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“Digital transformation is no longer just a project. It's a continuous and new way of doing business. It's a continuous investment and growth into new relationships and partnerships,” says Centili Group CEO Zoran Vasiljev.

The COVID-19 pandemic has been a wake-up call for organizations globally. This is when everyone recognized that the world has changed and implications have emerged on various businesses because of the abrupt shift to digitalization. Hence, the process of identifying opportunities to build resilience, fuel growth, and innovate customer experience is ongoing.

Businesses, including telcos, are looking to accelerate digital transformation initiatives by doubling down on agile and flexible technologies that can make them competitive and successful against others in the market. In fact, a survey of Fortune 500 CIOs regarding 2021 budget priorities revealed that more than 77% of CIOs recognized digital transformation as their priority going forward.

Yet, 70% of digital transformation efforts have fallen short of reaching targets, as per a BCG research. Despite companies having huge expectations for digital transformation, what causes their digital transformation efforts to fail?

Technology over business

Based on an IDC spending guide, the worldwide spending on the technologies and services that enable the digital transformation (DX) of business practices, products, and organizations is forecasted to reach $2.3 trillion in 2023.

With huge investments allotted for this phenomenon, many organizations get carried away with innovative technologies and fail to consider their customers — the core of the business — who are the crucial drivers for a smooth overhaul. No matter how innovative the initiatives are, if the customers won’t utilize them, the efforts become meaningless. This opens up an avenue for failure as companies tend to focus on technology and do not consider the needs of real people.

Understanding how customer demands are evolving, especially during uncertain times like the pandemic, is crucial for success. Telcos, for example, must always consider their customer’s end-to-end journey and include them in their digital transformation strategy.

Executives or leaders within organizations must have a broad, holistic view of what digital really means. In the ICT industry, we view digital as the nearly instant, free, and flawless ability to connect people, devices, and physical objects anywhere.

Lacking a clear definition of digital leaves companies adrift in the fast-evolving nature of digital adoption. No matter which industry it is, technology should never constrain any business from launching new imperatives. But this should be deployed in order to address the customers’ needs and improve their overall experience. The right tools can enable this transformation, most often with the help of partners. As a result of collaborative efforts, the core management team, systems integrators, and other technological allies become part of the digital transformation process. 

"Technology requires constant hands-on management to ensure that the business is adapting to the change in its DNA — and to ensure that future shifts, both internal and external, are accompanied by the appropriate flex of its tech stack," says Maria Martinez, chief operating officer, Cisco.

Thus, having the most advanced technologies can only go a long way if the direction of the company goes toward its clientele. As the company works on turning traditional to digital, technology becomes a vital component that would enrich relationships between businesses and consumers.

Transition within operations

While it can be difficult to shift mindsets to the new ways of working, embracing change is critical to the success of any digital initiative. It’s either you keep the traditional approach of consulting an approval board to review changes and deny requests or gradually embrace new tools to bring the team operations into new heights of success.

The new-age telecom networks, mainly underpinned by 5G, are aimed at providing varied services and customized communication solutions to a wider range of customers. Thus, with the increased number of subscribers, the operational processes are bound to get more complex.

Services like customer support, CPE installation, and billing must hence be updated to tackle this complexity. In modern times, network automation software is also among the trends. In fact, software becomes an integral component of every part of a business rather than being deployed in some areas. Companies now interact with their customers through software delivered as online services or applications, compatible with different devices.

Software is vital in transforming every part of the value chain, such as logistics, communications, and operations. Commonly referred to as DevOps, barriers between two traditionally siloed teams — development and operations — are removed.

With a DevOps model, teams work together to optimize both the productivity of developers and the reliability of operations. Regardless of their organizational structure, they strive to maintain constant communication, increase work efficiencies, and improve the quality of services they provide to customers. Accordingly, the entire development and infrastructure lifecycle becomes part of their responsibilities.

If an organization wasn’t able to keep up with the digital era and retain its operations based on legacy systems, digital transformation cannot be fully integrated. More so, a highly skilled team should be available to ensure that the quality, productivity, and security of business performance are optimal.

Lack of data infrastructure

By 2025, approximately 20 billion devices will be connected, nearly three times the general population. These devices have generated about 90% of the data produced in the world. With this massive amount, mining this data greatly enhances the power of analytics, which leads directly to dramatically higher levels of automation — both on processes and decisions.

This gives birth to brand new business models where the business dynamics are driven by market forces such as regulations, suppliers, customers, and even competitive pressure. One of the common pitfalls of digital transformation is lacking the proper steps needed to change the business strategy that corresponds to the technology strategy.

In terms of artificial intelligence (AI) in the digital transformation journey, IT needs to evolve and have a heterogeneous data processing architecture to support AI-powered solutions. Without the right data infrastructure, an AI initiative will not succeed. More importantly, a legacy IT infrastructure must be capable to move and into a new digital architecture.

Many organizations collect a lot of data but fail to analyze and utilize it. Why? There’s a lack of scalable data infrastructure built for end-to-end data flow. We must keep in mind that a successful digital transformation requires data-informed decisions. Thus, a solid data foundation should be present before you can actually move forward with the transformation.

Data is an incredibly valuable resource that should be integrated into business strategies. By analyzing and leveraging the collected data from business and customer activities, actionable insights and encourage data-informed decisions in your digital transformation efforts can be applied.

Telecom: B2B opportunity

The importance of business-to-business (B2B) digitization is easy to overlook due to the digital shifts underway in numerous B2C sectors and value chains. Nevertheless, B2B innovation can be just as disruptive. “Digital transformation is a huge focus for the telecom industry due to the gradual decline in revenue from traditional services. So, the industry needs to transform by improving efficiency, and by introducing a whole lot of new services,” says Martin Creaner, chief architect of Huawei SPO Lab.

Digitizing B2B players within the telecom industry equates to lowering costs and improving the reach and quality of their offerings. Internationally, telcos have a great pedestal as they shift their digital transformation into high gear. Most of them are moving persistently to be successful. In terms of approach, if it is only technology-centered rather than customer-centered, it’s not transformational.

As we see from both telecom operators and vendors such as Etisalat, Ooredoo, Zain, stc Group, Vodafone, Huawei, Nokia, ZTE, and many others, various products and solutions are deployed with customers in mind. These make their digital transformation initiatives effective and sustainable.

Aside from focusing on cost reduction, creating more value becomes the new way of business. While telcos are increasingly flexible around the concept of revenue sharing, launching digital services with more aggressive business models is still afoot. This is necessary to compete with OTT and hyperscalers in the battleground of new digital services.

As telcos become transformed digitally, more opportunities will open up that will benefit their businesses. The critical part is keeping this transformation continuous and sustain the deliverables needed. From a discrete physical network to a cloud-based network, telcos must be suited to handle millions of consumer devices to billions of IoT devices — embracing the shift to being a large-scale new digital services provider.

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