Vertical integration, says Investopedia,com is when a company expands its business into areas that are at different points on the same production path… and can help companies reduce costs and improve efficiency by decreasing transportation expenses and reducing turnaround time, among other advantages. It could be a useful description of Schneider Electric’s position in the market for prefabricated modular data centers, where it has scaled up its use of modules, for example, from power and battery modules, to UPS to Facility Power Modules. At each point in this value chain, the company has increased the amount of pre-assembly and integration supplied to the customer.
At the EMEA launch of 14 new prefabricated data center modules and 15 new Data Center Reference Designs during DatacenterDynamics 2013, I asked Scott Neal, Product Marketing Director for Prefabricated Solutions at Schneider Electric, how vertical integration helps the company to deliver its range of prefab modules and what benefits it brings to customers.
Scott says, “Schneider Electric is a large company with many products, across many regions so when you look at the power infrastructure and the cooling infrastructure, we make the majority of those components and we compete in the data center at a large range of levels. Essentially we have the capability not only to provide those products but also to pre-package them, to pre-engineer them. And we know how the products perform, so with that you get more predictable performance but also that delivers a better solution to the customer in the end because we understand how they are made, how they perform and how they go together, not only for the module but for the entire data center solution. Prefab offers not the benefits and takes away the dangers of vertical integration.”
If there are benefits to the customer in construction phase of the data center, I wondered whether these also extend into the engineering life cycle from a maintenance point of view? Scott was positive in his response, “Sure. Since we’re making the products we are also designing them in such a way that they are maintainable. That’s a key thing as far as the module design goes, we thought about the maintenance aspect of it and we understand again where the access points are and we’re not just taking third party components and putting them in a box, we’re not trying to address that issue as its built into the design.”
Schneider Electric has an established reputation for its hardware, and I wondered whether vertical integration also included the software layer, where the company’s company’s StruxureWare for Data Centers software could be added to increase the management of physical infrastructure.
“Yes,” said Scott, “As we continue to integrate the software, the DCIM solutions, the metering, monitoring, the security, all that plays into understanding the process, the components, how they need to be set up, how they need to be integrated and how they will work with the software. That also goes forward with our design that we will continue to optimize the design, products and the solution via the software. ”
More details about Schneider Electric’s fully prefabricated data center module configurations can be found online on the company’s website.