February 4, 2014

Leveraging the Managed Cloud for New CSP Business Initiatives

One operator that wanted to start an M2M line of business and expand its own cloud offerings switched to a fully hosted solution that helped it adapt an MVNO operation to an M2M organization.

Due to current market demands for rapid introduction of next-generation technology and bottom line improvement CSPs are turning to managed services increasingly just as enterprises have done successfully for more than a decade. The business drivers for using managed services can vary from achieving low, predictable costs to gaining competitive market advantages through greater business agility. Starting from outsourcing basic operations, managed services have evolved to a broad portfolio encompassing the entire BSS/OSS stack. The latest trend in managed services is toward cloud-based business process outsourcing (BPO).

As the shift toward BPO evolves, CSPs are asking how much of their end to end processes should be outsourced. Due to various approaches and models, it can be difficult for CSPs to decide what should stay in-house. Meanwhile, according to the research, the cloud may become a key driver for further managed services expansion and cloud-based BPO offerings may have a major impact CSPs’ decision making processes.

Advantages of Moving BPO to the Cloud
The cloud enables companies to focus on driving their businesses, leaving application and platform maintenance to a reliable partner. It transforms the BPO business model to a pay-as-you-go concept without capital expenditures, amortizing costs over the life of the contract via monthly subscriber payments. Therefore, CSPs do not need to make large investments upfront to enter new markets quickly, for example. Whatever the business goal, CSPs can measure results rapidly while evolving their businesses in more cost effective ways.

Proof Points
Operators’ experiences and successes demonstrate the efficiency of managed services models. For example, one operator that wanted to start an M2M line of business and expand its own cloud offerings to gain enterprise customers switched to a fully hosted solution that helped it change from an MVNO to an MVNE and then on to supporting M2M. This is an example of how a managed services approach can help an operator to adapt a line of business to meet relevant though rapidly shifting market opportunities.

Similarly, operators that want to improve their customer experience and bottom line can now choose to access advanced CRM solutions with BPO services delivered in the cloud in just one click. Operators that might be hesitant to make this kind of move, assuming it require a substantial portion of their budget, may find the opposite is true. One of the largest operators in the world underwent a massive transformation program from legacy solutions to next-generation offerings. It was able to reduce its total cost of ownership by more than 75 percent as a result of adoption cloud-based solutions and BPO. Today the operator is able to deliver new products and services 25 percent faster – or better - than before.

Reducing Cost and Risk
Managed services based on the combination of cloud and BPO can be very effective at minimizing expenditure. They can provide the means to expand and grow a line of business or large scale organization quickly while paying only for what’s needed as it is used. It is now possible to access core operational capabilities such as customer and order management, service fulfillment, and service assurance, which is turn can enable a CSP to trial and launch a new service offering or line of business very rapidly while substantially reducing the inherent cost and risk traditionally associated with such initiatives.



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