distillery, through
bottling to distribution.
Chivas had already used traditional BT voice and data networks:
FeatureNet 5000 for voice, and a fixed-link network based on
point-to-point KiloStream circuits for data. The latter, while
functional, was a distance-based charging regime and therefore not
the most cost-effective solution for a distributed company like
Chivas – which is based in Scotland but has heavy data traffic to
and from its international offices in London.
Under its new owner, Chivas wanted a flexible, expandable,
reliable and less expensive network solution that would be based on
proven technology. Above all it wanted a solution that could be
installed quickly – in about three months – and painlessly. “Our
number one priority was to completely avoid business disruption,”
says Stuart Watson, Chivas’s IT director.
Several bids were considered and Chivas eventually opted for a
single supplier – BT – to help it implement its communications
strategy. Initially the focus of that strategy was on getting a
data network up and running, but in later phases a converged voice
and data IP network would be implemented. Chivas chose BT’s IP
Clear service, an IP virtual private network (VPN) running over
BT's wholly owned IP multi-protocol label switching network.
Watson explains, “Part of the rationale for selecting IP Clear
was that sometime in the future we knew we would converge voice and
data across one network, and today the only way to do this is with
IP.”
As well as the IP technology, Chivas wanted a service provider
with demonstrable project management skills to meet its tight
deadlines.
In just three months, BT installed the data network linking
Chivas’s 21 sites each with varying bandwidths so that they could
share vital data – including the main manufacturing and financial
applications – as well as e-mail and internet access. Sites include
rural distilleries in the Highlands, bottling facilities in
Paisley, a major distribution centre in Linwood, and administrative
offices in both Paisley and London.
Despite some concerns about the impact of the notoriously
difficult task of switching over its data networks, no major
problems were encountered. “The changeover to the IP network was
well run and well managed,” says Watson. “We had practically no
disruption to business at any of our sites, and the project came in
on time, on budget, and exactly to our expectations.”
Under the terms of the five-year contract, BT is also fully
managing Chivas’s data network. Watson says, “We chose a fully
managed option because BT was offering a good, flexible service at
a cost-effective price, and I didn’t want to tie up one or two of
my MIS staff constantly monitoring the data network. It really
isn’t part of our core function.”
Included in the managed service is proactive network monitoring
and fault handling, the aim of which is to identify and correct
faults remotely before they affect Chivas’s network service. If the
faults cannot be fixed remotely, BT engineers, including staff
located right in the Scottish Highlands, can be quickly despatched
to any of Chivas’s sites.
An IP Clear service manager has regular review meetings with
Chivas to discuss service delivery, any Chivas concerns and actions
that may be needed. Chivas also receives network performance data
and management statistics so that it can see how its network is
functioning. These monthly reports include information on the data
network’s peaks and troughs, and which sites are running near
capacity, enabling Chivas to make better-informed decisions about
changes to its network.
One of the biggest benefits to Chivas of an IP network is that
it provides the company with a flexible and assured way forward.
Not only can Chivas easily change bandwidth and add more users but
it can also implement its forward strategy to integrate voice and
data networks into a single IP network. Chivas has already
installed IP-ready voice solutions and expects network convergence
in early 2005.
So now Chivas has a more flexible and cost-effective network and
the reliability that its business demands. “We’re saving up to 20%
against the arrangements that we had previously, and our internal
key performance indicators show that network availability has
improved from 98.5% to 99.9% since we took the managed IP
solution,” says Watson.
Not only can the company match bandwidth requirements to
business need on a per-site basis much more closely than before –
saving money on overcapacity – but it can also readily adjust
bandwidth to each site as required.
By going for a managed service, Chivas has an up-to-date data
network that is something to raise a glass to.