The Role of the Network: Cost Center or Business Enabler?

Is the network considered a contributor to an organization or a cost center? While a contributor helps an organization attain key goals such as revenue or efficiency, a cost center is considered necessary plumbing that saps resources. Which category does the network fit?

Enterprise Strategy Group conducted a survey of 300 IT organizations to get some insight. Sixteen percent of the respondents said they consider networking to be a cost center. That can be interpreted to mean they view the network as a necessary evil, and something where costs should be driven down as much as possible. Of course, this isn't too motivating if you're a network engineer. Moreover, networking traditionally is a small fraction of total IT capital expenditures, so even if decreases significantly, it won’t greatly affect the total IT spend.

Another 21% of those polled said the network is a potential conduit for security breaches that deserved more scrutiny. If you really want to secure your system, you can unplug it, but that’s not practical.

More of the ESG survey respondents actually have a positive view of the network. This group looks at what network enables as opposed to what it does, which is an important difference. What the network does is to transport data packets from point A to point B. Many IT pros focus on making that work, and that’s what many networking certifications focus on. It’s important, but also just fundamental networking.

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What the network enables is a different. You need to figure out the business benefits it provides, apart from basic connectivity. For example, your electric utility provides power (the electrons) to your home or office. What it enables is to light your room in the evening, heat some rooms, and yes, powers your IT equipment.

Of this group that take a more positive view of the network, 23% view it as a strategic asset that can enable new revenue sources. I can think of many ways this can happen. For example, the network can enable location-based services to retailers. In order to gather insight for marketing, it can detect patterns of how customers are walking within a department store, casino or even in the streets as they come close to a store. At a simpler level, providing WiFi can draw customers into a coffee store. Advanced connectivity can speed production and revenue-generating services. The ideas are limitless, and can create new methods of collaboration between IT staff and business units. This is an exciting area for ambitious IT pros; business can see more ways to leverage IT, which will further your career.

Another 27% of respondents said the network provides advanced analytics so they can better serve their users. This is a bit more difficult to understand, but also has a direct connection to how IT pros manage infrastructure. Remember that the network is like a nervous system for IT; almost all data flows through the network. The old adage, "the network does not lie," holds true. Network analytics provides accurate insights into how  systems are performing.

Analytics allow you to understand the traffic patterns and see what portion of the network is used for streaming YouTube videos compared to business-critical video conferencing, which enables you to make appropriate network bandwidth investments. Within the data center, it can be viewing server-to-server or “east-west” traffic, and understanding whether upgrading to a CLOS (spine-leaf) architecture is appropriate. While this sounds like basic network management, understanding where and how network performance affects business operations will create better overall infrastructure to support the goals of an organization. Traditional analysis tools provided a glimpse of network behavior, but modern analytics tools provide much better insight.

What should networking pros do? I would try to understand the possibilities of what the network can do, and be forward looking. Talk to your business unit contacts to understand how you can help them, and increase your position in the organization as a contributor to the top line, rather than a drag on the bottom line.

Learn how enterprise networks must adapt to meet the needs of today’s technology-centric businesses. Attend the Network Transformation Summit at Interop ITX, April 30-May 4, 2018. Register now!