Telcos urged: Don't go chasing waterfalls when it comes to IT procurement
- TM Forum claims industry could save a fortune by embracing agile development
- Operators, vendors agree that traditional RFP process no longer fit for purpose...
- ...but vendors still need to be wary of the dreaded back office spaghetti
Operators are wasting a fortune by persisting with traditional IT procurement practices, the TM Forum has warned, although aspiring suppliers would do well to beware of the dreaded telco back office spaghetti.
The industry group is urging telcos and vendors to leave behind so-called waterfall practices, where each step of procurement is taken one at a time, and adopt agile methodology instead: working more closely with vendors on multiple steps of the process at once, such as design and build, or testing and deployment.
TM Forum says that traditional procurement all too frequently causes delays and even failure of IT projects, which in turn leads to delayed product/service launches, and unsustainable TCO and technical debt. Traditional procurement policies also play it too safe, discouraging telcos from experimenting with their suppliers, and from working with small, innovative start-ups.
TM Forum claims that inefficient procurement costs the global telecoms industry more than $1 billion a year. A survey it carried out of more than 300 telco vendors and operators revealed that two-thirds believe that the traditional RFP process is not fit for purpose for any aspiring DSP.
"There has always been criticism of the use of the RFP for IT procurement because it glorifies the process rather than the outcome," said TM Forum's chief analyst, Mark Newman. "But what has now changed is the desire to transition to agile IT development and the need for a more flexible, iterative procurement process."
TM Forum claims that by using agile working practices, procurement time can be reduced to two-three months from 12-18 months.
A bold claim. However, the reality is probably not as straightforward as adopting agile development and working with an innovative but potentially unproven start-up.
The reason why stems from how encumbered the average telco still is by legacy IT systems (also known as back office spaghetti, to borrow a term favoured by Andy Tiller, formerly of Chinese billing specialist AsiaInfo, and who now serves as TM Forum's EVP of collaboration and innovation).
Over the years, with all the consolidation, expansion into adjacent markets – such as TV or mobile etc. – and the emergence of whole new industries like IoT, there are still many operators struggling with a mish-mash of stitched-together OSS/BSS and CRM systems.
Telcos already know they desperately need to change – TM Forum's survey results said as much – and adopting new procurement processes will doubtless improve the situation. But the heavy lifting of ripping out and replacing every back office system is still likely to take a lot of time and throw up unexpected challenges along the way.
Stay up to date with the latest industry developments: sign up to receive TelecomTV's top news and videos plus exclusive subscriber-only content direct to your inbox – including our daily news briefing and weekly wrap.