Digital Migration Tomorrow starts today - The path to business success - Telkom
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Digital Migration The path to business success Tomorrow starts today
Table of contents
01 Introduction – What is
Digitalisation?
02 The View of South
African CIOs
03 Adoption of Digital
04 The Path to Digital
Migration
05
Telkom Business’s
response to
Digitalisation
06 Glossary of
Terms
01 © Telkom | 2015© Telkom | 2015 02
01
adoption of digital.
This posturing by incumbent organisations provides
opportunities for new entrants to ‘shape‘ incumbents’
industries, gain ‘early mover‘ advantage and convert
customers away from incumbents.
Successful new digital companies, once they enter a
specific industry or niche, make it very difficult for others
to compete and win in the space (Amazon in the retail
space).
Technology
+
Introduction – fast digital adoption by consumers
+
innovation
What is +
slow adoption by incumbents
=
Digitalisation? disruption zones for new entrants
Digitalisation is the integration or adoption of digital As a phenomenon in society, Digitalisation can be seen in
technologies into everyday life by the digitisation of data three distinct areas:
or process that can be digitised. It is first and foremost a
social and business phenomenon that is underpinned by 1. Consumer Adoption – Digital consumers are already
the increasing adoption and use of digital technology for fully adapted to the digital environment. They
everyday processes and communication. generally have at least one personal digital device
that they expect to be constantly connected, and
Digitalisation is therefore a large-scale social/lifestyle they are increasingly willing to share personal
trend that currently permeates society and is not often information through these devices.
discussed as a business technology trend. This is the
paradox of Digitalisation – it is not primarily about 2. Increasing Technology Accessibility – Digital
technology. Digitalisation is being adopted by consumers technology is becoming more ubiquitous both in
much faster than enterprises. The core of Digitalisation is the number of devices that consumers have and in
the mass adoption of connected digital technologies and terms of the infrastructure backbone that supports
applications by consumers, which is followed by adoption these devices. Affordable, high-capacity broadband
from enterprises and governments. is becoming increasingly available worldwide, and
new technologies, applications and devices are being
To compete, win and remain relevant in the digital era, developed to utilise it.
organisations need to be able to successfully interact and
transact with digital savvy users and leverage the network 3. Business Integration – Many companies are
effect to drive adoption – a new challenge that requires a beginning to see the benefits of this trend of ‘hyper
fresh approach. connectivity’. From mobile connected workforces to
discovering new ways to interact with customers,
Some of the companies that have achieved significant companies are investing money in new digitalised
success in the digital era are ‘Hyperscale’ businesses1 technology and utilising Digitalisation to gain
or Supercompetitors2 such as Apple, Amazon, Alibaba, competitive advantage.
Facebook and Google.
While many industries have been and continue to be
disrupted by digital era businesses, many incumbent
companies remain defiant and believe that they are
immune to the disruption – this is evident by the slow
1
Competition at the digital edge: ‘Hyperscale’ businesses - McKinsey - 2015
2
The New Supercompetitors - strategy-business.com - 2014
03Digitalisation is a trend that businesses cannot ignore.
As it permeates all levels of society, businesses need to
make sure they are ready for it or they will be left behind. Digitalisation is the pervasive incorporation of
digital technologies to seamlessly weave togeth-
An example of this can be seen in the mobile device er the business processes, systems, customers,
growth in South Africa. Figure 1 shows the projected partners, employees and industries for the
growth of 2G, 3G and 4G devices in South Africa, while achievement of the ultimate connected business.
figure 2 shows the breakdown of devices using data.
Together, these graphs show, not only how rapidly the – Telkom Business
number of devices is growing, but how they are becoming
increasingly sophisticated in their functionality. This will,
in turn, allow for an increasing number of business usage
functions.
Figure 1: Mobile Device Growth in South Africa3
100
90
Total number of connected devices
80
70
60
50
40
30
20
10
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Figure 2: Number of Devices Using Data in South Africa1
50
45 M2M, Wearables, other
Number of devices (million)
40 Dongles & PCs
35 Tablets
30 Smartphones
25
20
15
10
05
0
2010 2011 2012 2013 2014 2015 2016 2017 2018
3
Africa Analysis SA Telecoms Model
© Telkom | 2016 04This rapid digital adoption also becomes a driver for online services. The advent of Long-Term Evolution (LTE)
change, as increased accessibility to connected devices technology is also creating faster mobile connectivity
creates a more empowered and digital savvy population. and improving the ease-of-use for mobile services to the
point where it is becoming a feasible fixed broadband
Beyond the proliferation of smart devices, which substitute.
consumers are using for a growing array of functions,
there are also other key trends emerging in the In order to take advantage of these trends, Digitalisation
digital world. For example, software development and strategies are being implemented in a variety of
distribution are getting faster, and software platforms industries across the globe. Figure 3 shows the industry
and app stores make it easier to create and sell mobile adoption of Digitalisation in Germany according
services. This reduces barriers to entry for enterprising to Accenture’s Top500 study of 2014. This digital
digital entrepreneurs. transformation has created a new competitive landscape
for enterprise companies. Smart solutions will redefine
Fibre connectivity is also becoming increasingly the interface to customers in most industries, and market
ubiquitous, and improved connectivity speeds and positions will be lost or won much faster than before.
accessibility are, in turn, driving increased demand for
Figure 3: Industry Adoption of Digitalisation in Germany4
Digital Maturity
Digitalisation Challenges Digitalisation Champions
1.0
1.5 Automobile
Telecommunications Manufacturers
Media & Entertainment IT
2.0 Electronic & High Tech
Services
Logistics & Transport
2.5 Average digital maturity: 2.8
Machinery & Plant Average business result: 49.7
Digitalisation Laggards Traditional Champions
Trade Consumer Goods Pharma & Healthcare
3.0
Automotive
Metal Industry
Business Result
Supplier Chemical Industry
Building Industry
3.5
Oil & Gas
4.0
0 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60
4
Accenture – “Germany’s Top500 and the Digital Challenge” 2014
To remain competitive, it is essential for companies to formulate a digital strategy, provide digital offerings, and
implement digital processes.
