Operational Excellence

Harmonizing operating models to attain M&A goals

Deploy Prodapt’s industry-leading Unified Operations Framework (UOF) as a strategic solution for a streamlined operating model transformation — Achieve a 25% OpEx reduction with Zero service disruptions

M&As in the Connectedness segment are expected to rise through 2024 as technology advancements and the release of pent-up deal appetite lead to a flurry of investments, according to this PWC report. Pursuing this route, Communications Service Providers (CSPs) may adopt shortcuts towards operating model transformation. However, a contrasting perspective from McKinsey emphasizes the importance of careful planning and execution when transitioning from two separate operating models to a newly integrated one. Even in ideal conditions, harmonizing operating models is complex, time-consuming, and challenging.

Several key challenges hinder the effective unification of operating models post-M&A. These include streamlining role redundancy, improving maturity levels across merged entities, and standardizing evaluation systems. Neglecting these aspects can lead to a sharp rise in operational expenditures, customer churn rates, and loss of competitive edge.

To address these challenges and unlock the full potential of M&A, CSPs can leverage the Unified Operations Framework (UOF). UOF offers a comprehensive approach to streamline processes, optimize resources, and integrate systems and teams effectively post-M&A. It employs a function and objective-driven approach to pinpoint areas for operational change and provides specific steps for implementation.

The three key implementation steps recommended by UOF are:

  • Redesign business teams aligning with TM Forum’s eTOM framework
  • Track automation and outsourcing maturity to enhance operational efficiency
  • Define, measure, and monitor Key Performance Indicators (KPIs) to ensure performance transparency and accountability

By adopting UOF, CSPs can achieve a significant reduction of approximately 25% in Opex, and accelerate migration by 3X. This strategic approach ensures sustainable growth and competitiveness in the rapidly evolving connectedness landscape, strengthening the merged entity.

McKinsey – Transitioning from two existing operating models to a new, combined operating model requires thoughtful transition planning and execution.”