Partnering is not a new sales term for the old cost-focused customer verses supplier management battle. Partnering involves working collaboratively with vendors. Its intent is to distribute business and technology risks to the partner who can most successfully manage those risks. Success involves both partners, the customer and the vendor, realizing benefits once shared business objectives are met. Those business objectives are defined in terms of desired outcomes rather than specific deliverables or traditional service level agreements (SLA). In a successful partnership, the relationship itself is an asset with value to both parties.

To realize success, both parties have to embrace a greater degree of openness, communication, and trust. Partnering involves the customer and the vendor working cooperatively to identify optimum solutions. Partnering can succeed only where there is a mature approach to relationship management and where effort and commitment, from both parties, are invested to make the relationship work. Partnering should never be regarded as an easy option.

Like most changes in an enterprise, successful partnering starts with the senior management team placing the full weight of their positions behind the desired relationship and agreeing on clear objectives. This commitment includes assigning the best people to create and maintain the relationship over a multi-year engagement.  Additionally, significant resource requirement commitment must be made to the partnering arrangement. This commitment includes staff and investment capital that may not pay off for several years. In a partnering relationship, the vendor must be willing to expose profit areas in open dialogs with the customer.  Customers must be expose current and future budgets as well as the process for acquiring corporate funds.

While partnering is a powerful tool, it is not suitable for every situation. It is most appropriate for activities where there is a need for:

• continuous innovation to address changing business needs over an uncertain future
• staff flexibility with specialized skills and knowledge
• outsourcing business processes or technology services in order to free internal staff to focus on core areas
• development of a new service or system

Conversely, partnering is much less successful when there is a requirement for:

• short-term, stop-gap fixes
• little flexibility in the approach
• tight control by the customer
• activities with limited ability to improve processes or provide innovation
• the vendor to take on an unmanageable risk

In the practical sense, managing a partnering agreement comes down to the customer-vendor relationship. Both parties need to consider how they will build trust, share risk, agree on accountability, and share success. There has to be continual conversations focused on reasonableness. How will success be demonstrated and compromise achieved without the burden of an overly taxing bureaucracy?

Establishing a partnering approach requires both parties to openly discuss what they want and need from the contract. In the early stages, dialogs between the customer and vendor about goals are unlikely to align well. Throughout the process, each party will face compromise and need to stress their willingness to remain at the table in a collaborative fashion.  Without setting a negative tone, an exit strategy should be developed from the outset. Both parties need to understand what is at stake and how the contract will end successfully as well as prematurely.

Establishing a meaningful relationship requires cultural and behavioral changes. Trust is earned through positive demonstrations over time. There will be a steep learning curve for the staff of both parties. Climbing this curve translates into having the right people in place. These people need to be able to make difficult decisions and have the authority to remove staff and obstacles which are hindering the relationship. Where customer and vendor staff are working together, peer relationships need to be established. Throughout the chain of command the partnering relationship must be reinforced. Initially, if the people will not change, change the people.

One consideration to be addressed throughout the chain of command is: how open should each side be with the other? Questions to consider include:

• Shared incentives – are increased savings or revenue for the customer translated in to a profit sharing opportunity for the vendor?
• Project control board – will there be active involvement from senior management from both parties in controlling scope, managing progresses toward goals and resolving issues? Are both parties represented as equals?
• Shared problem, issue and risk logs – will there be a single set of shared records for activities tracked and addressed by both parties in order to avoid duplicate efforts and focus shared resources on a single set of activities?
• Staff reporting – how will roles and responsibilities for managing staff be defined, regardless of affiliation? Who will direct resources and assign tasks?
• Open project accounting books – are both parties invited to review the projects accounting books? Will everyone see budgetary constraints and cost considerations of each business decision in the project life cycle? Is everyone able to see value for their money without focusing on the lowest cost?
• 360 staff & management feedback – will both parties contribute to the feedback loop? How will staff and managers discover what is missing and close the gaps?

The main advantage of this openness is the ability to raise issues much earlier and address them with a shared sense of ownership and responsibility. Resolving problems earlier, when they can be more easily solved, avoids unnecessary costs, time and blame.

While all partnering arrangements start with a contract there is usually a “partnering charter” as well. The charter states desired outcomes and goals that complement the terms and conditions of the contract. Creating a partnering charter usually identifies the principles, attitudes and ideals of the partnership. The charter will also set the level of openness and the code of behavior. It should be consistent with the procurement practices of both parties.

