Episode 8

Speaker 1: Accelerators from Beyond. Hello and welcome to Accelerators by Beyond. Join us, as we speak with industry leaders and explore the big opportunities ahead in 5G, IOT, AI and cloud, and the role of the ecosystem. We discuss how to stay ahead and what technologies, innovation and business models are driving the industry to accelerate.

Jeremy Cowan: Hi and welcome to the latest Accelerators podcast from Beyond by Bearing Point. My name's Jeremy Cowan and I'm co-founder of the website, IOTnow.com and vanillaplus.com. And this week, the pod is talking to no less than the CEO of Beyond by Bearing Point, Angus Ward. Angus, welcome.

Angus Ward: Thank you very much. Wonderful to be here.

Jeremy Cowan: Good to have you. Now, just to give our listeners a bit of background. Beyond by Bearing Point is a leading ecosystem, orchestration and digital platform provider. And the company enables organizations to launch new services at speed, and to grow revenue by utilizing its digital platform and software as a service business support systems. Am I right so far, Angus?

Jeremy Cowan: Yeah. I understand that Beyond's platforms are designed to help users experiment, to monetize and orchestrate services while taking advantage of new technologies such as cloud, Edge, IOT, AI, 5G, and more.

Angus Ward: That's absolutely right. I mean, it's a complex world out there and most of our customers have to sell things to their customers. And making simplicity work is key and that's what our platform does for them.

Jeremy Cowan: So Angus, how would you summarize 2021 looking back? And what changes did you see in the telecoms and technology markets?

Angus Ward: So, at the start of 2021, I wrote an article, I said my predictions for 2021 were really three things needed to be resolved by the carriers. The first one was around their financial debt. The second, the IT technical debt. And the third one I called organizational debt. So I think 2021 was a key year for the carriers. But what we actually saw was really a tidal wave of government enterprise spending in response to COVID listing really all boats in the sector. So I don't think we saw as much change as we were expecting.

And then below the surface, I would really maybe highlight two areas where we saw more fundamental changes taking place. The first one was really this transition to a new network architecture, which is software based, fully virtualized and cloud centric. And that was really coming at the time when 5G networks and fiber networks were converging.

On top of that, we have open round, a lot of conversations around open round. So rather than two or three very large network equipment manufacturers. We were starting to see the opening up of innovation to all kinds of startups and hyperscalers. And then new entrants like Dell Technologies coming into the open round space. And with that new architecture software based, it's all around innovation, ecosystem, partners, and how you actually start to configure the traditional network really with the software components to create differentiated communication solutions.

The second area was really around, similar to the network, but CSBs having to really declare where they wanted to play in the new value chains that will be created in the digital economy. Most notably with hyperscalers, with partners and with solutions. And so this choice around either competing to sell horizontal communication products. Or really wanting to win customers, update the enterprise SMB customers by creating solutions, owning the customer relationship and growing revenue.

And so we started to see some of the CSBs be really declaring where they wanted to play in that value chain. And so I think for me, those were really the two important things.

But then coming into the year, there was a backlog of things which needed to be solved, financial debt, organizational change, and IT technical debt. Which meant that CSBs are a difficult place to navigate that journey.

Jeremy Cowan: Well, we talked about collaboration and Beyond in particular, can we zoom out for a moment and just could you give us an idea of what you think are the most important things you predict for the year ahead?

Angus Ward: So I think first and foremost, it was really around real partnerships and real ecosystems. Early in 2021, I had a conversation with a CTO from a leading tier one CSP, who said that we are great at doing partnerships, we resell Microsoft Office 365 and we've been doing that for years. So we are good at partnerships and ecosystems.

And I think this realization that that's not what we're talking about. What we're talking about is getting closer to the customer, understanding their problems and co-creating real solutions which perfectly solve a customer problem. Things like an app store is not that. It's really around really solving problems for the customer. And that requires a different modus operandi.

Secondly, I think as companies start to move to do that, and we saw with the Vodafone tech co announcement, we saw with BT and its DigiCo, the standing up of separate technology communications businesses within the telecoms industry. I think we're going to see some moving one step further and start to look to spin those off or to get different investors in that kind of industry. I think to have the full commercial freedom and the right organizational model to really create solutions requires a level of freedom. So I think that's the second one.

The third one for me maybe is around Edge. So certainly Edge, I see that as something which is here and now, and we are seeing significant demand from enterprise and SMBs to really start to drive down costs, to reduce the inventories, to improve quality and to do those things now. And we see the Edge market as being solutions that are really there in the market today, whether it's with private LT or 5G. And there's demand for those solutions. So we really see Edge moving ahead more quickly than 5G. And solutions are out there in the marketplace. So we definitely see Edge getting a leap on 5G.

