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Sun 26 Jun 2005 04:00 AM

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Cash control

Money doesn’t only make the world go round, it also has a huge say in keeping the network on the right axis. However, this precious resource is not always in plentiful supply so Network Middle East explores strategies that can help network managers better utilise infrastructure to save money.

|~|AlSibai_Hatem_HR_m.jpg|~|“We researched available commercial and non-commercial solutions in a bid to address this problem and decided to implement SpamAssassin, an open-source project of the Apache Software Foundation.” - Hatem Al Sibai, chief information officer (CIO) at the Al Ghurair Group.|~|Arguably the dark days of network managers being asked to radically cut costs in their departments are over as confidence in IT spending recovers. However, the free spending late 1990s are unlikely to ever be replicated and from now on network managers must account for spending very carefully. While this is no easy task, if network professionals focus closely on technology, people and processes, they can succeed in keeping the wolves from the door.

Probably the most comfortable area for technical people to make cost savings is in technology. Network professionals are typically well versed in the latest products and innovations and are also on the look out for solutions that will differentiate their company and perform tasks more efficiently.

A great example of a technology group that can help in this regard is open source software. Being free, it lowers implementation costs for the enterprise but further cost savings can be made down the line using open source. It gives the innovating business the right to see and modify software code and allows the enterprise to tailor software to its own business. These solutions, if well executed, can save money in ways that are not forseen when the initial investment is made.

While the use of open source in the region is far from widespread, some companies are investing heavily in the technology. One such firm is the Al Ghurair Group, which has woven significant open source implementations into its IT set-up.

In early 2004, the Al Ghurair Group noticed a sharp rise in the number of spam e-mails being received by its users. The firm’s mail servers passed an average of 4,000 spam e-mails per day. The company assumed 15 seconds of lost productivity per e-mail, calculating that monthly lost productivity stood at an alarming 52 man days. In addition, spam accumulates costs due to wasted bandwidth and processing power, as well as eating up storage space. The Al Ghurair Group decided it was a serious problem requiring swift and effective action.

“We researched available commercial and non-commercial solutions in a bid to address this problem and decided to implement SpamAssassin, an open-source project of the Apache Software Foundation,” says Hatem Al Sibai, chief information officer (CIO) at the Al Ghurair Group.
SpamAssassin uses a variety of mechanisms including header and text analysis, Bayesian filtering, DNS blocklists, and collaborative filtering databases.

“Our infrastructure team took two weeks to complete the implementation and much to the delight of our management and users, our corporate e-mail environment has been practically spam free since,” says Al Sibai.

“Our decision to implement SpamAssassin was based on the product’s flexibility and effectiveness while the value for money was a welcome bonus,” he concludes.

This is a prime example of how technology, in a relatively simple implementation, can be used to make a huge difference to the company’s bottom line. However, we would sound a note of caution regards open source. While it can provide a flexible and cost-effective solution, it does not always come with the watertight guarantees offered in conventional software and almost always requires a high degree of tinkering and fine tuning on the part of the IT team in order to glean maximum benefits. For companies like Al Ghurair Group, which has a strong tradition of hands-on management and programming, this is an acceptable burden, but many companies would find themselves out of their depth.

“Open source is not right for organisations that do not have a DIY (do it yourself) culture. They will find projects overwhelming. But if a firm has a culture of building things and is comfortable with putting components together, I would recommend it,” says Al Sibai.

Technology is only one element in the equation, though, with people and processes other key ingredients. The perception of IT in the past has been that technical professionals tend to under-perform in these areas. The argument goes that they are not always able to align technology with business needs and are more comfortable talking technology than talking personnel issues.

The savvy network professional will realise that his system is only as good as the people that are operating it. The good news in this regard is that ever more qualified graduates are coming into the field and competing for the jobs that are available. This increased competition has allowed employers to raise the bar for entrance and demand wider and deeper skill sets of its employees. This also allows the enterprise to free up senior staff to tackle more profitable tasks.

“In response to changes in the enterprise, we are looking for a new breed of networking professional to take our business into tomorrow. It is possible to get junior engineers or network technicians to take care of basic tasks,” says Indranil Guha, head of the Network Services Unit at the Dubai Municipality IT department. “This allows senior network staff to work on management and control to ensure high standards of service delivery,” he adds.

As well as encouraging capable staff members to take on more complex tasks, it can also help to engender a feeling of ownership among staff. A great example of this is the Al Ghurair Group, which uses its hands-on lab culture to encourage staff to express themselves, which in turn builds staff loyalty.

Richard Jasnau, divisional manager of telco operations & infrastructure at Sahm Technologies, the technology arm of Emaar concurs with this sentiment.