05 © Telkom | 201602
When asked whether they consider Digitalisation to be
a potential competitive advantage in business, 96% of
respondents said that they believed it was (figure 4). Only
28% of respondents, however, have an articulated digital
strategy in their businesses (figure 5).
Figure 5: When asked if companies had
a formal digital business strategy, only
28% responded “yes” to this question
50%
42%
40%
30%
The View 30%
20%
28%
of South 10%
African CIOs
0%
Yes No In progress
With Digitalisation fast becoming a key part of any The importance of Digitalisation is, however, gaining
business strategy, it is important to get a view of what is traction in South African businesses. As figure 5 shows,
being prioritised in the South African business context. 30% of respondents say that their companies are in the
process of articulating a digital strategy. Furthermore,
While the concept of Digitalisation remains new to most Digitalisation is increasingly being seen as a way to solve
South African businesses, academically it is a well- major business challenges. Figure 6 shows the business
recognised and acknowledged concept by South African challenges that CIOs are hoping to mitigate using
executives. In 2015, Telkom Business hosted an executive Digitalisation strategies.
suite Technology Road Show. This was attended by top
South African industry players and data was retrieved
around a few burning questions on Digitalisation.
Figure 6: What business challenges are
From this, Telkom Business gathered views on some of you hoping to manage through a
the important focus areas around Digitalisation going digitalisation strategy?
forward.
Figure 4: 96% of respondents agree
that Digitalisation is a case for Customer Service
competitive advantage
Omni-channel
Staff Productivity
Other
No 4%
45% 27% 17% 11%
Yes 96%
Figure 6 further shows that many businesses in South
Africa already have a strong focus on Digitalisation as a
strategy going forward. However, in order to respond to
0% 20% 40% 60% 80% 100%
this trend successfully and make Digitalisation part of
their strategy, they must first undergo digital migration.
© Telkom | 2016 0603
prescriptive manner. In many situations, incumbents
also prefer to develop their own products and services to
expand into their existing markets.
Successful digital businesses leverage third-party
components, resources, networks and ecosystems to
deliver new offerings through new business models. This
is achieved through a combination of digital platforms,
ecosystems (real-time market places), the ability to scale
critical capabilities, and dynamic product creation to
differentiate themselves from traditional businesses.
With the focus on enhancing customer experience and
fast delivery of new offerings through digital channels, IT
must deliver new digital solutions but with the emphasis
on agility, scalability, continuous change and fast time to
market. The challenge is that most IT organisations take
months or years to deliver new solutions.
Adoption Digital era companies have fast ‘go-to-market‘
capabilities, enabled by ‘cross-disciplinary‘ collaboration
between marketing, innovation, R&D (research and
of Digital development) and IT teams for building, evolving,
operating and supporting rapidly changing resilient digital
solutions.
A side effect of incumbent organisations being slow to
adopt digital, hinders employees’ ability to engage with
Consumers continue to adopt digital faster than most digital customers. Although some incumbents have digital
incumbent organisations, resulting in a misalignment as part of their strategy, it’s often a fragmented strategy
between consumer needs and service provider that is not pervasive across the organisations and not
capabilities. Consumer behaviour has changed, and core to their DNA.
consumers expect their service providers to embrace
digital – anytime, anywhere and any device. Successful digital businesses are wired to compete
and win in the digital era. Their DNA is digital and they
Misalignment and ignoring changing consumer behaviour have a ‘digital first’ mindset. They employ digital-savvy
provide an opportunity for new entrants to disrupt an resources and prioritise digital integration across all
industry and shift focus to delighting customers across aspects of the business, with a focus on the customer
the entire customer journey. experience as their key differentiator.
Many incumbents continue to offer the same products
and business models that worked through traditional
analogue-era channels. In some industries, the challenge
is compounded by incumbents adhering to business
models that are convenient for themselves, but to the
detriment of the customer.
New entrants strive to deliver new and differentiated
offerings with new business models. Pay-as-you-go or
as-you-use services work for disruptors, but are difficult
for many incumbents due to organisational constraints
and culture.
Analogue-era organisations typically have a ‘one size fits
all’ approach to offerings, marketing, sales and customer
engagement, meaning that all customers are treated
the same, irrespective of their needs or situations. Many
incumbents still depend on ‘face-to-face interactions’,
although most customers prefer doing everything online,
at their convenience and through digital channels of their
choice.
New entrants are data driven, are 100% digital and
have great insight into customer behaviour and needs,
enabling a personalised customer experience at every
touch point, and when required, adoption based on real-
time customer data.
