Business Growing Pains

An IS/WISPs growth is an evolution process. Below I list a growth roadmap you should be following:

 

Broadband

ADSL ==> ADSL Bonded => Diginet (>2mbps) => Low cost shared Fibre (2mb to 15mb)=> Multiple low cost shared fibre (15mb to 60mbs) => 1:1 fibre to cloud ( 10mb to 50mb) => mega 1:1 fibre to cloud (50mb to 100mb)=> 100mb+ P2P to Data Center with international and local breakout from DC.

 

VoIP

Reseller (you sell & install, provider bills client directly and give you comm) => Share White Labelled Cloud infrastructure with major provider èWholesale (you setup your own switch, usually Asterisk, in your office and negotiate with one or multiple providers to terminate at wholesale) => Upgrade to Carrier switch ( more robust, accurate billing, Unified Comms)still wholesale => grow the carrier switch into VoIP transit. Fixed transit low rate => move the VoIP switch into a major DC, this goes alongside your P2P connection for broadband=> obtain an interconnect with Telkom => obtain interconnect with the other GSM and VoIP providers!!

 

Note, the interconnects will cost you quite a bit of money, technical resources and financial commitments (guarantees)!so you would look at that only if you’re billing R1m+ pm in airtime and your company is worth (arguably) R5m+ in credit worthiness.

 

To outsource or not?

I’ve received a large number of off list messages in response to my earlier mail, with most all saying the same thing, that it is not always worthwhile/possible to outsource is you’re in a smaller town with limited capital and resources. One WAPA member (who also happens to be a client) has made a humorous comment:

 €œsometimes a bit difficult for some small town WISP’s where you have to be the GP, anaesthesiologist, surgeon, nurse and many more  – you can’t outsource everything!!!.. €

 

On the contrary dear friends. Firstly, remember that most WAPA members thrive in underserviced areas, which is as to why the consumers first choice of compulsory internet & voice connectivity is wireless. With this growth, resources become tighter, the need to move away from the conventional ADSL backhaul (as covered by a mail I sent out a few months ago)   becomes a great necessity, and the owner can no long afford the time to actually go up a tower because he has a 100 other tasks to do in the day.

 

Have you noticed that your days of climbing are coming to an end? Most of your duties are now administrative. You now have to RUN the company. You struggle to find time to even monitor your network and uptime. Sure you have all the fancy software to send you the notifications, but you’re too engrossed in signing and retaining clients, finances, hiring staff, delegation and deployment of the tech team, ordering and keeping stock of equipment and designing expansion plans for your network!if you’re not doing these listed tasks yet, then get ready, because this is what   you   will face very soon as you grow.

 

Case Study

I’ll give you an example from personal experience. At OTEL, we’re deploying a Neutral Carrier Grade VoIP Switch service called TVNO 2 (Terrestrial Virtual Network Operator). Since many WISPs use various network operators, but have an Asterisk box servicing their clients, many are looking for a more robust solution to cater for their growth. Asterisk can be tricky once you reach a higher volume of clients, and/or if you do not have a proper billing system in place (A2Billing is not exactly carrier grade stuff). Many want to upgrade now before they get too big and the system starts failing, which is expected to happen (proven in history ).

 

Now this service has taken the market by storm. We’re deploying switches daily across the country. Whether WISP is terminating calls through us of a myriad of other providers, it makes no difference. The switch caters for all.
Whilst the National Sales Manager closes the sales, the CTO (with a team under him) handles the deployment, I need to start thinking operations, on how will I be supporting this service!hire or outsource?
A difficult decision which took me a month to make, so I penned some advantages and disadvantages with my friend G:

 

Outsource or handle internally the Monitoring, Maintenance and Security of Linux based TVNO2 Switches nationwide

ADVANTAGES

DISADVANTAGES

Monitoring, maintenance and security of Linux is not our core activity. We need to focus on our core services which is to market, sell and promptly deploy new and innovative VoIP and Broadband services. I rather allocate the time and financial resources to do the above.

Outsourced company will see my confidential information. There’s a threat to the security and   confidentiality.

Hiring, training and supervising new staff to do this will add more tasks on my already full plate. If I do not pay attention, the service will start to suffer due to lack of supervision or poor staff skills.

