As discussed in my previous post Rebooting the telco enterprise play – this time with cloud tech – the telecom enterprise market is being transformed as big investment and cloud technology capabilities open up new options for Communication Service Providers (CSPs).
CSPs and service providers have a unique opportunity to be key players in this new enterprise universe, with the power to shape the outcome of the “rebooted” market. But along with that power comes responsibility – and a lot of difficult choices to be made. The CSP will have to evolve to successfully navigate this brand new playing field – and the most important elements of the game will be internal organization evolution and partnerships.
Taking full advantage of this rebooted enterprise market landscape will require a great deal of strategic dexterity on the part of the CSPs – in the way they distinguish “partners” from “suppliers”, in their approach to partnerships and, critically, in the potential enterprise playbooks they decide to utilize.
Why is the CSP at the center of this ecosystem?
Enterprise customers (especially large ones, those in a geographical cluster of companies, or those in heavy engineering industries) have very demanding communication needs. They often have a mix of different technologies for varying needs and regulations that they need to cater to regionally. CSPs who serve the local market are well placed to intimately understand the local enterprise needs. These could include:
- Communication-specific Service Level Agreements (SLAs) – for latency, reliability, isolation, survivability or redundancy
- The local privacy norms and regulations
- The security specifics both for the initial set up and for continued operation
- Steps for emergency measures.
This intimate handling of requirements will be even more critical as applications become “turbo charged” with new cloud and communication capabilities. A hyperscaler, global software house or other such players are simply not in a position to serve this combination of cloud and communication needs on their own, without the local CSP.
The urgent need is to act – even with low data
Of course, this does not imply that the CSP can sit back and wait for orders – rather, they should demonstrate strategic dexterity, determine which playbook(s) they will bet on and build network and organizational capabilities to make the most of this emerging opportunity. The CSP needs to establish the rules of the game for all the others who are entering its serving area before a big global player sets them.
For example, these “rules of the game” could determine if the CSP controls and chooses end-to-end orchestration tech across public cloud, edge and private cloud, or if it designs and controls the industry or enterprise specific slicing characteristics, of course retaining full freedom on network related decisions.
A clear set of rules for within their market is essential, as it will set the boundaries for a CSP’s potential partners, preemptively avoiding a lot of guessing and suspicion over the intent of each party (the kind of issues that that will come in the way of true partnerships) as well as potentially preventing market chaos. A well-defined partnership can drive projects forward with the full collective power and yield the best results for the end customer and the partners alike.
The urgent need of the hour is to act – and given there is no history in this space, act decisively, even with low or no data. But to do that will require strategic dexterity, and the careful selection of enterprise playbooks.
Three tips for strategic dexterity
To demonstrate strategic dexterity CSPs should, at the very least, undertake the following:
Distinguish between partners and suppliers – especially for technologies
Suppliers can be dealt with by the normal procurement processes and executives for specific technological or business units within the CSP. However, the CSP must pick select companies from its tech supplier base that it can truly partner with on a deeper level – those who can take the CSP through this journey in the enterprise marketplace with maximum impact.
Without a set of true partnerships, the attractive enterprise landscape can turn into a minefield. A partner is one who is made to feel welcome and equal. They will be a co-solver of hard problems, not just technology fulfillment entities (for which there are technology suppliers). Partnering will require a mindset shift for CSPs in terms of working jointly through problems, as well as the sponsorship and active protection of the partnership at the C-level – not just the CTO or CIO, but the Enterprise CMO, if not the CEO themselves). A partner should not only be defined in terms of potential revenue, or “spend” with a supplier, but rather from the lens of the complexity of challenge this partner can solve in this rebooted enterprise market. Finding these few select but critical partners is a must.
Select partners for a specific set of objectives and for a pre-defined timeframe
The rebooted enterprise market will change constantly. It will need strong commitment by the CSP with its partners. Those stronger partnerships referred to in the point above should have a timeline (3 or 5 years, for example) with a specific objective. For example, to secure a win together with a joint play in the components manufacturing or aviation business in country XX, or the industrial cluster in region YY. This will ensure they are keeping up with the dynamics in the marketplace. Once the time limit is reached or objective achieved, the CSP and the partner will have to re-examine and determine whether to continue that partnership, part as friends or in some cases even part to compete over a specific footprint, such as functions in enabling cloud or edge enterprise applications within the same landscape. This approach and focus on “partnership portfolio” management and associated governance will be challenging, but is an essential part of the required CSP mindset shift.
Selecting from the most likely playbooks for the rebooted enterprise landscape
No CSP, however powerful, will be able to execute across every enterprise market or industry in its serving area. This means the CSP will need to select from emerging cloud and the new communication tech-enabled enterprise market playbooks (some of which are defined later in this post) and decide on the role they want to play for the selected playbook. What does that mean?
It means saying “no” as often as “yes” to enterprise facing sales and technology teams when it comes to which enterprise customer initiatives to pick. This is the only way to stay focused – to not fritter resources, keep a coherent common architecture and adopt the right technology that can scale for that CSPs entire enterprise market. Each of these playbooks could also have an “expiry date”, or at least a review date. Based on success in the market and continued potential of the playbook, new playbooks could be added, and existing ones discarded or continued.
