AMD -"Networking is a key enabler of the global enterprise"

Ajay Marathe is probably the only CIO of a Fortune 500 company who sits away

from headquarters, in India. He will be in Bangalore for the next two years or

so, during which time he will keep shuttling between India and the US.

Marathe is in a unique position at AMD, having moved around practically in

all functions, excepting finance. As a person who dons several hats, he spoke

about the challenges he successfully met as the CIO of AMD, in an exclusive with

VOICE&DATA. He also shared some of his views on the opportunity that lies

ahead for India, among other things. Excerpts:

Given that AMD's facilities, development centers, etc. are spread across

the world, how critical do connectivity/networking solutions become for various

business processes?



The connectivity and network solutions are critical to the business

processes of AMD. The engineering and manufacturing of AMD's products are highly

dependent on a global supply chain that is enabled by AMD's global network.

Since our design and manufacturing steps happen at different locations around

the world, our parts cannot be designed, manufactured, tested, or sold without

reliable networks.

What are your key investments in technologies like network storage,

structured cabling, LAN switches, routers, etc. that made a difference to

business processes at AMD?

We have standardized on Cisco for the WAN aspects, wireless, manufacturing

and Campus backbone, for their reliability, service and support. For the design

area LAN, we have standardized on Nortel for their high port densities in Gig

Ethernet and low maintenance cost.

What role did such decisions play in AMD's turnaround in the past and in

the ongoing success binge thereafter? In particular, could you touch upon

certain differences made to the development of Athelon 64 and Personal Internet

Communicator (PIC)?



The network plays a supporting role in the engineering, manufacturing, and

business processes and was required for developments like the Athelon 64



and PIC.

The line between IT and networking technologies is blurring in an

increasingly converged scenario. How difficult or easy does this make your task?



Networking is clearly a key enabler of the global enterprise. Recent

advancements in capacity, performance, and convergence provide a significant

number of options to align the appropriate technologies to the business

opportunities.

You have recently completed a large-scale implementation of SAP across the

company. Which networking technologies complemented/supplemented this IT

implementation?



The networks (WAN and LAN) were analyzed for available bandwidth and latency

requirements, across the world. And where found lacking, things were improved

with solutions from Cisco, Nortel, AT&T, and MCI.

How do compare your network infrastructure in India vis-à-vis AMD's other

facilities worldwide?



The LAN is the same architecture and bill of materials as we use in our

primary US design facilities. The same standards and policies apply and are

administered centrally from the US.

What are your annual networking and IT spends, respectively?



Our WAN budget, with AT&T and MCI is approximately $9 million per annum.

The India-US circuits are approximately $25,000 per month.

What initiatives did you take at AMD to use IT and networking technologies

for business benefits?



We wanted to change the model of IT at AMD and make things process driven

rather than trying to find solutions for a technology that we already had. So we

sat down and asked ourselves: what are the business problems, what will make AMD

a real-time enterprise? How can information flow quickly between our partners,

customers, or channel partners or even suppliers? What are the bottlenecks and

which are the technologies that will solve those?

So we became an SAP house, starting 2001. We selected SAP as the backbone and

we said we would expand it to other areas in steps. We implemented the financial

and the material module.

Which were the bottlenecks that you identified at that moment?



At that point of time, we had homegrown legacy systems everywhere. Those

were age-old systems, not connectable to anything. So there were islands of

automation everywhere, which of course had served a purpose till then. In 2004,

we implemented our sales and distribution module, which is the biggest module in

terms of customer touching. The biggest bottleneck was in understanding

customers' requirements in a more connected fashion, so that the entire supply

chain could be driven from that.

So you used technology to bring customer-orientation into all the

processes at AMD....



Yes, that's right. Not that it wasn't there but it was done in an ad hoc

manner and not in a very systematic way. For example, our planning cycle use to

be three months long. So by the time we finished a planning cycle, it was

already time to work on the next one. As a result, we were continuously in the

planning mode and just couldn't shrink that.

In our chip-manufacturing business, the raw cycle time is more than two

months. So shrinking the planning cycle was extremely important. The order

management, the new engine that SAP released last year, was extremely critical

for us and at the same time quite risky too, as only two or three other

installations had been done by then.

Who is your integration partner and what kind of relationship do you have

with it?



HCL Technologies is our worldwide integration partner. All our infrastructure
management and applications are from HCL Technologies.

How do you see India as a player on the global scale, in the years to

come?



In another 15 years, India is going to have 800 million people in the

working category, between the ages of 18 and 35. Also, India and China are the

only two countries that are going to continuously post GDP growths of seven

percent or above. Beyond a timeframe, India may become the only country to keep

on posting that growth, because China will be saturated.

Deepak Kumar