2018 north american data center services visionary innovation leadership award · 2018-11-19 ·...

2018 North American Data Center Services Visionary Innovation Leadership Award

2018

BEST PRACTICES RESEARCH

© Frost & Sullivan 2018 2 “We Accelerate Growth”

Contents

Background and Company Performance ........................................................................ 3

Industry Challenges .............................................................................................. 3

Focus on the Future and Best Practices Implementation ............................................ 3

Conclusion........................................................................................................... 5

Significance of Visionary Innovation Leadership ............................................................. 7

Understanding Visionary Innovation Leadership ............................................................. 7

Key Benchmarking Criteria .................................................................................... 8

Best Practice Award Analysis for vXchnge ...................................................................... 8

Decision Support Scorecard ................................................................................... 8

Focus on the Future .............................................................................................. 9

Best Practices Implementation ............................................................................... 9

Decision Support Matrix ...................................................................................... 10

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ................................................................................................................. 11

The Intersection between 360-Degree Research and Best Practices Awards ..................... 12

Research Methodology ........................................................................................ 12

About Frost & Sullivan .............................................................................................. 12



Background and Company Performance

Industry Challenges

To support their high-stakes technology needs in the digital era, businesses are looking

beyond the public cloud. Sixty-eight percent of US businesses surveyed by Frost & Sullivan

say they are implementing a flexible hybrid environment that comprises multiple

infrastructure options: public and private, local and remote, dedicated and shared. Across

the spectrum of options, traditional co-location services retain an important place. According

to the 2018 Frost & Sullivan survey, 70% of businesses say their hybrid IT environment

includes some co-location services, and 69% say they plan to increase their co-location

deployments in the next two years. Even more significant are recent indications that

businesses are moving key applications out of the public cloud into co-location facilities.

In a traditional co-location arrangement, the service provider procures the real estate, and

leases space, power, cooling, and network interconnects to business tenants. The tenants

provide and maintain their own compute and storage infrastructure. In a hybrid

environment, co-location services generally occupy similar territory as the on-premises data

center; that is, co-location is considered the right deployment model for workloads that are

not suitable for public or hosted cloud deployments. Reasons the business might decide a

workload isn’t cloud-suitable include concerns about security, performance, and compliance.

Businesses have long relied on co-location services as an extension of the company’s

private data center, a way to access additional data center facilities without the cost of

expansion or new construction. But today’s businesses need more than commodity space

and power. To compete effectively, they need to optimize and modernize every aspect of

data center operations, right down to facilities management and power utilization. They also

need assistance in managing the infrastructure to meet their increasingly urgent technology

requirements in the digital market.

Ideally, businesses need a data center partner that will improve on their own data center

infrastructure, with state-of-the-art design and intelligent systems that help them achieve

their top business objectives. More than power and space, businesses need a new “Data

Center as a Service” option that introduces maximum efficiency, cost-effectiveness, and

reliability into their IT environment. This is the innovative service that is provided by

vXchnge.

Focus on the Future and Best Practices Implementation

Founded in 2013, vXchnge is a fairly new entrant into the data center services market. The

company’s footprint comprises 14 data centers throughout the US, including 8 acquired

from Sungard in 2015. Data Center as a Service offerings include co-location, network

interconnects to over 70 network service providers, and “remote hands” management of

clients’ infrastructure hosted on site.



Criterion 1: Focus on Unmet Needs

As businesses undergo digital transformation, their urgent needs—for technology, expertise,

and timeframes to make confident decisions—are escalating faster than their ability to

address them. vXchnge has designed its services and data centers to make it easier for

resource-constrained IT organizations to support their business’s most critical business

goals.

Unlike competitors that simply provide power and space, vXchnge’s unique services and

technologies are built to address clients’ top challenges in digital transformation. For

example, 48% of respondents to the 2018 Frost & Sullivan cloud user survey say they

struggle to meet business expectations for application availability and performance.

vXchnge offers industry-leading uptime service level agreements covering its own

infrastructure. Equally important, the company’s intelligent management platform, in\site,

offers granular visibility into infrastructure performance that allows client IT and business

employees to identify and correct potential app performance issues before they happen (for

example, sending an alert when a server begins to consume excess power – which may

indicate an impending hardware failure).

