The light at the end of a tunnel (is not a train)

telegraph-19th-centuryThe Telecoms sector has taken a considerable battering over the last decade. An industry which was traditionally “old-economy”, forced to reinvent itself through several M&A and massive layoff and restructuring at nearly every leading firm. For many firms it was back to the basics or die!

In the meantime Telecommunications came a long way in terms of efficiency and productivity, mostly due to pressure from competition, reduced margins and rising consumer expectations. As networking technology became ever more complex, it’s R&D divisions started lending ideas, standards and processes from other industries such as IT. (Open Source, Agile Development, Flat-Organization) and scaled them to their needs.


NSN for example took the concept of agile and test driven development and proved over the last years that this not only works in a small local silicon valley start-up with 50 or 100 developers. Nope! They made it scale across sites in China, Finland, Germany, Poland, Russia and US. Several hundred software developers & architects collaborating across timezones and feeding one of the most impressive chain of downstream testbeds the industry has ever seen. As any advocate of agile methods might tell you: scalability is the most often quoted and #1 concern when it comes to evaluating whether a move to agile makes sense. These guys not only did it but proved that it’s methods scale all the way to the top!

Apart from BPO, consolidation is still high on the agenda in many of the leading firms. Yet the light at the end of the tunnel is becoming brighter by the day. Biggest business will go to those firms which can identify upcoming opportunities other then the obvious things (which the competition is already working on). Funny thing is that for most new opportunities on the horizon (e.g. in M2M, cloud computing, big-data, automotive, …), it was the telecommunications industry that provided the foundation and fertile ground through advancements in radio technologies in the first place!

For me Telecommunications is an excellent example of how an industry made up of giants and dinosaurs can reinvent itself by looking at it’s core values and shed everything it does not need. Painful as that maybe it’s the simple nature of life itself.

Written by Joachim Bauernberger. If you liked this post why not connect with him on LinkedIn!?

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