What is the importance of a partner ecosystem? - Odido and Telenor's perspective

Businesses across the globe – and telecommunications is no exception – are heading toward an era of ecosystem-based innovations, product development and revenue growth business models where organizations utilize a growing number of partners and partnerships to expand their portfolio or reach new customer segments.

However, CSPs are used to a world working with a handful of large partners with very similar business models – drawn out contracting processes and cumbersome go-to-market. This slow moving, long partnership process is no longer aligned to the speed of innovation and speed of technology disruption. CSPs need to reconsider how they are removing obstacles and barriers to partnership and developing diverse partner ecosystems.

The best way to drive innovation is to start with the problem a customer is looking to solve, and then create the perfect solution to solve it. The problem is, doing this requires a broader set of capabilities than any one organization or CSP can master. So invariably, that means working with partners to co-create, co-innovate and co-invest in creating the perfect solution.

In this changing world, CSPs need to adapt. To go from working with a handful of partners with similar traits, to working with hundreds or thousands of partners who are very different – from hyperscalers to start-ups. The old world with its long, manual processes is past, presenting a massive roadblock to future growth. There are huge challenges in terms of organizational change, skills and capabilities, to really invert the model, starting with the customer to co-create, co-innovate and build out the partner ecosystem. 

In this Fireside chat at Digital Transformation World 2024, Angus Ward, CEO, Beyond Now, discusses this topic with Martijn Teekens, CCO of Odido (formally known as T-Mobile, part of Deutsche Telekom Group), and Thomas Skjelbred, CEO of Telenor’s procurement company based out of Singapore, and they explain how their businesses are adapting to overcome these roadblocks in collaboration with Beyond Now.

What is the importance of partner ecosystems in your business and the type of partnerships you are creating?

Martijn
Odido’s journey began relatively recently – with an extensive background in telecom, we transformed into a new brand, prioritizing partner collaboration. For us this was important because we strongly believe that if you want to succeed in telco it’s necessary to rapidly create and leverage collaborations. If you try to do it all yourself, it won’t work – your pace will slow and you won’t stand out from the speed of technology. Partner ecosystems drive us to be the customer’s champion in the area of connectivity – we are the strongest connectivity player in the market – the market leader in the Netherlands in mobile. In parallel, we build strong collaborations with partners to expand our portfolio, and this means we can create perfect solutions for our customers, while retaining a lean general cost profile, giving us a great competitive advantage in future landscapes.

Angus
Connectivity is really at the core of everything you do, and you build from there, but there’s also the ecosystems, that speed to market, that speed of innovation, responding to the market, and being able to move quickly.

Martijn
Yeah, it goes fast. You mentioned in your introduction that cultural change is very important. Historically from a telco perspective, it’s recognized that we like to build it ourselves – we trust ourselves as the best option to create a new product. But on the other hand, if you flip the model and start from the customer perspective, with their constantly changing demands, it’s difficult to keep up. Therefore, I strongly believe you need the right partnerships to make sure you can adjust your strategy to the demand of today’s customer, as well as their future demands. Overall, this gives you a much stronger position.

Thomas
Telenor’s perspective on the word partnership is a little different, in that partnership is about collaboration and bringing value to the business. These days, in the telco world, we need to find that kind of value proposition. Collaboration is key, but I don’t think it’s new. We have collaborated with many suppliers, but how do we move away from that customer supplier culture that telco has always been? So what we are embarking on here at Telenor, is defining business enablement – which is maybe the traditional way of contracting – and moving away from that culture of being a supplier.

And I think from my role, the questions are… how are you contracting and how are you collaborating to get that signature? Because partnership and driving innovation, in one way is a very good collaboration and starting point, but in another, we also need that contract. And that’s very much the bridging element... along with how you are generating the incentive and the joint incentive to enable time to market.

In terms of a more collaborative, more flexible relationship – which is a win-win for everybody – how do you see procurement plays a role in that? 

Thomas
I think procurement is not an RFX function in itself. We are doing lots of renewals. We have first right of refusal, we are direct contracting and so on. Key is to lift the dialog into more of a strategic and business-oriented one, and in one way, not starting with a contracting process. How are you starting the dialog and how are you moving step by step into that contract both parties actually need? This is the key. As I said, business development and go-to-market is one area. I would say that’s where we are kind of humble, is how you are getting a full organization to be energized from that kind of collaboration around innovation, into putting it into an integrated part of your value proposition in a big market. That's a long end-to-end process. So I think there are different processes and contracting that we need to enable. 

How can CSPs manage the cultural mindset shift to work in a different way?

Martijn
When it comes to setting up a marketplace, most telcos start with a need – to build a platform – or to automate this – or orchestrate that – so it becomes a functional approach. The marketplace concept for Odido as a company is not new – we have been doing this for several years, but now we have turned it around and changed the concept by starting with the selection of partnerships first, and then discovering our added value.

