By Computerworld Philippines staff
Published in October print edition of Computerworld Philippines

In a call center and business process outsourcing (BPO) environment, business continuity and information security are two major concerns. Often at the core of a company’s IT infrastructure, the data center is given the tasks of ensuring the availability and reliability of all computer systems, data communication connections, security devices, and even the backup power facilities that it houses.

At Computerworld Philippines’ 9th CIO Roundtable, three IT managers discussed their data center challenges, their strategies in addressing these, as well as the future trends in the data center space that they foresee and how they are preparing for these.

“If we were to contrast the BPO and call center business with other industries, the BPO sector is an IT-enabled service (ITES), which is why the data center and IT systems are much more important in this business compared with other traditional industries,” said Jan Espino, regional IT manager for Asia Pacific at risk mitigation and business solutions provider, First Advantage.

This is why most companies in this space allot a big bulk of their IT budgets to investments in the data center. “I can say that it is also more than half of our total IT budget,” noted Michael Principe, IT manager at contact center firm, Logicall Inc. “This includes securing the information, having the redundancies, and all the other things related to these.”

For his part, Oscar Liao, global IT director at Admerex Solutions Inc., cited three data center issues which could shape future trends: virtualization, cooling, and power generation. “The first will somehow address the second and third, but there are still some equipment that are not yet designed for virtualization and whose manufacturers have yet to design a less power-hungry system. For now, system consolidation and vendor-hosted services are key factors in addressing these hurdles,” he said.

Sponsored by EMC Philippines, the roundtable was held at the Dusit Hotel. Also present during the discussion was EMC Philippines country manager Geronimo “Ronnie” Latinazo.

Excerpts of the discussion follow:

CWP: Can you share with us what your data center environment is like right now?

Jan Espino: Around six months ago, we had a study on how we can streamline our data center operations and, as you know, First Advantage grew by acquiring some 51 companies over the last several months, so we currently have 17 data centers—16 in the US and one in India . Now, we are in the midst of consolidating, hopefully, four or maybe five of these data centers. It’s very hard to say how many servers we have at this point but for Asia Pacific, which is what I’m handling, our main data center and our major applications are hosted in our Bangalore data center. It is a mix because we have our own data center in Bangalore and we also are using the IBM data center in Bangalore, but, eventually, when the data center we are building now is completed, these applications will all be housed under our own data center. For Asia Pacific, our main application is in-house developed (mostly because there aren’t a lot of companies doing what we do) and is very intensive on storing information and keeping confidential information. So we have educational details, social security numbers, sometimes even salary details—these are what we call “personally identifiable information” and we keep them in our servers. I think we have 20 people running the data center in Bangalore and in our major hubs like Mumbai and Manila. I have around 11 other people also and smaller offices where one or two people are running the servers, but the main application is stored in servers in Bangalore.

Principe: Currently, we are at about 30 terabytes in terms of our data center, where we house about 25 servers and that include the major PBX servers, our dialers, Cisco equipment and others, running on a mix of Linux and Windows platforms. The applications we use are built into the system—PBX, CRM tools, and other software that we use to manage our clients and their requirements. Segmenting it is another challenge since if we buy licenses for each of the applications for each client, it would be very chaotic and difficult to support, so we just try to put in layers for each application so that we will be able to manage them.

The whole IT department is currently made up of seven people. Some say this number is big given our current size. However, the number of applications and hardware that we have within the data center is pretty much pulling in our resources in people. Also, they’re not only supporting the data center but also the daily operations.

We have put in a lot of intelligence and redundancies in our system in such a way that it could react in a timely manner and correct any issues that we have. Now, since we are expanding our current business, we are looking at managing it with the same number of people but we are adding more intelligence and redundancy to it and we will now have two data center sites. Having two sites will then allow us to maintain our 24×7 redundancy and provide disaster recovery.

Latinazo: When are you planning to set up your second data center or have you already started?

Principe: We are currently already looking for new partners and providers that would be able to aid us in the setting up of the data center.

