Connect with us


Demystifying digital transformation

Telcos that optimize the operations and technology architecture of their businesses will thrive in the fourth industrial revolution.

The world is changing swiftly as uncertainty surrounding trade, economic growth, regulations and geopolitics looms. At the same time, the Fourth Industrial Revolution (4IR), also referred to as Industry 4.0, is the unfolding age of digitization – from the digitally connected products and services we consume to advancements in smart cities and factories and increasingly common automation of tasks and services in our homes and at work – has finally come of age. And it is pervading virtually every aspect of modern life. From consumers to manufacturers to cities, 4IR advancements are more accessible and less costly than they were just a few years ago.

4IR represents a fundamental change in the way we live, work and relate to one another. It is a new chapter in human development, enabled by extraordinary technology advances commensurate with those of the first, second and third industrial revolutions. These advances are merging the physical, digital and biological worlds in ways that create both huge promise and potential peril. The speed, breadth and depth of this revolution is forcing us to rethink how countries develop, how organisations create value and even what it means to be human. 4IR is about more than just technology-driven change; it is an opportunity to help everyone, including leaders, policy-makers and people from all income groups and nations, to harness converging technologies in order to create an inclusive, human-centred future.

When the first and the second industrial revolutions took place, India was a colony, under-developed, and exploited. India did take part in the third industrial revolution, but we were still an economy coming out of the shackles of controls. “India is guiding the Fourth Industrial Revolution as government programs make technology accessible, improve services and encourage startups,” says Prime Minister, Narendra Modi. “The Digital India program, started eight years ago, showed how technology can be used for progress. A country that does not adopt modern technology is left behind, as had happened to India in the Third Industrial Revolution.”

The government is skilling, upskilling, and reskilling at least 1.4 million people in the next five years and it will support 30 institutions under the Chips-to-Startup program. Space, mapping, drones, gaming, and animation are among those that are going to expand. Digital India has brought the government to the doorsteps and phones of the citizens. Similarly, documents for rural properties are provided using technology. The government is working on digital mapping of rural properties using drones. Digital India assisted in fighting Covid-19. The government transferred thousands of millions of rupees to the bank accounts of millions of women, farmers, and laborers with a single click. With the help of the One Nation One Ration Card, it has ensured free ration to more than 8000 million countrymen. Services like life certificates, reservations, and banking have become accessible and affordable. Under Direct Benefit Transfer, more than ₹23 trillion have been directly transferred to the accounts of the beneficiaries in the last 8 years. At least 40 percent of digital transactions take place in India. Initiatives as Digital India Bhashini, Digital India Genesis, MyScheme and C2S program will herald the transformation of the entire system of production, management, and governance.

According to International Federation of Robotics, India has witnessed a 20-percent average annual growth rate of new installations of robots for the period 2008–2020 as against the 15 percent recorded worldwide. Major shifts on the demand side are also occurring, as growing transparency, consumer engagement, and new patterns of consumer behavior, built upon access to mobile networks, force companies to adapt the way they design, market, and deliver products and services.

Many of the advancements have been made directly because of telecom research to continually improve communication with faster speeds and greater connectivity. The next step of this evolution will be triggered by the combination of emerging technologies – like the IoT, autonomous robots, augmented reality, drones, AI, just to mention a few, and enhanced by the implementation and democratization of the 5G networks.

The 5G expansion will provide a broader range of opportunities, including the optimization of new projects, access to relevant information for decision-making and enhancement of the end-user experience. A fully operational 5G network is estimated to be at least 10x faster than an LTE network, and this is the rate of connectivity necessary to make self-driving cars, and collaborative robotics to work together in factories.

5G will contribute to the optimization of industrial operations, making the daily management of assets and people more efficient. Operation-management applications in manufacturing could account for around 32 to 39 percent of the total potential IoT economic value. In numbers, that means around USD 0.5 trillion to USD 1.3 trillion, by 2030, according to a McKinsey study.

