In our last blog post in this series, we noted the worldwide interest in transformation programs. Why are so many service providers pulling the trigger? Coleman Parkes Research’s latest white paper, Transformation: Governance, Benefits and How to Get it Right, is based on a global study looking at transformation activity in the telecommunications service provider marketplace. It breaks down the triggers as follows:
The most common driver to initiate a transformation program is to reduce costs, mentioned by 64 percent of the service providers taking part in the study. But it is by no means the only driver. Nearly half of service providers also see transformation as a key to breaking down barriers within the organization leading to a more streamlined and focused operation.
40 percent of service providers cite the need to reduce the time to market for new services as a key driver for a transformation program and over half say that transformation is needed to improve the overall customer experience. This will also be linked to the need to remain competitive in a rapidly-changing and highly competitive environment, where customer loyalty is critical to ongoing business success.
What is most interesting among the service providers polled in the survey is that pure technology drivers are rare. The clear conclusion is that companies seek transform activity to provide operational, service and business benefits. Technology is the enabler, not the end goal. Almost two in five service providers cited technological issues as the key driver for embarking on a transformation activity, but this was ranked only 6th out of the key drivers mentioned, surpassed by both operational and service focused issues. Even in immature markets, technology is not seen to be the key driver.
Business drivers for transformation programs are also important. The most common is the need to maximize a strength or opportunity for the organization, followed by the need to meet regulatory requirements. One third of service providers cite competitive pressures as key drivers for a move to transform a process or activity, and one quarter see transformation underpinning the removal of a threat to the business. As always, merger and acquisition will play a part for those companies that have undergone this form of activity. Getting the best from the merged businesses transformation programs will be necessary to streamline the businesses and remove unnecessary duplication.
Previous posts on transformation:
On RCR Wireless News Reader Forum: