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Intelligent Bills on Bandwidth Capacity Planning

Modern enterprises need to effectively manage bandwidth capacity planning, that’s a given.  It impacts production, communication, collaboration, technology and data gathering in any modern business. Bandwidth capacity prep must be a dominant part of any business strategy no matter the size of the firm.

Our tenure in the Technology Expense Management industry and three decades of practical experience and expertise has given us the ability to swiftly visualize how our clients are committing long term for internet connectivity. We are experts at evaluating those commitments versus business requirements and advising on optimal strategy, solutions and sourcing.

Here, I’ll walk you through some basic steps we use to manage and execute this effort with our clients. We believe the following can prove vital to helping you effectively plan and purchase around your needs without wasteful spending, while limiting liabilities and losses in productivity.

What’s at Stake? Quality & Redundancy to be considered.

What are the real costs of productivity lost by not having the right sized connection speeds?  Though you may not be able to determine this at the line-item expense for the service costs, it does manifest itself in your labor costs each month.

Many providers have committed SLA covering uptime but protect themselves against failures with minimal credits when guarantees are not met.  These credits are a fraction of the costs you pay monthly and are not bundled with the revenue loss that may amount due to said failure. These types of failures encourage an alternate strategy built around redundancy.

Tying a few pieces together can help determine what’s at stake in terms of cost of an outage for your organization.

Key Categories to Consider.

  • Productively Loss

Understanding your labor costs is pivotal to determining productivity loss, as it should include salaried and hourly staff downtime.

Depending on the role each staff member, not every individual will use the network in a similar capacity, so it is pivotal to segregate staff members into groups based on utilization.  Facilities and janitorial may use zero to 1% of the utilization, whereas Labs or Operations can be the remaining 99%.

Sample Formula

(Average Hourly Salary x Hours of Downtime x Utilization % x Number of Employees = Productivity Loss)

  • Revenue Loss

Each organization has its own formula for calculating loss, but the following is a simple template that can be used for quick calculations.  First, determine whether you want to calculate this on a weekday, hourly or per minute basis against comparable revenue for the same period of time.  Next, determine how much of that revenue is dependent on the network, as for some e-commerce since the calculation is simple at 100% whereas for others, this could fall into 50-60% of the revenue.

Sample Formula                    

(Revenue Period x Downtime x Impact % = Revenue Loss due to Outage) 

  • Recapturing Costs

Encompasses data recovery, data loss, repairs, new equipment, dispatch and any ancillary charges.

  • Other Intangible Costs

These can actually be assessed by incorporating any short, mid, or long-haul harm to the brand’s notoriety, diminished client faithfulness and lost chances of securing additional business.  Some independent research firms place the negative financial impact at $300,000 per hour, contingent upon the reliance of the network.  The amount can be greater depending in the geographical impact affecting 10, 50, 100, or 1000+ locations.

Bandwidth Strategy & Capacity Planning

Understanding what’s at stake will provide clarity on how pivotal strategizing, planning and execution are to an organization.  Being frugal throughout the effort can raise the probability of greater losses.

Our recommended approach is simple.  First, determine if your network can adapt to seasonality or other types of increases in network demand.  Next, determine if the demand has taken into account newer technologies that require extra bandwidth, such as UCaaS, or Collaboration Services.

Disaster recovery comes next.  Many organizations don’t realize that redundancy, though ordered from different services providers, doesn’t necessarily exist, as the connection type coming into your facility may be the same one used by different providers going out with no protection should that particular connection drop. Then, consider if fiber, cable, or wireless are in play to provide that peace of mind.

Lastly, and equally important, your effort should include a detailed audit of all existing services to determine current state, what should remain in billed services, actives services, types of entry connections, and associated costs.  This data, tied with a visual dashboard illustrating usage trends, and heavy bandwidth applications are a crucial first steps to nailing down an effective strategy.

Why Intelligent Bills?

Our experts will perform a comprehensive billing and network audit all of your existing services.  We will examine the architecture of your network, allowing for the most competitive pricing made available to your organization. We will evaluate your needs from a delivery perspective but also take into account minimizing vendors, billing and overall expense.  This includes our overlapping project management on implementation of your new network. All of our engagements are CAPEX neutral.  Contact us to see how we do it.