As 5G develops, it clearly offers many new capabilities and advantages, including the ability to more easily deploy customized and automated services and applications. If history is any precedent, these capabilities will have a profound impact on business and industry. With the advanced communication technology that 5G provides, more companies, factories, warehouses, office buildings, entertainment venues, and many others will deploy services that enable more precise production methods, better and more synchronized supply chains, and more efficiency. It is akin to the mobile e-commerce revolution: The more smartphones there are in use, the more online shopping grows. In the same way, as 5G expands, more organizations will take advantage of the technology to install new and advanced services.

But in order to benefit from all that 5G has to offer, the industry needs systems to manage the software that will enable organizations to take full advantage of its speed, accuracy, and flexibility. Among 5G’s inherent capabilities is network slicing, providing on-the-fly redeployment of network resources in response to the dynamic needs of specific users.

While 5G’s software base enables the deployment of such features, it is the job of the telecom industry to develop those capabilities and offer them to customers, who can then implement them at their facilities, creating private on-site networks that meet their specific needs, including running robots and other automated systems, ultimately leading to higher efficiency and profitability.

That is the vision – and in order to realize that vision, we need to follow a roadmap that leverages 5G’s capabilities, including programmability and near-zero latency, to develop the new networks and services that will allow for the widespread deployment of automated processes.

“The telecom industry has all the technical capabilities to succeed in a 5G world, but it will need to adapt to the changing environment very quickly,” technology analysts Gartner said in a report of the impact 5G will have on global operators. “Given the diverse enterprise client base, operators must shift from a product-based strategy to a customer-based strategy focused on the unique needs of each client,” Gartner adds of how the telco enterprise will need processes and technologies that enable it to be highly customer-centric.

Telecom organizations are already market leaders at customer care, but 5G adds a new layer of complexity to the customer focus challenge. As the infrastructure for 4IR, 5G will bring the telecom industry into a closer and more vital relationship with vertical markets, such as manufacturing, automotive, transportation, healthcare, agriculture, and retail. Connected devices will reshape the way communities travel, make things, return to health, acquire goods, and how food arrives on their tables. Those businesses and their connectivity demands will be new and, in some cases, unique to their markets.

The telco providers will, therefore, need a business and technology architecture that is responsive to the demands of each of those markets. In the years to come, telcos will be responding to weather events in agriculture, supply chain demands in retail and manufacturing, and removing congestion from travel.

Working in this new, highly connected environment is changing the operating model for the sector. “Telcos face a set of industry-specific challenges, including those related to team structure, vendor management, risks and interdependencies, consistency, and culture and leadership,” says the Boston Consulting Group (BCG). “This last hurdle is especially high because many telcos have been doing business in much the same way for decades.” As BCG highlights, the sector has been operating without disruption to its business model for some time; as a result, the technology architecture of the operators has also remained in stasis.

“Revenue growth is so hard to come by that many telcos focus primarily on retaining customers and protecting the near-term revenue base. These priorities, combined with high capital expenditure costs (such as for network upgrades) and long payback periods, have led to a high intolerance for risk,” BCG says of why change has been hard to embrace. But if the telecom sector is to seize the opportunities of 5G and new markets, then not changing their operating models is the risk.

BCG indicates that telcos work in a market that demands high CapEx investment and long, slow returns from that investment, and 5G carries the same risks. However, the modernization of business processes and the technologies to underpin new procedures does not carry significant investment, cost, or risk. Cloud computing has lowered the cost of business change for telcos and many other sectors.

“Around the world, we have seen telcos increase process development speeds while reducing costs by 20 percent to 50 percent,” BCG reports. “Some have increased release cycle times for new products by a factor of ten and reduced marketing expenses by 60 percent.” Increasing the speed of delivery for new products and services whilst also reducing the spend on marketing is a clear example of how telecom organizations can benefit from enterprise cloud adoption.

