You: Roundtable - The press and e-commerce

The press and e-commerce

Network World, 7/26/99

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The participants:
Russ Davis
Ass't. director, network services, Ernst & Young in New York

Mike Hinkle-Morrison
Former CIO at Pier One Imports and CTO at TGI Friday's restaurant chain

Gene Rindels
CIO of Respironics, Inc., Pittsburgh

Brook Smith
Mgr., network engineering, Forum Financial Group, Portland, Maine

George Sullivan
Sr. network architect,Northrup Grumman, Bethpage, NY

George Yeager
Mgr., architecture and design, Columbia Energy Group Service, Columbus, Ohio
For some time now, the business press and even the general press have been covering network-related issues. Publications ranging from Business Week to the New York Times now routinely cover stories about new technologies, mergers of major network players and so on. What effect has this increased exposure had on your job?

Yeager: It's what's behind the press coverage that affects my job. And by that I mean network technology has really become a deeply integrated and a global business process. It's everywhere. And management now knows this. Networking has become a strategic factor for any business, as we just heard. And for telecommunications professionals, the coverage is helping to pull us out of the shadows of strategic planning and into the daylight. I think the press has really been a help in that regard. For me, it's easier to find an audience for proposals and to secure funding for a well considered project.

Rindels: I'd say that the heightened awareness for technology or information systems networks has had a positive impact. We are now becoming more and more a business partner and technology mentor as part of the senior business leadership team. And they are more aware now than ever of the effect that technology has on the way they serve and base their business to the customers.

Davis: Internally over the past few years at Ernst & Young, it has been recognized that our enterprise network has been one of the key enablers of technology initiatives, business processes, and also the growth of our firm. And our network has truly become mission critical in achieving the firm's business objectives. With the huge increase in publicity surrounding the network industry, all the mergers, and the development of a lot of these new technologies, our senior management awareness has been heightened dramatically regarding the complexity of networking, which is generally a good thing.

Our focus during the past year has been on processes, metrics, measurement, service level objectives and agreements, all of which somewhat demonstrate the maturity of the network that we have in place. And we really have very few issues concerning network availability and performance. Overall, the increased cautions and concerns on the part of senior management are either warranted or not, depending upon how you positioned your company's network for the future and also the stability and track record of your infrastructure within your own company.

Are there any negative consequences from all this press coverage and the heightened awareness on the part of upper management? Is there too much meddling or anything like that?

Smith: I don't think there's anything negative that goes on, at least not at Forum. We routinely have discussions with senior management about technological solutions that we can use to solve a particular business problem. But almost never is it a negative thing.

Yeager: I agree. I think the impact is largely positive. The only slight negative might be that folks read about [new technologies] and think they're awfully easy to implement. It still takes a lot of planning to implement. But I think [the heightened management awareness] is very, very positive.

Does anyone disagree with that?

Smith: I think it's refreshing just to have senior management swing by your office and drop off an article that they read in the Wall Street Journal about some new technology with a simple note on it that says, "Is this something that's of interest to us?" They're looking at [technology] from a business perspective. And that's a great thing. It's an open door to have communication to solve business needs. That's a good thing.

Sullivan: What about the time lag between the introduction of a new technology, the latest gee whiz thing, and the time that you can institutionalize it and roll it out, en masse? It seems to me there is a huge time span between when I first read about something in Network World and when I can really use it in a production environment.

Hinkle-Morrison: I would also agree with you. I believe there's a lot of marketing pressure being put on the small and major vendors to reveal their strategies. And sometimes, I believe, they are a little aggressive on the marketing side. Some of these things, you start asking your team can we do it, and when we can do it. Most of them don't know about it and sometimes it's way out into the future.

Yeager: You guys have done a better job of stating what I really meant. And I still don't see that as a negative. I see it as a positive as when somebody dropped something off at my desk and said, "What about this? Can we use it?" We just have to be sure to do a good job of communicating with management and letting them known what risks are associated with new technologies, and just make them feel comfortable that we are trying to integrate these things where it makes sense and where it doesn't endanger enterprise assets.

