[By Danie Nel] The SA broadband landscape has been littered with announcements that signal the transformation of broadband usage in this country.
The Seacom submarine cable recently went live and the East African Submarine System (Eassy) is on track to come on-stream by mid-year.
But the arrival of these high-capacity undersea cables and long-awaited cheap, reliable and fast broadband connectivity also bring with them some challenges. For a long time, all technology planning in business in SA has been geared towards operating in a bandwidth-constrained economy.
This means that improving efficiencies, while reducing the costs of technology infrastructure and service delivery has been the main driver. With the imminent arrival of real broadband, business in SA is suddenly faced with a new challenge — how to optimise functionality and innovate when cost of connectivity is not longer a major factor.
It may sound like a no-brainer. How can better bandwidth not be good for business? But the reality is, not all businesses are in a position to take advantage of these new developments in the broadband market.
It’s similar the problem that has afflicted airlines which were caught short by hedging against the rising cost of oil by forward-buying fuel at fixed prices. They did this only to find that prices tumbled, leaving them in the uncomfortable position of having to continue paying inflated prices for a resource that their competitors were now snapping up for half the price.
Businesses that have bought into long-term bandwidth agreements will be shackled to higher payments while competitors gain a technological edge.
In a bandwidth-constrained economy, entering into fixed agreements for bandwidth provision made perfect sense. In a broadband landscape with more bandwidth and greater value for money on the horizon, it clearly does not.
Even though the era of abundant bandwidth has not yet arrived, business of all shapes and sizes should be putting flexibility at the forefront of their IT planning in the coming months.
In addition to flexibility, the second element that SA businesses need to get right, and need to get right soon, is visibility. Having a proper baseline survey — a snapshot of their telecommunications environment — is vital. Good information is needed to support quantitative decision making and investment, cost and performance optimisation decisions.
With the advent of better broadband, the need for proper baseline information increases. The internal telecoms infrastructure of most companies is already becoming increasingly complex due to the need to run converged voice, data and video applications on their networks.
Corporate networks are being accessed over the Internet by employees, customers and suppliers and in some cases companies are trading online from their websites. In many big companies, users are accessing ERP, human resources and other back-office applications across the network from a centralised data centre or server.
With improved broadband, a host of opportunities becomes possible, from interactive distance training, to new Web-based applications that improve a user’s experience, to greater automation to improve efficiency and reduce staff costs.
These and other applications will accelerate as bandwidth becomes cheaper, and if companies don’t take steps to get a proper fix on their telecoms environment, they may be left treading water in a sea of technology while their competitors are ready to take advantage.
In an inversion of the 80-20 rule, companies should be aiming to spend 20% of their time looking for information and 80% analysing it to make good business decisions. The reality in SA is that most companies spend 80% of their time hunting down the information and just 20% looking at it strategically. Investing in a baseline survey of their businesses and putting in place processes to ensure sustainability can help fix this ratio.
The King 3 Report, which was published a few months ago, may help focus the minds of business leaders in this regard. Among its new reporting requirements is a clause to consider the strategic role of IT and its importance from a governance perspective.
This and other clauses have broadened the scope of corporate governance in SA with its core philosophy revolving around leadership, sustainability and corporate citizenship. This can only be a good thing, especially if it helps SA businesses become aware that technology is not an add-on but an integral part of how they do business.
And it has come in the nick of time. Ubiquitous broadband might be almost here, but unless businesses take stock now and plan accordingly, we might not find that it is the windfall that everyone is hoping for.
- Daniel Nel is CEO of Nebula, an independent professional services firm in the enterprise telecoms space