Then I guess the next one would really be around sustainability. I think that's going to be a key driver in everything we do in 2022. I think the climate change agenda is massive. And companies have got quite strict reporting and will want to report progress.

And then finally, it's now or never for telcos in the SMB marketplace. There's a huge opportunity there. There's huge demand for digital solutions coming from SMB. And they haven't really managed to successfully tackle that market. So I think 2022 is a pivotal year for them to really create the solutions that the SMB market place wants to buy. Which are typically vertical solutions and not just pure connectivity where they have to stitch things together. So SMB market will be my fifth.

Jeremy Cowan: Picking up on what you say about SMBs. I just wanted to quickly ask you if you think that the recent announcement by AWS of a DIY, private 5G network is going to play significantly for SMBs?

Angus Ward: Yeah. So I think what they're offering is a one stop shop. You can create a campus network very easily. I was out in Las Vegas when they announced that. I thought it was a really great move. There's huge demand. And anything to simplify that model and make it easier for SMBs to start that journey is a good thing. So, I definitely do think that that simplification that AWS have offered around private 5G networks means that it's super simple, a one stop shop for an SMB to start to create that kind of network.

Even better would be if AWS had a range of solutions over the top. And so people are not buying private 5G. What they're buying is a solution to transform, to take costs out, to automate, and that you're selling outcomes. And yes, private 5G is a key enabler in that, but what the SMBs really want to buy are solutions which include that private 5G. So I think it's a great step forward. Another really good step forward on top of that would be to have the solution portfolio, that SMBs can just consume.

Jeremy Cowan: With all those changes in mind and the choices that are now open to the CSPs. What do you think the impact of these changes will be on them?

Angus Ward: So, we've started to see new collaborations. I think some of the big announcements in the year, I mean, we saw Dish, for example, announcing this collaboration with AWS on cloud native network. And we saw ATT's collaboration with Microsoft. And that is examples of that sort of new network architecture in play.

Likewise, we started to see other announcements, for example, Vodafone stepping out its tech co business. So separating its network operations really into a tech co and a network centered business. And we also saw people like BT talk about its DigiCo. And so I think there's this idea that in terms of the value chain and where organizations want to play, they were announcing some big moves, and you started to see some of those organizations declare the space in which they want to play.

So with that, those tech cos, you're talking about collaboration, combining virtualized network functions with things like software, AI, Edge, and starting to form those partnerships to create solutions on behalf of the customer.

But again, if I also look at whether things are moving quickly enough. One of the interesting pieces research we published in 2021 was a piece by Omnia, which we also ran in 2020. And there, what we were seeing was that in the 5G solutions space, the market doubled in size for 5G solutions. But at the same time, the market share of the carriers of the CSP declined from 21% to 16%. Whereas alternative solution providers went up from 7% to 27%. And then enterprises declined slightly as you'd expect.

And so I think what we saw in 2021 was that CSPs were starting to evolve. They were declaring where they wanted to play in the value chain. They were creating solutions. And whilst the market doubled in terms of new 5G solutions, they were not changing fast enough. And that the demand is here and now with that doubling in market size. And so enterprise customers out there really do want solutions. And that means CSPs having to collaborate with partners to create real solutions, to solve real problems and which they can offer easy to buy, easy to try, easy to consume. But not really changing fast enough. And so the collaborations are important, but they're not evolving fast enough.

Jeremy Cowan: You've talked a fair bit about the collaboration that is going on in the market. And obviously Beyond is very involved in enabling ecosystems to collaborate. Can you expand a little bit on your views on the importance of the ecosystem in the new look environment? And particularly what needs to be done for companies to be able to collaborate?

Angus Ward: Yeah. There's lots of research on this. And it's really around, there's some great MIT research by Jeff Parker talking about the inverted firm model. And what this model is all about is that an organization can create more value from its customers from outside its organization than from within. And this idea of orchestrating value on behalf of a customer, really starting off with a customer problem, what is the problem the customer is looking to solve? And how to solve it. And then it's really orchestrating the right partners to co-create, experiment, and really then launch a solution which perfectly solves that problem.

So for me, collaboration is all around closeness to the customer, understanding customer needs, and then really using that to drive the creation of a solution with the right partners to perfectly solve that problem.

And then that co-creation process is one of equals where the carrier, who is orchestrating that value, is really working with an extended ecosystem of partners to create that perfect solution.

Now, traditionally most carriers, they would look at partners being two or three very large organizations. They typically work with all those network equipment manufacturers. In this case, enterprises typically see a solution being eight or nine partners forming that solution. And so as your portfolio grows, you can see that you might have several thousand partners. And they both include very large organizations, but also startups and smaller companies who are highly innovative in a particular problem space. And so this ability to orchestrate both the large organizations and the small organizations to perfectly solve a customer problem.