Incumbent organisations use their brand, market position
and assets to attract partners, but do so in a very
07 © Telkom | 2016Driving a Successful Digital Migration readiness. This refers to how prepared the company is to
make the move to digital processes and platforms. To do
Digital migration is a way for businesses to respond to the this, the company must be able to see the opportunity for
trend of Digitalisation. A successful digital migration will competitive advantage, and the wider ecosystem in which
result in a company that is more efficient, more intelligent, it exists must be ready to adapt to new digital processes.
and has greater competitive advantage in its industry.
Once this has been established, the business must look at
Digital Migration can be a complex and difficult process how it will respond to this environment of digital readiness
for a company. There are many factors that have to be and formulate an integrated business and technology
considered and many steps in the process. response, i.e. who will lead the migration towards
The first requirement of digital migration is digital Digitalisation?
Figure 7: The Digital Migration Journey for Enterprise
Reactive to industry trends
Digital readiness
of the population
Response of business
= digitalisation
Technology
levers
Strategy
enablers
Proactive to industry trends - Sustainable Competitive Advantage
Companies that have then made the decision to undergo To achieve growth and distinguish themselves from
digital migration can utilise strategic technology levers in competitors, South African enterprises need to address
leading technology domains that support the migration the impact that Digitalisation will have on their business
(such as pervasive connectivity, UC, mobility, M2M, IoT, and develop their ability to adapt to the new digital reality,
Social Media, Cloud, and Big data). These technology levers if they want to spread into new markets and diversify
can be used to implement the necessary digital processes revenue streams.
and solutions within the business.
Implementing a Digitalisation strategy in a business is,
Once they have the required technology levers in place, however, not a simple undertaking. Every business is
businesses can look at building the technology and different and its path to digital migration will be reliant on
business process platforms for Digitalisation. This can its unique set of circumstances.
be implemented through converged access, connected
devices, end-to-end networks and cloud solutions, There are several basic steps that a business must
seamless communications, and business process undertake to develop an ongoing digital strategy.
integration.
© Telkom | 2016 0804
technicians and data scientists who make business
sense of small and big data, by producing decision-
making information.
4. Competition: Incumbent organisations are the target.
The incumbent’s position in the market (brand,
products, customers, business partners, barriers to
entry, etc.) is significantly reduced in the digital era.
New competitors include not only local companies,
but foreign brands with local reach. They typically opt
for innovative approaches and technologies to win
over customers, leverage the network effect, deploy
disruptive business models and operate with much
lower cost structures. They intentionally build a new
company from the ground up, specifically to compete
and win in the digital era. For these companies,
data is the most powerful barrier to entry. Consider
whether you want to collaborate with the opposition
The Path
or compete with them.
5. Digitalisation of Business Processes: Digitalisation
provides companies with an opportunity to review
to Digital and optimise processes, and ultimately to reinvent
the business. Obvious areas to consider are paper-
and people-intensive processes, which can be
Migration
substituted with frictionless digital experiences.
Benefits include reduced operational costs, real-
time data input processing and output, the ability
to leverage online ecosystems, extended company
reach, new business models, swifter decision making,
faster time-to-revenue and exceptional customer
experience.
While planning a digital migration journey, it is important
to consider the following in order to enhance the 6. Culture: Probably the single greatest challenge
customer experience: in executing a digital migration strategy is
organisational culture. Digital migration is a collective
1. Mapping the Customer Journey: It is imperative to and inclusive strategy requiring all levels and
map the complete customer experience journey. A divisions to participate in achieving a clear end goal.
data-driven process and focus on understanding
customer behaviour will identify areas for
improvement, optimisation and radical change,
and force a review of product offerings. Companies
are encouraged to digitalise all customer touch
points in order to ensure a complete and consistent
experience. Partial digitalisation will result in a roller
coaster ride for the customer, with some touch points
or activities digitalised and others not, leading to a
reduced overall customer experience. End-to-end
mapping can also identify potential new offerings.
2. Pace of Technological Change: Digitalisation and
emerging technologies are transforming people,
organisations, industries and economies. The
rapid rate of technological change presents both
challenges and opportunities for some companies,
but for others, its relevance and business model may
be questioned. The challenge for any business is to
decide how fast and how far to go on the path to
digital migration.
3. Data Driven: Probably the three most important
capabilities of a successful digital era organisation
are: being data-driven, capturing data in real
time, and performing meaningful analytics. Digital
is all about data, whether it be data input, data
processing or data output (Apple, Amazon, Facebook,
Google, etc.). Many organisations have access to an
abundance of data, but face challenges in assessing
quality, processing data and extracting value. New
roles for many organisations are that of digital data
09 © Telkom | 2016“Culture is a derivative of leadership and represents the company’s personality, value system, purpose, and people. What’s
clear in every Altimeter Group research programme is that the need to change is constant and pervasive. This is the effect
of disruptive technology on business and society. Culture, too, must adapt to symbolise resilience and communicate a
renewed vision to employees and the market overall.” Altimeter Group5
Figure 8: Challenges Facing Digital Transformation5
The importance of digital transformation initiatives to very somewhat
your business’s digital transformation efforts important important
Changing company culture 63% 34%
Thinking beyond a “campaign mentality” in digital strategy efforts 59% 32%
Cooperation between departments and team silos 56% 39%
Resources (people, technologies, expertise) and budget allocation 56% 39%
Understanding behaviour or impact of new connected customer 53% 42%
Securing executive support of leadership 42% 39%
Lack of data to justify value of digital transformation 34% 51%
Risk management, compliance, and/or legal implications 31% 37%
7. Digital Capability: Digitalising the customer journey channels, companies need to integrate voice, data
and business processes represents a new challenge and video into a single converged platform. This
to most organisations and requires a digitally enables collaboration with customers, employees,
competent resource team. The same applies to suppliers and partners anytime, anywhere.
digitally enabled products and software, where Companies need to be omnipresent. Converged
organisations can build or buy such products and connectivity platforms extend access to and
services. One option for acquiring these resources, collection of data to the edge of business boundaries
products and customers could include a merger or with mobility and Wi-Fi, thus enabling real-time
acquisition. predictive analytics for informed decision-making.
