Architecting networks are once again back in vogue. But with executive management still disillusioned with IT after the internet bubble and telecom crash, most network architects are finding that their designs have to be put into a budget and sold to executive management, and depending on the size of the spend, the Board of Directors (BoD). This planning process usually includes three professionals: the network architect, the Chief Information Officer (CIO) and the Chief Financial Officer (CFO). While many network architects view this as a stressful and unpleasant task, it does have an upside. In short, networking is
becoming the single most important IT activity in corporate board rooms, thanks both to this new scrutiny and, frankly, exposure to the economic and business benefits networking affords to the most senior executives within corporations. Unparalleled US productivity increases over the past five years are being widely attributed to the corporate use of networking technology, applications and services.

In this Lippis Report we provide assistance to the network architect and CIO in up selling their converged networking plan to the CFO and eventually the corporate BoD.

In 1991 I wrote an industry report entitled ?¬¢‚Äö?ᬮ??¨The Internet Decade?¬¢‚Äö?ᬮ¬¨?? which was published by McGraw Hill. Just for reference, in 1991 voice dominated corporate networks, the Internet was still locked within the confines of government and academic institutions, LANs were just starting to be implemented and IBM´s SNA was the dominant networking technology in use. Our goal was to sell reports. We didn´t sell that many since a huge ?¬¢‚Äö?ᬮ??¨The Internet Decade?¬¢‚Äö?ᬮ¬¨?? supplement appeared in Data Communications magazine, but that supplement was widely read and very influential. I´m not bragging, but we were dead on. I am convinced that IP Communications will be bigger and have a far greater impact on corporate performance than ?¬¢‚Äö?ᬮ??¨The Internet Decade?¬¢‚Äö?ᬮ¬¨?? had on corporate operations. What convinces me is the consulting work I have been engaged in over the past three years and how the equipment suppliers and service providers are re-tooling for IP Communications. In short, we are in a two-phase industry
evolution. The first phase is the fact that equipment suppliers and service providers are giving away IP telephony and VoIP to lower the barrier of entry of this technology into corporate networks. Giving it away? Yes giving it away. IP telephony, if done right, will reduce the total cost of network ownership by as much as 30%. Some of my clients have a $100M annual budget for telephony and data networking which will be reduced to $70M over a four-year period after their converged network is fully operational. That is $30M in increased profit. IP telephony is a technology platform, which gives way to the second phase: IP
Communications is a business platform. Think of it this way — IP telephony is a PC and IP Communications is the software application business runs on. This second phase is just taking shape, and our industry is in the process of implementing a new organizing principal to create an ecosystem that will enable many companies to build IP Communication applications, which run on various IP telephony platforms.

So how does all of this help you up sell your converged network plan to the CFO and BoD? Simple. The vendor and service providers will make it increasingly difficult and costly to run networks the old fashioned way (i.e., separate voice and data networks). Over the next several years it will simply be too expensive to run two networks, your corporation will fall behind its competitors who adopt IP Communications and you will be increasingly pressured by your customers and suppliers to adopt and implement your own IP Communications strategy. So here are some helpful hints on up selling your plan.
First, you need to architect your network, taking into account business requirements and the existing state of your network and staff. This process is often best done by consultants since they are best equipped to extract business requirements from managers and impartially assess and calculate the current network cost. Consultants also have a wider and deeper view of vendor and service provider offerings while IT staff are confined to their existing vendor set. In this architecture development process don´t forget to add mobile devices and associated cost. For most of my clients mobile spend is nearly equal to toll. Mobility has to be included if you want to provide a true representative view of all network spend and technology used.

So the first step in ?¬¢‚Äö?ᬮ??¨Up selling your IP Telephony budget to your CFO?¬¢‚Äö?ᬮ¬¨?? is to start a network architecture review driven by business requirements. In part 2 of ?¬¢‚Äö?ᬮ??¨Up selling your IP Telephony budget to your CFO?¬¢‚Äö?ᬮ¬¨??, I´ll give you the Lippis Top Ten Convergence Budget Assumptions.

Posted 3 October 2004 at 7:06 am under Lippis Report, Enterprise Mobility. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.