Network Sourcing-The Running Game of Network Transformation Alsbridge Network Advisory-Client Sourcing Panel. October 22, 2015
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1 Network Sourcing-The Running Game of Network Transformation Alsbridge Network Advisory-Client Sourcing Panel October 22, 2015
2 2
3 Introduction and Format Apria Kevin Kranser, Director of Procurement DTCC Valden Paes, Managing Director-Enterprise Infrastructure MoneyGram Roger Dean, Director of Commercial Office-IT Univar James Clark, Director of IT Vendor Management Alsbridge Dave Muller, Jeff Cosby, Phil Hugus, Managing Directors Format Panelist observations Market trends Panelist questions and discussion 3
4 Panelist Observations Mix of IT, procurement and vendor management panel executives. All clients employ multi-vendor environments, leveraging multi-source procurement engagements. Financial services, home healthcare and chemistry distribution. Domestic and international services, wireless sourced where in scope. All completed engagements within the last year using Alsbridge for benchmarking and sourcing. Provider mix included full service and business service providers. 4
5 Current Market Trends Year-over-year reductions still an expectation Network essential, but also a commodity UC reduces expenses, enable business applications and maximize employee productivity. Anywhere-Anytime connectivity driving demand. Global versus regional sourcing strategies Ready to trust public internet and wireless services for smaller offices and work-at-home Outsourcing of network management services more common; third party consideration Cloud adoption and mobile connectivity make network security a priority Infonetics forecasts global VolP service revenue to hit $82.5 billion in Market: $69.6 Billion 2019 Market: $82.5 Billion Managed IP PBX Hosted VolP & UC IP Connectivity Residential Infonetics Research, now part of HIS, VolP and UC Servies and Subscribers: Annual Worldwide and Regional Market Share, Size and Forecasts; April
6 Current Market Trends Full Service providers (domestic and now foreign) responding to aggressive pricing offered by Business Wireline providers to retain customers. Competition still prevalent. Full Service Provider X has been more aggressive with first-round pricing. Historically we see a nominal first-round response followed by more aggressive pricing. Focus on surround services; leading clients to new technology solutions Global enterprises vacillating between global RFP and regional sourcing strategies. Consideration for TCO/Change Management a key factor SIP adoption continues, while implementations remain problematic. Culpability rests with both customer and supplier. Stating that savings is available is not enough carriers must educate and provide incentives. Enterprises need thoughtful SIP business cases and planning exercises with extensive piloting. 6
7 Current Market Trends An increasing number of wireline and wireless providers are not implementing contract rate amendments. Onus on customer to recoup missing contract rates/discounts. Cloud services are fueling move to multivendor solutions, and enterprises are adding telecom suppliers to their Vendor Service Portfolio to increase competition and decrease TCO. Continuing trend of suppliers to differentiate and create customer value by expansion of services and relationships beyond traditional voice and data services. Demand for mobility services fueling significant demand for BYOD policy reviews, continues to be one of the most disruptive technologies in enterprise IT strategy today. Growth engine for Full Service providers As enterprises become increasingly comfortable with both VPN/MPLS, consideration of considering multi-provider solutions leveraging service providers by region and by country. Clearly a more competitive market developed throughout the first 9 months of 2015, with enterprise customers still expecting price savings of 15%+ at contract renewal. 7
8 Panelist questions Sourcing Strategy: What is your sourcing philosophy-sole source, multisource; global vs regional, use of multiple providers? Describe your operating relationship between your role and the business-how do you ensure linkage? When sourcing do you consider a provider change? Rational and determining factors? What is your Vendor Management strategy? Where does the function of vendor relationship management reside? Network Service Providers: What do you think is the most important attribute of your network service provider? What MUST they do to maintain their role in your company? Do you see a difference in the types of providers you use today-full Service vs. Business Wireline? Niche providers? How flexible do you view network providers today? Pricing and contract terms? Service and technical support? How are the network providers performing on implementation of new services? (UC, VoIP, SIP, global) Network Technology How important is mobility in your overall telecoms sourcing strategy? How do you manage mobility today? How are you evaluating/implementing cloud strategies today? What is your current network transformation strategy? (UC, VoIP, SIP, broadband) Are you examining robotics as part of your overall network sourcing strategy? 8
9 Final questions and takeaways What did we hear? What did we learn? Where do we go from here? 9
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