Five ecosystem playbooks for the CSP to choose from
Global industry playbook
Here a global industrial giant (such as ABB, GE, Siemens, Mitsubishi), automotive player (BMW, Toyota, Tata Motors), aviation industry player, global shipping or logistics player defines its business requirements, and the communication and cloud technology is expected to enable its applications across countries with a similar look and feel, a customized portal from where it can push and manage distributed software to end-points.
The global players will likely turn to the Network Equipment Providers (NEPs) or hyperscalers for reach and as a single point for scaling across countries. The selected NEP or hyperscaler will have to deeply understand the global player’s business requirements, translate them into enabling communication and cloud-tech based needs and make it easy to deploy over easy to integrate global industry platforms for scalability and repeatability in different countries.
The CSP in each country will select the industry player that is most relevant to its enterprise customer base, engineer its network to enable the network and security needs that it alone understands best for its serving area and integrate with the NEP or hyperscaler platform, enabling the global player’s multi-country experience.
Exceptions of course could be global industry players who sign with a single global CSP and task them to work out country-by-country experiences through their existing CSP arrangement, a more cumbersome and costly but customized route.
Local scalable industry playbook
Here the CSP selectively picks one or two enterprises that it has an intimate existing relationship with – ones who it can work quickly with for a detailed pilot and in an industry with the potential of scaling up across the CSP’s serving area. The essence is not to trust paper thinking on technology and business cases that will work, but rather go in quickly with a trusted enterprise customer, determine the capabilities required and then work the business case to build a scalable business with sufficient entry barriers for future competitors coming from a globally connected cloud.
Here, the CSP will need to understand not only the site-specific communication needs (campus, factory site, distributed office needs) and associated SLAs, privacy and security considerations, but also get strong sense of the key applications that could be served more effectively from the network or “cloud”. These network hosted applications should be candidates to be hosted at the “edge”, within a CSP core or somewhere across the globe in a public cloud. The CSP needs to focus on the details of these application demands, translating into end-to-end slice and network requirements for these applications.
During the pilot, the CSP works the kinks out of the system in serving these slices, such as on-demand or with specific performance requirements for different end equipment, processes or uses. Having worked the technical kinks out to a reasonable extent, the CSP needs to pivot internally to build the business case, then select the NEP to partner with to fulfil these needs at scale in its serving area.
Communication technology enabled business process (CEBP) playbook
This is where the CSP chooses and works closely with a big enterprise software house or hyperscaler and one or two of its long-standing innovative enterprise customers. The CSP and enterprise pilot customer together must have the objective to “turbo boost” a specific meaningful enterprise function, say supply chain resilience or visibility, or call center operations. Again, like in playbook two above, the CSP works the communication, computing and cloud tech needs in a rapid trial, avoiding long planning cycles and months of paper exercise and vendor selection, instead working the technical kinks out first, determining the technical and organizational capabilities required to scale and bringing in the NEP and other tech partners or suppliers necessary to complete the play.
Low support cost playbook
Success in the re-booted enterprise landscape is not only about potential new revenues, but also internal simplification and reduced costs. This is where the CSP looks at its many billing, charging, ticketing, provisioning, order management and even customer-facing portals that have mushroomed in its IT backyard to serve specific needs of individual enterprise customers.
While most CSPs may have already reduced the complexity on the consumer and SMB (Small and Medium Business) market serving IT support systems, very few have done so for their large enterprise customers. This is where the CSP must partner with the provider of these enterprise support systems and move these IT workloads to a common cloud-based platform.
While intuitively the easiest playbook to execute, this too will mean taking hard decisions – around interfaces to the esoteric internal systems the support systems may be connected to, retiring internal applications with new substitutes or uplifting the application interfaces for easy integration to cloud technology. There will also be the hard task of communicating to its large enterprise customer why certain processes look and feel different than in the past.
Country-specific government backed playbooks
This is where the government of a country allocates spectrum to a specific industry or an industrial geographic cluster, or gives a powerful national IT champion a special mandate (likely in Eastern Asia, parts of Europe or the Middle East) to create a cloud and new communication technology enabled enterprise play that serves the country. This is where the business, not just the lobbying savvy of the CSP, is most critical.
The CSP has to jump in and be an early enthusiastic stakeholder, engaging with or participating in the bodies formulating or discussing these national strategies rather than being a late recipient of a RFP for operating these networks once communication needs are specified. Being part of the industrial body or local association and putting the CSP’s best thought leaders in front of these policy and industry decision makers is critical.
The focus of the CSP should be to get their best techno-commercial talent to be a driver in the discussions around the communication needs of the industrial complexes, campuses and technology parks that will be served by a national IT champion or be provided a specific block of spectrum for its campus needs. They should seek to ensure the communication needs are realistic, simple to execute and that they connect to the edge and the wider network.
(Disclaimer: this blog post is completely my personal view and does not reflect the strategy, opinion or thoughts of my present and past employers or their customers or clients. I have been involved in working on emerging business model plays for telecom technology enabled industry verticals for more than two decades, and biases from past failed attempts and successes color my view.)
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