Outsourcing network management

To reduce operational expenditure, Indian businesses have started outsourcing their network management needs to network management service providers. By Chirasrota Jena

With IT networks becoming more complex by the day, organisations have started realising the need for professional network management. They have also understood that device management is only a subset of network management. Most organisations have made provisions in their budgets for either purchasing and implementing, or outsourcing network management. Interestingly, most government organisations and institutions are calling separate tenders for network management which is clearly heading towards highly integrated management solution sets, with an emphasis on proactive, rather than reactive, systems. Organisations are increasingly looking at network management as a sub-set of enterprise management systems. This enables companies to deploy and manage networks using policies and move towards ‘on-demand computing’. Organisations are considering remote management, through the Internet or though an external managed service provider, to manage complex network infrastructure. These service providers are measured against the service levels committed to and the service fee payable towards the providers is directly linked to the uptime maintained by them.

With network infrastructure being expected to support multiple applications, business users are demanding consistent and predictable response time for critical applications. Additionally organisations have started realising that their bandwidth requirement during peak periods of the month and year is significantly different from that of non-peak periods. The critical question for them is whether they can subscribe to differentiated levels of service aligned to their business requirements. Budget erosion, consolidation, technology changes, branding and global competition have all brought new strategic challenges to organisations. These in turn have increased the complexity and costs of running the IT and network infrastructure that support business operations. Sanjay Motwani, country manager, Raritan India says, “Infrastructure management outsourcing services is an area that has received a lot of attention. Popularly called ‘the third wave of outsourcing’ by industry pundits, the market for global infrastructure management services is estimated to be anywhere between $ 80 and $140 billion and is growing at a rapid pace. With all segments in the country seeing tremendous business demand, there exists a huge opportunity for infrastructure management services and products. Recent times have seen many new entrants while existing players have expanded their portfolio of products and services.”

Outsourcing network management

Network management outsourcing is growing rapidly in India and there are many organisations willing to completely outsource to a service provider. Kasturi Bhattacharjee, principal consultant, PricewaterhouseCoopers says, “Network management includes different functions such as planning the design of the network, maintaining the network hardware and software, integrating new software and hardware, server upgrades to stay abreast with latest developments, supervising the resources, supporting the users, defending the network from hackers and troubleshooting problems. Maintaining networks on your own can be very challenging at times hence outsourcing can be a viable alternative due to reasons such as specialisation in the field, gaining access to a number of skills set at a single price which any organisation otherwise has to develop itself, the cost of recruiting, retaining and training employees among others.” She added that there is a good deal of growth potential for the outsourcing market in India due to accessibility to technology and manpower which plays a crucial role in driving down costs.

Prem Nithin, system engineer-ITS, Cisco India says, “With the growing complexities of managing networks most MNCs and Indian companies are looking towards outsourcing as the best option.” Growing cost concerns and shortage of talent are other factors. Security is a concern for business houses. So depending on their requirements customers should outsource their network management services.

With all segments in the country seeing tremendous business demand, there exists a huge opportunity for infrastructure management services and products. Saji P K, vice president, Technology, Sify Limited says, “We believe that this will be a growth area for us as we currently support about 1,500 plus high value enterprise customers. Attrition of network engineers is on the higher side and it would be a big challenge for enterprises to retain them. As companies want to work on latest technology and stay up-to-date, this is possible only by teaming up with service providers.”

The market is open to outsourcing network monitoring by means of facility management (FM). Organisations today face challenges of attrition, consistency in service delivery and hence remote infrastructure management services from service providers gain prominence using as they do industry standard tools and customised portals. Aldrin D’Souza, county manager, Tivoli, IBM Software Group, India says, “Network management outsourcing has matured. Customers expect the managed service provider (MSP) or service provider to monitor the last mile and manage network equipment as well. The service providers offering MPLS (Multiprotocol Label Switching) offer a stable and highly redundant network, today they also offer MLLN (Managed Leased Line Network) which offers flexibility in terms of bandwidth provisioning. Specific to network management outsourcing, the most important expectation from a MSP is to interface or liaison with the service provider for 99.99 percent uptime of WAN Links. MSPs are evaluated on this. However with private service providers today, the liasoning activity has reduced substantially.” Outsourcing network management help organisations address challenges that they face, freeing them from running day-to-day infrastructure operations, allowing them to focus on their core activities of service excellence rather than complex technology decisions. They like to partner with MSPs, who have the right monitoring tools (industry standard, best of breed) to proactively detect network problems and tools scaling to monitor servers, databases, applications, Web infrastructure with possible solutions and conduct root cause analysis. Most importantly to share detailed reports on managed elements or infrastructure in real time by means of business dashboards for CXOs or operator consoles for the IT team.

