Strategizing to a Digital Future

Transcription

1 J A N U A R Y 2 1 ST, Strategizing to a Digital Future Customer Centric Business Transformation Track 1

2 How are we digitizing A Glance? Kickstarter: the coffee story Human-izing Digital The New Customer Customer needs are evolving Strategizing to a digital future Digital Imperatives Strategic imperatives driving digital in the industry Digital Transformation Journey The journey from exploring digital to being digital The Middle East & the role of the digital telco The Middle East Digital Landscape Nations are taking the leap into being more digital Digital Telco: the enabler Enabling new adjacent markets 2

3 Have we really delighted the customer yet? Not quite. 1. Coffee store I walk into my habitual coffee store 2. Telco operator I encounter a roaming issue Experience: Greets me by name inquires why I didn t come yesterday prepares my small Americano with milk on the side as soon as I walk in no questions asked Personalized offers me upsells based on buying behaviors & preferences Only human interaction over 1 year Preferences learnt over time User-friendly service Delightful experience that creates belonging to the interaction Experience: I am disconnected asks questions after questions cant do nothing gets to roaming complaint ChatBot greets me by transfers call to agent name I explain the User-friendly Personalized issue all over again agent can t resolve issue and directs me to service the app I go through the hoops again issue doesn t get resolved Digital interaction over 7 years I visit the store Preferences not learnt over time (still asks for language preferences) Frustrating experience that takes very long to get customer to what they want 3

4 Have we really delighted the customer yet? Not quite. 1. Coffee store I walk into my habitual coffee store 2. Telco operator I encounter a roaming issue Experience: Greets me by name inquires why I didn t come yesterday prepares my small Americano with milk on the side as soon as I walk in no questions asked Personalized offers me upsells based on buying behaviors & preferences Only human interaction over 1 year Preferences learnt over time User-friendly service Delightful experience that creates belonging to the interaction Experience: I am disconnected asks questions after questions cant do nothing gets to roaming complaint ChatBot greets me by transfers call to agent name I explain the User-friendly Personalized issue all over again agent can t resolve issue and directs me to service the app I go through the hoops again issue doesn t get resolved Digital interaction over 7 years I visit the store Preferences not learnt over time (still asks for language preferences) Frustrating experience that takes very long to get customer to what they want 4

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6 Who is the new customer then? The customer is well informed, has high expectations, and connected all the time. Product information and inspiration as well as recommendation through social media Mindful communication behaviors? Growing amount of users of sharing info on telco products Connected media providers Around 2.6 hours per day are year-olds using internet 45% of smartphone owners are making purchases using a mobile device every month 64% of customers intend to research online before buying telco products Less is more Digital consumer own 3.64 connected devices Source: Deloitte research and analysis

7 What are the strategic imperatives for being digital? Strategic intents drive the strategic outcomes. Strategic Intent Digital is a means to Adjacent and more transformational sectors and markets Simplify and exponentially improve customer experience Improve operational efficiency to improve cost models Transform business models Strategic Outcomes Digital can help achieve Customer intimacy Talent retention and attraction Growth and profitability Shareholder Value Telco 2030 identity choices The virtual telco Customer relationship remains with Telcos The engineer strikes back Critical size in global number of clients > 1Bn customers The Virtual Telco The Engineer strikes back Critical size in number of clients and local infrastructure 1 > 1Bn clients and >500M mutualized FTTH/4G coverage Technology competence displaced from Telco Players Technology competence returns to telco players A vendor brand The new wholesale truth A Vendor Brand The New Wholesale Truth Critical size in number of service partners > 1Bn coverage aggregated FTTH/4G Critical size in local infrastructure > 3Bn clients and sensors 2 > 500M mutualized FTTH/4G coverage Telcos are fully displaced from customer relationship Source: Deloitte Telco 2030; Note: 1) Market share is gradually reducing, 2) ~10% of the 2025 estimate of 27BN IoT connections, 3) GAFA: Google, Apple, Facebook, Amazon 7

