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Continuous improvement is key to the connected solutions market

Ed FinegoldEd Finegold
09 Jun 2023
Continuous improvement is key to the connected solutions market

Continuous improvement is key to the connected solutions market

Many telcos are eyeing connected enterprise solution growth as some firms project a compound annual growth rate (CAGR) of nearly 28% through 2030 to result in a nearly $2.5 trillion market. Capturing it, however, will require communications service providers (CSPs) to take a longer-term view of continuous improvement.

Bespoke solutions to past problems

Often telecom solutions are sold to meet current needs rather than deliver new business capabilities. ”We are still trying to fix past problems,” explains Mounir Merhi, Consulting Partner, Network Solutions and Services, Tata Consultancy Services.

If CSPs seem to have been caught flat footed by the sudden explosion in the connected solutions market, its important to recall the context. The telecom industry was on the fast train to 5G before the COVID-19 pandemic hit. Merhi explains that in the pre-pandemic period, many managers within CSPs aimed to offload, consolidate, and outsource hundreds of applications supporting legacy networks and business processes to clear their own plates for 5G projects. This meant finding processes that could be broken off and shipped out for business process outsourcing.

Then the pandemic hit, however, and suddenly managers “weren’t just offloading, you were trying to transform to participate in the digital market, and many CSPs didn’t have a model or a process for doing this,” Merhi says. In response, CSPs brought in new open-source technologies and working methodologies, as well as digital transformation models from organizations like TM Forum, to help. But in the end, Merhi says, IT became spread across competing initiatives – 5G, digital, and now partner ecosystems – as “business was scrambling to accelerate digital transformation.”

As a result, as CSPs turn an eye toward capturing more of the connected enterprise solutions market than just connectivity, they are also rolling out 5G, bringing more organizations toward digitalized business processes and operations, and changing the way they approach solutions delivery. Rather than creating bespoke, point-in-time solutions with an expiration date and handing their care off to the lowest cost BPO partner, CSPs may have a long-term growth opportunity in owning the continuous improvement of the solutions they connect and deliver.

Repeatable solutions to add business value

A solution that is continuously improved to add increasing value over its long-term lifecycle infers a repeatable, platform-approach to delivery. This again differs from the past where CSPs created bespoke solutions to fill specific purposes in essentially the same mechanized way for as long as possible – sometimes decades. More often, however, these more static solutions would result in a growing mismatch over time between business need and solution capability, until the custom solution was retired.

The new approach to solutions, however, leverages continuous improvement methods to increase the solution’s capabilities and sustain its alignments with business needs over time. This kind of continuously improved solution infers delivery from a platform; utilizes repeatable rather than custom solution components; and is intended to grow and evolve to keep adding more value to the business – not just by solving pre-existing problems, but by enabling new business capabilities and new levels of productivity.

Continuous improvement for the win

In the modern software paradigm, this type of continuous improvement approach is the norm. Solution capabilities are intended to change over time and solution footprints can expand organically with business needs. This type of continuity, which seeks to keep adding more value to the business, should greatly benefit the prime contractor – the role CSPs want to play - and help to nourish its ecosystem for years.

A solution delivered using this approach will not be displaced easily because the solution platform itself will evolve with the client organization’s business. It can become an integrated and critical component of the customers’ business operations, with care, feeding, and growth entrusted to the CSP. And this is exactly where CSPs want to be positioned long term – as a digital and automated solution platform that enterprise customers can count on to sustain the new connected technologies, they rely on to run their businesses competitively and profitably. If CSPs own the continuous improvement cycle now, they may win big in connected solutions markets for decades.

For a closer look at how CSPs are competing in the connected solutions market with cloud hyperscalers, major IT ecosystem providers, systems integrators, and network equipment manufacturers, download our new report Partner ecosystems: who does what and can CSPs compete for more?