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Helping Portugal Telecom drive growth in emerging markets
By Craig Mindrum
Craig Mindrum is the managing editor of Outlook Online. For more information on this case study, contact Sérgio Ribeiro. firstname.lastname@example.org
When Portugal Telecom (PT) decided to pursue a growth strategy that depended on expansion into emerging markets, the executive team realized that the cost and time necessary to customize IT solutions in those regions could potentially undermine the business case for growth. To meet that IT challenge, PT implemented a standardized approach, called “Instant Telco,” based on an industry framework that leveraged leading off-the-shelf components. This comprehensive solution has helped PT decrease IT spending and reduce time to market for new products, and has improved the company’s overall business agility.
How could PT successfully establish subsidiary operators in these new markets to deliver such convergent services in a cost-effective way? According to Carlos Palito, general manager of PT Sistemas de Informação, an important focus was implementing key IT capabilities, including operations support systems (OSS), business support systems (BSS) and enterprise resource planning (ERP) systems. “Our goal,” says Palito, “was to be able to deliver a comprehensive IT solution for a new, midsize operator in just six months. That required the use of a ‘build once, deliver many’ approach—using standardized components so we could reuse our solutions anywhere in the world.”
PT is the largest telecommunications service provider in Portugal and a global player with more than 100 million customers worldwide. In 2007, Portugal Telecom initiated a comprehensive, global transformation program, the goal of which was to become a fully convergent telecommunications provider capable of offering a full range of information and communications services. A key to this transformation was global expansion. The company set an aggressive goal: two-thirds of its total revenue was to come from international markets, including South America, Africa and Asia. Expanding into emerging markets poses numerous challenges to service operators. The local technical infrastructure is often less mature. Understanding emerging-market consumers is also critical: Customers are price sensitive and choosy about which provider offers them value for their money. At the same time, services have to be robust to compete in the convergent solutions marketplace.
Portugal Telecom worked with Accenture, PT’s longtime consulting and IT solutions collaborator, to design an effective IT implementation approach for the company’s emerging markets. The starting point was Accenture Communications Solutions, an integrated package of leading-edge business assets that deliver essential BSS, OSS and service-delivery capabilities for operators. Its modular framework of solution components is based on an industry-standard model—TM Forum Frameworx, a suite of standards and best practices that provides a blueprint for more effective and efficient business operations. Because the standard framework already represents an integrated approach to building a holistic solution, end-to-end IT capabilities for network operators can be assembled in building-block fashion from marketleading, off-the-shelf components. The approach can improve end-to-end service management across
complex, multipartner environments. The result: less expensive, yet high-quality solutions that can be developed quickly and modified over time, as innovations occur within the individual components. Portugal Telecom worked with Accenture and Open Idea, a technology and engineering services provider, to further refine the existing standardized assets and adapt them to PT’s requirements and strategic intent. The development team integrated the solution with Oracle Communications Unified Communications Suite (OCUCS), PT’s chosen vertical BSS platform, complemented by other products from Open Idea.
of these midsize implementations, PT intends to offer the solution to Tier 1 and Tier 2 operators.
Supporting an agile business
According to Sérgio Ribeiro, Accenture’s managing director overseeing the Instant Telco program with PT, “A distinctive outcome of this work is that Portugal Telecom’s IT function can now be flexible and agile enough to change and propose new solutions quickly to support business strategy. Instead of restricting or delaying business needs, the supporting IT systems can be integrated and updated rapidly, whenever PT’s business requirements change.” The modular framework of Instant Telco can also adapt readily to marketplace innovations. For example, in 2014-2015, PT intends to use a cloud approach for the first time in one of its Instant Telco implementations in São Tomé, taking advantage of new PT data centers and a state-of-the-art infrastructure.
Being relentless when it comes to holding to the standardized approach of Instant Telco has been another important factor. Customization adds time and cost to an implementation; therefore, in most cases, the default is to the standardized capabilities within the components of the overall framework. Only when it is absolutely essential—as with local tax codes, for example—should one depart from the standard model approach. Building strong relationships with strategic partners is also important. Operations are different in every country; each situation has its own environment, its own perspective and its own sets of skills, so collaborating with local partners is a way to mitigate risk more effectively. Finally, managing the organizational changes caused by implementations and by the overall transformational business strategy is vital to success. Resistance to change is a reality in every business environment. As PT looks to compress the time needed to implement its solutions, managing the human dimension will become increasingly important. “This is a significant investment that we are making,” notes Palito, “because we believe in this approach. We need to expand our offerings, capabilities and markets so we do not become simply a commodity—merely a pipe through which other companies deliver profitable services. That means growing at every point along the value chain. Competitors are moving quickly, so, although we are happy with our success, we cannot stand still.”
Outlook Case Study March 2013 Copyright © 2013 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. The Outlook Case Study series profiles innovative solutions and approaches from organizations across a wide range of industries. David Cudaback, Editor-in-Chief Craig Mindrum, Managing Editor Jacqueline H. Kessler, Senior Editor For more information on Outlook Case Study and other Outlook publications, please visit our website: http://www.accenture.com/Outlook This document makes reference to trademarks that may be owned by others. The use of such trademarks herein is not an assertion of ownership of such trademarks by Accenture and is not intended to represent or imply the existence of an association between Accenture and the lawful owners of such trademarks. The views and opinions in this article should not be viewed as professional advice with respect to your business.
A comprehensive functional solution
The Instant Telco architecture provides a global, convergent solution that delivers a suite of “quadruple play” capabilities— television, Internet, mobile and fixed-line services. The standardized suite of components comprises customer relationship management, billing and revenue management, resource management and network management. It also includes the service delivery platform and middleware as well as analytics and reporting capabilities. The solution is preconfigured to integrate with ERP systems, data warehouses, geographic information systems, order management and network inventory management solutions. The delivery model includes on-shore and off-shore activities to help reduce costs and optimize project execution. Instant Telco enabled PT to start with an initial set of implementations and then scale quickly through multiple phases, improving the asset each time it was used. PT has developed the asset to the point where the company can deliver close to 80 percent of a total IT solution right out of the box, with the other 20 percent being important to the needs and environment of a particular local market. In 2010, PT implemented the Instant Telco solution at CV Telecom in Cape Verde, followed by delivery at Timor Telecom, in East Timor, a year later. Results from the network infrastructure project in East Timor have been notable: Bandwidth and communications are now better than in many developed nations, reaching more than 92 percent of the population with 2G/ 3G services. Currently, deployment is taking place at Mobile Telecommunications Limited, PT’s subsidiary in Namibia. Based on the success
Results from the implementations of Instant Telco have been remarkable. PT is measuring success across multiple dimensions, though the two most essential metrics have to do with speed: implementing a new IT solution faster and reducing the time to market new products and services. In the past, the time needed for PT to create new products was as long as a full year. Today, the company can launch a new product and align its systems with the product in only two months. And in cases where a rapid response is especially critical— for example, when a competitor has just launched a new offering—PT can now move even faster, launching a competing offering within 24 hours. Other benefits include reduced total cost of ownership for IT solutions, more accurate billing and faster responsiveness to customer needs.
Keys to success
PT’s Palito points to several factors that have contributed to the company’s success in driving business transformation through its Instant Telco implementations. One is to have robust governance in place, supported by strong sponsorship and commitment from top management. “Every program, every project, every stream of work we have undertaken has had a guarantee of strong sponsorship from our executive teams,” Palito says. “If we don’t have that, we won’t start the project. It’s as simple as that.”
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