Once the contract and partnering charter are in place the relationship work begins. A series of team building activities need to take place with active involvement from everyone from both parties, including senior management. These exercises will express to everyone the incentives for both parties as well as the expected behaviors which will deliver these incentives.

If all this sounds simple, it can be. There are also common pitfalls. One of the most common mistakes is to have individuals in crucial roles that are not suited to partnering. Most often interpersonal skills are more critical than technical understanding. Organizational maturity is another area often needing to be strengthened. If either organization is missing the cultural maturity to make partnering work, the changes required by may be out of reach regardless of how clear and achievable the benefits. When objectives are unclear, no amount of effort will make the relationship successful. One of the more difficult components of partnering is the articulation of adequate performance measurements. Finding relevant benchmarking measures that make meaningful comparisons between current and desired outcomes can be hard to achieve.

How do you know if your enterprise is ready for a partnering relationship with a vendor? The first step is to take an honest look at your enterprise and ask:

• how has the enterprise worked with vendors to date? Are vendor relationships aimed at driving to the lowest price? Are vendors viewed as adding value? Is there a shared responsibility for success? How is the enterprise viewed in the vendor community?
• is the right leadership in place with the skills and capabilities to work with the vendors collaboratively? Is the management style of the enterprise matrixed with shared responsibilities or siloed and highly controlling?
• has the enterprise clearly defined desired successful outcomes? Are measurements used in current projects to course correct? Are project targets and milestones currently published to all levels of the enterprise?
• is change easily instilled in the enterprise? Is there a successful track record of change within the enterprise?
• are mistakes viewed as opportunities to learn? Are defects found in testing viewed positively or considered a problem? Is quality about capturing metrics or improving outcomes? Is constructive criticism used to improve the process?

Assuming the relationship can be created successfully, will stakeholders ‘sign up’ to it and add momentum to its development? What kind of vendor could manage the risks envisioned to be allocated to them? Realistically, would a vendor be willing to take on the risks? If so, can the enterprise give the vendor sufficient control so that they can manage those risks?

Selecting a vendor who will become a partner means establishing goals that are compatible and achievable to mutual benefit of both parties. The selection of the right partner is not at the expense of an open competitive selection. The final choice of a partner is based on mutual benefit, cultural match, risk management and value over the life of the agreement.

Partnering is not right for every customer, vendor or engagement. At the very least, considering a partnering relationship allows customers and vendors to seriously evaluate their respective strengths and weaknesses as well as the risks and rewards at stake. Under the appropriate circumstances, partnering can deliver significant value over the length of the relationship for both parties.

You only relocate a data center once (hopefully), but you manage it day after day. A big part of making your data center more manageable, dressing in all the cables and fiber. This means keeping everything covered, bundled and out of sight:
a) Cabinets have doors and sidewalls.
b) Copper cables are patched within the cabinets using the provided cable management.
c) Cables follow standard paths and do not cut across cabinets.
d) Fiber and copper cables are kept in separate trays.
e) Blanking panels will be used.

Dressing in the miles of cable and fiber required to connect all the data center equipment is an art form. With a little practice you will learn how to comb through the cables to ensure they are aligned and bundled so they stay out of the way and allow access to the hardware they connect.

A large part of a well dressed facility is having a solidly designed standardized cabinet layout along with a good structure cable design and power plan. Obviously each category of equipment will require its own layout and each should be considered and planned before any equipment or cable is ever brought into the data center.

All your designs will be a compromise between capacity, initial cost, and management. Since a majority of a data center’s TCO (Total Cost of Ownership) results from the ongoing management and maintenance, spend the time up front and perform the necessary work to keep everything covered, bundled and out of site. You will see the savings over the life of your data center.

• Taking advantage of Moore’s Law and increasing capacity through appropriate hardware life cycle management
• Receiving increased value on purchases through solid vendor management practices
• Evaluating future business demand and scheduling appropriate capacity
• Internally developing a service catalog along with a service centered organization
• Outsourcing non-value-add or business differentiating components
• Are considered an internal business partner rather than a cost center

As operational organizations improve and build an enabling enterprise infrastructure, they begin to account for both mandatory and discretionary components.  Most companies recognize that components evolve from discretionary into mandatory infrastructure components.    Mature operational organizations use this evolutionary time period to their advantage.