There is a mindset change, from doing it ourselves, to let’s investigate first, and explore if there is a smarter way to collaborate with a partnership before we automate. Eventually we come to a point where we have lots of revenue on top of general connectivity. And the question is then different, because it’s now about how to scale, and how to keep customer engagement and promises alive with a much broader perspective of continuity in the marketplace. And that drives us back to the key question of how to automate and orchestrate and keep it futureproof.

Many CSPs like us are already dealing with complexity – a history of a fragmented landscape with many systems and products. So, for us, the question developed into how to bring this step by step into a futureproof solution, which became the journey – beginning with changing the culture, creating these collaborations, and then automating and orchestrating.

Thomas
From my perspective, I would say we need to evolve and learn. Partnership is definitely the way forward. But many businesses are not used to the type of collaboration and engagement needed to deliver jointly to the market. 

We need to think about how we are steering the risk and how we are enabling it through both contract as well as processes and role and responsibility. Because speed to market is also about structure. For me, strategic partnership is where you are actually harmonizing who should take the risk and how you are sharing the opportunity and value creation now.

Martijn
I fully agree with you. It starts with structure. And I think there are a few simple guiding principles. Start small and then scale, is really important in this area. And on the other end we don’t begin with the full integration. We learn first from everything we do and then we undertake the bigger job of integration. What works can be leveraged to grow, and what doesn’t can be discarded without huge costs. 

We collaborate closely with customers to create their roadmap and their future roadmap. So if you can define the end game of your customer, you can create all the steps behind it to achieve that goal. This is where a marketplace strategy helps because at one point customers bring new demands, and with an ecosystem of different partners you have the speed of innovation to fulfill the needs to the customer. Being flexible is the key.

What are the key challenges, from a procurement perspective, in creating that thriving ecosystem of partners? Especially when the potential is 100, 200 or 300 companies including innovators and large companies?

Thomas
I think we need to evolve, and it’s important not to limit yourself to have everything ready before taking the next step. I think that’s where Odido, as a company, is now. We are evolving, though it’s clear from the sheer number of companies that can be involved, that we need to build a foundation, and a playing field, to ensure everyone knows their role, the risks and opportunities.

I think that bringing partners close to the use cases and the market is definitely where innovation and opportunity is captured, and having the processes in place to capture it as quickly as possible. In the B2C landscape, telcos are the world champion in orchestration and automating and so on. So when we embark on that kind of a partner ecosystem, we have to remember our history, and not be humble and say we don’t know how to do this. Because we do. We are scaling. We just need to find a new formula and the ingredients and be sustainable at the same time.

Today in enterprise B2B, it’s all about tailored requirements and tailored contracts… and it’s just slow. So, we need to take a look at the history and culture of our experience in B2C and use it to scale and address needs.

Where is your business heading in regard to partnerships and ecosystems and platforms over the next five years?

Martijn
If you look at how we approach our customers today, we are still personally advising them on specific topics, and in time that will change through the use of intelligent software in the ecosystem and marketplace, which can predict the next best offer for customers and the next best step to make in digitalization. I strongly believe that in time we will use this automated, data-driven knowledge to support the customer. And that conflicts a bit with what we stand for as a brand, because we want to create the technology for humans and not technology just for technology’s sake. So, we need to find the right balance between personal interactions while leveraging data and insights to predict and provide their best customer journey. 

Thomas
I think that telcos need to reimagine themselves to be very close to their customers. And there are lots of use cases and opportunities out there on how we are aggregating these kind of value propositions and use cases into our technology platform. 

We have a strong brand, we have strong retail, we have strong distribution, and we have a strong technology capability. And to contract is kind of just a step on the road. But if you don't know what the customer needs, then it becomes connectivity only. And I definitely think we need to aim to be in the aggregator role, more than just connectivity, and to be close to the market and use the capabilities we have to execute locally.  And then we can scope globally with a strong technology platform or marketplace itself.

What kind of risks, barriers, or pitfalls do you foresee as businesses embark on this journey?

Thomas
The biggest risk is moving too slowly. There are a great number of small system integrators who have a huge valid wallet of the SMB market. And they are growing. In the last three or four years they have grown ten-fold, while we have not. And we have more capabilities than they do – bringing more partners to the local market from a global supply chain. It’s up to us to be more ambitious. And having the right mindset here is key.

Martijn
In my perspective, it’s all about execution. And if you want to reduce the risk, then allow yourself to dream big in the marketplace. But start small, make small steps and then execute on top of that to drive these steps forward. And if you do that, then it will add value to customers pretty quickly.

Thomas
Just want to add, because we talk a lot about hyperscalers in general – they certainly have their place, and we should work with them – but we have to consider who is best to sell and deliver and maintain a local presence. We are talking about the last mile in telco. We can be that last mile, also in a service delivery and service operational mindset.