The other side of transformation: the enterprise angle

By:
James Pearce
Published on:

Mike Zirkle runs transformation at Verizon. But it’s not Verizon’s own transformation that he’s worried about. He tells Alan Burkitt-Gray how the US telco is helping enterprises to transform

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It’s not only telecoms operators that are facing the challenge of transformation. So are their corporate customers. And that transformation affects the services multinational companies want from the big telecoms service providers – or are likely to want in the future. 

That’s why, when Mike Zirkle says his job title is executive director of transformation at Verizon, he’s quick to point out he’s not leading Verizon’s advance into the era of virtualisation, software-defined networks (SDNs) and 5G. 

“What we mean when we talk about ‘transformation’ is the adaptive enterprise,” says Zirkle. “We’re not crossing boundaries with product and marketing, but we are concerned about how we think customers will want to contract and build their services in the future.”

He’s looking not at the next quarter or the next year, but he has “multiple time horizons”, he says, adding: “I’m focussed on large national and regional customers. I’m really focussed on the enterprise customer base. How is HSBC going to change?” He quickly adds the footnote that he’s not specifically talking about HSBC, but he’s using the global bank as an example of the sort of organisation he has to work with and think about.

“Multinational companies are shifting. The geopolitical landscape is forcing relocation. Some are pausing and re-evaluating.” Geopolitical landscape? That’s a term that could be taken include, for example, the UK’s 2016 referendum decision – by a narrow majority – to leave the European Union. It is no secret that many international businesses, banks included, are worried about how so-called Brexit will affect their policy over where to site offices and factories: tariffs, employment policies and regulations may all make an impact. 

It is, therefore, perhaps no coincidence that he was talking to Global Telecoms Business in London, six months after taking up his new role, having just spent several days in Dublin: he was visiting customers in both cities, he said, not naming any. But Ireland is often suggested as a possible post-Brexit location for companies – especially English-speaking companies – that want to retain a home in the EU. 

Long relationships

Enterprises are not like consumers, which churn from one provider to another after a year or two. The relationship between a multinational corporation and its telecoms partner goes on for years – but that means the telco has to adapt to the corporation’s changing needs. “We have to be able to respond to how customers want to react to us,” says Zirkle. “We want to offer a single standard [or services] globally, but we need to be flexible according to what the customer wants.” 

But many of the same needs apply in the world of enterprise telecoms as in consumer telecoms. 

“We’re starting from customer experience, looking at our processes first,” says Zirkle. A consumer-focussed executive from Orange or Vodafone – or indeed Verizon Wireless – might use exactly the same expression.

Perhaps it’s no coincidence that Zirkle spent around 18 months with Verizon Wireless at the beginning of the decade, though his focus there was on vertical markets. The wireless industry probably encountered first the challenges that operators such as Verizon are now confronting in the enterprise market. And here the transformation is as much in the telco as in the customer. Sometimes they don’t sit easily together. 

Here’s a good example. How many POTS – that’s “plain old telephone service” – lines does a typical telco run? The sort of copper lines that are powered by a bank of lead-acid batteries in the basement of the telephone exchange – so they never stop working, even during power cuts – and, as often as not, have a black dial-phone at the other end: they’ll go on working for decades without maintenance.

Are they up for the chop as operators move to digitisation and virtualisation? Not to mention the move to wireless? “The CFO will say this is a declining revenue stream,” says Zirkle. 

But where are these POTS lines? “They’re used for burglar alarms, lift alarms, emergency services,” he says. If a lift breaks down, because the power to the building has gone, the POTS phone will work. If there’s a city-wide power cut, there should still be a basic phone service to fire stations and police stations. 

“How do you pull all these into a new digital environment? The telecoms companies are going to have to answer this – especially given the telecoms market is highly regulated and there are services they have to provide.”

Telecoms companies, despite their digital image, still have to dig ditches, he smiles. “We still have to roll trucks and we have to have generators so the systems don’t go down. There is an expectation that we provide these services.” 

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Change management

Not all analogue processes, Zirkle says, will transform to a digital world. “You have to re-architect them.” Change management includes cultural elements as much as technology. 

The biggest changes in the corporate world are mergers and acquisitions. “That’s when transfer of service agreements become very important.” 

How do he and his team do it? One element is “empathy interviews”, he says: meetings with customers about what causes them pain. There are also advisory boards “with up to 30 CIOs in a room”, and they are encouraged to talk about long-term plans. 

Even though the meeting may include competitors, “they do talk”, he says. In the finance sector “there are two topics that come up repeatedly, and they are security and data privacy”. The meetings “allow them to say what are on their minds, and then we can go back to customers and have individual conversations”. 

Expanding expectations

Customers are influenced by their experience of the consumer market. These drive their expectations of what they should get from corporate telecoms providers such as Verizon. 

“I can order an Uber and watch its path to me. How can I get a similar experience with network traffic?” he says. “The experience of interaction is changing. It’s influencing the expectation of speed and omni-channel interaction.”

He recalls a recent visit to Hong Kong, where a hotel had a rack of umbrellas for its guests, with a display that glowed if rain was likely. “It helps you make the decision to take an umbrella.”

But with a network, “what do you really want to know?” This is the sort of question that Zirkle and his team ponder as they think about Verizon’s future relationship with CIOs and other leading executives in their multinational customers. 

“We ask: ‘How do you want to be notified of an order completion?’ Do customers want an alert only when something doesn’t happen? How do you have the capacity and the data set? And do you have the understanding of the flow of a process?” he says. “If I can deliver an experience to a customer, and they’re satisfied, does it matter?” 

The legal people

The trouble with multinational customers is that there are a myriad of interactions between the two sides in a relationship: “There are legal people on both sides,” and that’s just the start. The lawyers get involved in such tricky details such as when ownership of equipment passes from operator to client. Is it rented or leased? There is a difference. 

And a multinational service provider such as Verizon must recognise that law and taxes are different from country to country – but is the contract local or is one central contract? It matters. 

Verizon likes to think of itself as a company that presents the same face to customers the world over: executives’ email addresses end in @one.verizon.com. 

“Why would you create a business support system country by country?” Zirkle asks. But sometimes there’s no alternative. He shrugs: “How do you talk all that complexity and simplify?” 

The company road-tests its own technology by using it. “We’re implementing our technology globally,” he says. It uses unified communications as a service and executives use a global content delivery network for global webcasts.

“That means our CIO, Vic Bhagat, can say it’s IT-proven. We are a referenceable account. Vic says to us: ‘You convince me that I should use it.’ So he’s a user. He knows how it’s supposed to work,” says Zirkle. 

But customers are different. Verizon offers a unified portal for enterprise customers, “but we look at what they are clicking”. Just like consumer telcos, customers want to work with multiple channels, including personal and digital, “and there are successes and frustrations”, he says. 

“It’s a lot less about technology enablement that you might think. Nine times out of 10 the technology works. It’s the customers that mess something up.” And he’s only partly joking. 

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