Telcos aren’t transforming fast enough – the TM Forum wants to fix that

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"There's too much confusion about what we're aiming for and how it's going to work. – TM Forum CEO Nik Willetts

Telcos know they need to digitally transform to keep up with the demands of the digital era and compete with digital-native players. But they’re not transforming fast enough, says the TM Forum, which aims to help speed things up in 2018 by focusing its efforts on navigation, agility and ecosystems, with the central tenets of simplicity, automation and intelligence – particularly the artificial kind.

TM Forum CEO Nik Willetts took the stage at TM Forum Live! Asia on Wednesday to outline the forum’s focus areas for the coming year in regards to digital transformation. Everyone understands the market forces in play driving the need for transformation, he said, but telecoms efforts to transform aren’t nearly as radical as they need to be.

“The 5G open ecosystem is a $582 billion opportunity for us as other industries go digital. But cashing in on that opportunity requires radical transformation at all levels of the business,” Willetts said. “Right now, in telecoms that transformation is happening mainly at the technology layer. Companies need to go much deeper than that.”

Simply transforming from a CSP to a DSP (digital services provider) is a good start, but it won’t drive growth, Willetts said. For that you also need to become a digital enabler and partner to help other go digital as well. And telecoms is moving too slow on this, he said. “It’s taking too long to make those changes.”

Part of the problem is that transformation is happening in silos, which is counterproductive as it’s the siloed structure and mindest of telcos that necessitates digital transformation in the first place.

Even the role of IT in telcos seems to still be locked firmly in the 1990s, Willetts said. “The 1990s mindset is that IT is 5% of opex and finding ways to make that smaller. What we need to be doing is thinking of ways that 5% of your budget can be transforming the other 95% of the business.”

Basically, a siloed approach to transformation won’t work, he said. “It has to be holistic. You need real digital ambition, and you have to radically change everything – technology, IT, operations, company culture, all of it.”

To that end, Willetts said the TM Forum will be setting its sights on three key areas in 2018, starting with helping companies navigate the transformation process with its digital maturity model and trackers to help the industry understand how to drive transformation across the business.

The second focus area is enabling better agility so telcos can move at the pace of the market around them, and the third is finding ways for telcos to be an effective digital partner with all the different and complex ecosystems that are emerging in different sectors.

The TM Forum will also be looking at emerging technologies like AI and blockchain, and will also continue its work in smart cities and helping the telecoms industry play a meaningful role beyond connectivity.

At the heart of all of this digital agility agenda will be the central precepts of ‘simplification, automation and intelligence’.

“This is predicated on the shift of the role of IT to driving simplification of the business processes and the product portfolios, the technology and operations, to transform the way that we work – and through that, enabling a level of automation we’ve only dreamed of before,” said Willetts.

That means telcos must work towards zero-touch operations, he added. “We shouldn’t have any human being involved in day-to-day operations of the business. It seems like a pipe dream today, but we need this level of automation just to move at the right pace. And a lot of that will be driven by having a different approach to intelligence in our businesses, by embracing technologies like AI that will help us to really change the game.”

Willetts emphasized that the most fundamental change to understand is that all-software networks won’t be operated by people, “but by an artificial intelligence that allows us to liberate a lot of our people from doing manual tasks – let’s put their intelligence to a different use by automating a lot of that. And through AI we can get to the speed we need to compete in the market we’re entering into.”

As for the perennial problem of silos, Willetts said telcos need to change their mindset and think of those silos as business components that can be strung together to create whatever services they like. That requires embracing the concept of open APIs, as well as a very clear picture of what that architecture looks like – which is another thing currently missing.

“Right now, whether you talk to operators or vendors, there’s too much confusion about what we’re aiming for and how it’s going to work,” he said. “We have to set a clear target and drive towards that aggressively. That can only be done by collaborating and working together.”

And the clock is ticking, Willetts warned. “There’s a limited window of opportunity. If you’re not already underway with a real digital transformation, you’re already late – you need to speed up and you need to embrace the scale of change that’s needed. Unless we start working together now, we’ll miss this opportunity and be consigned to being a commodity player.”

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