Apr 21, 2016
Whenever technology evolves from one thing to the next thing, there’s always a certain degree of perceived risk involved. Adopting new technology can disrupt workers because of a change in process, cause unnecessary downtime due to integration issues, or fail because it’s new and unproven. Because of these possibilities, many CIOs and other business leaders prefer to wait until technology matures before deploying.
Historically, having this cautious attitude seemed wise. Let the early adopters cut their teeth and then deploy new technologies when the best practices have been developed. In many ways, this is the tech equivalent of “keeping up with the Joneses”.
While this strategy may have worked in the past, I believe that there is more risk in not being an earlier adopter than there is by being one. The world is rapidly being digitized and, as Marc Benioff, CEO of Salesforce.com, said at the World Economic Forum, “speed is the new currency of business.”
Digital organizations move with speed; that’s where the competitive advantage comes from. Success in business isn’t based on the company that has the best products or even the best people. Sustained market leadership is based on an organizations ability to adapt to market changes faster than the competition.
Becoming a digital organization means having to be more agile and nimble than the competition. This requires having an agile IT foundation that enables the company to make rapid changes. IT leaders understand this well and is the primary reason why companies spent over $12 billion globally on technologies related to digital initiatives. However, companies can only be as agile as the least agile component, and today that is the network, particularly the wide area network (WAN).
Legacy networks are rigid in nature and slow to change. In fact, in a study conducted last year, ZK Research found that, on average; it takes over four months for businesses to make even a simple network change. Complex changes can sometimes take over a year to implement – hardly the calling card of a business that is striving to be agile.
For all the hype regarding cost savings regarding SD-WANs — and the cost savings can be significant — that isn’t the true value of the technology. I’ve never been a big supporter of implementing new technologies to save money, as unforeseen things can happen along the way that could diminish the cost savings. Also, the success of an IT project should not be determined on how much money it saves; cost savings are hard to calculate unless all the specific variables and cost inputs are known and can be measured both before and after deployment. In fact, it’s always been my belief that, with the WAN, if an organization really wants to save money and nothing else, then let the contract expire and hammer your service provider for bigger savings. In this competitive environment, that will yield at least 5%-10%.
The true value of an SD-WAN is that it makes the network dynamic and agile and enables an organization to compete at digital speeds. This becomes particularly important as IT becomes network-centric in an era that is highly mobile and cloud-first. This shift means that organizations that want to leverage mobile and cloud as part of their digital strategy must also consider the network. A slow, static network means digital strategies will fail. A dynamic, agile network means the business can implement new strategies quickly.
Common wisdom may say that moving to new technologies like SD-WAN creates some business risk. In this case though, with the network being at the center of digitization, it’s risker not to move — and that’s something all business leaders should be considering.
Zeus Kerravala is the founder and principal analyst with ZK Research. He provides a mix of tactical advice to help his clients in the current business climate and with long term strategic advice. Kerravala provides research and advice to the following constituents: End user IT and network managers, vendors of IT hardware, software and services and the financial community looking to invest in the companies that he covers.