Transformation is a complex journey that starts in the board room of every operator and needs to be undertaken with a holistic view. The process is not only about technology, says Johan Josefsson. Co-sponsored feature: Ericsson
The transformation will affect all areas of an operator’s business — which is why it is important to have a clear view and understanding of the business strategy, operational requirements, technology requirements and the need to develop competence.
From a business aspect, the operator needs to prepare to offer services to a multitude of other companies which will develop and supply innovative new end-user services.
The OSS/BSS needs to be overhauled. The network needs to be transformed to remove stove pipes and to introduce a layered architecture. A competence development plan for the organisation also needs to be in place.
The technology aspects of introducing a layered architecture are complex and need to be done by a well structured and manageable approach to mitigate risks and not jeopardise the business and the ongoing operations.
However the main challenge in transformation is changing the culture and the ways of working as a key component to reduce operational expenditure to ensure efficient and lean next generation operations.
Although the drivers are there and the imperative to transform exists, operators continue to be faced with pressures to reduce the cost of operations as well as capital expenditure.
In these financially challenging times, cost efficiency has never been more important. One way in which carriers can ensure they are transforming effectively — in a way that controls costs — is through adopting a prime integration approach, including programme management, stakeholder management, benefit management and supplier management based on a holistic understanding as well as experience related to business strategy, technology and operations.
Experience of transformation projects is one of the critical success factors to avoid repeating previous mistakes and take advantage of previous experiences. A prime integration approach means operators can reduce the costs of transformation. As prime integrator in the transformation area, Ericsson takes a holistic approach, linked to strategy, operation, competencies and technology.
When driving transformation it is important to have a clear set of skills and methods and operational experiences covering; definition and analysis of business strategy, consolidation of tools and network solutions, operational efficiency and operational readiness, all of which are required to ensure the most efficient networks, operations and service offerings.
This means that there is a need to focus on total cost of ownership of the systems, the set-up of the operational processes, the operational expenditure, customer experience including migration of the customer base to new service bundles, and how prepared the organisation is — including what competencies are needed when it comes to introducing new technologies and new services.
It is also important to take into account that the business dynamics can rapidly change during the transformation process. Having an adaptable partner that is in it for the long term is therefore critical.
In the transformation engagement process it is critical that the prime integration provider identifies strategic areas, not necessarily to increase the scope of the programme, but to understand what needs changing over a period of time to reach set business goals. For operators, that trust is important because these are complex processes and success rests upon managing the risk involved in transformation. Operators need to transform, but they need to do so safely.
Using a prime integrator such as Ericsson can provide a means to mitigate such risks. Ericsson’s previous experience, coupled with its tools to measure the efficiency of its approach in each engagement, means that operators can work with Ericsson to analyse the effects of actions and whether the expected performance is reached.
At the heart of a successful transformation strategy is the need to define business goals for organisational efficiency. Efficiency and key performance indicators need to be constantly assessed to identify what needs to be changed and to ensure transformation projects remain on track and do not fall victim to mission creep. Total cost of ownership is at the core. Operators need to know where they are going and what business value they can gain from increasing efficiency and reducing TCO. Ericsson, with its experience, can help operators accelerate their understanding of the issues.
With the years of experience Ericsson has gained providing managed services and being responsible for network operations and network management on behalf of operators, Ericsson has developed a library of in-house experience in many different markets across the world. Ericsson manages and operates network and telecom management systems on behalf of customers that provide services to more than 350 million end-users. The operation of the networks are done through Ericsson’s own network operation centres (NOCs) in the Americas, Europe, Asia and Australia. That, in turn, positions Ericsson as a key network operator and enables it to draw on these multiple engagements to provide a blueprint, or reference architecture, for efficient operations and a means to ensure operation processes and the telecom management systems can become more efficient - even as operators bring new and complex services to market that put strain on existing OSS/BSS systems, operation processes and competence.
With its own NOCs Ericsson has built up a deep understanding of the possibilities of tools and operational expenditure saving through its own NOC consolidation programmes. Implementation of its own NOC reference architecture has reduced TCO of telecom management systems and allows the replacement of stovepipe tools with more generic solutions without losing service availability to end users and revenue streams for operators.
To achieve that, the holistic view is crucial because tampering with parts that could affect performance without fully understanding them could cause a failure. Equally, such transformations don’t necessarily complete at the turn of a switch and can be a long exhaustive process that involves multiple small projects eventually completing and coming together to form the completion of a long-term programme. That’s why it is so essential that performance indicators are measured throughout the programme to ensure work is on track and goals are being reached and the project doesn’t become a costly, never-ending impedance to the operator.
From an OSS/BSS point-of-view, Ericsson’s consulting and systems integration expertise, coupled with high level involvement in standardisation initiatives and experience within operators, not only through the managed services engagements but also through more than 500 telecom management consulting and systems integration projects delivered to operators, means the need for operators to continually re-invent similar solutions for their own use is reduced. That’s not to say that all transformations and deployments are the same. Just that the more experience available to draw upon, the more likely it is to drive efficiencies from the knowledge it already holds.
It’s not a one-size-fits-all proposition but rather an ongoing process of developing understanding of each customer’s needs, capabilities and aspirations. It is no longer sufficient to enter an engagement with a box or a product to sell, installing it and leaving. Instead a holistic view of how the systems, people and processes will work together is required to construct a plan that will succeed.
Understanding the efficiencies that programmes based on simplified reference architectures and deep experience can provide, coupled with recognition that efficiencies can only be truly unlocked by addressing the three cornerstones of the organisation, the process and the tools simultaneously leaves operators with the challenge of actually executing on their transformation.
Making it happen is the massive challenge; the most widely used comparison is the concept of attempting to change the engine of a plane when it is in mid-flight. That’s not a bad way of describing the issues operators face. It’s not an option for them to shut down their networks and work on their systems for a few months so such transformations must be done in a situation of perpetual operation.
The choice of prime integrator partner is critical. After all, transformation is a lengthier and more complex process than traditional solution integration. Success is greatly enhanced if operators are willing to embark on the journey and have the ability to see the positives of change.
Transformation is a real change process that requires a prime integrator and change agent that has the knowledge, proven holistic experiences and skills to guide an operator through the journey.
Josef Josefsson is director for consulting and systems integration at Ericsson Global Services