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By Shahid Ahmed, Philippe Chauffard, Charles Nebolsky and Jack Sepple
Today’s enterprises and their communications networks are being challenged by an unprecedented surge in network traffic, caused by new devices as well as more mobile and collaborative ways of working. This is more than a technology issue; it’s a business issue, because networks are the lifeblood of today’s global businesses. The answer for many organizations’ network challenges may be to leap to a new model of network sourcing—giving up day-to-day management responsibility over the network asset and instead letting an external provider manage the network. Such a sourcing model gives organizations access to flexible, extensible and scalable network capabilities with more predictable and variable pricing.
The network is essential to how a modern organization operates and serves customers. Recently, however, IT executives have become concerned that demands on their networks have become almost unmanageable. The “bring your own device” (BYOD) phenomenon means that bandwidth-hungry laptops, smartphones and tablets are now pervasive in the workplace. The workforce is becoming more virtual and mobile, and the need to provide them with anytime-anywhere access to enterprise resources also puts increased stress on the network.
Companies may need to make significant investments to build a network with the agile capacity and scalability needed to handle today’s technologies and modes of working. But is that a smart investment?
Accenture believes that a major shift in thinking is occurring when it comes to transforming enterprise networks. The proper goal may not be to expand an asset that an organization intends to own and operate itself in perpetuity. Transformation can mean, instead, tapping external sourcing capabilities in a way that enables companies to get more for less over time.
Organizations have available to them several options for structuring and managing network services through the use of external providers and integrators.
On-Premise: With an on-premise approach, a company contracts with leading, best-of-breed vendors to execute activities across the network lifecycle inside its environment while retaining overall oversight.
Service Aggregator: A second type of model for network sourcing involves contracting with a third-party service aggregator to transform and manage the network leveraging multiple vendors. The provider manages the platforms, as well as the provisioning and management of IP telephony, and the IP application platforms reside in the provider’s data center. With this option, a company can gain greater flexibility in the overall solution while also retaining more strategic control.
End-to-End: A third option for network sourcing involves a comprehensive outsourcing approach—contracting with a third-party provider to host the communications platforms and services and also to manage the end-to-end network environment. The client lets an external provider manage everything associated with networking (LAN, WLAN, WAN) and IP telephony/unified communications platforms, as well as contact center infrastructure. This includes contracts with carriers and how rates are negotiated. The provider also takes responsibility for all capital-intensive network upgrades.
How can an organization make the network sourcing decision appropriate for its needs and business goals? Choosing the right path forward depends on a careful analysis of each sourcing option based on the following criteria.
Sourcing flexibility: Making a decision based on flexibility often comes down to the organization’s appetite for ongoing change. For example, the on-premise model can offer a high degree of flexibility, provided that the network architecture is modular enough to be able to move vendors in and out as need dictates, and as different vendors develop differentiated capabilities. This can assure organizations that they are technologies from vendors and carriers. Not every organization wants to retain responsibility for evaluating vendors on this ongoing basis, however.
Retention of control: What we find in the spectrum of network sourcing options is that the nature of what “control” means changes from one approach to the other. With the on-premise approach, the company maintains a general contractor role, though the services are being provided by external vendors. With the service aggregator model, control is focused more on contract SLAs. With the end-to-end approach, an organization should think of control in terms of executing and managing within the context of a robust governance structure.
Migration elasticity: The flexibility and speed with which users are migrated to an externally sourced network platform is a critical point to weigh while making a decision about a sourcing model.
Flexibility for growth: Of considerable concern to many organizations is the extent to which the new network architecture is flexible enough to support future business requirements. The service aggregator model and the end-to-end approach can be attractive to companies expecting either organic or inorganic growth, as the network architecture of a world-class integrator or outsourcer is, by design, more modular and therefore can support growth more flexibly. In many cases, the on-premise option will be more appropriate for an organization that does not expect a sudden surge in users.
Network economics: The final assessment criterion to consider has to do with network economics—considering which network sourcing option offers an appropriate balance for your organization between cost savings and required features. not expect a sudden surge in users. This Accenture report provides a detailed method by which to compare network sourcing options.
October 2, 2012
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