June 2004

VoIP At Getronics: A Case Study in Success

BY ROMOLO PALLINI

Getronics is an international information communications and technology company with offices in 30 countries. The company has rolled out VoIP services to over 8,000 employees in 15 countries. Starting with a pilot, the rollout has been extended to administration, sales, and direct customer support including help desk services that are at the core of the company�s offerings.

The internal VoIP deployment helped us better understand the challenges our customers would face when they move to VoIP. This paper will give an overview of the Getronics VoIP installation, examine one site in more detail and give some tips for companies that are considering a shift to VoIP.

Getronics is typical of many large U.S. and international organizations. It has several regional sales and service offices, as well as country-level headquarters throughout the world. We looked at VoIP as a way to leverage our existing infrastructure, eliminate redundant telephony networks, reduce cost and complexity, and make us more flexible in serving our clients.

As a service company with a major field force Getronics takes full advantage of many VoIP features. For instance, VoIP unified messaging lets our field force see all of their messages at once. They can respond to e-mail from their cell phones and access and answer phone messages from their laptops. This feature alone is a tremendous productivity enhancement for us.

The VoIP system was built onto a robust data network. Getronics has a Cisco-based network that connects 600+ sites and includes over 800 Microsoft Windows servers. The network also includes over 1,000 customers that connect via the Internet. All told, the network�s two major data centers support 28,000 networked PCs in 450 cities.

Internally, we deployed over 8,000 VoIP phones in +50 locations and expect to use only IP telephones by the end of 2005. We�ve seen a substantial ROI. We saved $50,000 in cabling costs alone at our U.S. headquarters building and save $100,000 per year in moves, adds, and changes (MACs) in our two major Massachusetts facilities.

Getronics was an early adopter. We wanted to work with the technology so that we would have the experience when our customers were ready to move to the new technology. It proved to be a good strategy since we are now seeing significant market growth. Also, the technology has advanced. Previously, Cisco�s CallManagers supported only 150 users. Today, CallManagers support thousands, which simplifies deployment and drives down costs.

At the outset, the deployment was affected by bandwidth costs, which were quite high in Europe. Now, it is cost effective in more geographies so we expect to convert virtually every IP phone in our European operations, about 6,000 units, by the fourth quarter of this year.

Also affecting the rollout is finances. Like other companies, we wanted to retire our PBX equipment when it was near or at the end of its depreciation schedule. This meant that we deployed the new technology as it made both financial and technical sense.
 

New Office Deployment Saves 50%
Let�s take a look at one specific office. It was a new facility in the U.S. that we were provisioning in early 2003. The �greenfield� site would have 70 telephony users.

Based on our review, we determined that the company would benefit in the following areas:
� Reduced cost for network infrastructure.
� Reduced initial costs.
� Reduced operating costs.
� Reduced telephony charges for local and long distance.

The equipment consisted of a Cisco C2620 Router with T1/DSU WIC and 70 Cisco Model 7960 phones. We also determined that we would have to add two Cisco Catalyst 3548 Switches with uplink modes and cabling with inline power to the phone units.

First, we looked at our initial non-recurring costs � essentially equipment and installation labor. We found that separate PBX and data networks would cost a little over $200,000 while a converged network would run about $115,000. This is a savings in the 40�50 percent range. The primary costs for the converged network were in switches and other equipment, while the savings were in wiring and installation costs and, obviously, the elimination of the PBX.

The operating costs showed similar savings with $55,000 in annual costs for the converged network, while the separate PBX and data networks would cost $96,000. This 43 percent savings comes primarily from reduced maintenance and software support and a reduction in MAC costs, as well as $11,700 in telco message unit cost savings.

Depending on the business activities, the savings in tariff costs can be even more significant. For instance, one of our call centers saves $35,000/month � over $400,000/year � by compressing the voice traffic and routing it over the data network.

The result at the new facility is a cost-effective phone network that provides the same or better Quality of Service (QoS) that our employees have come to expect from previous phone systems.

This is a relatively simple example since it was a �greenfield� site. For existing facilities, we often run phased VoIP introductions. The phased approach has the advantage of gradually moving capacity to the data network and giving you the opportunity to evaluate each increment before bringing the next group of users onto the network.

Lessons Learned
At Getronics, we�ve learned a lot as we�ve moved through our various deployments. These lessons are valuable, not only to us, but also for our customers as we help them implement VoIP:

Organization: Companies usually have separate telecommunications and information technology departments. At Getronics, we�ve combined the departments; I am Director, Global Information Systems Networks, which includes both data and voice communications. Organizations have to bring the technology and the skill sets together through either converged reorganizations or task teams. The goal is to arrive at a common language and a single set of goals that bring the two worlds together.

Other teams: Don�t forget to involve other teams, such as the ones that control the Active Directory and the messaging infrastructure. Strong relationships among all infrastructure teams are essential.

Small details: Small details do count. They may be even more important in a converged network since it is a more diversified environment with more equipment between the phones and the call manager. By properly planning and implementing the correct switches and routers, you can assure high QoS and reduce maintenance issues in the future.

Don�t take shortcuts: Always follow best practices deployment guidelines. Shortcuts will inevitably cause issues down the road. They can be expensive and dangerous because quality will suffer. Remember, the objective is to offer a QoS level that is equal to, or better than, the current system.

Network infrastructure: Perform due diligence; conduct the traffic studies; evaluate the existing network. With today�s compression technology the data lines generally are not the bottleneck unless they are already congested, in which case you should be looking at an upgrade anyway. Focus on the network equipment, such as routers and switches. For instance, newer switches include inline power which is the way to go for VoIP. Also, people tend to concentrate on the condition of the wide-area network (WAN). You should closely examine the condition of each local-area network (LAN) since LANs are sometimes in worse shape than the WAN.

Treat your pilots like the real thing: Pilots must have the same standards as the planned deployment because they often become, by default, the production environment. Pilots are seldom uninstalled. Instead, they tend to be expanded to larger groups. This means that all of the shortcuts will catch up with you later when system reliability must be maintained.

Implement a full set of services: Deploy in relatively small blocks of users, perhaps a department or other natural work group, but give them equal or better features than they already have with the POTS. Make sure that their initial experience with the new system is positive. A phased deployment gives you the opportunity to better control the experience. Monitor and adjust networks and switches to maintain QoS as other groups are brought onto the converged network.
Don�t overwhelm users: Make sure that employee groups get what they need but don�t give them a complicated set of unnecessary extra features. An administrative unit will not need the same features as a call center. By limiting features you can reduce complexity and control costs.

Evaluate the costs: For �greenfield� situations, converged networks are the way to go. For existing installations, you have to take a hard look at cost/savings projections, looking at equipment leases and depreciation costs. VoIP may not be right for every situation. Look at your calling patterns and data line utilization to evaluate what the effect of adding voice will be to your overall network operations. The cost equation includes equipment and infrastructure investments, ongoing support and operational costs, as well as tariff charges. By examining all of these factors, you can develop a valid projection of cost savings.

At Getronics we are clearly committed to VoIP, both for internal use and for our customers. Our business, with distributed offices, call centers and field service technicians, requires a flexible, cost effective communications environment. We�ve broken new ground with our VoIP rollout and we are well on our way to becoming one of the first companies in the world with a total VoIP telephony system.
 

Romolo Pallini is IPS Director, Global Information Systems Networks for Getronics. Getronics is one of the world�s leading providers of vendor independent Information and Communication Technology (ICT) solutions and services. For more information, visit www.getronics.com.



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