Grow with the flow
3Com's Buddie Ceronie looks at the 'pay-as-you-grow' method of upgrading a network.
Networking can be hard to plan, both financially and technically.
Firms have to choose between buying a network to meet their current needs and risk having to replace it in a few years following business growth, or buying excess capacity that may be obsolete when the company eventually comes to use it.
The channel has also suffered as customers may make large upfront investments in networking equipment but are then unlikely to make another purchase for years.
So what is the most effective way to sell networks to create a steady revenue flow? Independent research company Z/Yen Aspect recently investigated how corporates invest in networking, and found that two-thirds of respondents allocate IT costs to the company's profit centres or specific departments.
These results show that companies are looking for networking solutions to business problems and want return on investment from their IT infrastructure.
Control of the IT budget is moving to other departments. For example, if the customer service department needs new technology to help it respond faster to customer queries, the IT manager must present various investment options that justify the expense.
In turn, resellers must communicate to customers how the technology will benefit the whole business.
Solutions are now available that follow a more business-focused model, where companies can pay as they grow.
If a company can build its network by buying a product a month, it can spread the cost and gain incremental improvements in user features and performance with each purchase.
'Pay-as-you-grow' is an ideal model for organisations such as schools and hospitals that need to deliver on all the initiatives for which they are accountable. It allows the public sector to invest in its networks on a per-head basis.
The pay-as-you-grow model also offers steady revenue to the channel as companies are able to regularly upgrade their networks.
Technology is aligning itself with business goals, and the channel needs to do the same.
Like PCs, client devices and peripherals, resellers can now sell networking incrementally, thus offering customers a solution that the board will be happier to sign off, and that generates more stable revenue for the reseller.
Buddie Ceronie is area sales director at 3Com.
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