The majority of network devices in today's corporate networks around the world are either ageing or obsolete. This is the highest percentage in six years. An additional 27% of all devices are 'later' in their product lifecycle and at the point where vendors begin to reduce support.
These were the findings of the sixth Dimension Data Global Network Barometer Report, which attributes the prevalence of these ageing networks to a steady organisational call for budget savings - particularly on capital spending - disrupting three- to five-year refresh patterns.
"Organisations are sweating their network assets for longer than expected," said Raoul Tecala, Dimension Data's business development director for networking, when the report was released.
The report was compiled from technology data gathered in 2013 from 288 technology assessments covering 74 000 technology devices in organisations of all sizes and all industry sectors across 32 countries. In addition, data was gathered from 91 000 service incidents logged for client networks that Dimension Data supports.
Brainstorm spoke to three South African CIOs about the realities of businesses functioning in an IT environment in which so much progress is promised, but so few networks are up to the challenge.
The horse's mouth
Even within an IT giant like Dimension Data, ways need to be found to extend the life of its IT assets. Says Laurent Leclercq, the organisation's CIO for Middle East and Africa: "There's significant pressure on organisations to reduce costs across the board, and the IT department is not immune to it."
He says that this pressure doesn't just apply to networking equipment, but requires IT departments and consultants to extend the useful life of all IT assets. He points out, however, that he doesn't believe this has had a detrimental impact on innovation.
"The key for us has been having a strategic plan for the evolution of our IT infrastructure and looking at all IT investments through this lens to help prioritise projects. This includes revisiting the strategic plan on a regular basis to determine if current business conditions warrant a modification plan that could then impact prioritisation of projects and the associated allocation of resources."
Without this approach, he says, the risk of impacting innovation or delivery capability would be much higher.
We're looking at innovation, but mostly we're just maintaining.
Rubens da Silva, Johannesburg Water
He also points out that the report highlights that, generally speaking, the proportion of ageing and obsolete devices will increase. Conventional wisdom would assume that a technology refresh cycle was imminent, but the data reveals that organisations are sweating their network assets for longer than expected.
Sweating for water
Johannesburg Water CIO Rubens da Silva bears this out. He says their network position is that they are, indeed, sweating their assets. "We have budget constraints," he says. "We're looking at innovation, but we're mostly just maintaining."
He says that as a utilities provider, Johannesburg Water has no direct competition, so extending the life of their network assets won't have a direct impact on their competitiveness. "But we do benchmark against other providers on a national scale and people will ask us why our service delivery isn't up to standard."
He also points out that at Johannesburg Water, technology doesn't improve service delivery directly, but rather provides supportive internal services.
"We operate independently. Technology allows us to deliver efficiencies within the business, like mobility or access to innovation. We don't necessarily have a customer focus. Instead, we deal with indirect issues like keeping the system up and running and ensuring that communications channels are open. Obviously, these systems impact on our service to our customers indirectly."
Among these supportive technologies is the SAP system that the water provider runs, and an SMS service to allow customers to communicate with them.
He also points out that while cloud solutions offer some respite for organisations with budgetary constraints, he doesn't believe South African bandwidth supports this sufficiently to make it a realistic proposition just yet. "It's currently too expensive and concerning from a trust and security issue, but for organisations sweating their assets, it's an attractive option in terms of not having to outlay more capital for network equipment."
He says that broadly speaking, he believes IT is offering business networks incredible advantages in the form of the convergence of voice and video on a single wire, but in various industry roundtables that he has participated in, it has emerged that very few companies have adopted a converged network. "I've been surprised," he says.
Sweating for glass
Despite admitting to pushing their assets to the absolute limits, Consol Glass does have a fully converged network for voice and data. Beyond that, where the company owns its network assets, they sweat them. "These are mostly inside our buildings and factories," says Johan Du Plessis, IT director at Consol Glass. "We paid a premium for Cisco to get extra life out of the installed kit."
He says this approach is working for Consol, and that software updates have kept them going for all the functionality they've needed so far. "Budget constrains will see us pushing this to the absolute limit," he says.
He does point out that as a manufacturing organisation, their network's deliverables are not particularly demanding so extending the network assets' life doesn't impact on its ability to deliver on corporate requirements.
"Newer smart network functionality doesn't have a business case yet; we're not a financial institution but a manufacturing concern and the internal networks kit still serves our needs just fine."
For everything else, he says, Consol is fully outsourced to an MPLS vendor, which keeps their network equipment current as part of the service. "Therefore, it's not a problem," he says.
From high-end network functionality to low-end use, it seems IT decision-makers are being called upon to ensure that if a penny is spent, it's absolutely vital. While all three CIOs say this approach isn't yet impacting on business innovation, at some point the cycle of renewal will have to begin again.
First published in the September 2014 issue of ITWeb Brainstorm magazine.
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