PwC-led research shows Communications Service Providers must make smarter investments in “faster, better, cost-effective” IT to achieve business agility required to compete effectively
TeleManagement Forum, Dublin, Ireland – May 23, 2011
News Facts
• Research released today by Oracle Communications and conducted by PwC, has found Communications Service Providers (CSPs) have a clear opportunity to improve IT efficiency, with many already planning important steps within the next 18 months to deliver the agility their businesses need to thrive in a competitive industry
• At the heart of improved business agility is the use of fewer bespoke applications which carry a higher total cost of ownership and bring considerable budget overruns, management overhead and time delays
• In terms of aligning IT with the business priorities, CIOs said improving customer experience is the top driver for IT strategy in the communications industry
• A smarter use of customer relationship management (CRM) applications is a focus for system replacement or upgrade, reflecting this prioritisation of user experience
• Portals and improved content are also a greater focus for CSPs looking to service and monetise a consumer hunger for rich media and social networking on mobile devices
• Risk, lack of budget and complexity of existing systems are the greatest barriers to effective IT strategy implementation
• CIOs are planning a move towards more standardised, off-the-shelf applications as well as a more strategic use of outsourcing in order to simplify their in-house IT, bridge existing skills divides, reduce operating costs, mitigate risk and improve business efficiency
• The report, entitled ‘Rethinking IT strategy…can it enable a step change in Communication Service Provider performance?’ is based on research, conducted by PwC who interviewed CIOs or C-level executives from 30 EMEA CSPs. The report can be accessed here.
Key findings include:
• 67% of bespoke applications are delivered with a “substantial” budget overrun (74% have some level of budget overrun)
• 52% of commercial-off-the-shelf applications (COTS) are delivered under budget
• 60% of CIOs currently spend more than half of their opex budget on ‘maintenance’
• 95% of CIOs believe they will increase their use of COTS over the next 18 months
• 40% said IT refresh or upgrade is also in the top three while 36% cited reducing operating expenditure.
