Building the perfect telco strategy

With technology driving competition in products and carriers it's time Australian companies stared reassessing their telco strategies.

A few weeks ago, I started work with a new client (a well-known Australian business), who needed Full Circle to manage their go-to-market tender and associated strategy.  

This is quite a specific engagement and project, and then it struck me. Post tender, or post contract signature for almost each and every business I have ever worked with, telco strategy is almost non-existent. It’s a reactive state-of-mind that evolves ad hoc and is need of a serious makeover.

There is a simple explanation to why we have ended up with this reactive method of telecommunication management. Traditionally, telco products came from a monopoly (or monopoly like) provider and products were put on the shelf from where you could select. Choice was severely limited in terms of product and Australian carriers. Accordingly, there was not a lot to manage or a lot to choose from.

However, times have changed and technology is driving competition in products and carriers. There are now real choices, real options available and with that comes a definite need for businesses to have a clear understanding of what they need and who they can get it from.

Businesses that choose to take a backseat stand the risk of seeing their costs mount very quickly and here are five worthwhile items to consider when formulating an effective telco strategy.

  1. Have a Telco Strategy Owner – Don’t just lurch from reactive problem to reactive opportunity. Understand your carrier, your technology, your options and start to explore what you can achieve. Telco contract, pricing and product management is a measureable business activity and should be afforded a business owner.                                                                                                                                       
  2. Don’t let your contract run out – If you let your contract run out, you don’t give yourself adequate time to look at the market and consider options outside your incumbent. You also place yourself in a position where your incumbent can increase prices if your contract expires, forcing a new contract on you to maintain prices, usually at a rate well above market. Give yourself six months to renegotiate and resign.                                                                                                                                                                            
  3. Have regular meetings with your providers / carriers – understand what products they have, how they see the market moving, how to iron out your frustrations. Many companies only speak to their carrier when there is a problem and they need something. This is reactive. A telco strategy means you can strive for best practice and actually make gains by using better products, smarter solutions and more cost effective plans.                                                                                                                                                    
  4. Manage your users – Do you have a bring your own device (BYOD) devices? Which devices is your staff using? How much should each user be spending? These are key issues that need to be considered. Not asking these questions may limit what your staff can achieve, or how effectively they communicate. Meanwhile, not limiting staff usage could result in cost blow-outs and the management of multiple device platforms will always pose a challenge for IT teams.                                                                                                                                                                                                                        
  5. Manage your contracts – This is, in my opinion, the most overlooked opportunity for negotiating cost savings up front.  The trick here is to work out how much responsibility lies with you and how much with your carriers. If you understand where the responsibility lies and whether there are risks in not managing aspects of this supplier relationship you can either open yourself up for costs, or mitigate against them. Other areas worth considering are mid-term benchmarks and optimisations on longer terms contracts. Lock in revenue for the carriers and they may surprise you how willing they are to move with the market with their pricing. Again, contracts are a vehicle for business relationships and telco is no different. It is worth exploring.                                                                                                        

Telco carriers are a supplier and like most supplier relationships they require investment and a sharing of knowledge and process. Telcos are often treated as a difficult or unloved supplier, which is a shame. A telco strategy can bring understanding to carrier relationships and move the focus from the day-to-day to the evolution of your technology approach. 

 

Tony Simmons is the managing director and founder of The Full Circle Group, an independent telecommunications consultancy firm focused on Telco expense costs and management.  

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