Lucky La Riccia, Head of Digital Services at Ericsson Middle East & Africa elucidates the key capabilities required to capture business opportunities that are fast arising due to digitization.
Digital technologies are transforming industries worldwide. With 5G being deployed across the region, service providers increasingly recognize the new business opportunities that digital transformation of the enterprise market will bring. However, to successfully address these opportunities and accelerate longer-term growth, they need to extend their focus from traditional revenue streams to center on digitalizing targeted industries.
While leading service providers in the region are already taking steps to look beyond connectivity and focusing on a few specific industries, they should also expand their strategic ambition beyond mobile broadband in each targeted industry.
According to Ericsson report titled “Capturing business opportunities beyond mobile broadband”, almost half of the total projected value of industry digitalization will be enabled by 5G in 2030.
Service providers’ revenues from existing business, mainly driven by connectivity, are expected to remain stagnant. It is a must to look into new opportunities to capture a larger share of the potential global ICT revenue enabled by 5G, a figure up to USD 700 billion in 2030 (across 10 industries).
Critical capabilities and closing the readiness gap
For most service providers, business, operational and technical capabilities are highly critical in capturing business opportunities beyond mobile broadband. As the current gap to reach the desired state is wide, service providers must begin ramping up the most critical capabilities, particularly on the business and operational fronts, to ensure successful execution.
The top five capabilities pinpointed as most critical are:
1. Effective B2B and B2B2X go-to-market: To engage with enterprise customers beyond legacy business, an effective go-to-market model is crucial. This involves efficient and scalable processes for engaging with customers and partners, and for distributing insights and learnings across the organization. Moreover, it concerns making sure sales teams are properly equipped to understand and address enterprise customers’ business challenges.
2. Leadership and culture: Leadership involves ensuring the enterprise segment receives the right level of attention from both top and middle management, and that the strategic priorities are clear. The culture should support and strengthen the strategic ambition and priorities beyond legacy business, for example through encouraging co-creation and a customer-oriented and innovative mindset.
3. Industry knowledge of targeted verticals: This capability refers to having the optimal processes and resources in place to ensure an organizational understanding of industry trends, as well as customers’ business challenges, strategic priorities and digitalization needs. This is key to efficiently design, develop and sell relevant solutions to customers.
4. Skills: Developing and selling new solutions in new ways requires a different set of workforce competencies. Therefore, organizations must ensure sales teams are ready to serve enterprises beyond legacy business by being able to build a deeper understanding of their business needs and strategically engaging with other decision-makers. Moreover, the workforce must adapt to automation and software-based operations. If these competencies are not acquired through partners, service providers must ensure appropriate processes and tools to upskill, cross-skill, recruit and retain sought-after competencies.
5. Service orchestration, assurance and automation: This capability refers to automating the design, creation and delivery of end-to-end network services while guaranteeing quality and optimizing data analysis and decision-making. This is important, as networks are becoming more real-time oriented, driven by customers’ preferences for innovation and speed, and the need to meet or exceed those expectations with increased agility and lower cost structures. Orchestration answers the call for more dynamic management of information and technology in converged ICT networks and supports services and resources throughout their life cycle – from planning to fulfilment and closed-loop assurance.
This is a fundamental step in further developing the capability. Ultimately, it should support end-to-end automation from RAN to core, and fully autonomous service orchestration in both internal and external customer IT environments.
At the same time, service providers around the world are not the same, and their digital strategy must be adapted to suit their unique circumstances. Furthermore, the development of execution capabilities should reflect strategic ambition.
Service providers are in a strong position to capture emerging digitalization opportunities based on their strong customer relationships, extensive network coverage and deep knowledge of digitalization connectivity requirements. Notably, they can offer end-to-end data and network security, which is a key prerequisite in enterprises’ digital transformation.
Only by addressing these key capability gaps, service providers can truly gain the ability to engage, sell and deliver solutions to enterprise segments and truly capture this revenue growth.