8 What are the strategic imperatives for being digital? Strategic intents drive the strategic outcomes. Strategic Intent Digital is a means to Adjacent and more transformational sectors and markets Simplify and exponentially improve customer experience Improve operational efficiency to improve cost models Transform business models Strategic Outcomes Digital can help achieve Customer intimacy Talent retention and attraction Growth and profitability Shareholder Value Telco 2030 identity choices Customer relationship remains with Telcos Critical size in global number of clients > 1Bn customers Technology competence displaced from Telco Players The virtual telco A vendor brand Carry the best services and assistance experiences for clients Positioning on The services Virtual that reinforce the width of the client Telcorelationship (content, bank, AI, e-commerce ) Separate the network and service activities to manage heterogeneous dynamics Operation excellence: automate processes and transform The engineer strikes back Provide the best client experience through operational excellence, network infrastructure and long term technologies mutualized investments Keep bargaining power against GAFAs The Engineer 3 and vendors through consolidation strikes back The new wholesale truth Critical size in number of clients and local infrastructure 1 > 1Bn clients and >500M mutualized FTTH/4G coverage Technology competence returns to telco players Positioning as a Hub A Vendor of networks (bonding, Invest in network infrastructure and long The New Critical size in number of service partners SDN, ) and heterogeneous Brand service actors term technologies (fiber, 5G ) in a mutualized Wholesale Truth > 1Bn coverage aggregated FTTH/4G way Critical size in local infrastructure > 3Bn clients and sensors 2 > 500M mutualized FTTH/4G coverage Telcos are fully displaced from customer relationship Source: Deloitte Telco 2030; Note: 1) Market share is gradually reducing, 2) ~10% of the 2025 estimate of 27BN IoT connections, 3) GAFA: Google, Apple, Facebook, Amazon 8

9 Leadership & Governance Culture OD & Talent Management Workforce Enablement Customer Engagement Customer Experience Customer Insights and Behavior Customer Trust and Perception Real-Time Insights and Analytics Integrated Service Management Standards & Governance Smart & Adaptive Process Mgmt Agile Change Management Resource Management Brand Management Market and Customer Portfolio, Ideation and Innovation Stakeholder Management Ecosystem Management Finance & investment Strategic Management Data and Analytics Technology architecture Applications Connected Things Network Security Delivery Governance** Where does the difference lie? Digital leaders outperform digital wannabes in these core business areas. Telcos have historically been great at making technological advancements while there is a lot to learn and adapt from other nimble and digital native players who generally come from other adjacent industries like e-commerce, media and OTT Top Digital Benchmark Average Telco Digital Maturity Culture Customer Operations Strategy Technology 9

10 Strategizing to a digital future 10

11 How does an organization become digital? Becoming a digital organization is highly intentional. A HEAD START HOW DIGITAL YOU ARE TODAY It s critical to understand your level of digital organizational maturity today so you know where to begin and what to leverage HOW DIGITAL YOU NEED TO BECOME Digital transformation is a journey. Recognizing where you need to get to in 6, 12, and 18 months helps prioritize focus, energy and investments HOW DO YOU GET THERE Change happens more rapidly when you infuse digital traits into the existing legacy environment your organizational DNA The Digital Journey. Exploring Digital Leverage traditional technologies to automate existing capabilities. Dabbling with digital. No change to the organization. Doing Digital Leverage digital technologies to extend capabilities, but still largely focused around same business, operating, and customer models. Becoming Digital Leverage digital technologies becoming more synchronized and less siloed with more advanced changes to current business, operating, and customer models. Being Digital Business, operating, and customer models are optimized for digital and profoundly different from prior business, operating, and customer models. 11

12 Where to start? Organizations must first assess how digitally mature they are before taking any initiatives to transform. Digital Maturity Framework Purpose of the Digital Maturity Model Analyze current digital maturity holistically Strategy Set clear targets for transformation, short, medium and long term Operations 5 Key Dimensions 28 Capability Domains 170+ Criteria Easily used enterprise-wide Industry-agreed model Benchmark capable Customers Track and measure maturity progress through digital index Digital Maturity is increased through strategic digital initiatives that come out of DMA Run strategic digital initiatives by implementing a digital operating model Culture, people, organization Technology Value Add Agility Operational excellence Enablement and encouragement Digital technology architecture Digital culture & ownership Personalized customer experience Targeted Marketing & Products Foster Innovation Digital governance Data harmonization 12

