As enterprise and telecom communications networking technologies edge ever closer, so it becomes increasingly important for each sector to understand the view from the "other side of the fence."

So, having spoken with hundreds of senior executives from the telecoms industry this year, it was important for me to spend some time chatting with an enterprise technology leader such as Paul Hutchinson, the CEO and founder of independent, multi-vendor IT network services provider Hutchinson Networks Ltd. .

Figure 1: Paul Hutchinson

During our recent conversation, Paul and I chatted about vendor relationships, growth, virtualization and white box networks.

— Stephen Saunders, Founder & CEO, Light Reading

Steve Saunders: Tell me a little bit about Hutchinson. I mean, it's obviously your company. You founded it, did you?

Paul Hutchinson: Yes. I suppose I've had about 20 years in the Cisco space, but not as a hugely technical guy and that is still the case -- I am just passionate about helping businesses through knowledge. My positions have been in various Cisco learning partners, including Global Knowledge, Ashland… Geo-Train and Horizon NTS, before starting Fastlane with a couple of colleagues in the UK.

My whole background has been operational in terms of engaging with the appropriate skill sets to deliver what the customer ultimately requires for their business. That was in the training space for a long, long time, then in more of a professional services capacity rather than just a training capacity… It's all about offering very high level professional services to the marketplace to enable them to define the right networks to meet their business challenges or achieve their objectives. Then we moved into the more commoditized space, I suppose you could say. It's funny how your whole perception of that space changes as you move into it and realize how vital that sort of stuff is. Customers invest a lot of money and time in very expensive solutions, but if the simple stuff isn't done right then that's a bit of a waste of money.

SS: Are all of your customers enterprise users or do you have service providers customers as well?

PH: A few service providers. I try to mix enterprise and small/medium-sized businesses, even startups. We're in some big financial and logistics companies.

SS: It does make sense. How many customers do you have now? Is that something which you can share?

PH: Yeah. We're not a huge organization. We have over, I'd say, 150 customers now.

SS: I mean, I have 150 customers and I've been open 15 years so I think it does depend how much money they spend with you obviously.

PH: Of course. Absolutely. The key for me is definitely retention. I'd rather have a customer that spends a fairly nominal amount, but keeps coming back to spend it rather than just sort of doing a smash and grab. It's not that holy versus as alien to me as a human, let alone in business. I just don't understand it.

SS: How long has the business been in existence for?

PH: Early 2011. Before that we were an exclusive Cisco, high-end business. When we were starting to get requests very quickly actually from customers in channel to do more of different vendors and to come down that technology stack, etc, we decided to re-brand at that point in 2011. Instead of focusing solely on Cisco… we're sort of more things to more men.

SS: Juniper is another partner of yours now, right?

PH: Yes. Absolutely. Yep.

SS: They're different types of companies aren't they? I mean, at 30,000 feet they look the same, but once you actually work with them, they have totally different cultures and different approaches, I think.

PH: It's really interesting, as you work with different vendors, the approach is actually very important. I think what's really encouraging is when you do line up with a vendor that has the same ethos in terms of the customers as you do. That's incredibly exciting when that happens.

Next page: Going global

Going global

SS: I know that you're from the UK and the company, I guess, is headquartered in the UK?

PH: Correct. In Edinburgh.

SS: Yeah, in Edinburgh. Fantastic city. How recent is the move into places like North America and Asia and places like that? Have you actually won customers in those places yet or is that on the "to do" list?

PH: Our whole business methodology right now is lean and agile. The number of employees that we have is relatively small. The unique bit about what we offer is [our] global reach. We do that through engagement with subject matter experts. We're headquartered in the UK, as you say, but over 85% of every single pound or dollar that comes into this organization is derived from customers that are not in Scotland or not in the UK at all. From an international perspective, we're already doing it… We're in South America all of the time. We're in Asia working on data centers. We're doing product deployments across Europe for various manufacturing organizations.

SS: Are you growing the company organically or do you have an investor behind you?

PH: No. We're doing it all organically.

SS: Give me a sense of the growth that you're going through now. I mean, Light Reading doubled its revenues in the past three years. I mean, which is pretty exceptional but that's because it was so broken when I brought it back. That's not a typical number, is it? How would you define your growth? Obviously, it sounds like it's growing very, very quickly actually.

PH: It is. I think if I was to try to communicate the company's biggest challenge, it isn't one of opportunity and it isn't one of capability. It's one of managing growth. Some people would view that as a very enviable position to be in, but it's not easy. To manage that growth, in all manner of forms, whether it's human resources or better internal systems or the infrastructure to allow people to be the most productive or whatever guise it comes in, I think that's probably our biggest challenge.

I think, for me, it's all about constant improvement. Whether that's constant improvement in terms of, you know, our customer base or our expertise or, you know, how efficient we become or how profitable we are. That's always the measure for me. If you can look back and take a period of time and say, "We're better now than we were over that period of time," then that's the key for me. Growth is the biggest challenge. We're on a constant recruitment drive in all departments.

Then we've had to change the whole dynamic of our business and actually start to think about how we go to market and communicate what we feel the benefits of this business are to the market. That in itself is almost like a 180 in terms of how we were set up versus how we're set up today. Then moving on to probably the third line of revenue, which we haven't talked about yet, which is the recurring piece.