Criterion 2: Blue Ocean Strategy

Co-location, or leasing of data center space, is a service model that has seen little change in

decades. For most providers, any investment goes to expanding into new geographical

markets. vXchnge has a different model. The company, founded by veterans of Switch and

Data and Equinix, set out to revolutionize the data center services market, building and

refurbishing data center facilities with state-of-the-art design, infrastructure and

management technologies, and baked-in processes that serve the client’s entire business –

not just the IT department.

vXchnge executives say their company is in the business of “protecting the customer

brand.” vXchnge has designed its data centers with a sustained focus on reliability and

uptime. Rather than the cages that are common in many co-location facilities, the basic unit

of vXchnge infrastructure is a high-density server cabinet. The cabinets, into which clients

install their own servers, are deployed in energy efficient cold-aisle containment systems

that utilize state-of-the-art air flow technologies.

Furthermore, because human error is a top cause of data center failures, vXchnge has

incorporated design and procedural elements aimed at making it easier for client technicians

to do their jobs without error. During onsite visits (which may last long hours and days in

the case of a major installation), client technicians have access to electric carts to move

their equipment from the freight elevator to the cabinet, as well as a stocked kitchen area

and on-site shower. To catch configuration errors before they impact the business, the

in\site platform extends granular visibility to headquarters-based systems architects. The

result is a data center than not only augments the premises, but introduces optimization

and proficiency into the client’s business.



Criterion 3: Growth Performance

While it has been in market for only a short time, vXchnge has recorded continual revenue

growth. The company’s marquee customers include technology leaders such as SAP, Hughes

Networks, Tech Mahindra, and Comcast; financial services firms such as Bank of America,

and retail giants such as B&H. However, the company’s market-based pricing enables its

data center services to be affordable to less-well-known small and midsized firms. Unlike

competitors that require a contractual commitment for a specific amount of space and

power, vXchnge’s flexible contract terms allow clients to procure capacity on a consumption-

basis – reserving and paying just for the racks they need, for the timeframe they need

them. Also contributing to growth of small and large clients is vXchnge’s 24x7x365 support.

Unlike competitors who rely on on-call technicians to handle any issues outside of standard

hours, vXchnge staffs its data centers with technical resources around the clock.

Criterion 4: Process Design

vXchnge designs and operates its centers with military precision, resulting in operational

efficiencies that far exceed that of competitors (and likely its clients’ own data centers, as

well). The company provides an industry-leading uptime of “seven-nines” (99.99999%

across its data centers, which equates to less than 3 seconds of downtime per year), made

possible through a combination of resilient design and meticulous processes. As with most

high-end data centers, uninterrupted power is assured via N+1 configuration, with

redundant circuits running to each cabinet. Less common among data center providers are a

number of best practices geared toward keeping the data center (and even customer

equipment) continually operating. For example, fire suppression equipment is located on the

ceiling of each pod (cold-aisle containment system); this way, if the equipment is activated

– either due to an actual fire or equipment malfunction – the damage is limited to a single

pod. To support clients’ compliance requirements, the in\site portal allows compliance

officers to download watermarked compliance reports for five industry certifications attained

by vXchnge data centers: SSAE 18 Type II, SOC II Type 2, ISO/IEC 27001:2013,

HIPAA/HITECH, and PCI DSS 3.2. In addition, user activity logs available through the in\site

portal enable clients to identify compliance, worker productivity, and vulnerability issues.

Criterion 5: Technological Sophistication

Central to vXchnge’s value is its proprietary user platform, in\site. The platform delivers a

comprehensive level of visibility and analysis to vXchnge clients, enabling them to

understand their environment and quickly make business decisions. Through the platform,

users can perform functions such as:

View power and bandwidth usage, down to the cabinet level, over any period of time

Create notifications and alerts

Track asset location and status

Align assets with applications and workloads, via flexible customer-input name and description

fields, for easier management



Administer access to the facility and to in\site; view logs of those who have gained access, or

lists of authorized users who have not accessed the facility or platform.

Download security and compliance reports

Submit trouble tickets

Pay invoices

Access to the platform can be customized by role or user, with flexible dashboards

presenting relevant data. vXchnge says its customers—especially those without large IT

organizations—appreciate the role-based access, so that key stakeholders do not need to go

through IT intermediaries for each request.

