Breaking down the ‘craziness’ of internal siloes, it’s time to maximize your investments

The telecoms industry appears to be facing ‘darker times’, with job cuts both at operators and in the vendor community, alongside widespread efficiency efforts and ‘rightsizing’ becoming more of a focus for the sector. The challenge for Communication Services Providers (CSPs) is that they are still plagued by the inefficiencies of internal siloes. Individual business units are focused on specific offerings, stretching resources, and restricting the cross-pollination of ideas.

The outlook is bleak for an industry devoid of innovation and lacking ideas for how to stimulate sales growth. T-Mobile in the U.S. may be bucking that trend, following a 2023 that was rich with customer growth, new services revenues and profitability. The CSP’s customer acquisition in the Fixed Wireless Access market was a big driver of that strong performance, but even that rate of growth is difficult to sustain. Elsewhere, cost cutting is very much the norm and there are no real signs of recovery. This reality should have a sobering effect on the industry. It’s time that it gets to grips with the issues.

Taking a birds-eye view

Faced with new pressures, the C-suite needs to grasp the bigger picture to fully understand how nonsensical their siloed operations have become, and finally address real opportunities for efficiency improvements. Whether it’s in the introduction of new generations of mobile connectivity, or investments in new cloud, IoT or edge computing services offerings, the same series of events have played out. New monetization departments are created, new IT systems are rolled out, and new sales and marketing teams are brought in for each individual technology. And all to sell to the same customer?! With that perspective, its not difficult to see where the inefficiencies lie.

If CSPs are to turn their ships around and realize their vision for growth, then efforts need to center on operating model optimization. That involves using digital platform to lower costs and improve customer satisfaction and loyalty through a model that builds and delivers solutions that customers need. Real success and maximization of investment comes from a ‘what you sell’ not ‘how you sell’. Yes, this kind of reinvention requires significant cultural and organizational change, but the challenges in front of CSPs are deep rooted and urgently need addressing.

While not a novel concept, digital platforms are reemerging as the solution to this issue of enhancing CSPs’ market value. The approach to designing Telco as a Platform to streamline business processes, IT operations and systems is now a strategic imperative for CSPs who must navigate myriad market disruptions, economic turbulence, and newfound pressures to innovate.

One platform to rule them all

Platforms were key to the ascension of digital superpowers like Amazon, Google and Microsoft. It’s been said time and time again that CSPs can learn from the internet companies and achieve new revenues and greater value from their existing businesses by diversifying their portfolio of business models to include platforms. However, it’s less about some romantic notion of a CSPs’ metamorphosis into the next Amazon, but rather the opportunities to first break down siloes with the intention of running a more efficient business and reducing selling, general and administrative expenses.

This more evolutionary path starts with digitizing a company’s operating model and business processes, reducing internal siloes through the orchestration of several operational environments to provide both immediate efficiency and customer experience gains. This allows the conversion of the core product to be sold as an integrated solution linked to specific customer outcomes. It also enables the expansion of core offerings to new digital services through innovation and the ecosystem.

Critical for CSPs is that they remove the complexities that their customers have to face of working with multiple partners, providing multiple different component technologies and offerings, all just to achieve a single outcome. And the issue is that those management complexities are compounded by resource and skill limitations. What the platform model ensures is orchestration of that ecosystem, combining optimized connectivity from the CSP with partner technologies, all delivered as a unified offer over a single platform, with one overlay. That elegant integration enables the co-innovation, co-creation and co-monetization of solutions around outcomes that make sense for the customer, whether that’s a connected farm, connected office or smart building.

From there, CSPs can see greater ROI on their investments as they will have fostered environments for greater cross-functional collaboration and implementation of technology solutions that ultimately drive new revenue growth.

Streamlining partnerships

Equally important to solving this overarching challenge of maximizing investments is the urgent need to streamline the ways of working with partners who are becoming a critical part to any CSPs’ future, whether those are solutions partners or go to market partners like channel players such as MSPs or value-added resellers. By establishing a single platform to manage partner relationships efficiently and flexibly, CSPs can scale their partner networks and meet customer expectations for complete solutions, which includes addressing opportunities in non-traditional telco markets.

CSPs have frequently found themselves grappling with the complexities of managing multiple technology stacks and vendor relationships which slows down experimentation and time to market. Customers are accustomed to seamless digital experiences in other domains, making them increasingly dissatisfied with the lack of unified, simple services that are not realized by the existing CSP model. It’s this existing reality that is pushing CSPs like Telefónica to drastically cut back on its IT suppliers.

Breaking free from traditional constraints gives CSPs the power to not only keep pace with disruptors but also to position themselves as disruptors in their own right.

Ultimately, improving understanding of customer needs

One hugely beneficial outcome from this shift is the availability of more time and resources, achieved through new efficiencies, to focus on what customers need. Once those siloes have dissolved, the platform offers unparalleled insights into digital customer behaviors, preferences, and pain points across diverse touchpoints. By gathering customer information from various sources like billing systems, service usage logs, and interaction histories into a centralized database, CSPs can adeptly build offerings and services more effectively. For instance, by tracking customer usage patterns, CSPs can identify high-value segments and offer targeted promotions or service upgrades to enhance customer satisfaction and loyalty while optimizing revenue streams.

Suppose a CSP identifies a growing demand for cybersecurity solutions among its customer base or wants to integrate emerging technologies such as artificial intelligence (AI) and machine learning (ML) into its service offerings but lacks the capability or expertise to do so. In applying the platform model, the CSP benefits from network effect and improved access to a diverse network of partners, vendors and developers who can contribute valuable insights and resources to help build new capabilities and swiftly respond to market trends.

By leveraging platforms, CSPs can eliminate fragmented services, internal siloes, and establish a unified ecosystem that integrates business units, technologies, and data sources. This enables CSPs to automate end-to-end workflows across different departments and business units, such as customer service, billing, network operations, and marketing more seamlessly. And as a business’ needs evolve and grow over time, digital platforms can easily scale automation capabilities to accommodate any changing requirements.

Redesigning Telco as a Platform represents more than just a strategic imperative for CSPs – it embodies a paradigm shift towards a more future-ready, customer-centric, and secure operating model. This approach empowers CSPs to adapt to evolving market dynamics with confidence, enhance customer experiences, and fortify their infrastructure against emerging trends and opportunities.

Angus Ward is the CEO of Beyond Now, bringing 30 years of consulting and solutions experience to his role, supporting organizations across multiple industries to shape strategies and adopt platform-based business and operating models with differentiating partner ecosystems.

Under his leadership, the company has transformed from a service-based entity to a SaaS-based technology company, expanding into ecosystem orchestration platform and digital marketplace solutions, strengthening both internal innovation and Beyond Now’s competitive advantage.

In 2021, Angus led a successful management buyout backed by private investors which saw Beyond Now become an independent technology company with a vibrant global customer community of leading telecoms and technology organizations.