By: Amrita Shergill, Account Manager, NaaS and Ecosystem Sales
COVID-19’s disruption of traditional business models has paved the way for long overdue business operational changes. Declining revenues, along with the burden of growing fixed cost during Covid, induced lockdowns and eroded margins. Due to these tough conditions, organizations required working capital to keep the lights on.
In response to these circumstances, businesses adopted adverse technology and an asset-light model to navigate these market challenges. Network as a Service (NaaS) supports the asset-light model by using operating expenses (OPEX) in a pay-per-use manner, and transferring technology, people and processes to a vendor/partner that is a specialist in its respective field.
NaaS organizations allow to focus on its core business and maximize profits and shareholder value. Organizations can also move from a fixed to a variable cost structure. Research from Ernst & Young LLP1shows asset-light companies have outperformed their peers on total shareholder return over the last five years.
Drivers, Challenges and Solutions for Executing an Asset-light Strategy
In February 2021 Ernst & Young conducted an asset-light strategy webcast poll, which included responses from more than one thousand C-suite executives. Fifty six percent (56%) of respondents agreed that digitization and innovation are key drivers for considering an asset-light strategy. However, many reported that finding the right partner is the biggest challenge in executing the asset-light strategy.
Having a world-class network is the cornerstone of any successful digital strategy, and companies are looking for a partner that can provide a complete network solution (hardware, security, software, services) to help simplify operations, optimize resources, realize network and security convergence, and improve the user experience.
Responding to this market need, IT vendors have introduced innovative solutions with NaaS that deliver high-performance, end-to-end network solutions in a simple monthly payment model—with no upfront capital expenditure.
Today there is a heightened demand for different types of network consumption. To embrace an asset-lite strategy, companies must consider new ways of paying for and operating their networks and provide flexibility in how customers consume their services. NaaS can help rapidly deploy and manage networks in a more elastic way.
To learn more about NaaS and how HPE GreenLake for Aruba can support business agility through an asset-lite model, go to www.arubanetworks.com/naas
Ernst & Young, “How asset-light strategies and models can boost business growth,” November 2021