8. Incubation Lab: Rather than going the traditional 10. Intermediaries: The transparent nature of
internal route, companies should consider an digitalisation enables users and competitors to
incubation lab or capability. Such a lab should be rapidly determine a company’s unique selling
staffed with start-up innovative mindset resources, features, business model and pricing. In fact, there is
with laser-focused deliverables, experimenting with a dramatic increase in the number of ‘compare before
new technologies, techniques and business models, you buy’ sites and apps managed by third parties
and can be isolated from the rest of the organisation. who have been able to insert themselves between
This enables innovative business solutions to be the customer and a seller.
delivered in a fast, agile and timely manner. In
addition, the incubation lab can assist in cultivating
new, digital-ready DNA for the company.
9. Integrated Connectivity Platform: This is a
prerequisite for the seamless delivery of digital
solutions and services. With the need for real-time
collaboration across multiple digitally-enabled
5
Altimeter Group Digital Transformation Survey - Altimeter Group - 2014, N=59
© Telkom | 2016 10“Digital migration is a way for businesses to respond to the trend of Digitalisation. A successful digital migration will result in a company that is more efficient, more intelligent, and has greater competitive advantage in its industry.” 11 © Telkom | 2016
The Digital
Implementation Roadmap
Compile a high level digital business strategy
Key questions:
• What is the impact of digitalisation on your industry?
• What are the key digital opportunities and risks for your business?
• What is the potential impact of digitalisation on your financial and customer metrics?
• How does digitalisation link to your business strategy and plan?
Conduct a digital readiness assessment
Key questions:
• How are current key business processes utilising (or not utilising) digital technologies?
• What is the ideal state of digital uptake in key business processes?
• What are the high level business process and technology gaps in the business?
Develop a digital strategy implementation plan
Key actions:
• Implement an organisational change management plan.
• Align necessary technology strategies.
• Implement a transitional plan around timing and resources.
• Ensure ongoing measurement and benchmarking.
© Telkom | 2016 12Technology Trends and Enabling
Digitalisation
When looking at digital migration, a business must
consider three distinct areas:
Business Drivers – How they will respond to the changing
industry environment, how they will enable business
growth and respond to competition.
ICT Needs – The business needs expressed as ICT product
requirements, a digital migration plan.
Points of Differentiation – The criteria that the business
will use to choose ICT providers and formulate an ICT
supply plan.
It is also important that the business ensures that it is
able to leverage the power of the latest technologies as
part of its digital migration strategy.
The Key Technology Levers
In order to move towards a fully digitalised business, one
must look at the technologies available to help achieve
this.
Telkom Business has therefore identified several Key
‘technology levers’ that represent the current leading
The Competitive Advantage of technology trends impacting all industries. Organisations
Digitalisation need to understand how they acquire, deploy and
integrate these technology trends to support their
If implemented correctly, digital migration can give Digitalisation strategy. These trends are described
a business a distinct competitive advantage over its as technology levers in that they can be used to drive
competitors. Digitalisation strategies.
A competitive advantage is generally gained by 1. Pervasive Connectivity – new technology allows for
combining the following aspects: constant and all-encompassing connectivity across
all areas of a business. It is now possible for head
• Operational effectiveness, i.e. doing the same things offices, regional offices, branches, suppliers and
better. mobile employees to communicate with each other
• Difference or positioning, i.e. doing things differently and process transactions in real time, even across
or doing different things. widely dispersed geographical locations.
• Industry shaping, i.e. predicting, influencing and 2. Machine-2-Machine / Internet of Things – M2M and
responding to the industry structure. IoT can be utilised in a number of ways to increase
organisational efficiency. For example, it can be used
A Digital Competitive Advantage derives from for condition monitoring across such areas as utilities
understanding and optimising the digital impact and measurement, perishable food monitoring, employee
opportunity in each of these realms. behaviours, time-pattern monitoring, logistics, stock
control and asset tracking.
When implementing a Digitalisation strategy, it is 3. Mobility and Unified Communications – The
important to keep a balance between user needs and integration of mobile with other real-time
business needs. Customers or end-users must show a communication services such as IM, presence, video
demand for Digitalisation options and be equipped and and data sharing with non-real-time communication
ready to utilise them. Businesses must also have the services such as SMS, email, voice mail and fax, can
capacity to implement the Digitalisation strategy and the enable communication for business processes.
ability to leverage the competitive advantages it provides. 4. Social Media – by engaging effectively with
customers on social media platforms, a company can
Companies are using digital technology to create real, increase its brand capital, find out what customers
transformative effects across customer experience, want and need, and enable an additional sales
internal operations and new business models. It can channel.
improve the customer experience with technologies such 5. Cloud Computing – many key business processes can
as online or omni-channel solutions and can have a big now be run through cloud services. For example, IT
impact on customer satisfaction. It allows businesses services and solutions such as security or data centre
to reach new customers and markets, and it makes it services such as hosted applications, backup and
possible to transition physical products or services to storage. Leveraging the power of cloud computing
digital products or services. It can also improve internal can increase system uptime and make necessary
communication, enhance the productivity of workers and information or systems available across all areas of
automate operational processes. the business, even remotely.