Latinazo: I just want to validate an observation: What we are typically seeing in the contact center industry is that most of the data that is used is still housed in the customer or the client side. Very few, if any, is actually taken into the country, probably for security or legal compliance. Will the same setup be the case for you?

Principe: Yes, we have the same setup, though there is some data which, in the near future, may be stored locally.

Latinazo: But how are most contact centers doing it today?

Principe: Right now, most are into segmented storage. On our end, we have our own file servers and we do have storage for the network. We are also looking at how we would be able to improve the availability and security of some particular information, specifically when clients would ask for a certain file or a certain recording outside of our network. So that is again one of the challenges that we are facing; technologies right now are vast and we want to be assured that those types of services would be available.

Liao: The Admerex Limited Data Center in our Sydney office hosts most of our enterprise servers. The contact center business in the Philippines, Admerex Solutions Inc. (ASI), hosts its own servers and the telecommunications equipment used for its collection operations. Meanwhile, the Global IT (GIT) group is based here in Manila and supports 100% of ASI’s IT operations, together with the rest of the global infrastructure. Though we employ vendor support on our remote sales and satellite offices, the GIT group, with its eight professional IT support staff, fully manages the contact center office. GIT handles massive numbers of transactional database and reports incorporating a huge voice network infrastructure for ASI’s outbound and inbound process.

CWP: How much of your IT budgets usually go to data center expenses? Is spending on data center investments increasingly being given priority in your company?

Espino: If we consider everything that’s in the data center, including the applications, I would say that it takes up more than half of the total IT budget. In our case, we spend a lot on developing internal applications, so if we include that, it definitely is more than half. We are basically a data company, without the data we are nothing. This is why, for last year alone, we spent I think US$10 million for securing data alone. The data is very important because if that data goes out, nobody will trust us with their information anymore, so the database in the data center is very vital.

Principe: If we’re going to define it as a whole, including applications, servers, etc., I can say that it is also more than half of our total IT budget. This includes securing the information, having the redundancies, etc. Yes, there are a lot of solutions in the market right now, some are also available at cheap prices, but we need to be more cautious about this because some might not meet our requirements, especially since we are servicing clients worldwide. With the expansion that we are currently undergoing, the budget may increase but it may not be that significant.

Espino: If we were to contrast the BPO and call center business with other industries, the BPO sector is an IT-enabled service (ITES), which is why the data center and IT systems are much more important in this business compared with other traditional industries. So you see, for them, if the total IT budget exceeds 1% to 1.5% of the total revenue, that’s already high, but in our case, about 8%-10% of the revenue is poured on IT. I remember when I was working in the manufacturing industry before, if 2% of your revenue goes to IT spend, that’s already high for a manufacturing environment, but not for IT-enabled services.

CWP: Has this budget allotment remained constant over the years or is still increasing?

Espino: I think it’s increasing because, in this line of business, automation is key to getting competitive advantage and if you automate you need more technology and, hopefully, less people. So in terms of percentage, I think this is still going to grow. Even in our case, all the new spending in IT now is geared toward automating more of our processes, doing more with less people and more technology.

Principe: We have also increased our IT budget and investments on IT infrastructure, especially since we will be expanding. However, we are very cautious about expanding the IT infrastructure because we will also need to allocate some other budgets to the total expansion of the company. This is why we are also looking at how we could be leaner in terms of the headcount and why we are increasingly going into automation.

Liao: I have only been with the company for slightly over three months and, during this period, we have invested on infrastructure where it’s mostly needed. ASI has been growing tremendously and, within a year of operating its collection business, we have expanded to another building floor, built a secondary data center and expanded our voice network infrastructure, with our investments reaching about a quarter of a million dollars. The company is always willing to invest on technology that will enhance its efficiency and profitability.

CWP: What main challenges do you currently encounter with your data center and how do you, as head of the IT department, address these issues?

