A benchmark-based framework for estimating network operations cost reductions by shared delivery

We currently observe a trend of emerging-market ¿regional champion¿ telecommunications network operators to spread operations across multiple countries. After acquisition of target local operators or new licenses, consolidation of operations becomes critical in order to provide consistently high service levels in a cost-efficient manner. This leads to an increased demand for innovative, cross-country delivery platforms for network operations. Apart from the obvious technical issues, also strategic and economic aspects need to be taken into account when determining the optimal, resource-sharing re-design of network operations processes. Outsourcing alternatives at the various local, regional and global levels should be included in such an evaluation. This paper presents the technical approaches and the strategic and economic impacts of regionalization, centralization, and outsourcing of mobile network operations processes, as well as the underlying comprehensive methodology for doing a structured evaluation. After analyzing current market trends, challenges, and paradigm shifts in the telecommunications operator business models, the dimensions of increasing operational efficiencies are discussed. Our model is then described from a technical/infrastructure, a process and activity, and a delivery option perspective. After defining a sample of potential target scenarios, the strategic aspects of selected scenarios are investigated. For the evaluation of the economic impacts, both a top-down and a bottom-up approach are introduced. Our benchmark-based top-down approach is then elaborated in further detail, also highlighting the challenges for the benchmarking concept. Finally, a real case of a MEA cross-country operator is presented, and conclusions are drawn using our methodology.