The always thought provoking Great Telco Debate took place on 29 November in London, attended by over 100 leading figures from the industry. Telco CxO delegates discussed their priority issues with analysts from information and consulting partners. The selection of issues, as well as reactions to them, revealed that the Telco networks still have great difficulty in even seeing the customer, let alone building their approach around the needs of their most important asset. Telco Customer Myopia is a reality.
Still a Technology-driven Vision
The first debate about the role of the telco in the digital economy offered the promise of bringing the customer to the fore in strategy decision making, and Tim Pritchard, MD of Customer Experience at Kantar TNS, emphasised the importance of customer experience, while warning that telco Net Promoter Score (NPS) is among the lowest of any sector:
“A historical obsession with lowering cost-to-serve and failing to engage in dialogue with customers leads directly to high churn and a lack of trust.”
A Technology Vision Built on a Virtual Customer
Speakers from telcos mostly focused on technology issues and how, for example, 5G could be afforded and deployed. They assumed an understanding of customer needs based on little or no interaction with actual customers. One senior telco representative summed-up the challenge we face by stating that:
“I’m not worried about understanding what the customer wants. I already do, because I am one.”
Projecting one’s own experience onto all customers is one way to ensure increasing irrelevance! Unfortunately we have heard many a CxO echo this belief. You can read more about the problems of Virtual Customers and how to combat them in Failures in Customer Perception.
A presentation on the experiences of Reliance Jio claimed that its customers love the company and used its deployment of a “hyper-dense HetNet architecture ensuring higher efficiency per coverage area from available spectrum” as the foundation of that love. The reality is that Reliance Jio used immense resources to bring new capacity at disruptively low prices to a supply-limited market. Under the circumstances, initial success is assured, but having catalysed restructuring in the market in India, newly competitive rivals may well win back those users if the assumed love is really only expediency.
Only real dialogue with real customers (or experience over time) can reveal whether Jio’s proposition has engendered loyalty or just pragmatic and temporary affiliation.
Tools are Available but Dialogue Needs to be Added
Telcos can achieve greater agility through softwarisation. Use of AI and analytics, 5G and IoT network deployment all provide the means to develop value that will assure a future role for telcos, beyond wholesale basic connectivity provision.
What is more, the eco-system that supports telcos – consultants, software providers, research companies and even (to an extent) regulators and governments, are on hand to support telcos in the development of a new business model fit for the digital age.
The vital component in the development of a business model that will be sustainable is a better understanding of customers. This is an inversion of the traditional telco focus on the network and its development, replacing it with a passion for helping customers achieve their own aspirations in the most efficient and cost-effective way.
Telco Eco-system to the Rescue?
It was apparent during the debate that the telcos have not progressed as far down the road of understanding the need for change and the nature of that change, as the other members of the eco-system that supports them. The Future of Customer Ownership explains the challenge telcos face in retaining ‘ownership’ of the customer in the face of more powerful global digital players. Maybe only by intervening can other members of the eco-system trigger the fundamental transformation required and avoid the largely wholesale role that currently seems their fate.