An example of this evolution is  Internet Messenger (IM).  IM is at a stage where many  companies treat it with a try and see attitude.   There may be an HR usage policy, a firewall rule or two or even a corporate IM server.  However, there are few enterprises that have established an OLA (operations level agreement) equivalent to IM’s older bother, email.  During this period while the service is under the service umbrella of best efforts, mature organizations develop component specific practices for Tier 1, 2 and 3.  They capture metrics and build a technical capability in preparation for a components evolution.

Just as email worked its way into the business fabric, IM is becoming a standard tool in the business arsenal and as such is moving from the discretionary spending bucket to the mandatory operational service delivery catalog.

Effective operational organizations keep the lights on for mandatory components, improve overall operational efficiency and effectively evolve discretionary components.

At a high level there are three areas of guidance for migrating a data center. Those areas are Move, Design and Management. Although their are some universals ideals, each company has to develop their own guiding principles. Individualized guiding principles are required since they reflect corporate culture, technology strategy and business goals. For a good start on developing your own guiding principles consider the following:

Move Principles:

1. Business Drivers:
   1. Contract renewals are driving the completion date Production cut over must be on or before the current contract expiration date
   2. Down time is expensive and taken as a last resort
   3. The data is the asset and needs to be protected
   4. One-time use equipment or service should be minimized
2. A team approach will be used in the move so that all disciplines are represented on the team.
   1. Storage: design, document, perform and sign-off on all storage component activities. Include vendor management for physical move of the storage component
   2. Networking: design, document perform and sign-off on all network component activities
   3. Systems: design, document, perform and sign-off on all systems component activities
   4. Back office: design, document, perform and sign-off on all back office component activities.
   5. Application Development: provide information, documentation, guidance and sign-off on all application component activities.
   6. Software QA: Test and sign-off on all functionality
   7. NOC (network operations center): Gatekeeper for documentation, escalation and monitoring of move activities
   8. Business Owner: Sign-off and approval of all move activities
3. Extend the network so both spaces look like one
4. Extend the SAN so storage in both spaces looks like one. Vendors will be enlisted in moving and ensuring proper turn up of their storage systems. New storage equipment will be used as a temporary landing zone for data in order to move it off of a subsystem prior to its move and then back onto it after its move
5. Pools of resources will be split and moved in stages. One resource should not need to know the physical location of another resource
6. Designs will be published, reviewed, challenged and revised prior to the move. During the move designs and scripts will be followed

Design Principles:

1. Plan Ahead:
   1. Data center plans and designs are to support the next three (3) years of anticipated growth.  This growth is estimated at 20% year over year
   2. Environmental monitoring is required in unmanned facilities
   3. Equipment will be maintained on a five (5) year life cycle
2. Keep it Simple:
   1. Aggregate cabling where possible to segregate patching
   2. Standardize on the rack, ladder system, PDUs, Patch Panels and cabinet layout.
   3. Priority deployment of standard computing:
      1. Virtual server on x86 architecture
      2. Blade Center
      3. Standardized x86 based server platform
      4. Other architecture
3. Remain Flexible
   1. Equipment can be placed in the next available cabinet.  There is no intelligence built into the floor plan
   2. New standards should be carried forward and retrofitted only where it makes business sense
4. Think Modular:
   1. Two cabinets make a non-blade center module to be deployed when additional resources are required
   2. One cabinet makes a blade center module to be deployed when additional resources are required
   3. Cabinet modules are outfitted the same for network and cabling
5. Keep things covered, bundled and out of sight:
   1. Cabinets have doors and sidewalls
   2. Copper cables are patched within the cabinets using the provided cable management
   3. Cables follow standard paths and do not cut across cabinets
   4. Fiber and copper cables are kept in separate trays
   5. Blanking panels will be used

Management Principles:

1. Label Everything:
   1. Racks, PDUs, and environmental monitoring devices are labeled with name as it appears in the book of record
   2. Servers are labeled with name as it appears in the book of record
   3. Network equipment and patch panels are labeled with name as it appears in the book of record
   4. Storage is labeled with name as it appears in the book of record
   5. Fiber, copper and power cables have a matching serialized label at both terminating ends. (should track in the book of record what cable attached to equipment)
2. Configuration Management is paramount:  the book of record contains information on all physical and virtual servers, network equipment, storage systems, racks, PDUs and environmental devices
3. Change Control:
   1. The change approval board ensures the inventory is updated
   2. All work requires a change control
4. Access is Locked Down:
   1. Only 3-5 people have physical access to the data center
   2. The Facilities group manages access to the data center
   3. Change control approval is required to perform work in the data center
   4. The NOC is aware of data center access through the daily production schedule and notices
5. Audit the work: Audits are conducted on
   1. The book of record against the physical data center
   2. Data center sign-in against daily production schedule
   3. The NOC is the Gate Keeper for data center management process adherence

