The big issue in the Telecommunications industry right now is declining margins. The past several years have been tough for telcos. Their revenue and cash flows have dropped by an average of 6 percent a year since 2010.
These firms can address this issue, by improving the speed of delivery of new products, reducing order fall out and simplifying and improving their customer experience.
When redesigning their value proposition, go-to-market, and interaction model, operators find it increasingly difficult to differentiate between traditional drivers of customer choice. Instead, they have turned to customer experience as the key influencer. For example, Vodafone Germany has transformed their business to enable their path to digital transformation:
“It is the first time we have raised Vodafone’s organic EBITDA [earnings before interest, tax, depreciation, and amortization] guidance in recent history,” said Vittorio Colao, chief executive. Polo Tang, an analyst at UBS, said the company’s performance in the second quarter was ahead of expectations in almost every geography but notably in Germany and Spain.
Success lies in reimagining the end-to-end customer journey to create signature customer moments. Companies can accelerate the delivery of a new customer experience by implementing a seamless Omni channel experience, digitizing core business processes, deploying artificial-intelligence platforms to simplify customer interaction, and creating a more agile organization.
What can companies do to alleviate the squeeze on margins and create more value?
Major advances in data analytics, artificial intelligence, network equipment, and other technologies have rewritten the industry’s winning formula. With the newest software and hardware, along with digital-age management practices, mobile operators can achieve breakthrough cost savings and capital intensity while maintaining or even increasing their scale.
Many mobile operators have essential processes that are more complex and labor-intensive, and therefore costlier than they have to be. The Management consultants Mckinsey estimate that just 20 to 30 processes generate 45 percent of the average operator’s operating costs.
There are a lot of Telecommunications providers can do to improve businesses margins operationally. This can also be part of an even bigger over-arching strategy for CSPs to boost their bottom line. For example, increasingly, slow but stable growth Telcos (at Business School we called such businesses 'Cash Cows') are acquiring high growth and high margin content companies to increase their profits.
When redesigning their value proposition, go-to-market, and interaction model, operators find it increasingly difficult to differentiate between traditional drivers of customer choice. Instead, they have turned to customer experience as the key influencer. For example, Vodafone Germany has transformed their business to enable their path to digital transformation:
“It is the first time we have raised Vodafone’s organic EBITDA [earnings before interest, tax, depreciation, and amortization] guidance in recent history,” said Vittorio Colao, chief executive. Polo Tang, an analyst at UBS, said the company’s performance in the second quarter was ahead of expectations in almost every geography but notably in Germany and Spain.
Success lies in reimagining the end-to-end customer journey to create signature customer moments. Companies can accelerate the delivery of a new customer experience by implementing a seamless Omni channel experience, digitizing core business processes, deploying artificial-intelligence platforms to simplify customer interaction, and creating a more agile organization.
What can companies do to alleviate the squeeze on margins and create more value?
Major advances in data analytics, artificial intelligence, network equipment, and other technologies have rewritten the industry’s winning formula. With the newest software and hardware, along with digital-age management practices, mobile operators can achieve breakthrough cost savings and capital intensity while maintaining or even increasing their scale.
Many mobile operators have essential processes that are more complex and labor-intensive, and therefore costlier than they have to be. The Management consultants Mckinsey estimate that just 20 to 30 processes generate 45 percent of the average operator’s operating costs.
There are a lot of Telecommunications providers can do to improve businesses margins operationally. This can also be part of an even bigger over-arching strategy for CSPs to boost their bottom line. For example, increasingly, slow but stable growth Telcos (at Business School we called such businesses 'Cash Cows') are acquiring high growth and high margin content companies to increase their profits.
