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1、Federico Germani(CH),Bernd Kraus(FT),Andr Krause(DU),Friedrich Neumeyer(FT),Stefan Schmitgen(FT),Juergen Stark(CH),Safroadu Yeboah-Amankwah(CH),CONFIDENTIAL,Primer Document,Version 1.0,Chicago/Frankfurt,March 2004,This report is solely for the use of client personnel.No part of it may be circulated,
2、quoted,or reproduced for distribution outside the client organization without prior written approval from McKinsey it is not a complete record of the discussion.,213,CONTENTS,Management summarySituation and demands on Telco ITAssessment of existing Telco IT environmentsVision of a future Telco IT la
3、ndscapeOutsourcing of Telco ITHow to get startedAppendix 1:