Conclusion

As businesses transform to meet the demands of the digital era, they require a new type

of data center partnership. vXchnge’s unique Data Center as a Service offering leverages

next-generation data center design and power/cooling systems, a sophisticated

intelligence platform, and industry-leading best-practices to facilitate clients’ ability to

manage their infrastructure, their applications, and their business.

With its strong overall performance, vXchnge has earned Frost & Sullivan’s 2018 Visionary

Innovation Leadership Award.



Significance of Visionary Innovation Leadership

A Visionary Innovation Leadership position enables a market participant to deliver highly

competitive products and solutions that transform the way individuals and businesses

perform their daily activities. Such products and solutions set new, long-lasting trends in

how technologies are deployed and consumed by businesses and end users. Most

important, they deliver unique and differentiated benefits that can greatly improve

business performance as well as individuals’ work and personal lives. These improvements

are measured by customer demand, brand strength, and competitive positioning.

Understanding Visionary Innovation Leadership

Visionary Innovation is the ability to innovate today in the light of perceived changes and

opportunities that will arise from Mega Trends in the future. It is the ability to scout and

detect unmet (and as yet undefined) needs and proactively address them with disruptive

solutions that cater to new and unique customers, lifestyles, technologies, and markets.

At the heart of visionary innovation is a deep understanding of the implications and global

ramifications of Mega Trends, leading to correct identification and ultimate capture of

niche and white-space market opportunities in the future.



Key Benchmarking Criteria

For the Visionary Innovation Leadership Award, Frost & Sullivan analysts independently

evaluated two key factors—Focus on the Future and Best Practices Implementation—

according to the criteria identified below.

Focus on the Future


Criterion 2: Visionary Scenarios through Mega Trends

Criterion 3: Growth Pipeline



Best Practices Implementation

Criterion 1: Vision Alignment


Criterion 3: Operational Efficiency


Criterion 5: Company Culture

Best Practice Award Analysis for vXchnge

Decision Support Scorecard

To support its evaluation of best practices across multiple business performance

categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool

allows our research and consulting teams to objectively analyze performance, according to

the key benchmarking criteria listed in the previous section, and to assign ratings on that

basis. The tool follows a 10-point scale that allows for nuances in performance evaluation.

Ratings guidelines are illustrated below.

RATINGS GUIDELINES

The Decision Support Scorecard is organized by Focus on the Future and Best Practices

Implementation (i.e., These are the overarching categories for all 10 benchmarking

criteria; the definitions for each criterion are provided beneath the scorecard.). The

research team confirms the veracity of this weighted scorecard through sensitivity

analysis, which confirms that small changes to the ratings for a specific criterion do not

lead to a significant change in the overall relative rankings of the companies.



The results of this analysis are shown below. To remain unbiased and to protect the

interests of all organizations reviewed, we have chosen to refer to the other key

participants as Competitor 2 and Competitor 3.

Measurement of 1–10 (1 = poor; 10 = excellent)

Visionary Innovation Leadership

Focus on the

Future

Best Practices

Implementation Average Rating

vXchnge 10 10 10

Competitor 2 8 7 7.5

Competitor 3 6 5 5.5

Focus on the Future


Requirement: Implementing a robust process to continuously unearth customers’ unmet

or under-served needs, and creating the products or solutions to address them effectively

Criterion 2: Visionary Scenarios through Mega Trends

Requirement: Incorporating long-range, macro-level scenarios into the innovation

strategy, thereby enabling “first-to-market” growth opportunity solutions

Criterion 3: Growth Pipeline

Requirement: Best-in-class process to continuously identify and prioritize future growth

opportunities leveraging both internal and external sources


Requirement: Strategic focus on creating a leadership position in a potentially

“uncontested” market space, manifested by stiff barriers to entry for competitors


Requirement: Growth success linked tangibly to new growth opportunities identified

though visionary innovation

Best Practices Implementation

Criterion 1: Vision Alignment

Requirement: The executive team is aligned along the organization’s mission, vision,

strategy, and execution.


Requirement: Processes support the efficient and consistent implementation of tactics

designed to implement the strategy.

Criterion 3: Operational Efficiency

Requirement: Staff performs assigned tactics seamlessly, quickly, and to a high-quality

standard.