In its major study, Succeeding with CIO led Digital Transformation, industry analysts IDC discovered that cloud delivers benefits on four business issues – enhanced flexibility, cost control, tackling the skills gap, and improving business resilience.

The study found that organizations with a strong enterprise cloud estate were able to restructure to match business needs and that working with cloud providers ensured telco CIOs had access to skilled staff from the cloud provider, adding to their own teams and the business was able to respond to major events, such as floods or pandemics. And all of this was done with greater clarity on the cost of the compute power the organization was using.

These benefits are in stark comparison to the existing technology landscape in telco providers. At present, according to BCG, a “complex technology landscape creates challenges in and of itself. Incumbents typically have old and interrelated IT systems, which can complicate efforts to expose application programming interfaces and resolve integration issues.”

In contrast, those organizations with a rich enterprise cloud computing estate are tackling business-wide issues of delivering new products, reducing the cost of doing business, gaining access to skilled technology workers, and having a strong disaster recovery platform in place.

New technology causes disruption; that’s a given. People, companies, and governments are mostly able to keep up pace with new technologies that are inherently good for productivity. This time, however, it is happening at a pace and scale unseen before.

On all levels of the financial pyramid, disruptions are happening at all times. From one year to the next, new technologies emerge that change the entire dynamics of an organization as a whole. This means that adaptation must happen continually, with the retraining and reskilling of employees becoming an inherent part of a company’s workflow and business model.

It is also clear this is a great opportunity for telcos to carve out a useful slice in the IIoT space, considering they currently control most of what is going on at the edge. Despite acknowledging the clear gap between the skills held in-house and those needed to deploy IoT projects, a minority of organizations turn to outsourcing as a solution.

Paradoxically, despite being in control of the main edge data points, the cell towers, many telcos continue to sell off or spin out these prized assets, greatly diluting the influence they have over the potentially lucrative edge market. Towers are certainly seen as central to technology vendors when it comes to addressing the needs of the edge market, with companies, including VMware, Dell, HPE, (recently acquired by Rakuten) and Samsung, recently launching products designed to support low-footprint computing in tower base stations, in response to edge growth.

As past revolutions have demonstrated, the overall growth in the economy could in aggregate result in a net increase in safe and rewarding jobs. This would of course require extensive skilling, re-skilling and up-skilling of the work force. Without digital skills, connectivity and new technologies are of little value.

For many members of the world’s workforces, change can sometimes be seen as a threat, particularly when it comes to technology. This is often coupled with fears that automation will replace people. But a look beyond the headlines shows that the reverse is proving to be true, with Fourth Industrial Revolution (4IR) technologies driving productivity and growth across manufacturing and production at brownfield and greenfield sites. These technologies are creating more and different jobs that are transforming manufacturing and helping to build fulfilling, rewarding, and sustainable careers. What is more, with 4IR technologies in the hands of a workforce empowered with the skills needed to use them, an organization’s digital transformation journey can move from aspiration to reality.

Research from Inmarsat reveals half of industrial businesses that could take advantage of IoT and Industry 4.0 lack the skills to do so. Among 450 companies worldwide, including those in agriculture, electrical utilities, mining, oil and gas, and transport and logistics, 47 percent said they lacked the skills in connectivity technology to take advantage, and 50 percent cited a cyber-security skills gap. In addition, data science and analytics skills were a problem for 49 percent, and technical support was a problem for 48 percent.

Many businesses also said their organization lacked the strategic IoT skills, needed in the C-suite or senior leadership team, to fully integrate IoT into their overall business strategies, with under a third claiming to have all the skills needed at this level.

With the world entering a transformative era of digitization, collaboration with leading telecom equipment manufacturers is paramount to ensuring the successful accelerated deployment of i4.0 technology. It is these vendors that will make this vision a reality by leveraging the power of new technologies, such as 5G, IoT, and the cloud to transform every sector and paving the way for an intelligent, sustainable, and connected future.

Click to comment

You must be logged in to post a comment Login

Leave a Reply

error: Content is protected !!