This Industry Viewpoint was authored by Prodapt
According to Gartner research, around 50% of initiatives for digital transformation fail and CIOs report that the main barrier is culture. A successful digital transformation must begin with an effective cultural transformation. As Communication Service Providers (CSPs) aim to compete with new digital businesses by adopting cloud-based technologies and agile development methods, they need to first start the transformation of their organizational culture, operational processes, and core business strategies.
However, this transformation journey is not that straightforward in the complex CSP ecosystem. It has become more challenging because of the evolving organizational structures, rigid mindsets, and inflexible processes, that have shaped up over the years. These further results in the below-mentioned challenges:
- Transformation fatigue – Passion and commitment towards transformation project at the beginning inevitably fades, particularly when goals are not met. Past failures bring down the team motivation.
- Project separation from the line organization - Stretched project duration creates issues such as lack of trust and collaboration between project and line organization.
- Lack of business agility - Functional & departmental silos, complex hierarchies, and operating high-cost waterfall models that look like agile, create roadblocks for faster rollout of new/flexible business models.
- Vendor dependency – Lack of control mechanisms and quality gates, inadequate processes and need for manual intervention increase vendor dependency.
- Inability to scale operations and innovate faster and often – CSPs face enormous challenges due to digital skill set gaps. It is also challenging to change people’s mindsets to adopt a new business model.
- Rigid and complex processes - Traditional CSPs, in contrast to digital natives, spend a lot of time defining, adhering to, and measuring process compliance. CSPs are not only organized as hierarchies but also heavily reliant on processes to ensure that decisions are made in a highly prescribed manner.
The Achilles heel of any digital transformation effort is typically found in the realm of an organization’s cultural transformation. This article provides key strategies for CSPs to drive an effective cultural transformation.
a) Bring process innovation to streamline operational activities and improve productivity
- Set up cross-functional collaborative POD model to eliminate siloed culture – The formation of an agile POD structure comprising a representative from different groups is key to eliminate the siloed culture. Vertical agile PODs comprising a small group of self-organizing people with a variety of competencies can be set up to work collaboratively and ship production-ready code at a predictable rate. Additionally, a horizontal inception team can be set up to build the backlog and support the vertical PODs. It’s crucial to ensure that each POD has a set of complementary skills that are needed for successful project delivery. Furthermore, it is essential to form a cockpit team comprising product owner, scrum master, business process leads, and senior architect to take quick decision on any requirements or scope changes.
Fig: Cross-functional collaborative POD model
- Set up an effective program governance model – It is important to develop a governance framework that provides a single view of the project rather than departmental views. Use tool-based tracking to closely monitor defects with timeline, aging ETA, and backlogs. Also, streamline vendor collaboration and establish clear escalation mechanisms.
- Cut down status quo on hierarchical decision making - Hand responsibility to people who make actual changes. This enables a much higher rate of change and reduces the failure rate dramatically.
b) Overcome people-related challenges by the following key strategies
- Cross skill resources for better productivity - Train users on multiple platforms simultaneously, keeping the focus on workflows, rather than on individual tools/components.
- Contextualized teaching and recorded walkthroughs - Employees learn effectively on the job, as it allows them to immediately apply the learnings.
- Instill clear accountability and responsibility with appropriate tracking models - Publishing RASCI (responsible, accountable, supporting, consulted, and informed) matrix to all stakeholders with clearly defined goals is more effective.
- Instill effective communication in the workplace – Building open and transparent communication lines and instilling the importance of common language documentation is essential for an effective exchange of information.
- Motivate teams by sharing success and challenges - Though shorter successful releases are challenging, it motivates the team and connects them with the larger organizational goals.
- Prioritize on long-term success over short-term wins - Set a winning long-term strategy, communicated clearly with the team. Then, place the right incentives to drive team behavior to reach the goals.
c) Embrace data-driven approach to improve customer centricity and continual improvement of the model
- Quickly adapt to changing needs of customers- Market analysis, customer feedback, and NPS scores are key to identify customer needs. It’s crucial to quickly find and fill the gaps at each touchpoint in the customer journey.
- Drive continual improvement of the model by analyzing key performance indicators- Closely assess the change initiatives that have come to fruition from the team. Create a baseline of team performance using the three performance indicators - business metrics, development metrics and operating metrics. Closely monitor these metrices while bringing continual improvement to the model.
d) Leverage industry standards to guide implementation strategy
Successful digital transformation initiatives should have the overall societal effect of digitalization. This can be achieved by leveraging best practices defined by the TM Forum framework.
- Digital maturity model assessment can be used to assess the existing operations, strategy, and culture to identify the areas of improvement.
- Digital Organizational Transformation Ecosystem (DOTE) framework can be very instrumental in making key changes across the operations, strategy, and culture layer as per digital maturity model assessment.
Benefits achieved by a leading DSP in Europe by leveraging the key strategies described in this article:
- 62% reduction in time-to-market – Adoption of various processes, people, and business strategies enabled the DSP to reduce time to market from ~2 years to 9 months
- 50% acceleration in product deployment and rollout time by effectively using the collaborative agile POD model
- 45% reduction in decision making turnaround time with the introduction of cockpit team
- 2x improvement in operational efficiency with the agile-based program governance model
- Srinivasan Murugesan- Associate Director, Delivery, Prodapt
- Senthil Velan- Senior Project Manager, Delivery, Prodapt
- Sumit Thakur – Senior Manager, Strategic Insights, Prodapt
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