13 © Telkom | 2016“Aligning business intelligence capabilities in a business allows for real-time business decisions based on an analysis of gathered data.” © Telkom | 2016 14
6. Big Data – the volume of data being produced by The Digitalisation Strategy Enablers
businesses is expected to expand 50-fold by 2020,
and unstructured data will account for 90 percent of The process of digital migration is one of taking a system
all the data created in the next decade. Companies of disparate communications and technology suppliers in
that are able to use big data analysis in order to a business environment and transforming it into a system
spot trends, track performance and make strategic of integrated communications and technology suppliers.
decisions will have a major advantage in many
aspects of their business.
No strategy for leveraging digitalisation Clear strategy for leveraging digitalisation
for competitive advantage for competitive advantage
Ineffective customer interaction and Effective and efficient customer interaction
inefficient internal processes and internal processes
Disjointed communication and data flows Cohesive communication and data flows
Disparate communication Integrated communications
technology platforms technology platforms
Disparate communications Integrated communications
technology suppliers technology and suppliers
By utilising Digitalisation Strategy Enablers it is possible to create a technology platform for the business which provides
a competitive advantage in the age of Digitalisation.
Figure 9: Digitalisation Strategy Enablers
Digitally enabled business processes and competitive market offerings
Seamless Communications
Converged End-to-end Connected
Access Network Devices
15 © Telkom | 2016Some of the main components of a digitally enabled
platform include:
Digital Business Architecture Building Blocks
• Converged Access – high speed, pervasive and
reliable connectivity The palette of assets for digital business should
• Connected End-Users and Devices – Mobile, BYOD include technologies — these include any of
and IoT functionality the technologies that enable digital business,
• End-to-end Network and Application Management – such as the devices that make up the IoT,
Network, Data Centre and Cloud capabilities communications, applications and data analysis,
• Seamless Communications – including access, cloud platforms and solutions, mobile devices
network and services and applications, social networking and media,
• Digitally Enabled Business Processes and Solutions and digital business applications.
– UC / M2M / mobility and communication enabled
business processes “Determine Your Digital Business Architecture
Building Blocks to Guide Investment Decisions” -
Gartner 2015
Old vs New State: Making the Transition
Companies have to move from the traditional
communication environment to a seamless
communication environment to fully become digital
players. To illustrate some elements of this transition,
the following are examples of the changes across various
layers of a digital capability:
Fragmented Access Converged Access
Fragmented and duplicate Access mediums – ADSL, SIP, VPN, Internet over fibre or next generation
mobile SIMs, leased lines, primary rate voice access, copper access with fixed or mobile redundant
mostly fixed connectivity to enterprise applications. backup (improved manageability and cost efficien-
cy). Pervasive (fixed and mobile) access to enter-
prise applications and new mobile apps for employ-
ees and external customers (improved efficiency
and customer experience).
Selected Devices connected Connected devices
Multiple end-users and devices not Connected end-users and devices - BYOD, IoT. Wi-Fi
connected. Non-standard mobile devices not used where customer transactions occur for
allowed. Limited connected sensors. Limited Wi-Fi customer Internet access in exchange for customer
offering Internet access to customers. tracking. Customer interaction and advertising
(improved customer experience). Pervasive
connected sensor network with analytics integrated
into business processes (improved efficiency and
cost effectiveness).
Fragmented Network / Data Centre / Cloud Integrated network / Data Centre / Cloud
No end-to-end manageability and End-to-end network and application performance
performance analysis. Separate access, network and management across Network, data centre and cloud
hosting/cloud providers. (improved manageability).
Independent Communications Technologies Seamless Communications Platform
Communications hardware and software not interop- Communications infrastructure and services
erable – legacy access, PBX, Internet access not able cohesive and optimally tied into network routing,
to link services, limited use of video applications. data centre and cloud services (Improved
manageability).Video applications used for improved
conferencing and collaboration (Improved
efficiency).
Standalone Communications and Business Digitally Enabled Business Processes
Processes UC / M2M / mobility - business processes communi-
Customer solutions and supporting business process- cation enabled (Improved efficiency). Social media
es not integrated into a standardised communica- integrated in contact centre infrastructure and
tions capability, non-stadardised comms platforms, business processes as a customer service channel
limited social media (improved customer experience).
integration for customer interaction.
© Telkom | 2016 16Getting Started
The task is urgent. Companies can embark on the digitalisation journey today, or wait until they are forced to – at which
point it will be too late.
The framework below provides a high-level indication of how digitalisation allows companies to get closer to customers,
offer them a seamless experience and to stay at the centre of their commercial lives.
