Case study

Phil Jordan, Telefónica: “How do you know when you’re winning?”

Telefónica Global has been undergoing massive digital transformation. How will we know we’re winning and becoming more digital? Group CIO, Phil Jordan answered his own question in his presentation at the Executive Summit during TM Forum Live!

“We’ve moved from enablement to exploitation. I could talk about the IT, but I want to talk about end-to-end digitalization in the context of a company having most of the capabilities and needing to exploit them to become a digital business. This is narrower than [TM Forum’s Digital Maturity Model] about – it’s down more in the weeds of being a telco. Also, how do you ensure the board understands? They tend to have different interpretations of what digital means.

Digital characteristics, business goals

At the start of the business transformation we spent a lot of time on customer interaction and experience. Then we thought about how we operate as a business, and there are two key characteristics that guarantee we’re digital:

  • Does it happen in real time?
  • Is it automated?

We want real-time interaction on the right mix of channels, always, and a business that has no back office. We have tens of thousands of back-office people, so that’s a huge goal. But we want our processes to be automated to give us very low error rates and higher efficiency – and our customers that omnichannel, rich experience.

At the core of our transformation is a standardized process model. We use TM Forum’s standards: The Forum’s role in the industry is central to our transformation because we want standardization – standardized APIs and processes and so on, as we want to work with vendors who are committed to those standards. Standardized processes make the business a lot more consistent in its operation.

Is it automated?

We’ve looked at every process in our business in every one of the 20 countries we operate in and asked ourselves two questions:

  • Is it automated and to what extent?
  • Is it in the right channel and in real time?

We’ve mapped every process in our business to this kind of framework, and looked at every channel and how it engages with which customers, from assisted channels to self-assisted.

There is still a place for great assisted interactions in a digital company, if a much smaller number than self-assisted. We’re measuring zero in the back office on the orders that require human intervention. You can’t have a business digital business if you need a human involved.

Our analysis – our maturity model, if you like – shows us these things. We’ve mapped all our operations against it to find out what works without intervention (see graphic below). The bigger the bubble, the higher the interactions with the customer, and color-coding shows the level of satisfaction.

Looking at the customer journey

I can see each part of the customer journey, whether the process is automated or not, and if the interactions are in real time and use the right mix of channels. This is very useful: I can show the CEO how we are moving the business and exploiting capabilities.

When we plan based on this, it’s not so much about technology as policy, process change, business change, changing the customer’s expectations and behavior. We’ve been through the process of analyzing our business and we can categorize and characterize our company based on real time, automated flows.

You don’t necessarily want everything to be in the top right quadrant – you don’t necessarily want everything to be in a non-assisted channel. But equally, we’ve started to slay some sacred cows, because normally when someone wants to leave, that process is the most difficult and antiquated – you don’t want to make it easy for someone to churn. In Spain, we’re moving to enabling customers to leave without assistance – they can leave without having to speak to anybody. This is a real mind-shift for us as a business.

What have we learned?

If you look on the right-hand side of the graphic (below), you will see that although we have the capabilities to handle a large number of interactions in an automated way, we don’t. That’s about providing the right choice of channel. It might also be based on customers’ behavior or something being too painful to do automatically. My message to the CEO is we need a plan to move to the top right.

More importantly for care and sales, where we still have a low level of automation across all the lines of business – I’m talking about fixed, mobile, TV, quad play and value-add services – we still have too many processes that customers don’t like, such as how to deal with technical problems. Some things we know how to handle: omnichannel capabilities, real time and single product catalog. How are you going to move the process and the journey of the customer to being more automated?

Using a maturity model

Being able to look at things this way is super-powerful because it has enabled us to retarget our investment. For years, we’ve been undergoing the IT transformation, and we’re replacing our applications, starting to do new things with data and coming up with new ways to empower customers. So, the enablement journey carries on.

The maturity model, which is narrower than the Forum’s but similar to it, has enabled us to create that last mile automation plan. It helps me measure the enablement side and challenge the business: The technical capabilities are there, so how are you updating journeys with the new processes and what are you saying to customers about upgrades or top-ups?

The good news about top-ups is that although customers can do it in every country we operate in, customers in Latin America are used to doing it by going to a shop at the end of their street.

That’s not a technical challenge; it’s one for communications to change their behavior. We started off doing an IT transformation and ended up doing many countries at the same time. Now it’s about using the capabilities to digitalize the business, and I’m engaging with the board differently.

I have a speedometer that shows our overall level of digitization – an aggregated view of all processes, all segments, all countries. It is easy to understand, and you can look at this from different perspectives, from that of a mobile operator or a fixed operator or a converged operator. Or you can look at how digital we are on a smart phone or the web, or the assisted or non-assisted channel, and look at our plan to see where it’s taking us.

My big question at the outset, was, “How do you know if you’re winning?” I can see that now and explain it to the board. Now each country must have a digitization plan to share with the board – where are you with process X, with the sales journey and so on?

We are looking to gain cost savings from the business, not the technology. There is very much a push back on the idea of transformation being an IT cost-saving exercise. We are not doing it to make us leaner, but to make our customers’ experience better.”



About The Author

Snr Director, Research & Media

Annie Turner has been researching and writing about the communications industry since the 1980s, editing magazines dedicated to the subject including titles published by Thomson International and The Economist Group. She has contributed articles to many publications, including national and international newspapers such as the Financial Times and International Herald Tribune, and a multitude of business-to-business titles. She joined the TM Forum in 2010 and is responsible for overseeing the content of the Research and Publications portfolio.

1 Comment

  1. Great for Telefonica to share their Digital maturity model. I’m still surprised how few boards (Telcos and others) have any idea of where they are or any framework to consistently assess where they are and where they are going. There will always be tough decisions to make and no model will take away the pain but it will provide a map of the territory and aid navigation.

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