The Race to the Cloud is not a Sprint
How can telcos succeed with cloud services? It’s a question that the industry’s struggling to answer, judging by conversations at the World Cloud Forum in Munich this year.
Businesses are aware that they need to do it, and quickly if they’re not to miss the boat. But they’re hesitant because of previous failures in what was, only a few years ago, an immature market.
Now there’s a real opportunity to get it right. So what’s the answer?
Take the long view
There’s an imperative to act now before competitors occupy the cloud service space, but not at the expense of long-term planning. In a world where beta launches are increasingly common, it’s a good idea to get your service live in four to six months, but then what?
You need a road map of activity for the next 12 months, three years, and so on. And that should go hand-in-hand with a structured plan for monitoring performance and customer needs so that the service continues to evolve and stay relevant.
I’ve read a couple of articles recently that say telcos will never be successful in cloud services because software isn’t in their DNA. But is that really the point? Sure, technology’s involved, but it’s not primarily a technology project.
Building a cloud offering with the right partner is about achieving your business objectives through their expertise by creating the right service. Don’t think ‘software’, think ‘service’. And remember that, unlike the technology you may be used to, the beauty of the cloud is that you can flex and change things almost immediately.
Be clear about your objectives
What do you actually want to achieve by getting into cloud services? Build loyalty? Increase customer value? Win new customers? When we start working with new partners, we encourage them to force rank their objectives. The most important should shape the proposition design.
That often means thinking beyond average revenue per user, which for some businesses can be a difficult place to go. So I was encouraged to hear a handful of operators at this year’s Forum talking about broadening their business case to include less tangible benefits, like brand recognition and customer satisfaction.
The success of a small business cloud service depends on people using the apps within it. To make that happen you need to be continually communicating with your customers at every touch point, improving journeys and offerings, revisiting pricing and bundling, refining your proposition design, and so on.
No small task – and it’s unlikely you’ll get it exactly right at launch. That means taking a realistic, long-term view of costs, and managing expectations about rapidity of payback.
Find a partner, not a supplier
At one of the Forum’s panels an operator said he was sick of hearing about partnerships: weren’t we all just vendors or suppliers? It got me thinking about what partnership is all about.
Our experience has shown that a successful cloud service depends on having a collaborative relationship between the brand and the builder. The two businesses focus on their core areas of expertise, share examples of best practice, and complement each other’s strengths. That’s a partnership.
But in what is currently a young and virtually untested market, you’re not truly a partner unless you share some of the risk. That’s why we believe in aligning objectives for joint success.
If you’re confident about the market opportunity and in your expertise, then you should be willing to take some risk in return for some reward. Then both businesses are in the same boat, focused on making the service a success. And in our experience, that then leads to a long-lasting, fruitful partnership.
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