Corporate View

Virtual Companies And Raised Floors

Virtual companies have been touted as a means to an end. That end is lean organizations that form quickly, concentrate on core competencies and outsource or partner with those companies better able to provide services and specialized talent. The goal is to beat the competition to market.

How does network infrastructure play a part in the discussion of virtual companies? As soon as you say "mission critical," the pace of change slows to a crawl, right? How can we reconcile that turtle's pace with the reality of budget cycles, investments of time in both design and deployment, building a support staff and all the other factors that make up the modern corporate network?

Outfitting the Video Hut Let's look at an example. Pat has been hired as manager of network operations by a start-up company that wants to ge t into the retail market, say, videotape rentals. The company against which the start-up will compete is well-entrenched and the start-up needs to find underserved areas and get in there with facilities before the competition can notice or react. In short order, the start-up's staff needs to quickly and quietly develop a marketing and advertising campaign, sign real estate deals, order inventory and develop an IS strategy.

Then, in a well-orchestrated launch--bam! The advertising hits, neon signs are switched on and--voila!--stores are opened and attracting customers before the competition can say, "Where did you come from?" Once entrenched in these markets, Pat's employer can compete and build market share.

Now the question: What is Pat supposed to do? When querying the market, Pat finds that companies like the competition are using a traditional mixture of frame relay and leased lines. The competition has multiple carriers, contracts with different franchises and lead times measured in months to get new circuits and equipment to a new store location.

These lead times and entanglements are not goi ng to fit into the schedule set by Pat's managers. In addition to developing the WAN, Pat also needs to locate and build a computer room with all the attendant issues--raised floor, uninterruptible power supply (UPS), access security and disaster recovery, to name a few. Faced with these projects and a demanding business plan, Pat knows something more radical needs to happen.

A modest and tentatively radical proposal: Build/buy your applications around off-the-shelf Internet technology solutions. Remember that there's no such thing as an intranet (see Robert Moskowitz's "Hey, Wanna Buy a Seawall? Here's One for You," September 15, page 43). Moskowitz's point is that the corporate imperative is interbusiness applications; therefore, our imperative is to design, build and deploy our applications in an any-to-any and/or over-any environment.

Outsourcing the Farm In addition to robust security, the virtual company's other requirement for outsourcing of network operations is a completely lights -out operation. If you can honestly say that you can manage your entire server environment remotely, then why build a physical environment to house it? Several carriers and Internet service providers (ISPs) can provide a footprint in their facility for your server rack complete with air conditioning, UPS power, physical security and a choice of ISPs and telecom carriers. They can, in effect, become your computer room facility and operations staff. Given robust security and lights-out operations you can leverage the competition among ISPs and essentially outsource the majority of your network.

The net effect is shared facilities lead to lower costs. Instead of begging and pleading to justify an ongoing budget for ever higher bandwidth requirements, you can collocate your equipment at a major Internet site where large pipes and redundant facilities are "over the wall" instead of "across town." Other intrinsic cost reductions, such as those for power, staff, fire protection and cooling, all arise from shared space.

You have two choices to make. Do you want to outsource your WAN to one or more ISPs, or do you wish to collocate one or more of your servers at a carrier's site?

Which service provider is qualified to house your site? Although it seems like a risky and emotional decision, large mainframe sites have been making similar plans for years as they select remote disaster-recovery sites, such as those from Comdisco and SunGuard. With the rise of the Internet and its associated competition, the alternatives for the number of sites other than these major players has grown. With the standardization and security of modern protocols, such as Secure Sockets Layer (SSL), the possibility exists for outsourcing live sites, not just disaster recovery.

Some Weeding Required You should qualify your short list. Weed out the minor players. If they don't have a computer facility you would love to have, then why bo ther? If they are not in an established traffic-switching center core in the Net, the cos t reduction, traffic resiliency and easy cross-connects you expect won't be there. Do their resilience and disaster-recovery plans match your own? How long will your site be down? Where are you on their recovery priority? Will they put it in writing?

Does this mean that all your leased lines will go away or that your servers will go off site. No, of course not. But you might gain a competitive advantage by outsourcing your WAN or facilities. Any edge is too important to dismiss out of hand. This may seem like a radical notion, but in a few years I doubt anyone will be surprised by it. Remember my original point: There is no such thing as a virtual customer. Very few people actually make money with their networks. Instead, they leverage and enable new business ideas by providing solutions more cheaply than the competition and faster than the competition can react to. Collocation can help you accomplish both.

Brian Walsh is a senior consultant with Cap Gemini America in Portland, Ore. He can be rea ched at bwalsh@nwc.com.