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You know the drill: Two companies join forces and - bam! Suddenly they have an urgent need to integrate their disparate information systems. The enterprises then scramble to figure out how to make their systems and networks interoperable.
A silver lining sometimes appears for this cloudy IT challenge: Such projects have been known to uncover opportunities for creating new operational efficiencies while the company is back at the network drawing board.
 Just ask McJunkin Corp., an 80-year-old, 1,600-employee U.S. distributor of industrial products and a winner of an honorable mention in Network World's 1999 User Excellence Award competition. The Charleston, W.V., company formed a 50-50 joint venture with Casa Trottner, S.A. de C.V. in Mexico City earlier this year and wound up making network improvements that reaped benefits beyond the new venture's immediate data connectivity goals.
McJunkin and the smaller Casa Trottner figured that by combining their complementary inventories and by leveraging their prominent brand names in their respective countries, they could each easily grow their revenues while establishing an international presence. "We thought this was a better business approach than both of us being the new kid on the block in a new country," explains Larry Shank, McJunkin's computer operations manager.
First SNA, then voice
The business goals of the venture required that each partner open a portion of its mainframe-based applications and data to the other in a kind of "SNA extranet." Both companies were already running leased-line networks among their own corporate sites. The challenge was to introduce the connectivity required to give each partner access to the other's inventory data and pricing information, says Lisa McClain, McJunkin's network manager.
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Quick Look
TROTTNER-McJUNKIN
Primary business: Distributor of pipes, valves, fittings, steel and other industrial products.
Project name: Not applicable
Business case: When joint venture partners combined inventory and sales teams, they required access to one another's data systems. Integrating international voice and fax traffic onto a cross-border frame relay service let the partners accomplish data connectivity goals while reducing international telephony bills and overall network costs.
Cost: About $175,000 (one-time capital investment)
Benefits: Reduced overall data network costs and inter-national telephony charges; reciprocal access to one another's data systems.
NOTABLE FACT
Mexico recently gained the capability to complete calls to U.S. "toll-free" 800 numbers - at a cost of 50 cents per minute.
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| One option, of course, would be simply to string more leased lines from the Mexican sites to McJunkin's Houston distribution center. But that was an expensive proposition considering the international nature and distance of the links. The venture decided a U.S.-Mexican frame relay network made more economical sense than investing in additional private lines.
While they were at it, McJunkin IT staffers analyzed the cost of the company's 100-site domestic leased-line data network. They replaced all the existing leased lines with 64K bit/sec and T-1 frame relay private virtual circuits (PVC) and added a frame relay link from Trottner's Mexico City site to McJunkin's Houston location, which is serving as the hub for the venture. All the Mexican sites can access Houston through that frame relay link.
Then the team turned its attention to voice.
"When we started looking at the long-distance voice charges we were incurring between Mexico and Houston, we decided to research ways to integrate voice onto the network," McClain says. "We knew voice-over-frame relay standards and technology had settled, so we decided to explore that possibility."
All three entities - McJunkin, Casa Trottner and the new Trottner-McJunkin venture - are now running a frame relay network for data using services from AT&T. A hub site in Houston connects a 100-site U.S. WAN to a six-site Mexican WAN. For international voice calling, the venture combined voice and fax onto the frame relay links between the Houston hub and five Casa Trottner locations in Mexico: Coatzacoalcos, Culiacan, Guadalahara, Mexico City and Tampico. A Trottner distribu-tion site in Caracas, Venezuela is slated to soon join the integrated data/voice frame relay network.
All Casa Trottner and Trottner-McJunkin intracompany voice south of the border has been integrated with data onto the frame relay network. Voice-enabled frame relay sites run Nuera Communications F-50 or F-120 voice frame relay access devices (FRAD), along with Sync Research data 3600 and 4600 series FrameNode FRADs, which are installed at all McJunkin and Trottner sites.
Piggybacking for savings
For now, McJunkin in the U.S. still uses long-distance services from AT&T for voice. But the Mexican sites link to the Houston hub via frame relay, then piggyback on Houston's PBX to initiate voice calls over the public-switched telephone network (PSTN) at U.S. calling rates. The 10-cent-and-below per-minute U.S. long-distance rates shave about 68% off the price of calls to the U.S. originating in Mexico, says Dan Sheinberg, president and CEO of Trottner-McJunkin.
