Professional Services

Focused on operational efficiencies

The services sector had put the basic technology in place. Networking and connectivity top its current agenda. By Vinita Gupta

The companies in the Professional/Other Services vertical consisted of a complex mixture of LB firms that were primarily engaged in providing a range of day-to-day office administrative services, such as financial planning, billing and record keeping, personnel, and physical distribution and logistics such as healthcare, hospitality, media publishing and more. It covered a vast range of businesses involving comparatively little capital investment, leading to gainful employment and had a good potential for export revenues. Logistics, telecom companies and hotels were part of this sector. The top business priority for companies in this segment was geographical expansion. IT transformation was a key factor in achieving high performance for retailers.

Still creating the basic infrastructure

As per the survey companies in this sector had made steady investments in creating a basic IT infrastructure. The deployment of desktop PCs and notebooks was 100%. Thin clients had a penetration of 41%, which was on the higher side high, as the small and medium businesses in this sector did not have such widespread implementation of thin clients.

In 2008-09, 26% of these companies were planning to invest on desktops, 24% on notebook PCs and 28% on thin clients. Like any vertical, top brass and marketing folk were using notebooks. Desktops and notebooks had become business enablers.

BSNL Mumbai had more than 200 desktops. Around 90% of its PCs had broadband Internet connections. A source at CGM, WTR (Western Telecom Region), BSNL Mumbai informed, “We use P5 desktops and various configurations of notebooks from IBM, HCL, etc. We work out the balance with the price of products from different vendors. The notebook PCs were used by our senior people and maintenance staff to monitor the performance of our solutions at remote locations—this was a strategic area for our operations.”

Livelihood Improvement and Focus on Empowerment (LIFE) a civil society organization and resource agency was using Acer and Compaq desktops and notebooks. Sriram Kannekanti, Senior Consultant, LIFE said, “I had tried my hands to know about all available notebooks in the market. We were interested in buying Dell, but there were no retailers [Dell did not go through channels in the past although that had changed of late]. We were supposed to place orders and make prepayment online. Consequently, I bought Acer notebooks with AMD Athlon processors. One notebook was getting heated within 5 minutes into booting. The dealer from whom I had bought the notebooks told me that this was due to the AMD processor, which was heating up, but he had failed to inform me about this before the purchase. So you see there is no proper guidance for the buyers in the market place. Hand-holding is important if you are making investments in IT.”

Networks are in place

The survey indicates that 89% of these companies had a LAN in place and 32% were planning to invest in LAN technology this year. 93% of these companies had a WAN. Leased lines were the most popular means of connectivity (78%) for a WAN followed by broadband (74%) and VSAT (15%).

What was surprising was the fact that LBs continue to use hubs; 59% of the companies were using hubs. That does not, however, mean that switches are not used widely as the same percentage of companies were also using switches and 25% were planning to invest further on switches while investments in hubs were tapering out. The reason why these companies were making low investment on hubs was because switches offer better performance. Large companies preferred managed switches to unmanaged ones.

For example, BSNL used managed switches from D-link and Cisco as they believed that performance in the case of managed switches was better and that problems could be easily identified in the case of a managed switch and hence maintenance became easy.

Most of LBs in this vertical had chosen a mix of copper (81%) and fiber (70%) cabling for the connectivity infrastructure. However, they were planning to invest more on copper cables (16%). Although fiber works better over long distances investment plans for it were lower (8%). The reason for such low investment on fiber cable would be the low usage of broadband, as the higher uptake of fiber optic cable will depend on the success of broadband services. Several broadband service operators, in fact, had already laid out kilometers of fiber anticipating huge demand.

As far as fiber to the desktop was concerned, it definitely offered advantages in terms of high bandwidth throughput, but its adoption had been slow in the recent past, primarily owing to high costs as compared to structured cabling options (copper).

These companies preferred Cat 6 cabling. BSNL had used Cat 5 structured cabling for connecting its office but it was looking at Cat 6 for future investments.

BSNL uses Juniper routers at the gateway level. The source at BSNL said, “We were looking at wireless routers to provide WiMAX services to our customers and not for our own use as at present.” WiMAX has emerged a hot technology for rolling out Wireless Broadband Access (WBA) where last mile and backhaul was a problem. Reliance and BSNL had already rolled out their WiMAX based WBA for consumers and SMBs.

Connecting offices

Professional services firms were mostly using leased lines and DSL for connecting their different branches with penetration of 70% and 74% respectively. That does not mean that they were not using other modes of connectivity. In fact, depending on their requirement they were using all kinds of connectivity. For instance, if they need to connect offices located in rural areas they would resort to VSAT (37%). ISDN and Wi-Fi had a fair degree of adoption (30%) each. As this sector provided services to customers situated anywhere it needed proper infrastructure in place. For instance, BSNL provided services even in rural areas.

The BSNL source said, “As we were the network service provider we used different kinds of networks such as VPN, Gateway, broadband, etc. We also used a combination of leased lines for point-to-point connectivity and broadband. To connect the major locations we used MPLS of 2 Mbps bandwidth and smaller offices with 5 to 10 people were connected through broadband. We had our data center at 4/5 locations in India and they were connected through leased lines with 2.5 Gbps of bandwidth. Our core revenues come from connectivity.”

The survey indicated that the professional services sector preferred leased lines and broadband over VSAT, but this sector has no huge investment outlays as these companies already had robust WANs.

Kannekanti revealed, “Our primary need for connectivity was for Internet. We used Outlook and Thunderbird for sending regular mails. We preferred Sify broadband over other service providers because their customer service was comparatively better. Other providers give modem-based connections, which we do not prefer and additionally there was no transparency in billing. For Sify we selected a prepaid package and were more comfortable with it.”