The stuff out of the 24/7 NOC [network operations center] that we have here, but also the Fabrix [a hosted infrastructure service] piece. For us, again, we need to look at how the business is set up today, because you've almost got three separate lines of business. We probably look at that as time goes on, but our strategy isn't to shut one of them off. It's to actually grow all three. That represents in itself a huge challenge. That's back the original question, the challenge primarily in growth in all areas and all aspects.

Next page: Virtualization realities

Virtualization realities

SS: There's a lot of talk in the industry now about virtualization. Is that something which you are hearing about from your customers? Do they have questions about it? Are they interested in it?

PH: Absolutely they are. Yes. I think there's still a fair bit of confusion around the whole SDN/NFV piece in the market place. I think that priority is only going to come to fruition more and more as people realize the power of that whole piece. I think, for us, launching that Fabrix product , we had to consider that very carefully, in terms of the timing. What we didn't want to be is so far ahead of the curve that actually the market was never going to catch up or there was such a big delay in the market catching up with that mindset that we were left high and dry.

I think today, if I'm honest, our customers are probably still predominantly in the traditional networking space and are still assessing the whole SDN/NFV virtualization piece in terms of the power and the ability it can give them as organizations. I don't think they're quite there yet, but I think there's a growing noise and we're hearing it.

SS: I think most of them, if they're sensible, won't do anything until the froth is out of the market which it certainly isn't. I guess to you, your responsibility primarily needs to be guide them on when the timing could be. Also, you must have to have to start in house on your own team to be able to answer the really hard questions. Which, in itself, is very challenging at the moment seeing as there is over a dozen organizations working on just the standard and actually the standards don't even cover everything that needs to be addressed.

I guess for your company, Paul, you have to be the sort of trusted advisor, but you also have the luxury of saying to customers, not really the luxury, but it's a safe bet to say to customers, "Actually, sometimes the best thing to do is nothing." It's the service providers, particularly the multi-billion dollar ones that we write about and for, I mean, they're really twisting themselves in a knot right now because they got half of the industry telling them that they're going to go out of business if they don't it. Then sort of the more sanguine and reasoned side is saying, "If we do this now, we might go out of business because it's not ready. It's not going to be ready for three or four years."

PH: Exactly, and to an extent I think we have a very close-knit team here. We put a lot of reliance and, you know, empower the CTO to give us direction on that. We trust in each other. I don't think it's an all or nothing decision for businesses. It may be in some cases, but I think there are enough possible scenarios which give enough, again, competitive advantage to organizations by just taking a small step rather than that big leap.

In our eyes, you don't have to pick up your whole infrastructure and put it into the cloud. You don't need to take that step. What you can do is start to take smaller decisions on virtualization or take overhead away from your businesses within that IT space in terms of skill sets and internal costs away and entrust somebody else to do it where you feel comfortable. Every organization is going to be in a very different space. Our guidance will be around the language that the customer is using and how aggressive they are about new technology.

If we get a good feeling that the customer is ready to take those steps then absolutely, we'll advise them to do it. But will we feel hesitation? We'll back them on it. It goes back to my original statement on we want what's best for the customer. Even if we think that the customer's right to take that leap, but they're not quite ready to take the leap, then we will find middle ground for them. Whether that's storage or additional security features by putting an element their network into Fabrics for example until they're comfortable to look at the rest of the estate. It may well be they've recently invested heavily into significant infrastructure. Advising them to take the jump immediately is just the wrong thing to do. SS: Your CTO must be very involved in all this. That's Stephen Hampton?

PH: Stephen Hampton. Hugely. I think he's probably one of the most stressed guys on the planet at the moment. In a good way. For him, this is a direction that he's been passionate about for a long time. You look at the skill sets required in the traditional networking engineering space…The whole CLI piece going away, becoming less of a requirement, that's a big change for engineers. Especially when you've been in or around the industry for a long time.

I think the advantage we probably have for our customers is that we've grown up with that traditional networking capability and many, many years of it. Now we're very passionate and can demonstrate the advantages of moving into the new software defined and network virtualization piece. I think it's the best of both worlds for customers. We're not going to selfishly point them in one direction or another because we've got to hit utilization targets or we need certain gains for our self. That's just not what we're about.

SS: Exactly. In addition to virtualization and SDN/NFV, people talk a lot about white box networks now. I think what people mostly mean when they're talking about that is sort of commoditized hardware layer that you can buy from companies that wouldn't just include Cisco or Juniper or Brocade, but would also include people like Dell.

To me, I think that is very important to a company like yours, Paul, because if people do go down that path, they're going to need a company like yours to actually put all of that together in a way that in the past they might have relied on you plus Juniper or you plus Cisco to do that. In the future, I mean, if we really are talking about interoperability, that hardware could come from anybody. It seems to me that makes the role of your company even more important. Do you think that is something that's going to drive your business in the future?

PH: I think it will definitely have a big impact. We're already seeing it. If you look at the traditional vendors, selfishly it's been useful for us because it's really had a competitive effect on pricing in the traditional space. I think from a very black and white perspective it's good for the market in that way, but I think if you looked at where we are today and the choices we had to make, we're still heavily relying on the core vendors and their existing solutions in terms of the overall solution that Hutchinson's recommending. But obviously that white box network option is getting louder and louder. It's something that we're keeping our eye on and is clearly having an effect in the marketplace.

SS: And Dell's one of your partners already, isn't it?

PH: Absolutely. We met with Dell recently and we have some very interesting conversations going on with them right now.