The challenges telecommunications carriers face are not so different from those of their enterprise customers. They’re just a lot bigger. And IT managers are meeting them by pursuing consolidation -- that is, reducing the number of systems and personnel -- with a vengeance.
“You’re talking about revenues up to around $100 billion and tens or hundreds of millions of customers, business and consumer, with a lot of detail on those customers,” says Jay Pultz, vice president and distinguished analyst at Gartner. You’re also talking about recent mergers of massive organizations with their own IT departments and systems that were typically developed in-house.
“From an IT perspective, getting a very old industry with its unique scale through all the recent megamergers while maintaining customer expectations of absolute reliability is a huge challenge,” says Judy Spitz, CIO of Verizon Business. But that’s just maintaining a dial tone. Telecom providers also face new competition from cable providers, increased customer expectations, time-to-market pressures, voice/data convergence, and data protection. Clearly, things have changed for an industry raised on monopoly, regulation, and doing one or two things very well.
Even without megamergers, telecom would have a significant consolidation headache on its hands. “In the past, launching a new product generally meant launching a whole new line of business with a new set of processes, systems, policies, and customer services,” says Jim Preston, deputy CIO of BT Retail. “BT now has about 3,000 systems supporting all the different products and parts of the customer lifecycle.”
The only way for carriers to survive a declining voice market and increased competition is to cut costs by consolidating systems, applications, and data and to streamline and automate business processes that were often highly manual. The ultimate goal, according to Spitz, is a single bill and single order, by provisioning process flows independently from the networks being provisioned. Carriers must also be able to launch multiple new converged wired/wireless and multimedia offerings and tie them back into billing and provisioning in weeks, not months.
Many into one
The first step for many of the carriers has been IT staff consolidation. “We consolidated the separate IT functions from BT Retail, BT Wholesale, and BT Global Services into a single IT group that spans all the lines of business, so that we could transform the business with a single lens, rather than having lots of things running in parallel,” Preston says.
BT has also consolidated redundant systems and, wherever possible, replaced expensive in-house development efforts with off-the-shelf enterprise software. “We had more than 200 different systems for customer relationship management alone,” says Preston, who adds that BT is moving toward consolidating on Siebel’s CRM solutions. Consolidating data has also been a priority, not only for achieving the goal of one bill for multiple services but also for having a single view of customer data that can provide insight for competitive advantage.