According to the survey, 74% of the companies have a Web site followed by intranets (44%), developing and deploying Web services (33%) and e-commerce (B2B) (44%). 35% intended to invest further in Web sites and 16% in B2C applications.

Servers and printers

Since a large number of LBs were putting up their Web sites and expanding readily, the underlying technologies to support this and other business critical applications—servers, connectivity and printers—would be given attention in 2008-09.

The survey indicated that although the professional sector preferred Windows Server (81%), UNIX and Linux were also quite popular with 48% each. Going forward both Windows and UNIX servers would be of equal importance—each winning the favor of 20% of the respondents. Linux would be invested in by 16%.

Kannekanti explained, “We used Windows server for our main application because comparatively it was more economical than any other proprietary server platform and the skill-sets on the Windows platform were easily available and cheaper. Linux was a lonely child and we do not know whom to contact for the same. We would be interested in investing in it provided someone could demonstrate that our application can give higher availability using it. I contacted 10 shops but nobody seemed to be interested in giving a demo.”

BSNL used a combination of IBM and Sun servers (a combination of x86 and UNIX) that helped it run its billing applications. The organization follows a tendering process to select vendors.

Laser printers were used for printing customer bills and this is reflected in the wider usage by this vertical. Usage of lasers stands at 100% followed by inkjets with 74%, DMPs with 56% and MFDs with 37%. Projected spending on thermal printers was highest (29%), followed by digital copiers (30%), MFDs (20%) along with laser printers and inkjets (16% each) in 2008-09.

Security and storage

Most professional services companies already had a robust perimeter security infrastructure with anti-virus, anti-spam and firewalls in place.

This sector was using all types of security solutions but anti-virus tops the list as per the survey. It indicates all of them were using anti-virus solutions followed by 67% of them using PC-based firewall security, 52% using anti-spam, 56% using network-based firewalls and 33% anti-spyware. Anti-virus will continue to be a strong area of focus within security as 20% were planning to invest on this category in 2008-09. On the Internet side, BSNL uses firewall and anti-spam and anti-virus for the PC.

Other security areas such as content filtering, deploying/enhancing biometric security and penetration testing were not of high importance for this vertical.

When it comes to storage, LBs in this vertical continued to use rely on DAS (52%), NAS (37%) and SAN (26%). Tape was primarily used for backing up data and 50% of them agreed to it. VTL usage was also high in the case of telcos—33% were using it. The BSNL source informed us, “We use a combination of NAS and SAN for our data center. We had already done the storage consolidation and segregating storage helps in reducing storage costs and reduces complexity in managing storage resources. We used tapes to backup our customer and production data.”

Storage software was used for e-mail archiving (89%), followed by database archiving (63%), backup and recovery software (59%), storage resource management software (26%) and replication software (11%). The companies were planning to make the highest investment in backup and recovery software to the extent of 16% of the respondents intending to do so.

Logistics companies, hotels, retail outlets and other industries were making extensive use of e-mail communications, which was why most services companies already had these solutions or were planning to get them.

EWA for tracking

Enterprise messaging was the most popular EWA (63%), databases and ERP followed (56%) with CRM (33%), SCM (26%), BI and middleware (22% each) bringing up the rear.

Logistics companies were also front runners in deploying enterprise-wide applications. While tracking goods across the supply chain was a necessity, companies were also realizing the need for deploying enterprise-wide applications. This was because logistics companies were realizing that they had to move beyond shipment tracking to monitoring and tracking shipments proactively. They had even deployed RFID technology (15%) to track goods but had no investment plans.

BSNL was not using a standard off-the-shelf CRM solution. It was using an in-house developed package. The telecom major was implementing an ERP solution for its Gujarat area operations, which was in the pilot stage.

IT management and support

Over the years, the IT landscape had changed and become modular (mainframes to servers), while the infrastructure that supported IT in the data center had remained static from the mainframe era. It was therefore critical to get the right technology in place, which enabled businesses to be agile and support it as it grew and yet scalable enough to adopt technological and environmental changes in the future.

The professional services sector had also gone in for IT management and support including IT management (63%), consulting (33%), development and integration (22%) and process management (19%), network management (52%) document management (26%) and identity (22%) management.

Challenges faced

Even though this sector has deployed and was planning to invest in IT management and support, still there were many challenges faced by the sector in managing and upgrading IT.

Kannekanti revealed that they were facing some problems with regard to upgrades and adopting newer technologies. According to him, retail sellers or companies were not showing interest in upgrading systems or technology of existing customers and were concentrating on new customers or sales. Hence the companies needed to depend on private or unauthorized professionals. He gave examples. “We had a desktop with an 80 GB HDD and 128 MB of RAM. Now we need to upgrade it further to a 160 or 250 GB HDD and 1 or 2 GB of RAM, but OEMs and their channel partners were least bothered about our requirement. Then we need to consult private people for upgrading the system. The same was happening with regard to new versions. Take the example of MS Office 2007. We had installed it, but had problems when we sent Word documents to those who were using the 2003 version. MS Word 2007 documents will not open with older versions. Consequently, we needed to convert them it to make them Office 2003 compliant before sending to external users. This was a big problem for us.”

Being a government organization, the major challenge faced by BSNL were slow procedures and major competition in the telecom sector.

As this sector was on the growth path organizations were adopting and making investments on IT on a large scale, especially on desktops and notebooks, networking, connectivity and servers, but it was also important for IT vendors to provide the right solutions and training so that companies do not face any problem in using these technologies.

vinita.gupta@expressindia.com