Revolving around FCAPS

As networks became more complex with numerous applications and services running on them, Indian businesses have started outsourcing their network management needs to network management service providers. Additionally businesses have started consolidating their IT infrastructure to reduce the operational cost of managing networks and they need a solution that can help them fine tune their infrastructure so that it can be monitored 365x24x7 with 99.99 percent availability. Nithin says, “Primarily businesses are looking at FCAPS (fault, configuration, accounting, performance and security management). The whole concept of network management revolves round three concepts. They are the network management foundation which includes software as well as hardware, security and compliance. The latest technology enabled offerings are helping organisation stop data leakage and manage networks with ease. Nowadays there is no single management centre which has led to the growth of Network Operation Centres (NOC). NOCs help CIOs centralise everything with consistent and consolidated systems.”

FCAPS, being an ISO framework for network management, gives vendors and system integrators a solid chassis to build a solution upon. However, as mentioned above, this framework needs to gel with a larger framework for IT service management. It should be able to address the entire IT landscape consisting of applications, networks, security, data centre. Kiran Bhagwanani, vice president Sales, APAC & ME, HCL Comnet says, “HCL follows ITIL processes as its IT service Management framework. All our processes are ITIL compliant with most of our delivery centres are BS15000 certified. Also, being the Cisco’s Gold partner and a large system integrator with a global clientele, we manage close to 15,000 links and over 1,00,000 network and security devices. We offer this service using a Web-based, on-line portal called “mydashboard” based on the ITIL service framework. We firmly believe that this solid focus on Infrastructure Management can transform an organisation’s IT infrastructure from being a necessity to being a source of competitive strength.”

Even though the cost of IT equipment has fallen over the years, the amount of equipment in use has gone up with IT aligning itself towards business goals. Along with this the cost of maintenance has gone up because the price of downtime is loss of business. Saji says, “Sify has comprehensive offerings starting from network operations and management (FCAPS) to network audit, optimisation, engineering, design solutions for customers. In terms of network related services, we offer wireless (WiMAX) solutions to customers for faster implementation. Triple play support and IPv6 ready network services are key areas for us.”

CIO’s dilemma

With the advent of multi service platforms, the various challenges that the modern day IT managers are frequently faced with are in the areas of traffic engineering and management, which now form a key part in maintaining the desired service levels. Bhattacharjee says, “It is suggested to look into outsourcing network management especially if it is not the core area of an organisation and stands to gain in the long run. The path to outsourcing has to be treaded with caution and lot of care needs to be taken to put appropriate controls in place to ensure that the outsourcer’s business interest is protected and that service levels improve. There is also a need to figure out the success criteria for measuring the advantages of outsourcing.”

In a way, one does see cost effectiveness as a result of outsourcing network management. The biggest benefit is that an organisation can expand since it can focus on its core business. Organisations are able to grow their revenues since network management is a key element for growth. With reduced bandwidth prices and easy availability of bandwidth, organisations are also enjoying the benefits of reduced transaction costs. Bhagwanani says, “2006 saw increased pressure on CIOs to cut costs, amidst the emergence of new, bandwidth-hungry applications and amplified performance demands. We see maturity in the sense that the industry will no longer be able to sell ‘best-of-breed’ devices on the basis of traditional measurements of performance like throughput, speed etc. Organisations will demand a strong service portfolio from network integrators, with great emphasis on an excellent network management record. 2006 saw small offices getting routing, wireless, voice and security in one box. Unified communications and the like have begun putting pressure on bandwidth and ease of management. Organisations are likely to respond in 2007 with a clear demand for solutions that give them a sense of control over their complex infrastructures.”