Sheinberg estimates that throughout Mexico and the U.S., Trottner is cutting about 10% off what was a $17,000 monthly telecommunications bill overall by putting its telephony traffic on the frame relay network and piggybacking on the Houston PBX. These calculations take into account monthly frame relay equipment lease costs and monthly recurring frame relay service charges.
"We have installed a service where we know exactly what we will pay, and there will be no increase in our bill regardless of how much we use the service," Sheinberg says. Unlike in the U.S., he explains, telecommunications prices in his country are escalating every year. Because there is only a single local telephone company in Mexico (Telefonos de Mexico, or Telmex), competition has not yet resulted in lower prices, he says.
Speed: The name of the game
In addition to cost-savings, Trottner-McJunkin also focused on response time of SNA applications. "SNA was and still is our bread-and-butter protocol, so our major criterion for a new network was faster response times [because of SNA's low-latency nature] and cheaper circuits," McClain says.
However, she adds, the company knew that TCP/IP applications were playing an increasingly larger role in its business processes, to date accounting for about 25% of the company's traffic. "We needed a device that could handle both kinds of traffic," McClain says.
Frame relay has long been successfully used for interconnecting LANs running protocols such as IP, generally slashing monthly carrier charges by 50% compared with long-haul leased-line networks. Within the past one to two years, frame relay has also become a popular alternative for SNA traffic as network service providers have begun offering standard service-level agreements (SLA) on network performance metrics such as uptime, latency and packet loss. In addition, some carriers offer "priority PVCs" - virtual circuits that customers can dedicate to time-sensitive traffic such as SNA or voice.
Because subsecond response time for its SNA and voice traffic was critical, McJunkin tested several vendors' FRADs, as well as routers with integrated frame relay interfaces from the major players, with various services. "We discovered that Sync Research FRADs delivered the best response times for our SNA-heavy environment," says McClain. The devices also include quality-of-service traffic prioritization capabilities for blending delay-sensitive traffic such as SNA with more tolerant IP and LAN traffic on a combined link.
McJunkin set up and paid for live production testing of multiple pieces of equipment using frame relay circuits from AT&T, as well as a combined network from Bell Atlantic and Intermedia Communications. The test network linked the Charleston headquarters to Charlotte, N.C., and Hurricane, W. Va.
In the tests, McJunkin discovered that traffic passing through a Network-to-Network Interface (NNI) between two frame relay service provider networks suffered from delay. "Some people would say I'm being picky, but we need subsecond response times. With 1,200 people on a circuit, the difference between one second and seven-tenths of a second is significant to us," Shank says. "AT&T was about the only carrier that didn't have to use an NNI to provide us with the international connectivity we required."
In addition to SNA's sensitivity to timeouts, "we were a little concerned about quality of voice," Shank acknowledges. The company settled upon voice-over-frame relay access equipment from Sync partner Nuera Communications based on test results and confidence in Sync's recommendations from past projects. "At first, the voice took a bit of tuning, but it is running at toll-quality now," Shank says.
Meanwhile, the Trottner-McJunkin venture has installed Sync Research Frame Relay Access Probes (FRAP) - also called smart DSU/CSUs-at key sites so that it can actively monitor network performance metrics and usage statistics of each link.
Staying on top of its usage patterns and application performance using the smart DSU/CSU tool puts McJunkin network managers in control of their users' destiny. They can discover in real time, for example, if and when committed information rate on a given PVC needs to be increased and how new applications joining the network affect existing traffic.
The Trottner-McJunkin cross-border frame relay network, now about six months old, is on track to save the firm $75,000 compared with leased-line circuit charges this year. The new net is expected to save the firm $225,000 in the third year, McClain says.
At the end of the day, the equation is fairly simple, says Trottner's Sheinberg. "We're getting more capabilities, and we're paying less money."
Related links
Other 1999 winners:
Trottner-McJunkin's Web site
Read last year's User Excellence winners
Staples bets on ATM, frame relay to deliver goods
Network World, 10/11/99
Frame Relay Forum renews its purpose
Network World, 08/30/99
What to do with that SNA net
Network World, 07/12/99
The global challenge: Building international networks
Network World, 03/08/99
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