Figure 10: Opportunities in digital6
Get closer to customers
Position at the centre of Build customer intimacy
Reward customer
customers’ commercial lives through social media &
loyalty through analytics
through new P&S direct communications
Offer a seamless experience
Opportunities Ensure consistent user Allow for a non-linear
Put mobile at the core
in digital of the offering
experience across multiple customer journey - across
channels - omni-channel mobile, call centre and in-store
Reduce cost to serve customers
Reduce the cost of recruiting new customers -
digital marketing and sales channels
Connectivity platform
Convergence Hosted Wi-FI
Collaboration
6
Fiserv, Delta Partners analysis
With the focus on the customer experience and business ICT sourcing optimisation – outsource vs insource
drivers, companies need to consider a digitalisation
strategy that is business-driven, mapped to their specific Deciding what to insource and what to outsource in a
needs and supported by a connectivity framework that business can be a delicate balancing act. When enabling
will enable the execution of the Digitalisation strategy. a digital migration strategy, companies must have
disciplined ICT sourcing governance capabilities. This
Embarking on the digital migration journey requires that will allow standard solutions to contribute the majority
you map your strategy for the future, based on where of the outsourced ICT stack, with a minimum number of
you are today and the digital customer journey. vendors. Testing and demonstrating these ICT supply and
operating modes should also become a natural behaviour
In order to better understand current digital capabilities as organisations move towards buying solutions rather
and future requirements, a digital readiness or maturity than capacity.
assessment can help companies better understand their
current digital capabilities and future requirements. This One of the challenges around sourcing optimisation
typically includes key areas for innovation across current includes knowing which ICT services and assets are
and future services, channels and infrastructure, including important to retain ownership of, versus which services
customer engagements across all channels, digital can be outsourced for greater efficiency. Companies also
operations and governance, as well as infrastructure need to understand the implications on costs, flexibility,
readiness using leading practices. service levels and risk that come with outsourcing a
solution, as well as be able to identify areas where it is
necessary to retain access to skills and capabilities.
Benefits of Digitalisation
Telkom Business’s suggested response to sourcing
There are a few major business benefits to successfully optimisation is a process of Review, Identify and Acquire.
undergo digital migration and implement a Digitalisation
strategy. First, review the complex internal structures and current
management of technology life cycles within the
Some of the main benefits can be seen in: company. Then identify the ideal capability placement
– be it internal, with solution partners, or with service
• ICT sourcing optimisation providers. Finally, acquire a managed services approach
• Technology supplier integration to enable flexibility and meet business service level
• ICT efficiency enhancement expectations.
• Business intelligence gains
17 © Telkom | 2016The benefit of optimising outsourcing in this way is that costs, managing risks, responding to business demands
it gives businesses managed, flexible and responsive rapidly and supporting flexible supply models.
supply models for their ICT services. It also shares the
responsibility for service levels and risk and ensures The suggested response to these challenges from Telkom
that appropriate internal skills are focused on business Business is to contract solid service level agreements
demand and business solutions. between the service provider and internal ICT and
business divisions that support the business process
Technology supplier integration – vendor consolidation performance goals. In addition, organisations should
develop strong business solution capabilities, both
Vendor management is an important part of a internally and in partnership with key vendors to be able
Digitalisation strategy. Companies must ensure that to rapidly respond to new business requirements.
they have a holistic view of vendors across their entire Emerging supply models that offer utility or on-demand
ecosystem. This view should include data analytics on services also make it possible to implement flexible,
service usage and performance, pricing and costs and ICT outsourced supply models that are closely linked to the
data security, data integrity and system availability risks. real and variable demand for services.
They must also ensure that ROI is measured in terms
of strategic business outcomes and that governance The benefits of these capabilities are that they lead to
is established across internal teams and appropriate lean and efficient response structures, which in turn
vendors. reduce the time spent on managing infrastructure and
related services. This allows for increased time spent
One of the main challenges around vendor management on accurately forecasting business demand and rapidly
is dealing with a wide range of technology suppliers who responding to solution demands.
may have competing objectives. It is therefore important
to make sure that technology, solution, integration and Business intelligence gains – big data collection and
service providers are all aligned, and that the company accessibility
has a uniform policy on SLAs which does not allow for
weak points or ‘blame’. Aligning business intelligence capabilities in a business
allows for real-time business decisions based on an
Telkom Business’s suggested response to vendor analysis of gathered data.
management is to rationalise, reduce and consolidate
the number of suppliers, while increasing the internal ICT The major challenges around optimising business
supply and demand management capabilities. This will intelligence are collecting and storing growing volumes
reduce dependency on technical and support skills and of data, including voice and video. It is also important
allow for cross-functional SLAs with reduced supplier for businesses to maintain constant control of their
interfaces. information assets and know that they are secure. Finally,
they need real-time, dynamic access to the relevant
The benefits of this approach are reduced cost and data and trends presented in a meaningful way, so as to
complexity around managing third parties, as well as enable business decisions.
reduced risks and ‘points of blame’ as the company
receives bundled and pre-integrated services ready for In response to this trend, Telkom Business suggests
use. connecting Business Intelligence requirements to
competitive advantage drivers and establishing ‘highly
ICT efficiency enhancement – costs and service levels aware’ communications processes to collect and feed
intelligence data, as well as allowing for the evaluation
Efficient ICT operations in a business will have a direct and of suitable data collection, storage, protection and data
positive impact on the overall business responsiveness recovery services.
and productivity.