Is a Boeing 747 three times “faster” than a Boeing 737?  They both cruise at around 500 miles per hour. The difference is that the 747 carries 500 passengers where as the 737 only carries 150. The Boeing 747 is three times bigger (more bandwidth) than the Boeing 737, not faster.  And like an airplane, as long as you have fewer files (passengers) than the network can carry at any one time, increasing the bandwidth will not reduce presentation times.

From a physical perspective, in order to increase the speed at which web pages or other data are presented to customers on the Internet you need to reduce the distance.  There are two strategies to reduce distance.  Regional Data Center (RDC) or Content Delivery Network  (CDN) strategies both reduce the distance data travels to customers.

In this discussion we will look at the effects of an RDC architecture for reducing the time it takes data to reach customers. With an RDC strategy, you have multiple data centers strategically placed around the globe to service those areas closest to the RDC.  For this analysis we simulated an RDC in Seattle, London and Hong Kong.

In order to expose the base Internet latency a test was run sending one packet of data over the Internet and measuring its round trip time.  This is referred to as a ping test.  As you can see the following chart shows latency increasing over distance from Seattle.

By moving the data and servers closer to the customer and establishing a regional presence, delivery times experienced by the total customer base becomes more consistent regardless of their location.  In order to simulate an RDC presence the ping test was repeated with Asia Pacific locations measuring latency times to Hong Kong and European locations measuring latency to London.  The chart below shows the results of that RDC simulated ping test.  The distances and the latency are from the initiating location to the simulated RDC.  There was a 65% improvement in the average response time utilizing the RDC model.

Conclusion:
While big network pipes will push more data out the door, it will not deliver it to Internet customers faster.  In order to reduce latency, move your data and presentation services closer to your customers.  Depending on systems, significant reduction in latency can be achieved through the strategic use of regional data centers.

The tests run for this analysis accurately assess latency with for simple data requests.  This investigation does not represent a specific customer experience and results will vary depending on variables such as time of day, network provider and other public network activity.

According to Gartner, U.S. Data Centers: The Calm Before the Storm (ID G00151687), “the US data center collocation market will grow rapidly during the next few years and should be considered as an alternative to internal data centers.”

Forrester research finds in its white paper Collocation Buyers Are in For Sticker Shock, “Diverse requirements are driving up demand for collocation space… allowing providers to be selective”

In this uncertain environment, companies are succeeding by:

• Building strategies for the short (1yr), mid (3yr) and long-term (5yr) horizons in order to move rapidly when opportunities arise
• Modeling power, cooling and space capacity to maintain an optimal balance
• Monitoring energy consumption and maximizing million instructions processed per kilowatt (MIP/KW)
• Exploring virtualization and dynamic workload management to improve asset utilization
• Committing to managing a hardware life cycle that takes advantage of hardware efficiencies

In this environment of uncertainty, successful companies are opportunistically consolidating data centers to reduce costs and expanding as warranted to hedge against future volatility. Prepared companies are using data center facilities as a tactical advantage over the competition

As an example of success, one client was able to reduce their collocation and IP network traffic costs by $1.2 million per year by consolidating their multiple data centers single foot print into a lower cost, high density facility. The cost of collocation space and network traffic are dynamic. Annual contract reviews can allow IT Directors add to the corporate bottom line by renegotiating or changing providers.

In spite of the difficulties and all the complexities, many companies are reaping the benefits of offshore outsourcing. Successful companies are seeing lower costs, employee resources freed for additional projects and a flexible work force that can scale to changing business demands. But these companies are not achieving positive results on their own.

What separates the successful from the outsourcing bust, cultural understanding and project managers who understand how to bridge technical and cultural gaps. Outsourcing is same around the world, assume the problem is communication based and that you are the cause of the breakdown. Clearly articulate (read document) the requirements (read everything you expect) and go over them again and again. When you think you’ve communicated everything clearly, have the offshore communicate it all back to you. Keep on this cycle until you hear from them exactly what you said.

To find out more about managing outsourced project read Metagyre’s offshore outsourcing methodology.