Digital Transformation: where did it all go wrong?

Digital Transformation continues to make headlines in the telecom sector, but primarily for the wrong reasons, with CSPs still slow on the uptake. What does Digital Transformation really offer telcos, and why is it proving to be so hard to achieve?

Digital Transformation is crucial to the future effectiveness and viability of the telecoms sector, but a quick glance might make you think otherwise, as many CSPs continue to drag their heels – not a good look for the industry driving the digitalisation process for so many other sectors!

Many people confuse Digital Transformation with a basic IT upgrade, with a UK survey finding that 57% of employees just didn’t understand what Digital Transformation entails for their business or industry. Despite substantial progress being made in many sectors, there is still plenty of work before the great Digital Transformation project can be considered complete.

The need to accelerate Digital Transformation in telecoms – to reimagine and future-proof businesses processes, access new markets and boost profits – has never been greater. New forms of ecosystem engagement are crucial, and telcos must implement changes not only to mission-critical systems, but also reinvent their processes, services, customer experience and company culture with a digital-first strategy.

In practice, however, the road to Digital Transformation has been a long and rocky one in most industries: though 87% of business leaders claim that Digital Transformation is a priority of theirs, only 40% of organisations have brought their initiatives to scale. Worse still, another survey by McKinsey found that just 16% of company executives say that their Digital Transformation strategies are succeeding.

Global spending on Digital Transformation is expected to hit $6.8 trillion by 2023. Within the telecoms sector, CSPs clearly recognise the need for significant investment despite the COVID pandemic wiping $43 billion off telecoms revenues in total, with voice and roaming suffering most heavily; only a third of this lost revenue is expected to be recouped during 2021.

In order to succeed in the post-COVID economy, businesses must reimagine how they organise themselves and operate. As ongoing advances in telecom technology increase the demands on BSS/OSS systems, CSPs risk falling victim to an unfocused mess of systems and processes as they try to keep up.

According to a Deloitte survey from last year, cybersecurity is a priority investment area for all companies undertaking Digital Transformation, as concerns over the vulnerability of cloud systems holds back migration, while a 2019 study by EY found that disruptive competition is the biggest challenge faced by the telecoms industry going in to the 2020s, with organisational agility (or lack thereof) and return on investment also of significant concern.

Any Digital Transformation process cannot just focus on one or two of these aspects though; Martin Creaner, one of the communications industry’s leading strategic thinkers, discusses the 10 transformation journeys of the telco in his book, Transforming the Telco. From virtualised infrastructure and data- and API-driven systems, to new business models and work cultures – the legacy BSS/OSS systems and associated processes that once powered the telecoms industry are no longer enough to provide the immediate, on-demand service that customers expect.

These transformative changes don’t come easily, however, with seven out of 10 telcos reporting that integration of these new servicesis their greatest barrier to Digital Transformation, according to a report from the Technology Innovation Council; it remains the view of 73% of providers that it would be too difficult a task to integrate new technologies and processes within their existing channels, interfering with short-term profits and smooth customer experiences.

With Digital Transformation, CSPs can improve business performance and monetise cloud services to increase innovation and reduce outgoings. For all the high-level talk of Digital Transformation, however, what are the steps that a telco must take? Here are some of the components that, in our experience working with a wide range of CSPs from around the world, are key to any Digital Transformation:

• Digital-first customer experience - automated self-service capabilities must be built into all products and customer touchpoints, enabling consistency, repeatability, efficiency and scalability.
• Unified product catalogue - a master product management and catalogue solution allowing business users to build, test and launch new products, services, tariffs and packages, from one centralised application, meaning faster time-to-market and more flexible market offerings.
• Real-time analytics and insights - a real-time understanding of customer behaviour and business performance is needed in order to make the right business decisions at the right time.
• Open integration - standards-based integration using the TM Forum’s Open Digital Architecture and Open APIs to provide solutions that are easier and cheaper to deploy, integrate and upgrade.
• Convergent charging - online / offline charging that supports all network types (fixed, mobile), all service types (voice, data, content) and all payment types (prepaid, postpaid) on one platform with high performance and scalability.

Digital Transformation is not a one-off project, or one with a fixed endpoint (or even a fixed starting point); it is an ongoing, company-wide process with ever-shifting goals, requiring a constant morphing of organisational mindset towards acquiring the digital capabilities that will help your business seize new opportunities.

Successful Digital Transformation relies on more than just implementing the right technology; it must be given the attention it deserves. Your business needs a solid foundation which starts with your BSS/OSS systems, but also depends on the right culture among your teams and the right processes to support them, which together will create a positive feedback loop for further innovation and deliver on-going gains in efficiency, service quality, customer satisfaction, employee engagement and revenue.

To succeed in the new telecoms future, CSPs must embrace Digital Transformation, ensure that their systems and processes remain ahead of the curve, and rally behind their strategic goals to unlock the full potential of their business.

Let Cerillion accelerate and empower your Digital Transformation with our highly scalable, cloud-ready BSS/OSS solutions. For more on Digital Transformation, download our white paper here.