REAL WORLD Metric & Multistandard Components CASE 3
Corp.: The Business Value of a Secure Self-Managed Network for a Small-to-Medium Business
With 22,000 customers, 48,800 cataloged parts, and 150 employees working in five U.S. locations and an office in Germany, the last thing John Bellnier needs is an unreliable network. Yet that’s exactly what he contended with for years as IT manager at Metric & Multistandard Components Corp. (MMCC). MMCC may still be classified as a small business by some standards, but this small-to-medium business (SMB) definitely has been a big-time success story in its industry. MMCC was founded in 1963 by three Czech immigrants in Yonkers, New York, and has grown into one of the largest U.S. distributors of metric industrial fasteners. In the last 10 years business has doubled, reaching $20 million in sales in 2005, and growing just as fast in 2006. However, the company’s growth overwhelmed its telecommunications network, which was managed by an outside telecom network management company. The network crashed frequently, interrupting e-mail communications and leaving customer service representatives unable to fulfill orders promptly. “We had locked ourselves into a three-year contract with our provider,” Bellnier says. “It was a managed system and therefore we didn’t have passwords to the routers. I experienced dozens of episodes of spending days on the phone trying to escalate job tickets to get the problems solved. It was a nightmare. “He recalls a particular challenge that occurred when the provider denied that its router had gone down: “Their network was broken, and we had to deal with the downtime consequences on top of spending time trying to convince someone 2,000 miles away that one of their routers needed repair. “Several months before MMCC’s contract with the provider was to expire, Bellnier began to seek a better network solution. He outlined five key requirements for a new network for the company: Reliability Provide maximum network uptime to sustain business operations Scalability Grow with MMCC’s increasing business demands Security Ensure confidentiality and integrity of company data. Economy Reduce costs for both initial outlay and ongoing administrative and maintenance overhead Responsibility “I wanted all the hardware from one vendor so when issues come up, I know who to turn to,” Bellnier adds. Bellnier met with MMCC executives in 2004 and told them that he believed he could manage a new companywide network internally, on a limited budget, and could recoup the upfront investment by lowering operating expenses. Company executives agreed that the current network situation was intolerable and gave Bellnier the go-ahead to research and select an experienced local IT consulting firm that was certified to build telecom networks by one of the top telecom hardware and software vendors. Bellnier selected Hi-Link Computer Corp., a Cisco Systems Premier Certified Partner that had earned Cisco specializations in wireless local area networks (LANs) and virtual private network (VPN) security. As a first step, HiLink audited MMCC’s existing network and interviewed management about business goals and requirements. Company management was impressed with Hi-Link and agreed that Bellnier should seek a formal project proposal from the consultants. HI-Link’s consulting engineers, led by Business Development Manager Jim Gartner, proposed to Bellnier that MMCC build a secure network foundation consisting of virtual private network links between sites. Using Cisco integrated services routers and security appliances, the network blueprint was designed to give Bellnier transparent remote access to all necessary devices, increase his control over the network, and improve network performance. Hi-Link showed Bellnier how a secure network foundation works to automate routine maintenance, monitor the network, and alert IT staff of security or performance issues. Bellnier accepted Hi-Link’s network plan and made a formal presentation outlining the proposal to company management. After discussing the business costs, risks, and benefits of Hi-Link’s plan, MMCC executives agreed to the proposal and the following key project objectives: Goal Create a business network for MMCC with higher reliability, security, and scalability, but lower costs, than the existing externally managed network. Strategy Design an IP (Internet Protocol) network with advanced technologies for high availability and efficient network and security management, which can be operated by a very small IT department. Technology Use virtual private network technologies to connect remote offices and users securely and facilitate company expansion. Support After designing and quickly implementing a secure network foundation based on Cisco products, Hi-Link will help MMCC with technical support whenever needed. Once the consulting contract was signed. Hi-Link began working with Cisco and the local telecom company to install the telecommunications lines needed for the new network. When those were in place, it took less than a week to deploy the Cisco routers, switches, and other telecommunications hardware preconfigured by Hi-Link. “Hi-Link made this implementation effortless by working efficiently at the best times for us,” Bellnier says. “They handled all the details associated with the local telecom company, Internet providers, and project management. “After the secure, internally managed network was up and running, the following benefits soon became apparent: The new network eliminated MMCC’s network congestion almost immediately Network bandwidth, reliability, and security were significantly improved The sophisticated network monitoring system greatly improved network management Network downtime was reduced to nearly zero The new network is saving MMCC a significant amount of money. “The previous network had cost us just under $11,000 a month; the new high-bandwidth telecommunications lines we lease cost $4,400 per month,” Bellnier explains. “We’ve calculated an annual savings of $77,000, which means we got our return on investment in our first six months.” Best of all, the network is transparent and easy to manage. “We can access all our Cisco routers. We can view the errors and logs. All our telecommunications lines are contracted directly with the local exchange carrier, which gives us a direct communications link to resolve troubles,” Bellnier says. Hi-Link’s Gartner says of MMCC’s network: “Every remote office is configured in exactly the same way, and we can easily duplicate it to bring up any new location. We can easily add extra bandwidth to meet additional demands.” Thus, Hi-Link is helping MMCC add wireless capability to all its warehouses, knowing that additional capacity can be provided if needed. Gartner emphasizes that as it did for MMCC, a secure network foundation can improve a small company’s operational efficiency, secure sensitive data, contain costs, and enhance employee connectivity and customer responsiveness. For example, companies with such network capabilities allow customers to track their orders securely in real time over the Web, empower customer service agents with detailed account information even before they answer the customer’s phone call, and provide easy, inexpensive videoconferencing for remote workers, vendors, and customers. Bellnier offers advice to other IT managers in small companies that may be considering building and managing their own network: “Do not limit company expansion by thinking you cannot support or afford a self-managed system with limited resources,” he says. He adds that MMCC’s experience with Hi-Link shows just how quickly an SMB can “recoup the cost and implement a self-managed system with far superior performance and a lot fewer problems.”
CASE STUDY QUESTIONS
1 What were the most important factors contributing to MMCC’s success with its new, secure, self-managed network? Explain the reasons for your choices?
2 What are some of the business benefits and challenges of self-managed and externally managed networks?
3 Which type of network management would you advise small-to-medium business firms to use? Explain the reasons for your recommendation