The Move Toward Adding Value and Away from Managing Infrastructure: Our Journey with Riedel Networks
There’s been a revelation in IT Management. IT professionals no longer have to spend their time managing infrastructure at the component level. We are no longer obliged to configure routers and switches, cable data centers, or manually redirect traffic when a network trunk fails. Cloud-based and virtual infrastructure, along with remote management tools and services, have eliminated many of our day-to-day maintenance tasks and freed us to focus on the big picture.
Instead of dealing with outages, we can now find ways to enhance end-user satisfaction and increase IT's contribution to our employers' and customers' bottom line. Unfortunately, few companies are taking advantage of this major shift. I was determined that Müller | Die lila Logistik would be one of those few.
Going Beyond the Basics
I'm the head of IT at Müller | Die lila Logistik.
Müller | Die lila Logistik is a leading logistics service provider in Germany offering the development and implementation of integrated logistics solutions for procurement logistics, manufacturing logistics, and inbound/outbound logistics.
The establishment of our two business domains, Lila Consult and Lila Operating, contributes to integrating consulting and implementation services. Our solutions are implemented either directly on site with our customers or in our Müller | Die lila Logistik service center.
Together with our customer Mercedes-AMG, Müller | Die lila Logistik won the German logistics award in 2014 as well as the German sustainability award in 2011.
I joined the company in March of 2019. I had a clear vision of the future of IT and began to implement it right away. Although I had the support of our management team, some members of my IT team were skeptical. You see, people in this line of work are used to playing the hero. We know how to code apps and write scripts, we understand how to reboot a wide area network when it crashes, and we have the skills to rebuild a server or data center from a backup. These firefighting skills served us well in the past, but today's IT challenges no longer lie in maintaining infrastructure. Our job is to add value and to help our employers and customers stay ahead of the competition.
Today's IT managers and decision-makers must look away from the nuts and bolts of the business and turn their gaze to the technologies and applications that drive innovation and bolster the bottom line—namely, artificial intelligence (AI), business intelligence (BI), and automation. These are the engines of the future. When you look under the hood, they differ from traditional IT tools in the same way that electric motors differ from internal combustion engines. But it's hard for some people to switch gears. When you spend years or decades mastering the intricacies of IT, you might have trouble steering your career in a new direction, and it's not always easy to embrace change.
Adding Value Instead of Cutting Costs
When I started at Müller | Die lila Logistik, we had all our eggs in the traditional IT basket. We had an on-prem, hardware-based data center and a massive IT team that kept everything running smoothly. But we were stagnant instead of moving forward. I wanted to change that.
Rather than investing in physical infrastructure and assigning people to manage it, my goal was to virtualize our servers, move our data center to the cloud, and adopt software as a service (SaaS), storage as a service (STaaS), and backup as a service (BaaS).
I didn't waste any time. Instead of phasing in this new approach slowly, we quickly moved everyone to Microsoft 365. We ditched our Microsoft Exchange servers and put email on the cloud, which gave us one less thing to manage. Next, we switched to a cloud-based warehouse management system. It was as simple as going to a supplier and saying, “We love your software, but we don't want to configure or maintain it. Do you make a version for the cloud?”
A lot of companies make IT decisions based solely on cost-cutting measures, which is the worst way of saving money. I believe in getting the best value for your investment. Moving our infrastructure to the cloud didn't reduce our IT spend, but it increased stability and freed my team to focus on providing creative solutions to our customers' logistics issues.
Our next step was a big one. We moved from our aging MPLS network to SD-WAN. MPLS was an excellent technology for its time and was once the best solution for shaping and routing traffic. Today, SD-WAN offers the same traffic management features, runs on mixed networks, including the public internet, and is decoupled from hardware. You no longer have to rip apart your network to rebuild it. And you can configure all your hardware remotely. Better yet, you can hire an external partner to build and manage your network, and we did exactly that.
