Let Your Business Customers Be Your Guide For NFV / SDN Transformation
OK, if you’re not thinking that I have lost my mind you are perhaps thinking, “How can my customers guide me with SDN and NFV?”. If you look at it from the technology viewpoint, you are correct! Your customers don’t specifically care about SDN and NFV nor any other technological mumbo jumbo and more acronyms.
But that’s not what I mean – look at it instead from the viewpoint of what you need to offer them. What are the services and what are their critical attributes? Your business customers know very well what they want from you in regards to the networking services they require for their businesses. If you have doubts, read my earlier blog.
My colleague, Ben Bekele, referenced a study of 350 large, medium and small businesses globally in his recent blog here. In that same blog, he wrote that we commissioned a research study of several service providers. The latter study’s aim was to understand the progress and challenges that each provider faced in their respective SDN and NFV journeys.
One finding from the service provider research was the emergence of three distinct pathways that you, a service provider, can take for your own NFV/SDN transformation.
You can read more about these pathways (and monsters) from another colleague, Sidney Kriger, in his recent blog. Note that in your specific journey you will touch all three. One however, will be your primary driver.
In this blog, I focus on 2) Service-led Innovation. Another way to think about this one is: be customer–focused! What do your customers value and will pay for? Deploying your services to meet your customers’ needs will guide you along a good path of NFV/SDN transformation. And you don’t even need to mention SDN and NFV to your customers. Let’s take a quick look at some findings from the service provider study.
In addition to being customer-focused, the research report recommended developing a more cloud-like commercial model. The underlying technology is still important in delivering that which your customers want, but it becomes secondary in the process.
With regard to new services, the providers surveyed are mostly exploring two services areas as their first foray into virtualized services:
1. 79% are either exploring or have launched a vCPE-based service.
2. 57% are either exploring or have launched an SD-WAN service.
This perhaps is not a surprise, because it makes sense to explore new services that let you use the expertise you developed for your existing services, such as VPN and managed CPE. The two services above are also very much in the minds of business IT folk who want more from their WAN services – improved security, improved application performance and, of course, reduced costs.
While the above two services emerge as favorites, only 14% of the surveyed providers, have launched both of them. Many are still in the exploratory stages. You are not too late if starting now!
When launching these new services, providers typically provide a new customer proposition such as greater flexibility or IT agility. For some markets, where solutions are less well established, providers have started at a basic entry level, which lowers costs for both provider and business customer.
A couple of important points that the report makes:
1. Service providers are typically relying on partners to speed entry for new services and secure market acceptance of them.
2. The drive to new services may be from a strategic initiative rather than via an extensive business case process.
Of course, there is a lot more to the report than my little snippets above. Look out for more blogs in this series from my colleagues who will address other aspects in the report such as the other pathways described, the challenges that service providers face and overcoming them.
Meanwhile, find out for yourself when you download the report.
Wishing you much success in your NFV/SDN journey and as you delight your customers!