The benefits of utilising Business Intelligence include
The major challenge around improving the efficiency of near real-time analysis of business and communications
ICT infrastructure and systems concerns balancing the processes, protected data and information assets, and
competing demands of improving service levels, reducing competitive advantage assessment capability.
© Telkom | 2016 1805 Telkom
Business’s
As a leading digital solutions provider, Telkom Business is
perfectly equipped to help your business on the path to
digital migration.
response to Telkom Business is a leading provider with an
extremely wide geographical coverage and is the only
service provider that can provide true and affordable
Digitalisation
convergence across fixed, mobile, data and cloud.
Telkom Business’s Digitalisation Portfolio has everything
that a business needs to implement a Digitalisation
strategy.
Figure 11: Telkom Business Digitalisation Portfolio Approach
What / Who does “it”
Underlying
Needs
Individual Corporate, Systems
“Person to Person” “Machine to Machine”
Communications
Personal Communication Networks & Connected
Systems
Fixed, mobile and converged Basic data connectivity
communications Managed data Network Services
Voice & data M2M
Agnostic access Product sets
which
deliver the
What “it” does / is
Digital Home & Lifestyle Corporate IT Infrastructure needs
Computing &
Applications
& Applications
Devices XaaS
Applications Service Integration
Integrated Services
Content & VAS
Content
Video, music gaming, education, e-Commerce, “Smart Home”
19 © Telkom | 2016Telkom Business Solution Orientation managing solutions
• To reduce the dependence on internal scarce
Telkom Business has decided to orientate towards a skills that have limited knowledge and in-house
‘Solutions Business’ focus to address the needs of vertical experience only
industries and horizontal cross-industry or value-chain • To link ICT solutions, services and costs closer to with
focused solutions. This focus is designed to achieve the business value, business outcomes and business
following: needs – both in terms of the solution itself and
the manner in which solution is offered, ordered,
• To prove to those industries that they are Telkom managed and commercially packaged
Business’s target market – ‘we are designed to serve
your industry’ Telkom Business is perfectly situated to provide a
• To make it easier for companies to do business with holistic Digitalisation solution for your business. With its
Telkom Business – ‘Telkom Business already has solutions-based approach, Telkom Business is able to
solutions and services designed for your industry’ assess what the customer needs and wants to achieve,
• To reduce the need, complexity and costs for in- and to make sure that the solutions that are on offer are
house service aggregation and systems integration aligned with those wants and needs, through providing a
• To reduce the risk inherent in self-constructing and business solution for that company or industry.
Figure 12: Telkom Business’s New Vertical, Solution-Centric Operating Model
Finance Retail Government Health Education Diverse
Account Managers Account Managers Account Managers Account Managers Account Managers Account Managers
Solution Architects Solution Architects Solution Architects Solution Architects Solution Architects Solution Architects
Service Delivery Management
Solutions
Fixed Mobile Convergence IT & Cloud Acquisition / Local & Global
Services Subsidiaries partners
Pre-sales specialists Pre-sales specialists Pre-sales specialists Pre-sales specialists Pre-sales specialists Pre-sales specialists
Customer ops
Product House - TPD Product Product Product Product Product
Network / Wholesale Mobile Network IT Factory Partner
Management Management
© Telkom | 2016 20Telkom & Business Connexion key differentiators
World-class
Largest, most Leading POP Best mobile data
Unified Innovation in
reliable fixed Infrastructure network in
Communication M2M and POS
network & backup South Africa
services
About 147,000km Most extensive POP Hosted/virtual PBXs 98% population
infrastructure – IP Net,
of fibre across coverage in SA service provider to
Exchanges, Fibre distribution
include advanced M2M
South Africa points, Internet POPs,
and PoS, complementing
Internet breakout,
international investment traditional connectivity
in undersea cables
Multiple Data Centre backup UC ready network Sites: LTE, 3G
redundancy, best (9,700 square (rich media capable)
availability and metres of hosting)
uptime in SA
Manage data Device 2,643 mobile base
network sites management stations constructed
sites: 47,000+ at 30 September
2015
Internet subs: Advanced UC with High data quality
560,000+ collaboration and and speed with
telepresence extensive LTE
coverage
World-class End-to-end SLA and
network network prioritisation
monitoring and
management
(24x7)
Application
performance
monitoring
21 © Telkom | 2016Network &
application Converged Cloud and
performance Communications IT services Wi-Fi hotspots
management
Manage Introduce Unified Provide all Campus Wi-Fi
user-experience, Communication integrated IT, roll-out in customer
networks and platform and data centre and locations
applications services cloud services
Deliver QoS classes Hosted IP Contact 11 Data Centres in Free access to
for applications Centre South Africa. 3 x
Tier IV design Wi-Fi hotspots as
certified part of Mobile
data offer
Manage IT assets ISO20000 certified
in the data centre for hosting
and cloud
Faster time to
market
Full range of Cloud
solutions (Public,
Private, Hybrid)
offering IaaS, PaaS
and SaaS
Business
requirement based
IT solutions
Data Residency /
Sovereignty
Economies of scale
Service Level
Agreements
© Telkom | 2016 22Telkom & Business Connexion key differentiators
Leader in Data Data Centre Facilities Data Management
Centre Services Management and Services Data Centre Cloud Platform
in South Africa Operations Support Services Support Services
BCX’s Tier IV Data Centre Mainframe ICT Infrastructure Infrastructure as
designed-certified Hosting Support Services Management a service
data centres are (incl. Co-location)
the benchmark for
hosted information
systems and
