Pilot 2.0 - How to trial new business models
Below is a summary analysis of the Pilot 2.0 session at the May 2009 Telco 2.0 Executive Brainstorm.
One of the recurring themes at the event was ‘where to start?’ with Telco 2.0 business models. Although many participants could perceive where operators would like to be eventually, there was much less belief or consistency in working out how to get there.
Most recognise the need for caution. C-level executives will, quite rightly, take time to buy into the idea, as will investors: proof points will be needed. And Telco 2.0 projects will need to be aligned with various other transformation initiatives, such as more moves to new OSS/BSS stacks or outsourcing of important functions. In addition, any major new programme of investment (for example in new hardware platforms, or extensive developer-centric marketing and support) is likely to be burdened by delays and much closer business case scrutiny in the current economic climate.
So, Telco 2.0 believes that quick and influential wins might be achieved via pilot projects – illustrating the power and vision of two-sided models without needing complete reinvention of overall company strategy first. As the economy picks up and executives are more inclined to take risks again, these proof-points can then be used to accelerate much larger programmes of change. Clearly, the appetite for risk will vary by operator – as will the most accessible ‘low hanging fruit’
Audience input around piloting spanned a wide range of themes – from the technical to the organisational, and from attitudinal shifts to more specific early niches. Overall, all these elements will be important to align.
Lessons learnt & next steps
The main take-out from this session is that there is no single clear path. The feedback yielded dozens of suggestions, many of which make sense on a standalone basis. The appropriate options for any given operator will clearly depend on its specific circumstances - fixed vs. mobile, tier 1 vs. tier 2, national vs. international, age & capability of OSS, maturity of existing API and Telco 2.0 programmes, and numerous other criteria.
However, one theme came out strongly throughout the event: do something quickly. There is insufficient time to pursue the usual protracted Telco timescales for research and deliberation. This means that areas with long lead times - such as government projects - are typically unsuitable. Some target industries are also experiencing lengthening sales/decision cycles in the recession - these are also not optimal for pilots.
Instead, focusing on sectors or groups capable of making quick turnarounds - with easy measurement of success/failure - are paramount. Web-based companies are often the most flexible, as are some academic institutions. There may also be a geographic dimension to this - countries with low regulatory burdens, or where it is unusual to have projects stuck for months with lawyers, are attractive for piloting purposes.
Working alone may be fastest, but collaborating with other operators is likely to be more effective in demonstrating validity to the Telco 2.0 concept. Balancing this natural tension will be important in the near-term. Gathering a small collection of operators together to work on tightly defined projects seems sensible as these can morph, over time, into larger scale activities with a larger ecosystem.
The Telco 2.0 Initiative is happy to work with any individual operators looking to identify early options. But some general short-term guidelines include:
- Get a credible senior (board member) executive to sponsor activities in this area - preferably the CEO. Don't try and build something without this support as a new business model will never succeed without the will to change at the top;
- Realistically assess the likelihood that the corporate culture and systems will sustain ‘maverick' Telco 2.0 operations. If it can, it is probably worth setting up an in-house group to work closely with relevant IT and operational units to select pilot areas and capabilities. But be honest with yourselves - if this will get mired in bureaucracy and politics, first seek an alternative approach outside the main business;
- Where possible, avoid trials which need software or devices to be ‘hard-coded' as making changes to beta versions is difficult and distribution issues will limit adoption. Instead, using the web or browsers as an interface enables any changes to be made on the server-side, on an ongoing basis;
- Web-based trials have another advantage - multiple versions of the same underlying service can be developed in parallel, enabling project managers to see immediately what works and what doesn't, by comparing feedback from separate groups of customers;
- Perform an audit of current Telco 2.0-type initiatives across the whole company. Highlight any apparent duplication of effort, and predict any likely areas of tension or internal competition as early as possible. This is not trivial - in-fighting can kill projects quickly;
- Assess and contribute to relevant industry-wide collaboration projects- GSMA OneAPI, OMTP BONDI, etc. Send representatives to developer meetings of competitors or peers elsewhere in the world, or in adjacent technology markets;
- Look for any internal groups that could themselves act as early clients for new service propositions. It is easy to be blind to the obvious: if communications-enabled business processes are valuable, why not communications-enable your own processes first?
The Telco 2.0 team is creating a database of pilot work, some of which will be presented at the next Telco 2.0 event on 4-5 November in London.Event Participants: can access the full presentation transcripts, delegate feedback, and long-term recommendations for action at the event download page (NB. the URL has been emailed to you directly as part of your package).