Need to change mindset as the outsource company will have his own methods to get the job done, which may not conform to my way. But he will get it done.

If I outsource this monitoring, maintenance and security service of the TVNO Switches, I can sign an SLA with penalties, and bind the company to perform, or risk losing the contract.

Current staff may lose interest in achieving certain goals as they may let the outsource company handle many of the redundant tasks (which both companies can perform)

The headache of ensuring the correct personnel is handling the tasks listed is no longer our problem. The outsourced company will need to ensure that he has qualified and expert staff to properly manage the servers in order to meet his contractual obligations. This will result in increased efficiency and productivity in the TVNO2 service

The above may cause mis-communication and result in bad service.

I can streamline my business operations

Outsourced company is not providing services only to us, so we may not get 100% attention.

I will be saving Hiring costs (advertising for staff), time in interviews, effort of training, no manpower loss whilst training new staff, operating costs is saved, and I do not need to send new staff for training, thus costing much as well. Good overall cost advantage

Outsourcing may have hidden costs and time, like legal costs of signing the contract, regular meetings to ensure all is running well, etc

Can change outsourced company if they’re not meeting   their SLAs. More flexibility.. Can’t just fire staff if not performing. There’s a process which takes up time, energy and cost money to fire.

We may suffer from lack of customer focus, as we will not have the normal relationship we’ve had in the past. Client will be a number, but his job will be done or problem fixed promptly.

Will experience control in the business as I can dictate to outsourced partner what I need and how do I want it.

There can be several disadvantages, such as, renewing contracts, misunderstanding of the contract, lack of communication, poor quality and delayed services amongst others

Do not need to purchase on monitoring software, hardware, and other infrastructure. Outsourced company will already have this.

Outsourcing may cost more money per client, so need to weigh out that the advantages makes it worthwhile.

Get the assurance that my business processes are being carried out efficiently, proficiently and within a fast turnaround time.

The company may not be able to attend to your urgent needs immediately, so you may need to wait in line, thus causing frustration.

I can free up the cash flow, I will have a fixed amount to pay at month end with no hidden costs.

I’ll be sharing the business risks. I do not need to pay for mistakes made by outsourced company’s staff.

 

After careful consideration, we decided to look at outsourcing. We will place the disadvantages in an SLA with time limits, so we’re on calculated risks.   We were careful in our selection process.

 

A friend introduced me to a bunch of Linux experts. After setting up an initial meeting, I spent a day at their office to see their operations and explore synergies!. Pony tails, hands as smooth as butter, multiple 22 € LCDs per engineer, lots of coffee and a Google like atmosphere, needless to say I was impressed! these guys were passionate about their Linux and extremely knowledgeable.

A month and a couple of contracts later, we came to an agreement to look after all of our TVNOs nationwide. At a mere monthly cost to WISP at R499 per VoIP Switch, it’s almost a free service. Monitoring 24/7/365, Firewalling, maintenance/version updates and some other ADHOC services. A flippin good deal, but then I’m a good negotiator J, plus we have the large volume of TVNOs in the market.

We’ll be releasing the Enterprise version (current version is for Carriers) sometime this year, so its added business for them.

 

We’re already changing some of the larger TVNOs to High Availability, NAS on the cloud, and various other things!overall a good and informed decision.

 

What has this saved us?! A team of at least 3 highly trained professionals with an accumulated R100k pm monthly bill. We now have access to 22 highly trained Linux Professionals (for TVNO2 ) at a fraction of the price.

We’re considering passing some of our CORE network duties (also maintenance, firewall and monitoring) over to them from this month on, the optimal performance and impressive work rate is the deciding factor!

 

Use the above table and see where you fit in. Whether a WISP is large or small, it may pay to outsource. Ultimately, it comes down to what type of business owner you are!.if you struggle in letting go of some responsibility and let another person/company of your choice handle it, you may be bottle-necking your growth, as there are only so much you can do with your two hands, 10 fingers, and one busy head in a 24 hour day.

 

After all, we’re a long way to go for human cloning!I sure do wish I had another one of me to help!

Can I do his Job?

South Africa lacks skilled personnel in a big way. There are young techs available, but they have no experience. The experienced ones comes at a high price (we’re currently on a hiring drive, where no senior tech comes below R45k pm), but do not stay long as they get snapped up by larger companies, the same way we snap them up from smaller companies where they’ve gained their experience from. This is a huge issue in the ICT sector.

