Virtualizing does not mean outsourcing

The idea of companies virtualizing their business processes is catching on in the IT market. But there is a widespread misconception that virtualizing business processes is the same as outsourcing.

A virtual business process is defined as one that leverages an intelligent networked infrastructure to reduce costs, improve efficiencies and focus on the core business. An intelligent networked infrastructure involves more than just a collection of Layer 3 to Layer 7 switches, load balanced servers and distributed storage.

An intelligent networked infrastructure is one that is designed specifically to support clearly defined business objectives. This means that the applications, users and activities using the network all add specific value to the company. To achieve this objective, a company must focus on its strategic core business and determine the optimal method for leveraging its network for competitive advantage. If an application, user or activity is not directly tied to strategic core business and revenue generation, it should not be accessing the network.

The intelligent network is built on a foundation of policy management, security, application and intellectual property access controls, and quality-of-service delivery. These tools engage the total network 100% of the time, whether the network is in one building or spread across the globe. The intelligent network lets users access the resources they need to do their jobs any time, anywhere. The management and maintenance of the intelligent network is also virtualized, letting the support team perform their functions any time, anywhere.

Most businesses have started down the path of virtualization without realizing it. For example, e-mail access is ubiquitous. Users can access their e-mail from home, desk or the road using a variety of methods. Companies have recognized how important e-mail is to driving business and have implemented the application, security and user-access methods necessary for any time, anywhere access.

One benefit of moving toward virtualization is that it can be implemented incrementally. The focus might be on a specific department, such as engineering, which needs enhanced security as well as improved throughput. In this model, virtualization would be a vertical implementation, starting with a review of the physical level and wrapping up with identifying the core applications needed within that group. By applying policy to the engineering team, access to the corporate network essentially becomes a virtual LAN, allowing only approved users and applications access to the resources and intellectual property associated with the engineering group. In blocking unapproved applications, bandwidth as well as infrastructure resources such as CPU cycles and throughput are recaptured for the benefit of the team. With this knowledge, any additional resources needed, such as storage or bandwidth, can be justified in terms of measurable benefit.

The next step in virtualizing the engineering team would support access to the intellectual property from anywhere on the globe. As an engineer connects to company resources through a high-speed link, wired or wireless, he would be able to access everything needed to perform his job, but be contained to the assets necessary to his specific role. An intelligent network would not permit the engineer to access human resources, sales and marketing or any other group’s assets.

The next step, then, would be to ask if paying for office space to house the engineering team in one location is the best use of company dollars. “Probably not” would be the correct answer. The dollars spent on leasing and maintaining real estate would be better used to build and support the intelligent infrastructure needed to support the best engineering minds around the globe. As a business you want the engineers’ brains; there is no need to acquire their bodies, too.

Outsourcing a process only shifts responsibility for supporting a particular activity. Virtualization emphasizes the use of an intelligent networked infrastructure to enhance the business’ competitive position. It forces the decision makers to focus on the core business, and the applications and processes that drive the growth of business.

Young is president of Nova Amber, a business consulting firm, and co-author of The Case for Virtual Business Processes. She can be reached at myoung@novaamber.com.