The myths of transformation

Martin Creaner
10 Mar 2010

Transformation is a hugely important topic for our industry, but it's bedeviled with myths. While recognizing the myths does not mean you will be able to implement a successful transformation, at least it will help you get your thinking straight and help target your transformation appropriately.

The first myth that we need to dispel is that it only applies to long established incumbent service providers. People tend to associate the word "transformation" with huge network transformation programs such as the BT 21C program that's received great attention over the past five years.

However, transformation is a much more generic term that applies to a series of constant improvement activities that all service providers must continually pursue in order to achieve sustainable profitability. So the principles of transformation apply equally to the small, but rapidly growing new mobile operators as well as the large and stagnant monopoly operators.

The second myth about transformation is that it essentially refers to the challenge of a major network swap-out activity. Undoubtedly, the challenge of moving from a circuit-switched network paradigm that has held sway for the past century to a next-generation all-IP core and access network, supporting a dizzying array of new services, is a non-trivial challenge. But there are many different types of transformation, and only one involves the massive capital expenditure challenge of a network renewal. The other types address system transformation, business process transformation, product portfolio transformation and business model transformation.

System transformation involves a comprehensive renewal of the systems that support both the network and the processes that underpin the business. The goal of system transformation is to dramatically increase flexibility and the ability to implement new products and services to adapt to rapidly changing industry demands. One key goal of system transformation should be the significant reduction of an integration tax for all future systems.

Process transformation involves a radical streamlining of business processes to enable complete or near-complete automation of the most commonly implemented processes. One key goal of this form of transformation is to streamline the operational cost of the business and to dramatically improve operational effectiveness.

Portfolio transformation involves a significant reinvention of the portfolio of products that the business offers to its customer base. In many cases, it results in a business evolving from offering basic voice and data transportation services to offering a portfolio of value-added services that may well extend significantly beyond traditional communications and entertainment services (e.g. micro-banking services).


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