The challenge for WISPs in the rural areas is that few are willing to move to the area, and if they do, they look to moving back to the city as soon as another (not necessarily better) job opportunity becomes available.

 

In 2009, we’ve changed our strategy somewhat. Since we’ve outsourced each section of our national VoIP and Broadband network to various companies across the world, we now have directly or indirectly, over 250 highly trained, qualified and experienced engineers who assist us 24/7/365!.from all continents, across all timezones.

Eg: If one is not available to do a Cisco script, we’ll have more than 5 other companies on standby to assist on an ADHOC basis. It is up to them to get one of their multiple engineers to assist, within couple of hours. So although you’re paying one entity, you may actually have 20 heads to assist you.

 

The trick is to find these companies and setup a standard terms & conditions with them, which does not necessarily bind you to use them, or pay all of them a monthly recurring cost. Some companies whom you deal daily with may need a monthly retainer, to which we gladly pay as the hours they save us in troubleshooting a problem on escalated 3rd tier level and fixing it makes it worthwhile.

 

Of all our multiple support partners, only 4 are in South Africa, and Mikrotik SA (who have responded to your email) is one of them. I would suggest you give them a try.

 

You will need to Google these consultancy firms, and you will also soon learn which country has outstanding skills. Eastern European countries such as Latvia, Romania & Czechoslovakia have exceptional Cisco skills, whilst India will have outstanding PHP & JAVA skills, and the folks in Cali have very good Linux expertise.

 

Needless to say, you will need local techs for 1st and 2nd line support. Escalation to Senior Engineers, then Vendors is the normal process. The skill of the management to motivate the local tech to stay and grow with the company become a  ‘man management’ issue. But there’s nothing that beats a motivated high salary if the tech is really an integral part of your business.. Remember, if he leaves, to replace him by training another individual and getting the new guy to understand your thinking will take time, and that’s something you do not have! so price your senior staff that way!do not make the mistake of saying  ‘ ah, I can’t pay him that price, I rather do it myself.

 

Think about it this way: How much are YOU worth per hour?

The medium sized WISP owner would be worth nothing less than R750 per hour. So if you dedicate 15 hours a month doing the job of the tech whom you decided not to hire, you’ve got to pay yourself R11250pm (R750x15)!

Now, who did your CORE job function whilst you were doing that person job in those 15 hours? That’s how much less progress you’ve made for your company!

Oh yes, we can do it after hours or on weekends, it ok!.but then you’re infringing on your family’s time. Not only that, you’re depleting your energy levels which needs to be at optimum during office hours to do your CORE functions as owner.

 

In conclusion, what I would suggest to all WISPs is to
a) find out what if your function in the company, CEO, COO, CIO, CTO, CFO, CMO, HRM?!

b) judge your commitment and knowledge and put a price on your hourly rate, this way you can set the benchmark and price your senior staffs value of time/salary.

c) stick to your job function. Maybe at max share two functions.

d) get competent and responsible staff to handle the other functions, experience is key, even if from another sector for functions such as CFO, COO, CMO, HRM.

e) pay these staff well to stay on and value them as business partners (without shares, but possibly profit sharing for the more senior guys, like CFO, COO)

f) Stay out of their way, let them perform their functions without interference. Only get involved when things are about to get awry, or have gone awry, and they need your decision making skills.

g) as weird as it sounds!.avoid know everything that goes on in the company (unless you’re the COO)!.this will enable you to focus on your Job without distraction. Trust me, you will be approached if something’s not going right!or you will instinctively notice it.

h) some may disagree, but avoid hiring family, friends, neighbours, or people whom you have a social life with.. it makes it that much more difficult and risky to let them go if they are not performing according to expectations. Getting them cheap or hiring them for trust may not be the right reason!.according to my experience and reports from other friends in business, it doesn’t always work out.

i) outsource when you can!there’s only so much you can do!. Stick to your expertise, and use it to progress in your business, rather than self-learning about something which may not reap as much rewards!

 

Anyway, this is my advice!now I’m off to spend time with the family whom have just woken up on this cold Sunday morning J

 

Ciao!