Sun Adapts Services To Global Business

by Sunil Kumar    Jun 01, 2006

While it is generally accepted that the dotcom bust has caused a drastic and widespread negative impact on the global economy, some industry watchers have pronounced it one of the best things to happen to the IT industry.

This is firstly because investors, technocrats and the business community at large have realized that only businesses that provide real tangible benefits to customers can survive a severely competitive and punishing market place. Secondly, it asks for a re-look at business models to enable necessary precautions to avoid repetition of such a disaster. This is true of both large and small organizations across the world.

Over the past five years, Sun has executed a series of initiatives aimed at growing revenues and product portfolio that would compete more effectively in the post-dotcom era.

Through consistent investments in R&D, acquisitions, innovative sales models and more recently, appointing Jonathan Schwartz as CEO, Sun says that it has been steadily heading towards a path of recovery and growth.

A significant new addition to Sun’s bouquet of offerings is Sun’s managed services business, which Sun claims is the only ‘real’ form of Managed Services that is being provided by any vendor today. Launched over two years ago, it took off with the completion of the acquisition of SevenSpace, a company focused on providing managed services in a heterogeneous environment.

“The integration of SevenSpace’s technology into our existing remote services offerings will greatly improve our ability to enable customers to stay focused on their competitive advantage, while managing the unique demands of their businesses,” says Joyjit Chatterjee, Director, Sun Services, India.

Talking to CXOtoday, Joyjit Chaterjee stated, “Most Indian enterprises today have growth and change as the two dominant attributes. Our strategy is to partner with them, which allows for scalability and flexibility in the solutions that we provide. This would allow for seamless growth, adoption of changes with minimum disruption in the business process. In turn the enterprise can continue to focus on its core competency.”

On innovations in the service model he says, “Enterprises will no longer be able to afford outages & hence traditional, reactive, break-fix models would need to evolve. Services will participate from the architecture phase of the solution to define redundancy, provide technology and processes, which monitor behavior and predict gaps. The gaps need to encompass outage related warnings as well as performance shortcomings. The service model has to necessarily include “education & training” to the enterprise on specific operational skills, process adherence (ITIL etc).”

On IT-business alignment he said, “As long as tangible results are visible, CIOs are ready to adopt to different service models. Sun Managed operations will use real data points from customer resources to design, implement and manage a services strategy with the customer. The IT department is indeed a cost center but its sheer importance as well as relevance to business can no longer be denied. With Managed Operations not only would Sun help in ensuring availability increases but also reduce cost over a period, for overall IT operations.”

In the two years of operations, Sun’s services business contributes 18% of Sun’s revenues in India, which continues to be one of the major growth markets for Sun worldwide. For Sun India, services is growing at a rate of 50%. Globally Sun’s services business is pegged at $5.3 billion, which accounts for 35% of Sun’s business.

Major wins include Punjab National Bank and Reliance Infocomm where Sun has been mandated to manage and support the growing IT infrastructure. Some of the key drivers for growth of managed services have been high investment in IT infrastructure from sectors such as banking, BPO and telecom; statutory guidelines from government bodies like RBI, alignment of business systems with global trends, and the need for always-on, always-available IT infrastructure.

IDC estimates that Managed Services will form 24% of the total domestic IT Services market vis-a-vis 22% for Technology Product Services (TPS) in CY 2006.