Lippis Report Issue 100: A New Approach to Branch Office Networking and Communications Emerges

Network services follow computing and application paradigms. IBM's SNA extended mainframe-based transaction processing applications over large distances between the 1960s and the 1990s. SNA was/is a deterministic delay network assuring strict response time for applications and thus a consistent user experience. During the 1990s multi-protocol LANs connected over WANs supported client-server computing and desktop productivity applications. Networks were required to be multi-protocol while supporting bridging, switching and routing and provide best effort packet transfer. In the late 1990s into 2000 converged IP networks supported web-based applications and the beginning of IP telephony. This generation of networks was required to deliver quality of service to applications, support faster bandwidth speeds and deliver power over Ethernet to various end-points. Today the demand is for networks to support unified communications, web 2.0 applications, and mobility in addition to decades of legacy applications. As networks transitioned through these stages network services were added to support a changing computing and application environment.

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But it's not just computing and applications driving network services; changes in the way corporations distribute human and capital assets also impact network service, which brings us to today. US corporations are hollowing out headquarter facilities and distributing resources to data center and branch offices. These trends have ushered in new options and designs for branch office networks and communications, which I call Branch 2.0

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Branch offices have always been limited in their IT personnel due to cost constraints. Paradoxically Branch 2.0 leverages networking, communications and IT to deliver on strategic corporate initiatives by improving customer experience, and providing employees with the same IT services to which headquarter staff are accustomed. To meet this end, Branch 2.0 IT architecture includes IP telephony or Unified Communications and state-of-the-art networking.

For example, many business thought leaders in financial services are exploring how best to leverage their branch assets to up- and cross-sell customers while improving the branch office experience. These thought leaders are collectively thinking in terms of Branch 2.0, which from a real estate and staffing point of view is a smaller footprint but rich in IT. Here intelligent video is a key IT attribute of Branch 2.0, assisting customers selecting products or services that meet their needs out of potentially 100s of possibilities as it is impossible for limited branch office staff to be experts with this number of products/services. Staff experience is a critical factor, limiting the number of products/services that can flow through retail branch offices. In this case Branch 2.0 seeks to address the main concerns of retail banking executives such as:

  • Constrained staff skill levels
  • Right here, right now customer transaction requirements
  • Broad lack of loyalty, thanks to increased competition
  • Using the large branch office footprint to up- and cross-sell existing customers while gaining new ones

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IP telephony is the platform that enables a wide range of communications-based applications such as UC and a wide range of as yet unforeseen Communications Enabled Business Processes (CEBP) improvements. Business and IT leaders in the financial services sector have a broader UC framework that extends beyond desktop and mobile phone communication launch points to a UC that is tied deep into business process which satisfies a competitive business requirement. Soon retail banking customers will experience a new level of personalization at the branch office when they interact with a digital sign that connects them directly to a loan officer or bank expert who can assist them in product selection. This is but one example of a new level of communication-enabled personalization that is driving branch office value creation.

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Retail customers demand personalized and relevant brand interaction at every touch point, be it web, call centers, online and particularly in-branch. The brand experience must flow consistently across these channels. Smart multi-channel retailers "“ especially those with traditional branch marketers like department stores, home improvement, retail banking services, even branch-delivered healthcare "“ are realizing the value creation possible by investing in communications innovation of their core brick and mortar investments. This alignment of the customer experience across channels ensures consistently good customer interaction, increased productivity and, ultimately, brand loyalty and increased revenues.

Retailers, particularly in financial services are now beginning to see the role that distributed workforces can play in delivering customer value. Value is created by connecting this workforce to the customer and the retailer’s core operations, essentially placing personalized branch expertise wherever the customer happens to be. Personalized customer experience at branch offices offers new levels of top and bottom line success for retail business. Networking and communications innovation is at the root of this new value creation.

The UC providers such as Avaya, Microsoft, Cisco, Siemens et al., are leveraging their system integration resources along with their contact center and UC solutions to deliver customized Branch 2.0 implementations. For example, Avaya has a dedicated team focused on branch office solutions in retail and financial services, which customize UC, and CEBP solutions for Branch 2.0 prospects.

In addition to UC and its various application enablers networking has evolved to support Branch 2.0 requirements. For example, companies such as Cisco, Nortel, Juniper, Riverbed et al., have integrated many networking functions such as security, switching, routing, UC, WLAN, application delivery, etc., into a single platform to ease management and operations while supporting new value creation models in support of strategic corporate initiatives.

One of the big innovations in 2007 and one which will continue well into 2008 and beyond is application delivery or what I like to call Application Network Delivery (AND). This market, while segmented into at least three parts is focused on increasing application performance over networks. There are a wide range of firms participating in AND including Cisco, Riverbed, F5, Bluecoat, Foundry, Packeteer, Certeon, Exinda, Silverpeak, Palo Alto Networks, Citrix, A10 Networks, Juniper, and Nortel. Some of these firms such as F5, Bluecoat, and Cisco are focused on load balancing in data centers to increase application performance of both public facing web sites and branch office applications. Others such as Cisco, Riverbed, Foundry, Packeteer, Certeon, Exinda, Silverpeak, Palo Alto Networks, Citrix, A10 Networks, Juniper, and Nortel offer either integrated or single function appliances located at branch offices which increase application performance over thin wide area network links.

When discussing branch offices and Branch Office 2.0 it is impossible to ignore Cisco, which has shipped over 3 million ISRs in less than 3 years and over 1 million Catalyst 2960s in the last two years. Cisco, the leader in the integrated approach to Branch 2.0 networks has integrated network security, switching, routing, UC, application delivery and mobility into the ISR family of products. In September of '07 Cisco added the new High Capacity WAAS Module or NME-522 and Cisco IOS Performance Routing PfR to increase application performance over wide area links. In addition Cisco added a NAC appliance or NME-NAC for 50 and 100 users, which integrates CAS (Cisco Clean Access Server) functionality and supports the 2811, 2821, 2851, 3825, 3845 ISRs. In November of '07 Cisco added Intrusion Prevention System (IPS) advanced integration module for the ISR plus a suite of unified network services and communications.

A lot of new networking and communication technology has matured together to offer a new range of options in which to build Branch 2.0 office and retail networks. Business requirements will guide design options. Many business leaders require an open architecture where choice at the network and communication layers are required. Branch 2.0 is an open approach to exploiting one of the largest and strategic corporate assets, that being the large foot print and touch point of branch offices. Branch 2.0 communication is UC and CEBP-based while its networking utilizes AND techniques and technology to accelerate application performance. When designing a Branch 2.0 solution first gather strategic initiatives and business requirements. Map these business requirements against network and communication (NaC) attributes by creating a NaC requirement list. Use the NaC requirement list to develop a Branch 2.0 architecture which identifies stability points such as Ethernet and SIP, interfaces, services, management and operational models. The architecture is the blue print or framework to which all IT can reference and build up to. The Branch 2.0 architecture is also the bridge between business requirements and branch office evolution. Once the Branch 2.0 architecture is agreed upon then an evolution plan can be developed which dictates the pace of implementation, be it event-based or short term upgrade. This evaluation plan will be the basis for a request for quote (RFQ) document that will be distributed to suppliers to bid upon.

One Response to Lippis Report Issue 100: A New Approach to Branch Office Networking and Communications Emerges

  1. Tamra Flenniken said:

    Well done…