Building Something New with a Trusted Partner
Despite the dramatic change, we decided to work with the same company that provided our MPLS infrastructure. was founded in 2001 in Butzbach, a small town just north of Frankfurt. The company operates a worldwide MPLS with points of presence in over 40 countries and has recently moved into the SD-WAN space. As a long-time partner, Riedel was in a perfect position to help us make the transition to software-defined infrastructure.
Traditional MPLS infrastructure offers limited bandwidth and limited options. As a result, we typically ran a pair of low-capacity leased lines to each of our customers' factory floors. These one- and two-megabit connections were not only slow but also unreliable and cumbersome to manage. If one line went down, our IT team had to manually route traffic to the other line. We had minor outages every two or three weeks and major network failures four or five times a year.
Dealing with these crises took time and resources away from building better logistics solutions for our customers, and when our MPLS lease ended, we asked Riedel for something better. At our first meeting, I told them that I didn't care about the price, the technology, or the vendor. I wanted a fast, reliable network that was highly available and used algorithms instead of people to route traffic to customers' warehouses. I also wanted Riedel to manage it, so my team could continue our shift away from network maintenance.
They came back for a second meeting and showed me Cisco . We loved the solution, and that took the conversation up a notch; we started talking about SLAs instead of technology specifics. Even better, Riedel would provide this new infrastructure at the same price as our aging MPLS network, and my people wouldn't have to lift a finger to manage it. While we do have a management console with high visibility into the network, Riedel does all the heavy lifting.
Adopting New Technology and Changing our Internal IT Culture
We signed the deal in September 2019 and rolled out the new network in May 2020. Instead of running two high-service-level low-capacity lines to our customers' factories and warehouses, we now run one such line for priority traffic and pair it with a low-service-level high-capacity line for everything else. The SD-WAN optimizes traffic automatically and routes it through the appropriate network segment—be it a private line or the public internet—based on factors like capacity and cost. If part of the network goes down, algorithms divert traffic to working segments so data can reach its destination.
Our SD-WAN works perfectly, and we haven't experienced a single outage since we switched over from MPLS. Riedel handles our network infrastructure and our connection to the internet, leaving us to focus on best serving our customers. They have negotiated new agreements with the relevant last-mile providers on our behalf. They have helped us eliminate unnecessary telecommunications expenses, and we have invested this money in managed services. With the same amount of money, we’re doing so much more.
Adopting new technology was easy. Changing my IT team's mindset proved more of a challenge. Some of my people wanted to keep operating the old way, putting out fires one at a time. Some even feared that automation would put them out of a job. Once we went live with Microsoft 365, however, they began to get the message. Instead of managing mail servers, they started seeing themselves as business partners who could drive acquisitions. They started pursuing more interesting tasks that better maximized their skills, and that transformed our internal IT culture.
For our customers, logistics is all about moving data and managing supply chains. Their choice of supplier often comes down to pricing—if they can save a few euros, they'll go with someone else. However, if we can add value to our services and offer them more attractive SLAs at the same price as the competition, we can retain them. Thanks to Riedel's managed SD-WAN services, Lila's IT team is free to create money-making opportunities instead of managing infrastructure.
Pursuing Revenue Growth
Our current project with Riedel is to assess and implement a cybersecurity solution for Müller | Die lila Logistik and our customers. As with our SD-WAN, we want a set-it-and-forget-it solution. While I recognize the need to keep our network and our IT assets secure, I want to automate and outsource the work, so my team can continue to pursue revenue growth. I have already proven that this strategy can work, and now it's time to scale it.
Technology is a tool that can help grow a business. Some people–especially executives—are afraid of new technology. They think that it's too expensive or that it might disrupt a company's operations. While this is sometimes the case, technology can be tamed by focusing on results. Carpenters don't spend their time making hammers. They buy the best hammers they can and use them to build houses. IT professionals must do the same and think about building on top of our networks instead of maintaining infrastructure. The change would be astounding.