Why Internetworking Matters to Business
Access. In times of slow
data transfer, it made sense to have distributed databases. Each department might have customer records,
or each mill might have a database, or each country might have a set of
records. But that meant that the same
information might be in separate places (so each change in a customer’s address
might have to be updated in multiple locations), and central planners had
limited access to remote data.
Now it is practical to store
all data in one location and access a single record from anywhere in the world. That also means all data can be seen anywhere
in the world.
Data transfer. If data is
run on multiple computers and stored in multiple databases, it might be in
multiple formats. If so, my computer
might not be able to read and understand your customer record.
Internetworking not only
provides for fast transfer of data, it provides international standards for the
format of data. HTTP and XML are
formatting standards that are universal.
That is why information transferred from all makes of computers can
still be displayed clearly on your machine.
Data sharing: If data can
be transferred quickly and uniformly across long distances, then it is easier
to share information with business partners.
Now supply chain projects are technically possible.
Data accuracy/speed: With the
ability to know instantly when an order is received, or when an item has been
taken out of inventory, managers can respond more quickly to fluctuations in
business. One important consequence is
the need to hold less inventory (a.k.a. “safety
stock”). This reduces costs, while
keeping production at levels to meet sales demand.
The Requisite Infrastructure for Internetworking
- An international agreement on how data should be
transferred – TCP/IP. (Thank the US
Pentagon for funding this boon to world business).
- Fiber Optics for huge bandwidth
transmission. It also helps that we
have an interstate highway system we can run the fiber along. (Thank the breakup of the AT&T
monopoly as a way of creating competition in this industry.)
- International agencies like ICANN (Internet Corporation for Assigned Names and Numbers) to
settle squabbles and distribute names.
- Internet Service Providers (ISPs). The Internet has been private for over a
decade. Companies need to make a
commercial gamble on providing data transfer and connections.
- Local area networks. Fortunately, we have a couple decades
experience in moving data around the office.
A router connects a LAN to the Internet. It watches the address on packets in
circulation. If the first three
address segments match its own, it keep the message on the LAN. If the address segments are different,
it is sent off onto the Internet.
Various protection devices are essential, or no one would dare
connect to a public network like the Internet.
Some device is needed to find information and move it around the
These are basically middle systems between desktop “clients” and
corporate databases or corporate mainframes.
- Backbone conduits. These can be leased T-1 lines (1.5
million bps), or installed optical fiber running between buildings or
across the nation.
Sooner or later we need a place to put information and get it back
out. Since this data is being
updated in real time, these databases need to function at gigabit speeds.
- How much of your organizational infrastructure
do you know anything about? Who is
charged with maintaining this resource?
What authority is charged with approving changes/improvements in
the infrastructure? How do you
know if they are doing their job?
- Postgirot seemed very inefficient since they added
routers and other significant IT components in each functional area and
for every new business process innovation. Why would they do that? Think back to our discussions of
centralized and decentralized organizational structures. Can you support the decision to
- Think back to our discussions of CIOs and IT management. If you were trying to prioritize the
duties of a CIO, where would you put infrastructure management?