Smith: I agree that a conservative approach to technology solves a lot of those problems. We're in the financial industry, so we can't make mistakes either. It could cost us a whole business relationship very quickly and very easily. So systemically, within the company, the way we approach technology is it's a tool, it needs to be mature, it needs to be proven, and we need to have ways around it should it fail.

Electronic commerce is one of the areas that the business press has been focusing on. In what ways has the whole e-commerce movement had a positive effect on your company and on the network group in particular?

Davis: From a professional services perspective, Ernst & Young has the opportunity to shape the future and bring many companies into the Internet economy by working with them and transforming their organization into what's called an E-company. From an internal networking perspective, the e-commerce focus in the press, and the well publicized stories concerning companies like Amazon, show the strategic significance and advantage that the network has for any particular company. And, naturally, as a byproduct, we're also seeing a huge increased workload in terms of new projects and activities within the firm that funnel down to our department.

Yeager: I agree. We're seeing e-commerce growing at Columbia. We've been doing electronic gas commodity and pipeline transportation trading for years. But we're now breaking into residential energy and related services. And I think everybody views this as a very positive trend. With respect to the networking group, it's raised our corporate visibility, it's increased pressure on us to get things done very quickly, and we're seeing a lot happening much more rapidly in our non-regulated business.

Sullivan: In the aerospace industry, the Department of Defense is pushing the concept very much of integrated product teams, which are teams across various specialties and across different companies. And we find ourselves in a mode of operation that has dubbed "co-opetition," in which we are business partners with some of the biggest companies in the industry, like Boeing and Lockheed Martin. We are partners with them on a lot of projects and we're competing with them on other projects. So we have a number of very specialized network links to do electronic commerce with them on specific products.

Rindels: I agree with most of the comments made so far. It's really the ability for our company, and most companies, to directly engage their customers and start to build new ways to form strong relationships which always seem to be mutually positive. Certainly, these are technology initiatives, but they really are business initiatives.

Hinkle-Morrison: One of the e-commerce issues, at least from the retail perspective, especially on the consumer side, is being able to take on high and low demands. An example was during the Super Bowl. Victoria's Secret did a great job advertising their web site. And when it came down to the day when people needed to get access to it, there were a number of bottlenecks. One was the network, one was on the server side. In some cases, you don't know what kind of volume can hit you. And that is what challenges you, from the network side, because you've got to balance [the demand] with capacity and being able to afford the capacity when you need it, and be able to stretch it and collapse it whenever possible.

In the future it's going to challenge the network group even more, I believe, because we'll be doing real time ads. [Real-time advertisements are tailored to individual customers based on known preferences or artificial intelligence mechanisms that assess likely preferences. They also enable retailers to quickly change product offers to increase the likelihood of a sale.] When you get into the real time ads, your network group needs to be tied in with your marketing team to know how much to open that pipe up because you don't want to leave it open all the time and just pay a lot of money for something that's not used.

So, clearly, the e-commerce side is very much becoming entwined with the network group. In fact, this is the first time I've seen the network people sit in a room with the marketing team doing projects.

Has there been any negative fallout from the whole EC movement? Maybe too much pressure exerted on the network group, anything like that?

Smith: The only thing, and I don't think this is a negative, is it requires a rethinking of the business processes. You really do have to work with the different teams that are out there pushing different initiatives. For instance, we had an internal mailing that was going out through our marketing department that was going to ask customers to send in their email addresses for various pieces of information. But we hadn't built the infrastructure in the back to handle the responses. And it was just a fluke that we managed to catch the mailing before it went out there. It was a learning process for us. So the only negative is that you really need to pay attention and to educate other departments that we need to work together as a team if we're going to really solve these problems.

Other sections of the roundtable:

Intro
Putting this discussion into context.

Convergence
If you could only focus on one network initiative for the next year, and Y2K is off the table, which one would it be?

A look ahead
What would you say are the most important steps you can take today to prepare your network for the years ahead?

Staffing and advice to vendors
What are your secrets for keeping and hiring the best people? If you could make the CEO of one vendor take your advice, which CEO would it be and what advice would you give?

Stress
I think anyone would agree that your jobs are fairly stressful. What would you say are the keys to handling that stress, and keeping your head?

The whole thing
The entire roundtable transcript.

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