Requirements: Systems enable companywide transparency, communication, and

efficiency.

Criterion 5: Company Culture

Requirement: The executive team sets the standard for commitment to customers,

quality, and staff, which translates directly into front-line performance excellence.

Decision Support Matrix

Once all companies have been evaluated according to the Decision Support Scorecard,

analysts then position the candidates on the matrix shown below, enabling them to

visualize which companies are truly breakthrough and which ones are not yet operating at

best-in-class levels.

High

Low

Low High

Best

Practi

ces I

mp

lem

en

tati

on

Focus on the Future

vXchnge

Competitor 2

Competitor 3



Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices

Frost & Sullivan Awards follow a 10-step process to evaluate Award candidates and assess

their fit with select best practice criteria. The reputation and integrity of the Awards are

based on close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

1 Monitor, target, and screen

Identify Award recipient candidates from around the globe

Conduct in-depth industry research

Identify emerging sectors

Scan multiple geographies

Pipeline of candidates who potentially meet all best-practice criteria

2 Perform 360-degree research

Perform comprehensive, 360-degree research on all candidates in the pipeline

Interview thought leaders and industry practitioners

Assess candidates’ fit with best-practice criteria

Rank all candidates

Matrix positioning of all candidates’ performance relative to one another

3

Invite thought leadership in best practices

Perform in-depth examination of all candidates

Confirm best-practice criteria Examine eligibility of all

candidates Identify any information gaps

Detailed profiles of all ranked candidates

4

Initiate research director review

Conduct an unbiased evaluation of all candidate profiles

Brainstorm ranking options Invite multiple perspectives

on candidates’ performance Update candidate profiles

Final prioritization of all eligible candidates and companion best-practice positioning paper

5

Assemble panel of industry experts

Present findings to an expert panel of industry thought leaders

Share findings Strengthen cases for

candidate eligibility Prioritize candidates

Refined list of prioritized Award candidates

6

Conduct global industry review

Build consensus on Award candidates’ eligibility

Hold global team meeting to review all candidates

Pressure-test fit with criteria Confirm inclusion of all

eligible candidates

Final list of eligible Award candidates, representing success stories worldwide

7 Perform quality check

Develop official Award consideration materials

Perform final performance benchmarking activities

Write nominations Perform quality review

High-quality, accurate, and creative presentation of nominees’ successes

8

Reconnect with panel of industry experts

Finalize the selection of the best-practice Award recipient

Review analysis with panel Build consensus Select recipient

Decision on which company performs best against all best-practice criteria

9 Communicate recognition

Inform Award recipient of Award recognition

Present Award to the CEO Inspire the organization for

continued success Celebrate the recipient’s

performance

Announcement of Award and plan for how recipient can use the Award to enhance the brand

10 Take strategic action

Upon licensing, company is able to share Award news with stakeholders and customers

Coordinate media outreach Design a marketing plan Assess Award’s role in future

strategic planning

Widespread awareness of recipient’s Award status among investors, media personnel, and employees



The Intersection between 360-Degree Research and Best Practices Awards

Research Methodology

Frost & Sullivan’s 360-degree research

methodology represents the analytical

rigor of our research process. It offers a

360-degree-view of industry challenges,

trends, and issues by integrating all 7 of

Frost & Sullivan's research methodologies.

Too often companies make important

growth decisions based on a narrow

understanding of their environment,

leading to errors of both omission and

commission. Successful growth strategies

are founded on a thorough understanding

of market, technical, economic, financial,

customer, best practices, and demographic

analyses. The integration of these research

disciplines into the 360-degree research

methodology provides an evaluation

platform for benchmarking industry

players and for identifying those performing at best-in-class levels.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth

and achieve best-in-class positions in growth, innovation and leadership. The company's

Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined

research and best practice models to drive the generation, evaluation and implementation

of powerful growth strategies. Frost & Sullivan leverages more than 50 years of

experience in partnering with Global 1000 companies, emerging businesses, and the

investment community from 45 offices on six continents. To join our Growth Partnership,

please visit http://www.frost.com.

360-DEGREE RESEARCH: SEEING ORDER IN

THE CHAOS

http://www.frost.com/

2018 north american data center services visionary innovation leadership award · 2018-11-19 ·...

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