13 Operating Model Layers Why is a customer-centric approach required? Technological innovation & economic trends have empowered the customer. Classic Telco Operating Model Digital Operating Model 1 Customer-centric strategy & experience 3 2 E2E processes facelifted by robotics, automation, and AI 2 1 Customer experience 3 4 IT & Network infrastructure enabling agile business delivery Organizational structures adapt to new customer-centric processes 5 Flexible organization Innovation Continues effort to innovate business and offerings Partnerships and alliances evolve business delivery 6 Partnerships & alliances Legacy telco operating model s main shortcoming is hat it never starts with customer in mind. The model is built layer on top of layer with weak interlinkages Digital operating models have evolved to take digital intent telcos through a customer-led operationalization approach and building the business around the customer 13

14 Who runs the digital transformation initiatives? The role of DVO in the Digital Transformation Lifecycle is to orchestrate the transformation journey. Digitisation Initiation Digital Factory Blueprint Sourcing Development Scaling Strategy articulation Concept to MVP MVP to Reality Consult key stakeholders Outside-In Change Management Predefined annual budget Funding & Implementation Track & measure benefits Determine governance structure Secure funding Digital Maturity Partner Ecosystem Design & Assurance Ideas In Value Proposition Minimum viable product Business case Executive approval Digital leadership across enterprise Prioritize initiatives and develop roadmap Technology & Platforms Legend DVO orchestrates Digital maturity progression Pioneer Differentiated service offerings Contribution to digital funding Flexible delivery models Custodian Telco s Digital Ecosystem 14

15 The Middle East Digital Landscape & Evolving Digital Telco 15

16 How the Middle Eastern nations are taking the leap into being more digital? National visions cascade down into digital initiatives across the countries. 16

17 What are the key sectors being targeted? Areas of focus are assessed, prioritized, and kicked-off. Focus areas across in Middle East Digital Arena translating into 6 Digital Themes in the Middle East Patient-powered healthcare Healthcare data revolution Public Sector Trends Sustainable consumption Digital customer Next gen. care Tomorrow s curriculum Smart environment data & Security devices 2.0 Smart tourism Smart governments IoT 5G, 4G & 3G Cloud computing Blockchain ICT Technologies Smart Future of cities Analytics/Big Data mobility Artificial Social Classroom of intelligence the future Cyber security OTN Robotics IoT in defense Sensor Integrated National Transformation platform technology national Autonomous platform vehicles Rise of robot & drone Digital twins Unnamed aerial armies Vehicles School Systems 2.0 Real-time location services Impact High High POL SDN/ NFV LIFI Augmented/virtua l reality 3D printing Predictive crowd flows Low Low Non-exhaustive High High 17

18 How can governments overcome their transformation challenges 1? The digital telco can fill the gap. Digital Telco Legend 1 The interventions have been proposed for a subset of challenges, Deloitte Research & Analysis

19 How can future digital telcos deliver digital transformations? By acting as the solution enablers in the ecosystem. Ecosystem State leadership Businesses & citizens Technology National government Future Digital Telco Professional Services SDN Cloud Integrated Platforms AR/VR Technologies Robotics AI Predictive Analytics/ Big Data IoT 3D Printing Blockchain NextGen Security Sensors Legend Relationship with digital telco 19

20 Further information Hasan Iftikhar Director - Consulting Contact: hiftikhar@deloitte.com This publication contains general information only, and none of the member firms of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collective, the Deloitte Network ) is, by means of this publication, rendering professional advice or services. Before making any decision or taking any action that may affect your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this publication. As used in this document, Deloitte means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see for a detailed description of the legal structure of Deloitte USA LLP, Deloitte LLP and their respective subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Copyright 2019 Deloitte & Touche (M.E.). All rights reserved. Member of Deloitte Touche Tohmatsu Limited

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