Getting ready for disruption
The recent GSMA Mobile 360 Series – MENA offered timely reflection on the challenges and opportunities currently faced by telecom operators in the Middle East and North Africa. From OTT disruption to blockchain, IoT, artificial intelligence, 5G and regulations, the event covered most of the pressing issues that are top of mind among telecom industry executives.
But perhaps none tied all these together as the topic of telco digital transformation. For some time, traditional telecom revenue streams have been shrinking as core voice and messaging businesses continue to be disrupted by OTT applications. And disruption is a big word here. 18 months ago, a survey of more than 2000 C-level executives revealed that 64% anticipated moderate to radical disruption in the telecoms industry over the coming year, placing telecoms second only to media as the most disruption-ready major sector. Yet, in a recent survey of more than 300 IT stakeholders in the UK and US, 65% of telco companies interviewed predicted that they would be disruptors rather than disrupted in 2018. A traditional industry in which the majority of players are disruptors? Perhaps not, but ‘disrupt or be disrupted’ seems to be the call of the times in telecoms.
The challenges faced by telcos are not limited to declining voice and data revenues. They struggle to differentiate themselves in customers’ eyes, leading to high churn and low brand loyalty. At the same time, decreasing margins and a lack of new revenue streams also threaten the long-term sustainability of capex needed to maintain the increasingly sophisticated networks that customers expect. Add to this the common legacy issues facing large corporations as they reorient to the shifting demands of today’s market, and one starts to see the picture that was painted by leading Sri Lankan telecoms provider Dialog as they presented at the GSMA Mobile 360 Series. Answering the question of what is needed for large corporations to successfully transform themselves digitally, Dialog promotes a holistic approach to digital evolution. Their strategy mirrors the ‘4D+1’ Digital Transformation framework espoused in the Digital Transformation Imperative and also rests on strengthening the core business while growing digital adjacencies. Echoing the framework’s pillar of building digitally smart collaboration platforms, Dialog has delivered significantly greater value to customers by opening API’s to partners and co-innovating with them. Dialog also demonstrated a focus on building data analytics, agile and other capabilities into their culture and organizational DNA. It is this approach that will help Dialog achieve its successful transition from being a traditional telco to an ecosystem enabler.
Telecoms operators are so vulnerable to technological landscape distortions because digitization touches every corner of their business. Though, what may look like a threat to some is seen as an opportunity by others. Those that succeed in this space are the ones who see digital transformation as an enterprise-wide program, built into the lifeblood of the business function rather than a siloed set of initiatives within IT or marketing. Turkcell, another GSMA Mobile 360 presenter, takes an enterprise-wide view of digital transformation as well. It focuses on 3 pillars of transformation, namely, Digital Services, the Digital Ecosystem, and the shift towards being a Digital Company. There is a strong correlation here with the ‘4D+1’ Digital Transformation framework as well. Turkcell’s approach focuses on the creation of a digital smart company from the core outwards, built on twin pillars of digitally smart operations and digitally smart customer experience journeys. Turkcell’s ecosystem engagement, on the other hand, requires growth beyond the core into adjacent businesses through collaboration and disruptive digital plays. Turkcell showcased a broad array of digital content and applications they have built internally or acquired, organized under the Lifecell Ventures unit.
The growth into adjacencies is a critical pillar in any successful digital transformation, and powerfully modelled by UAE-based telco, Etisalat. To address the adjacency opportunities, Etisalat has combined its disparate digital assets under the independent Etisalat Digital unit, with a focus on the enterprise customer segment. This unit has a full complement of digital experts, assets and platforms. It takes advantage of the parent company’s core business scale and network strength in order to co-create innovatively disruptive solutions with their B2B customers. Presenting at the GSMA Mobile 360 Series, Etisalat Digital’s Miguel Angel Villalonga highlighted the ‘being’ vs ‘going’ digital dilemma facing most organizations. Whereas most businesses want to employ digital transformation, few understand what it truly is or where to start. Most are ‘going’ digital by implementing siloed digital initiatives in IT, marketing, or customer care, whereas ‘being’ digital implies a genuine enterprise-wide digital transformation. How then does a business move from ‘going’ digital to ‘being’ digital? A digital transformation program requires a digitally smart business core achieved through systemic digital evolution – as Etisalat Digital’s parent company—Etisalat—is currently in the process of, and digitally smart growth beyond the core, which is Etisalat Digital’s primary value proposition.
Cloud, blockchain, IOT, AI, analytics – these are all powerful technologies. But they only express meaning when they form part of a coordinated campaign that makes the end user’s life easier and more enjoyable. In the words of Aysem Ertopuz-Deobler of Turkcell, who paraphrased Maya Angelou at her panel presentation at the GSMA Mobile 360Series MENA event: ‘People can forget what you told them, they can forget what you did to them. But people will not forget how you made them feel! We are no longer in the business of selling technology. We are in the business of providing emotions and experiences.’ This powerful vision is only available to those telcos that are willing to move beyond simply ‘going’ digital in IT, marketing, or customer care channels, towards ‘being’ digital in the culture and organizational DNA.
For more information about our insight on digital transformation, download Synergy Consulting Group’s White Paper: The Digital Transformation Imperative
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