Digital Transformation & Maturity

Operators reflect on culture

In September 2017, TM Forum published a report based on the findings on one of the largest surveys ever conducted of digital transformation in the telecoms sector. The Forum’s Chief Analyst, Mark Newman, looks at the culture of telecoms operators – both from the perspective of people that work in them and those who supply their technology and IT.

We talk a lot about the culture of telecoms operators – the implication being that there is something wrong with it and that it needs changing if they are to become true digital service providers. So, do the people who work for telcos recognize there is a problem to be addressed? And what about their suppliers?

Some engineers and architects employed by vendors spend long periods of time working alongside telecoms executives, so they are well placed to comment on the culture. Those who work in the sales and marketing organizations of vendor companies also gain good insight into communications service providers’ (CSPs) culture through long, drawn-out procurement processes and the hand-holding that goes with large contracts and account management conventions.

We asked our respondents which of the following words they would use to describe the department that they work in:

  • Fun
  • Dynamic
  • Formal
  • Hierarchical
  • Team-based
  • Creative
  • Dull

We asked vendors the same questions about the CSPs they sell to. Respondents could choose multiple responses.

As you can see from the responses in the chart below, telcos and their suppliers have very different perspectives on CSP culture.

How would you describe the culture of the department you work in / the CSPs that you partner?

The words most used by CSPs were “dynamic” and “team-based”. Many recognize that their organizations are hierarchical, but almost as many believe that they are also creative. Vendors, on the other hand, consider CSPs to be hierarchical and formal. Only one in three consider CSPs to be team-based and less than one in five consider them to be creative.

So, what are we to make of these different perspectives, and do they matter?

Our respondents had little or no reason not to be truthful in their responses (they knew that they were answering anonymously). But this does not mean that they answered objectively. As an industry, we have grown much older in the last 15 to 20 years with relatively few people leaving voluntarily and fewer new recruits. And when you have worked for an organization for a long time, it can be difficult to look at it objectively, particularly when you have few points of comparison.

Looking at the telecoms sector from the outside, few people would characterize it as dynamic.

Possible explanations

One possible explanation is that our respondents (51 percent work in IT, 15.8 percent in the enterprise line of business, 13.6 percent in network, 9.2 percent in product management and 7.1 percent in sales and marketing) work in departments that are more dynamic than their organizations as a whole. To the extent that IT departments are seeking to transition to new working practices (DevOps, agile software development, microservices, virtualization and cloud), it may well be that they are becoming more dynamic. But for most CSPs, these are more aspirations than realities, and IT teams still spend more of their time keeping the wheels turning rather than transforming their organizations.

One other reason could be that a large proportion of our CSP respondents manage large teams and would take it as a personal affront for their departments to be seen in a negative light. The same question posed to members of their teams may have elicited different responses.

From the vendors’ perspective, there is often frustration with CSPs’ RFP-based procurement processes which require them to assemble large bid teams and allocate a considerable amount of time to satisfying the terms of the RFP. Furthermore, CSPs’ procurement divisions put together contracts that give vendors little room for flexibility or innovation.

Vendors are also frustrated by the siloed nature of CSPs’ organizations. It is often the job of the vendor to bring together different departments within a CSP (IT, technology, marketing and enterprise, for example) to demonstrate how their product or service can create value across the business.

Why does it matter anyway?

Even if we were to think that telecoms organizations are more like vendors describe them then how they see themselves, does it really matter?

The answer is yes, and for several reasons. If CSPs are to truly leverage the benefits that cloud and virtualization can deliver, they will have to change their working practices. Transitioning to DevOps is difficult. Many CSPs who have tried DevOps are having less than satisfactory experiences. But this does not mean that they should not keep on trying. And if the first instinct of the teams who are asked to transition to new working practices (and most people don’t like change) is to resist, then it will not be successful.

When it comes to microservices, the change is as much about devolving responsibility and accountability to smaller teams as it is to taking a different approach to building applications. How confident do these teams feel about being held more accountable? Is there a culture of experimentation, trial and error, or are employees scared of making mistakes?

Many large telecoms operators today are seeking to become ‘tech’ companies and, in doing so, write their software either themselves or in partnership with third-party vendors. They are trying to retrain staff and recruit new, younger software engineers for whom it is second nature to embrace digital architectures and processes.  They will struggle in the competition for talent if they are unable to offer dynamic, creative roles and career paths.

This story originally ran in our Digital Leader Network newsletter. If you’re a C-level executive and would like early access to content like this, join our Digital Leader Network. Contact Arti Mehta via [email protected] to learn more.


    About The Author

    Chief Analyst

    Mark Newman is an analyst with 25 years of experience delivering insights on the future of the telecoms sector to senior level executives and audiences. Mark’s recent research has focussed on telecoms operator business models, digital transformation, service provider diversification, and the intersection between Internet and telecoms. He delivers analysis, presentations, strategy sessions and workshops to global audiences, helping them to plan for the changes that technology and disruptive new business models that will fundamentally transform their businesses. Mark was Chief Research Officer at Informa Telecoms & Media and Ovum before leaving to set up his own research firm, ConnectivityX, in 2016. He joined the TM Forum as Chief Analyst in February 2017.

    1 Comment

    1. Fascinating if unscientific. Next time get a bunch of suppliers or sub-contractors to the vendors to participate and rank the vendors on the same criteria. I can guess the results! CSP’s are hopelessly (and maybe fatally) behind the curve but they do have a very tough challenge in significantly changing their culture for the digital age. Few incumbents in any sector have succeeded. For CSP’s, the challenges are greater than most given their competition is increasingly from global digital behemoths or startups.

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