“We get the best individuals possible and give them the responsible to make decisions. This gives them a feeling of ownership in the project they are involved in. Manpower is often the most important consideration in bringing projects in on time and within budget,” he explains.

A more dramatic way to cut manpower costs is to swing to the other end of the spectrum. Instead of empowering staff, enterprises can simply outsource network and IT management to another company and concentrate on its core business. This is a well-established trend in Europe and North America, although it has yet to catch on in a big way in the Middle East. This is due to the proximity of large pools of high quality labour at relatively low cost.

With outsourced services, the customer is buying the performance not the network and thus enjoys a cost saving compared to owned solutions.

“Customers can easily reduce complexity as well as operating costs by outsourcing network management to a service provider,” says Stefan Herrlich, president of enterprise sales at Siemens Communications. “Also because the management of a mixed network is complicated there is the option of outsourcing the task to a smaller company that specialises in that area,” he adds.

While outsourcing the IT department is a radical solution that tends not to appeal to the Middle East enterprise, it is likely that the degree of out-tasking will increase over the next few years. Areas like maintenance and support, and development and integration could be key targets for out-tasking. This allows the business not only to save money but to free up resources for other purposes and make use of specialised skill sets that may not be available within the company.

Even with sound technology and a capable and dedicated staff in place, the company cannot be confident of success in maximising bang for buck. Without refined processes, the potential for wastage is still high. However, once processes are correctly implemented the enterprise should be ready to generate profit and minimise cost.

“An excellent example of a Middle East enterprise refining its processes to cut costs is the American University of Beirut’s (AUB) drive to reduce complexity in its procurement cycle.

The issue was that the staff at the AUB had haphazard, ad-hoc demands for computing capability that could not be easily predicted. This led to a costly and un-standardised approach to equipment procurement. The AUB therefore decided to create a fast response network-based system.

“We research the latest computer models and the most common configurations are published on a custom built web portal where staff can log in and request the model that best fits their requirements and budgets,” says Rabih Itani, network and security manager, Computing and Networking Services, American University of Beirut (AUB).

When an end user makes a request, its starts a procurement process within the AUB’s Financial Information System (FIS). The IT support department is also alerted so it can prepare to install the requested computer.

“Before delivering the vendor must configure the PC within University guidelines. This process has proved to be very fast, scalable, agile and cost effective,” says Itani.

Processes are focused on getting resources and services to where they are needed when they are needed and a key development in process management is the Just In Time idea. Just In Time is a phrase that originated at Japanese car manufacturer Toyota. Originally, it described how material should be processed and moved in order to arrive just in time for the next operation.

“Timing for investments is crucial and the movement toward Just In Time deployment of inventory, manpower, empowerment, vendor negotiations, and performance is important,” says Sahm’s Jasnau. “The idea is to avoid redoing elements due to lack of detailed review, or have resources standing idly by,” he adds.

Whatever philosophy IT managers use to structure their strategy, attention to detail is crucial in making it work and with care the enterprise can spot potential cost savings.
When eTQM College implemented IP telephony it looked at more than voice services. The company spotted that cost savings could be made by migrating the fax server to the converged system.

“We use one primary rate interface (PRI) line from Etisalat for phone and fax. We were already we are paying for the PRI voice, so I decided to split the voice and fax into two different direct inward dialing (DID) numbers. We use one PRI for both functions while paying for one service,” says Sameer Khoory, IT manager at e-TQM College.

Through this simple measure eTQM College saves US$6750 (AED 25,000) each year, while being able to add an effective richly featured fax service for its employees.

The key is to cut costs sensibly without affecting the ability of the business to meet its objectives. Slashing costs too hastily or in a blind way without fully understanding the implications can have a catastrophic effect on the business and make it more difficult for the company to maintain stability in the long run.

“Within the networking world the satisfaction of the end user is the ultimate cost saving, since we derive revenue and increase usage based upon the quality of services,” says Jasnau. “So decisions to cut costs on service equipment or personnel could impact your customers and their ability to utilise your services and ultimately damage revenue,” he explains.

We have seen some excellent examples of how the enterprise network professional can fine tune his methods and carefully invest in promising but cost effective technology to build networks that do what they are supposed to without frightening the bank manager. Clearly, the key is not slashing costs purely for the sake of it, after all the business must spend in order to survive. It is more important that each bit of expenditure, both capital and operating, delivers on its expectations. Therefore, network professionals need to maintain a business-focused outlook to ensure that value for money is achieved.

“A network expert may no longer make decisions based solely on technology,” says Herrlich. “Like anything else in an enterprise, the infrastructure must be looked at in terms of an investment and its subsequent economic
benefits,” he explains.||**||

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