Which vendor?

In region that is renowned for its conservative culture, enterprises rarely choose to change vendors once they’re comfortable with an infrastructure. In the second part of our datacentre roundup, we ask why.

Tags: CompetitionF5 NetworksKamal Osman JamjoomMiddle East Communications Networks (www.mcnholding.com)Roads and Transport AuthorityUSA
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Which vendor? If one person is going to make a decision for the entire organisation, it’s not going to be right, says KOJ’s Rizvon.
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By  Imthishan Giado Published  October 21, 2010

In region that is renowned for its conservative culture, enterprises rarely choose to change vendors once they’re comfortable with an infrastructure. In the second part of our datacentre roundup, we ask why.

Change is not a natural human state. Whether it’s as simple a change as choosing to eat a different breakfast cereal in the morning, or deciding on whether to buy a different toothpaste while standing in the supermarket aisle, change confronts us each and every day. And most of the time, we sidestep these confrontational choices with vigour, comfortable and safe in our own little worlds that our needs are met by what we know.

Likewise, information technology is not normally ground zero for change. Once an enterprise has settled on a particular technology, it generally stays locked into that choice for long as possible. Part of the reasoning behind that rationale comes from a financial perspective; to use our supermarket analogy, this is a $100,000 tube of toothpaste and most CFOs will attack it with a rolling pin if they can squeeze a little bit effectiveness from it.

Kamal Osman Jamjoom’s group IT manager Mohammed Thameem Rizvon says he generally plays safe when it comes to infrastructure, and confirms that the cost – or at least the perceived cost of change –can be a stumbling block to change.

“Why do you get into a comfort zone first of all?” he asks. “When you decide on an infrastructure, there’s a lot of things to it. One is your cost. If you change anything there’s going to be a lot of cost. Let’s say you’ve been running on an IBM P5 server. You want an extra Sun box – that’s fine, but if you’re going to change your IBM P5 into a Sun M5000, that’s a lot of extra cost.”

Few vendors would doubt that switching to a different vendor is not a cheap proposition – and indeed, it’s one of the things that they like to gloss over during the PowerPoint presentation when they’re trying to grab a client from a rival. But for Samer Shaar, enterprise regional managing director for the Middle East and Africa at Juniper Networks – and it must be noted, the only vendor we spoke to that would publicly comment on this quite contentious feature – costs higher or otherwise, must be balanced with the possibility of redistributing resources elsewhere in the IT infrastructure.

He says: “According to a study by McKinsey & Company, IT investments fall into three basic categories: “Staying in the race”, “Winning the race”, and “Changing the rules”. The latter includes deploying innovative, high-risk/high-reward technologies that open new markets or enable the business to offer new products or services that are substantially different and more desirable than anything else on the market, thus redefining the competitive landscape. However, the percentage of the IT budget that a business commits to each category depends largely on its competitive position and its future aspirations.

“High-performance businesses, which are continually looking for ways to streamline business processes, quickly capture new opportunities, mitigate and attack operational inefficiencies, are investing more in innovative “winning the race” and “changing the rules” technologies. With these businesses, the investment distribution is reversed, with an average of 60% committed to innovation and the remaining 40% devoted to operational considerations. We notice that in these cases, organisations are more concerned with the benefits and vendor than the actual cost of the new solution. The benefits include a better TCO, OPEX, RoI, performance enhancements, flexibility and expandability, reduction in operational costs, time, waste, redundancy, resources and so on,” he continues.

For Indranil Guha, manager, for IT infrastructure management at Dubai’s Roads and Transport Authority, he believes that the culture of low risk-taking has much to do with the fact that many enterprises don’t do their homework properly.

“People are sceptical of change because they are not sure of the risks. You can mitigate a risk when you can quantify it. I have seen people looking at risks without the proper methodology of quantifying risks. If that is not done, risks look enormous,” he says.

With the larger projects that he and his group engage in which are country-wide in their execution, it also becomes exponentially more difficult to change course – which for Guha, add up to the sense of complawhich can afflict many of the region’s enterprise organisations.

“They get comfortable over time. It’s not just about the cheapest offer for most organisations. It is a mix of good value propositions. If the RFPs and all these are not done very well, then there are creeps in the  project and these obviously go to the same vendor, because you can’t change vendors in the midst of a project,” he states.

“Over time, they see that these changes have been managed by the vendor and they feel comfortable. When the next project comes, they think about how the previous one was well handled, even thought there was a little bit of cost and time overrun. We’d rather stick to the same vendor, rather than taking a risk of another where we do not know what the time or cost overrun would be. Here at least, it is a known factor. As people say, the known devil is better than an unknown friend,” he relates.

Why bother?

With all the hassle that’s involved with shifting to a different vendor, the obvious question that needs to be asked is: why think about doing it in the first place?
The reason is simple: competition. Evolutionary change comes about because a new organism appears with a select mutation which proves advantageous compared to the norm. Natural selection favours it, and eventually it becomes the new norm. In much the same way, IT vendors will quite happily sell you the same gear year after a year, and your team will keep implementing without thinking too hard about it, unless you go out and look for something which moves the game on.

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