Bechtel CIO Shares Global Communications Nightmare At Supercomm 2005
Bechtel's global network challenge was solved with the implementation of an IP VPN, says CIO Geir Ramleth.
Building telecommunications on a global basis can be a nightmare -- just ask Geir Ramleth, senior VP and CIO at Bechtel, the $17.4 billion-a-year engineering and construction company. At this morning's opening keynote address at the Supercomm 2005 conference in Chicago, Ramleth told audience members how Bechtel was living that nightmare not long ago.
As the number of its offices around the world grew to 40 and the number of employees reached 40,000, the complexity of its network also increased, Ramleth said. Additionally, Bechtel was putting in new IT infrastructures in many of the locations it services, and network connectivity became costly, he said. For example, when Bechtel tried to provide connectivity to a location on an island in the South Pacific, it was hit with bandwidth costs of $65,000 per megabit a month.
The world has changed dramatically since Bechtel began building railroads heading west 107 years ago, Ramleth notes. When it comes to such high connectivity costs for global locations today, "you need to figure out how to be innovative and find other ways of deploying the network," he said. Bechtel found a solution in its deployment of an Internet Protocol Virtual Private Network, or an IP VPN. The service connects branch offices and remote locations over an IP network, and can support multiple applications such as voice, video, and data.
The IP VPN "enabled us to do business differently, because we've been able to build a modern network with more capacity and better performance, as well as redundancy. And before we couldn't afford redundancy," Ramleth said. Now Bechtel can deploy its international and domestic lines in a matter of days or weeks as opposed to months. "We can now deploy phone systems in a matter of days without PBXs [by] using IP phones with Cisco IP Manager," Ramleth said.
The company also has been able to reduce bandwidth costs from $7,500 to $1,530 per megabit for its international lines and from $3,500 to $500 per megabit for its domestic lines using the IP VPN.
The keynote address served as a vehicle touting the importance of a robust global network, and included a speech by Charlie Feld, executive VP of portfolio management at EDS Corp. "We're now in the second era of global commerce, and you need global, secure networks with thousands of companies connected to your supply chain," Feld said.
Businesses are looking for the most efficient supply chain and have become dependent on networks and data centers, Feld said. He concluded: "The issue now for most companies is how they get from legacy environments like PBXs to new technologies."
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