Does this scenario sound familiar?
Your desktop computer at work is your workhorse. You polish an important presentation and transfer the files to your laptop for the big out-of-town meeting. The morning of the meeting you realize your forgot a key piece. You email the home office with your importunate plea, but the time difference means no one will turn on the lights there until after your meeting is over.
That happened to Brett O’Brien. The CEO of a high powered public relations firm in California, he was always on an airplane or in and out of hotel rooms. He needed a way to share information with multiple clients in multiple locations.
That need was the origin of Xdrive Inc., a Santa Monica, California company that calls itself† “a file cabinet in the sky.”† Users who store files on their “X drive” can access it from any Web-enabled device, which includes desktops, laptops, personal digital assistants like PalmPilots, WAP-enabled cell phones, and Blackberry pagers. Instead of loading a PC and schlepping it through the airport, users can arrive at your client’s office and call up the entire presentation from their X drive on the client’s computer.
Today, 73 percent of the files stored using the Xdrive application are Word, Excel or PowerPoint applications, according to Keith Pinter, executive vice president, business services. Since businesses are using the technology as a productivity tool, security is an issue.
Xdrive offers three levels of security.† The first area deals with the identity of the user. When a user signs on, the software authenticates the identity. Then, there is a Secure Sockets Layer (SSL.) In addition, the software uses a digital certificate authorized by Verisign. Finally, there is a secure ID, a credit card sized token that has 11 digits. “This makes it virtually impossible for someone to say they are someone who they are not,” says Pinter.
The user can set different levels of security for different people. For example, the CEO and CIO can get tokens. But passwords may be enough for most employees.
The second level of security includes encryption. Users can encrypt their documents at their desktops. When they send it to the Xdrive application, it remains encrypted. “No one can bribe our employees to get your information because it remains opaque,” says Pinter.
The third level of security includes breaking up the metadata — the file name and the author, for example — from the data itself. The software stores this information separately. Dividing up the data makes it impossible for hackers to find what they are looking for.
Pinter says Xdrive has two distinct markets that look at security from two different angles. The corporate IT market “wants everything completely secure,” says Pinter. But end users desire† “a light amount of security but want everything to be easy.”
The company, which incorporated in January 1999, launched its Xdrive capability in June 1999. By November it had 100,000 users; that number jumped to 1 million users by the following March. “We were the fastest growing membership-based Internet organization,” reports Pinter.
At this point scalability became an issue. “Scaling from 100,000 to 1 million users was one thing. But scaling from 1 million to 10 million was another,” says Pinter. At that point Xdrive decided that data storage was not its core competency. “We’re about access to information, sharing information and distributing information,” he adds.
The Search for an Outsourcing Partner
In addition, data storage requires infrastructure expenditures. Xdrive founders did not want to spend their resources on data warehousing.
So the company began the search for an outsourcing partner. Its search criteria were very stringent. It had to select a vendor who could manage huge amounts of storage. Reliability and uptime were crucial. In addition, the California company is subjected to earthquakes, so it needed a “fault tolerant solution,” explains Pinter. The provider had to have a national network so if California went offline because of the tremors, customers could continue to retrieve their X files from their X drives.
“We evaluated hordes of folks who claimed they could do this,” says Pinter. However, few companies had an operating history long enough to make the buyer feel comfortable.
Storage Networks Corporation in Waltham, Massachusetts was the only supplier that fit all the criteria, according to Pinter. The two companies signed an outsourcing contract in March, 2000. “They manage the back end storage infrastructure where our bits and bytes live,” explains Pinter. In other words, Storage Network maintains the plumbing. The supplier deployed the outsourcing solution in 60 days.
The service level agreements (SLA) include an uptime guarantee “north of 99 percent,” says Pinter. This is the alpha and omega SLA for Xdrive because of the demand that its customers “always have access to their information.”
Another SLA guarantees zero data loss. The solution must be scalable. Since the two parties signed their contract, users have grown from 1 million to 6.4 million. On average, the company adds 30,000 new users a day.
Taking the SLAs Seriously
The SLAs are real time, “so they are putting their money where their mouth is,” says Pinter. He adds Storage Networks takes its SLAs seriously. “They are not just a marketing tool,” he observes.
If there is a dispute or the supplier misses an SLA, there are “significant” monetary penalties. Pinter says failure is very “painful.”
To nurture the relationship, the vendor has assigned a local account manger. This employee spends at least two days a week at Xdrive’s facility. In addition, the buyer reports “great communication with the executive team.”
Although the outsourcing relationship started as buyer/supplier, it has evolved into a business partnership. Pinter says if the vendor is working on signing up a new account, the sales force will bring in Xdrive to sell a soup-to-nuts solution. Xdrive also contributes leads to the joint marketing effort. “We appeal to the customer side. They appeal to the IT crowd,” says Pinter.
Lessons from the Outsourcing Primer:
- Companies growing rapidly turn to outsourcing to help them handle the exponential growth.
- Investigate all claims before selecting a supplier. Often, vendors claim they can meet a need when they really can’t.
- Set up SLAs with teeth.
- Your supplier can become a good source of marketing leads.