Jeremy Cowan: And what is Beyond particularly doing to enable this collaboration?

Angus Ward: So, our platform is all around automating and enabling that journey. So I guess one of the things that we are really focused on is the question of how do we help our customers grow revenue? So not around the technology, but what is the full journey, both organizational and technology. And it comes from really thinking of that more customer centric approach where you start to prioritize which sectors, which customers, starting to understand their problems. But then being able to use our platform to co-create and co-innovate a solution and test it with a customer at regular intervals. And so it's all about speed, low risk, speed, and being able to actually provide a solution very, very quickly. But also then fully automating all the interactions really from the very front end, all the way through to the fulfillment and delivery and monetization of that solution.

So if you've got a large number of partners, you're not bringing more complexity into your business. But you can perfectly solve that problem, orchestrate all the various elements of the solution in a completely frictionless, zero touch way. And so that as you create solutions, highly automated, and you're not introducing cost or complexity.

Jeremy Cowan: So how are you organizing Beyond for this year? You've mentioned sustainability as being high on your agenda. Is that a particular focus of what you are doing for this year?

Angus Ward: So I think for us, like I said before, we're a technology company, but we're not just about selling software, but about helping our customers navigate the journey to grow revenue. And so for us, it starts by putting ourselves into our customers', the CSPs', shoes. And really helping them understand the value chain, where they want to play, how to play, where to win. And understand the issues and constraints for starting that journey. But then thinking about how they then scale that model going forward.

And it is quite scary for a lot of the carriers because they're very comfortable in the network space. But that new network architecture, which is really around solutions now, communication solutions, and then the over the top revenue, they're new domains and require very different organizational models and very different ways of working.

So I think for us, it's not just about the technology, but it's about helping our customers navigate that journey to grow revenue and not just purely about the technology. But about having the right solutions, the right partners and the right organizational models, which make that model real.

Jeremy Cowan: Do you have any particular advice that you would share with CSPs for the year ahead? I'm particularly thinking around SMBs, but it might be in something else.

Angus Ward: I might go back to the stats I quoted earlier from that Omnia survey where the market has doubled in size in one year for 5G solutions and where the CSPs' market share is declining. Whereas the alternative service providers market is there.

And that's a real case for change. It's really about the market is here and now, that market is happening. It's happening with private 5G. And really I think the advice would be that the CSPs really need to ... a lot of them have been very B2C centric. They have been very focused on the B2C market. But I think that market for 5G and that convergence of both 5G and fiber with things like private 5G is happening now. So the buying side would really be giving. It's really important for the CSPs to start their journey.

And that a lot of them are very stove piped, and they have an IOT division, and a 5G team, they have enterprise, SMB, but this requires a new way of working and really requires them to work really across all their silos and focus on what the customer wants to buy here. And how to perfectly solve the customer problem, bringing all they have to offer plus what their ecosystem and partners have to offer. And that requires firstly, that new organizational model, but also it requires them to start the journey now.

Jeremy Cowan: Finally, do you have any wishes or resolutions for the year ahead?

Angus Ward: My wish list. I think it's really around the, at the front end of this conversation, I talked about those three changes, the financial debt, the IT technical debt, and then the organizational debt. And I think my wish for 2022 would really be that they have to start to tackle that organizational challenge they have if they are to take the B2B opportunity seriously.

So, traditionally telcos have being organized in a way which best enables them to sell what they want to sell. We're talking about a new world here where you start with a customer and you organize in a way that enables them to bring to market what the customer wants to buy. So less centralized, more empowering those people in the front line, be easier to work with, enabling smaller companies, startups to co-create and innovate with them, without being put through brutal procurement processes.

And so I think for me I think my wish for 2022 would I think, first one would be around starting to understand what it means to be really customer centric and starting with the customer. And bring all the great elements of solutions, which the CSP have in their portfolio today, being able to bring them to bear in a solution. And then bringing in the partners. So, organizationally, they are more agile, more experimental and more able to empower those people who face off against the customer.

And then I guess the second one really is, having more accelerators we can invite to this podcast, people who have successfully driven change and at speed within their organizations.

Jeremy Cowan: Yeah, we'd welcome that. Angus, thank you for sharing your thoughts with our listeners, that's been really instructive.

Angus Ward: Thank you very much. It's been actually wonderful to talk to you.

Jeremy Cowan: Sadly, that's all we have time for today. We'll be back with another podcast soon. In the meantime, don't forget to like and review the podcast wherever you found us today. It's not just to make us feel good, but thank you for that anyway, it really helps other listeners to find us more easily. That's all for now. Join us soon for the next Accelerators podcast by Beyond. Bye for now.

Speaker 1: Accelerators from Beyond.