Principe: A challenge right now would be the flexibility of the total data center, primarily because there is a lot of growth in terms of the services and clients. Another challenge is maximizing the investments on the infrastructure that we have, without compromising quality of service and ensuring that we still meet the expectation of our internal and external customers. In IT, the mandate is always to do more with less.

Espino: The main challenge is speed—delivering what the business needs at the soonest possible time. In our business where information is our lifeline, availability is also paramount. One way to address these issues is to be pro-active, anticipate what the business needs so we can plan early. Another common challenge is trying to do more with less. In the current business environment, the pressure to optimize all costs, not just IT, is much greater than before.

Liao: Since ASI’s setup as a call center business is new, we still do not have any major challenges on our data center setup aside from the cooling system where we need to add another five-tonner airconditioning unit to cope with the heat coming out of the equipment we added for our expansion project.

CWP: How different are your data center challenges compared to those in other industries? Does a call center environment demand more from data centers?

Espino: Compared with, say, a traditional manufacturing environment, BPOs demand a lot more from their technology departments. In traditional manufacturing companies, for example, the business can survive a significant downtime of their ERP systems (enterprise resource planning). They may take some hit on the timeliness of their financial reporting, but the plants can go on making the products, sales can go on in manual mode, etc. In our company, the moment our main system goes down, virtually all work stops; we might as well just send our people home.

Principe: In the call center and BPO industry, we face a lot of different challenges. One of these is the flexibility of the design of our current data center and the need to ensure that it could cater to the different requirements from different customers. We also need to comply with standards to ensure the security of our information and the robustness of our disaster recovery system to maintain 24×7 availability.

Liao: Being in the industry for just a few months limits my view of the industry’s data center challenges in comparison with those of other industries that I have worked with before, but I think a BPO or call center environment demands just as much as with those in the financial or retail industries, since they also require a robust IT infrastructure.

CWP: Given the current trends in server consolidation, virtualization, and the recent buzz about “green IT” and “green data centers,” what initiatives, if any, have you undertaken in line with these?

Espino: Like I mentioned earlier, First Advantage grew through more than 50 acquisitions in the past five years throughout the US and the Asia Pacific region, and, as you can probably imagine, we have disparate systems located in 17 different data centers globally. We have started a move to consolidate four or five data centers, primarily to lower costs and enable more synergies across the company. Besides consolidating our data centers, we are also moving into server consolidation using virtualization technology such as VMWare to derive more savings in hardware, software, administration, and power consumption.

Principe: We are looking at really maximizing the infrastructure that we currently have and avoiding additional electrical loading with the addition of new hardware. We are also looking at consolidating applications into one server without, of course, compromising security and availability.

Liao: Admerex Limited has been into server consolidation and virtualization for quite awhile already. Its contact center business, ASI, has only started its collection business for a year, so its server technology structure is not big enough to reap the full benefits of these virtualization and consolidation technologies. However, with our expansion plans lined up over the next two years, we will surely go into this as well.

CWP: What future data center trends do you foresee affecting local organizations and how are you preparing for such changes?

Espino: I see more local companies moving into outsourced data center services, eschewing the traditional view of building and maintaining their own data centers, primarily to lower costs. I would think that if local companies actually do rigorous financial analyses on their data center costs, it would turn out to be cheaper to outsource, especially for medium-sized companies that don’t have sufficient scale to justify maintaining their own.

Principe: We are taking a serious look at the scarcity of space and the spike in the price of space and electricity especially in the commercial areas. We are then looking at several strategies to prepare for these, like having a smaller hardware footprint, moving from 1U-type (one rack unit) servers to blade servers, and going into server consolidation and virtualization.

Liao: There are three data center issues which I see affecting future trends: virtualization, cooling, and power generation. The first will somehow address the second and third but there are still some equipment that are not yet designed for virtualization and whose manufacturers have yet to design a less power-hungry system. For now, system consolidation and vendor-hosted services are key factors in addressing these hurdles.

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• Data Recovery– Riding Through The Chaos
• Mitigating the Risks
• Greening the Workplace

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