How COVID-19 Made the Network a Strategic Imperative

Photo credit: iStockphoto/gorodenkoff

COVID-19 has changed the way we look at networks. 

It is no longer an infrastructure issue; businesses looking to become more agile and flexible to changing market demands see networks as a Board-level concern — when businesses have no offline channels to fall back to during the lockdown measures. 

To understand the role of network optimization and how recent trends are changing business perception, CDOTrends in partnership with Tata Communications organized a dialogue session with key industry players. 

Dan Bieler, principal analyst at Forrester Research and Song Bac Toh, vice president of Global Network Services at Tata Communications led the conversation. There were quite a few interesting industry folks who joined in the discussion across sectors some of whom were: 

  • Elvie Lahournere, digital and innovation director for Asia Pacific, Natixis
  • Annie Chen, managing director and head for digital banking and personal segment at retail banking Hong Kong and Standard Chartered (Hong Kong) Limited
  • Sakthi Kumar Lakshmanan, vice president and IT for Wealth Management Core Technology at Credit-Suisse
  • Jacky Leung chief information officer at Bluebell Group

Together, the cohort examined the trends and challenges, key initiatives from their companies and the role of networks and cloud in future proofing their infrastructure. The discussion was held under Chatham House Rule.   

Stress testing business flexibility 

For certain, COVID-19 impacted all businesses. But not all impacts were the same.  

Participants noted that some companies in online retail and online banking saw meteoric increases in business. Chemicals and pharmaceuticals were stable. Food and beverage (especially those partnering with food delivery companies), electronics and semiconductor saw an increase in their trajectory. 

Companies who had agile infrastructure and networks could deploy the right measures. For example, German manufacturers could shift their operations from European plants to China-based ones as the latter were opening up earlier. Those who were unable to shift their offline operations to online were caught out by nimbler online rivals. 

Clearly, the biggest winners were companies whose business focused on a cloud-driven model. For example, Zoom, Alibaba and streaming companies like Netflix were highlighted as key winners during the lockdown. 

However, even within the  online retail sector, the growth is not even. One participant noted that while purchasing necessities became more urgent, buying luxury suffered tremendously. But that was offset by the revenge shopping spree that was seen in some parts of the world.

Nevertheless, all participants agreed that this shift in buying patterns makes e-commerce or online business a vital part of business in the new normal. It also makes having the right network infrastructure vital. 

Understanding the remote phenomenon

When global employees went into remote working, quality and availability of the network became a key concern. 

For those who were already empowering remote working within their companies, the shift was painless. The issue for them was how they could do the same for their partners and contractors who may not have been as equipped

But it was surprising that many Asian businesses were caught off-guard. Having endured SARS, many should have been better prepared. But they were not entirely better off than their European or American counterparts.

 Some participants felt that COVID-19 was a wake-up call for many to  invest in the right technologies to future proof their business from new disruptions. 

Cloud puts networking in the spotlight

The Forrester study showed that COVID-19 is pushing companies closer to cloud service providers. While managed service providers and connectivity were not immediate focus areas, companies are beginning to see how they directly impact cloud adoption.  

Participants noted that part of the reason is complexity and rapid pace of the technology change. Keeping up with these can challenge companies who need to focus on powering their profitability at the moment.

A partnership with the right managed service provider can help them address the technology challenges. 

In regulated industries, like financial services, participants observed that regulators are softening the rhetoric against cloud adoption. In fact, forward-looking economies are seeing regulators taking a more proactive role in virtual banking. This increases the pressure on incumbents to embrace the cloud. Else they risk online competition. 

Another reason why participants feel companies should look at how their networks can support cloud needs is in the planning for recovery. No one could guess how and when economic recovery will come. But when it does, companies need to be ready to ramp up scalability and work in an environment where fast-changing customer expectations and remote working is the norm. They also need to be resilient to future COVID-19 waves. 

Some participants noted that being cloud-ready is not enough. Instead, they need to focus on becoming omnichannel ready. With customer acquisition becoming challenging, adapting to new changes in customer behavior is vital for customer retention. This means companies must be ready to allow their customers the freedom to choose how and when they want to engage their providers. 

Security should be a mindset

The discussion ended on a topic that is now becoming a global concern: network security. Participants agreed that agility needs to be done securely, and companies need to explore concepts like zero trust seriously. 

Authentication and authorization need to also become more agile. Network access alone can no longer mean access to key data and applications, since employees will be working remotely. The suggestion was to make authentication continuous and seamless. 

Some participants remarked that the ransomware attacks and impersonation issues have heightened awareness. Currently the concern is not about employees, who would have gone through training and guidelines; it is about educating end-customers and partners who are beyond the company’s security perimeter. 

The networking conversation is shifting

The discussion highlights the maturity in the networking conversation. It is no longer an infrastructure concern; rather, COVID-19 has made it a business imperative. 

The good news is that the technology is here. Participants noted how network innovations like SD-WAN can make networks more application-aware and programmable to shifts in bandwidth demands. It also allows companies to use the best network available.  

A good, agile networking infrastructure can improve business agility. One participant noted how it helped a utilities company to shift their on-premises management crew to work remotely within six hours to meet WFH measures. 

Whatever the choice, participants agreed that the networking conversation needs to go beyond capacity. They agreed that the choice of their network can now directly impact their business future. 

Photo credit: iStockphoto/gorodenkoff