The CIO is not looking so much to reduce cost of discrete operations but to manage things cost effectively and push total business value. This is in line with new thinking that IT overall is no longer a tool to support business but rather a business enabler. Motwani says, “It is definitely cost-effective to outsource infrastructure management. IT Infrastructure Management applications play a critical role in monitoring and measuring the performance of the network, across local and wide area links. Having said this, businesses today do not view outsourcing as a tactical decision to save cost. They rather view it as a strategic business decision that facilitates cost containment and provides a knowledge domain to bring innovation and provide competitive advantage.” The CIO today is getting caught in transactional issues though he needs to focus on larger strategic business issues. The other challenges include over-dependence on service providers, inadvertent human errors, skilled manpower and manpower to mange the expanding and dispersed IT infrastructure set-up. Amidst all this, there is a silver lining as CIOs explore novel and less-expensive ways to overcome these challenges.”

Bhagwanani says, “Converged networks are also on the rise. Businesses are looking to leverage their existing infrastructure and investment by incorporating new technologies such as video and video transfers on existing networks. Uptimes have ceased to become a significant concern for customers. We do network planning and optimisation which ensures application availability and acceleration, monitor and manage network application performance, collect traffic and other data, manage incidents and problems and ensure strong reporting.”

One interesting trend which is evolving is many organisations is that they are looking for specialised skills and are willing to have multiple vendors (than a single vendor who does everything) for IT, desktop management and network management. They are especially looking for providers with domain expertise in network and data centre management. There is progress from a ‘per person model’ to ‘device or transaction’ based model. D’Souza says, “Networks are becoming far more integrated into the enterprise computing architecture, but most IT organisations lack the depth of knowledge to deal with this area. Managing voice, data and followed by video on network infrastructure is the upcoming key trend. Business dashboards on network uptime are becoming crucial to measure network services and the management of these diverse heterogeneous environments.” IBM has also acquired Vallent which is a leader in the Service management and performance management space in the wireless telecom service provider space. He further added that with Tivoli Netcool solutions for Managed Services, MSPs will have a complete and transparent view of their infrastructure, their customers’ infrastructure and the services they provide to customers.

There is flexibility to support customer applications even as customer environments and applications evolve. It also provides precision monitoring and automates service assurance processes. Organisations and CIOs are looking at managing IT from a business perspective and aligning the IT Infrastructure to business needs and goal. The aim is to provide users with a single interface to understand the IT performance and the SLA status of the IT Infrastructure and its impact on business.

Small to medium sized enterprises have aggressively begun exploring the outsourcing of infrastructure management. This has seen the emergence of a new set of players—Tier II System Integrators, who are further expanding the IT Infrastructure Management space by redefining their portfolios. Not only are they undertaking complete outsourcing but they are also exploring new tools for monitoring and network management. Motwani says, “It is an exciting time for us at Raritan. In the coming months we will be introducing intelligent power strips that will distribute, monitor and manage power. We call this an intelligent power strip because users will also be provided with flexible secure remote access options. Our access solution will now have a next generation hardware architecture that will provide BIOS level control with absolute mouse synchronisation. The industry’s highest port density, stand-alone operation, dual power, authentication and authorisation options are other new features. Coupled with our monitoring tool, it will provide for seamless asset management, intrusion detection and vulnerability scanning.”

Multiplicity driving growth

In the network, the basic plumbing your routers, switches and cabling may stay more or less the same, at least for the next few years. The way you think about and manage that plumbing changes frequently, however. Multiple branch offices have driven the need for better management tools in the networking space. D’Souza says, “Growth and complexity of leased line infrastructure necessitate good network and service management tools. Multiple users, locations and applications drive the need to have a complete view of the application infrastructure (application and database servers) and be able to monitor and manage and plan capacities based on actual usage patterns, behaviour and stability of the same. Increasing usage of voice and data over the same circuits adds to the complexity of management. Customers hence have to become more demanding rather than simply asking for Up or Down status of links. They have to look at more pre-emptive or predictive management of networks. Proactive management by setting thresholds and alerts have become the order of the day for fault management.”