applications
BCX’s operational expertise Data Centre Open Systems Media Management Computing as a
combined with its
management skills and
Operations Support Services service
experience in customer (24/7 monitoring) (UNIX, LINUX)
services enables the group to
deliver data and facilities
management ensuring a
connected world at all times
Data Centre ITSCM Cloud Infrastructure
Facilities (Disaster Recovery) (Pvt Cloud and CSB)
Consultation
Data Centre Deployment
Facilities Upgrades
23 © Telkom | 2016Leader in Application One of the largest The largest ICT
Services, Application Industrial Solutions Service Provider Full Business
Development & capabilities on the to the South African Consulting Capabilities
Application Outsourcing continent Retail Space
Energy & Industrial Solutions Africa’s largest Retail IT POS
Application Services provides an in-depth Maintenance Service Provider Business Consulting
understanding of the industrial
provides trusted sector enables us to provide provides Business
application development stable and reliable ICT Providing services to 8 of the 10
capabilities supported by environments that are effective Top 100 Listed JSE Retailers and
Advisory, ICT Planning
defined methodologies
and efficient, improving most of our customer contracts and Integration, Risk
production, maintenance, quality have been in place for >15 Years
to plan, design, and build and inventory, bridging the gap and Service
quality applications. between factory floor and the
boardroom. Presence in 74 locations Management Services
throughout Southern Africa
Services are BCX has the largest pool Mirrored support provided to > Business Advisory Services (BAS):
of Industrial Solutions Improving business performance and
focussed on 180 Retail Stores in Ghana,
Nigeria, DRC, Angola, Zambia, measurement, realising IT value,
Engineers amongst its
creating a mobile competitors and
Malawi, Mozambique and Uganda understanding changing business
and operating models and
platform and peer Systems managing change
presence for Integrators (SI’s) –
Full turnkey specialised services
provided
customers. total of 99 people
Retail IT Infrastructure Break Fix
Services including Desktop
Application Outsourcing Accredited as an Eskom Support Services ICT Planning and Integration (IPI):
manages the full life Energy Services Using planning frameworks and
Company (ESCo) which methodologies to ”architect”
cycle of application Workshop Repair Services
enterprise solutions; establishing
allows us to develop and
development and EA centres of excellence and
deploy technology that capability; aligning ICT to business;
application management will conserve power
Warehousing
planning ICT strategies and
for Enterprise and within the commercial underlying systems
Corporate Clients and industrial environments. Specialised Procurement – value
added supplier (BBBEE)
Project Management
Risk and Service Management (RSM):
Optimising ICT processes; managing
Research and Development ICT Governance; improving IT service
management; ensuring business
continuity; identity management
Cabling
Provider of business process and
IT related services to companies
that operate within the Retail
Value Chain
Provides SAP oriented services,
Postilion and JDA-related and
business process optimisation
services to large and medium size
retail businesses
Specialist retail supply chain,
merchandise and store expertise
focused on process and system
optimisation
Flexible, innovative and dynamic
managed Private Cloud services
for SAP and other business critical
systems
Proactive management and
improvement of service delivery
underpinned by our dedicated
command centre and optimisation
team
© Telkom | 2016 2425 © Telkom | 2016
06
Glossary of
terms
2G - Second-generation wireless telephone technology SIP - Session Initiation Protocol
3G - Third-generation wireless telephone technology SLAs - Service Level Agreements
4G - Fourth-generation wireless telephone technology TPD - Telkom Product Development
(also called LTE)
UC / Unified Communications - the integration of
BYOD - Bring Your Own Device real-time, enterprise, communication services
Digitalisation - Integration of digital technologies into VPN - Virtual Private Network
everyday lifethrough the digitisation of everything that
can be digitised. XaaS - X as a Service/anything as a service
ICT - Information and Communications Technology/ies
IM - Instant messaging
IoT - Internet of Things
LTE - Long-Term Evolution (also called 4G)
M2M - Machine to Machine
Omni-Channel - An approach to sales that seeks
to provide the customer with a seamless shopping
experience whether the customer is shopping online from
a desktop or mobile device, by telephone or in a bricks-
and-mortar store.
P&S - Products and Services
PBX - Private Branch Exchange
ROI - Return on Investment
R&D - Research and Development
© Telkom | 2016 26Telkom Business is a division of the Telkom Group organisation. We exist to serve the South African and African corporate; government and SME markets. Our passion is to seamlessly connect every business towards a digital future. Our solutions are offered end to end — ensuring that your business benefits from every economy of scale and superior service quality. Our solutions are customised by taking into consideration the role of the relevant technology trends; such as: fixed mobile convergence; mobility; machine to machine; big data; Wi-Fi; broadband; LAN; WAN; cloud computing; unified communications; digital and social media and others. Migrate your business into the digital future — contact Telkom Business today! Business Connexion is one of the largest ICT services providers in Africa when measured in terms of turnover, assets under management and staff complement. It remains one of the leading South African cloud-based services providers with offices in South Africa, Namibia, Nigeria, Mozambique, Tanzania, Zambia, Kenya, Botswana, the United Kingdom and Dubai. The company employs more than 6 800 people on the African continent and generates revenue in excess of R6 billion a year. For more information, please email tbsm@telkom.co.za www.telkom.co.za/bigbusiness
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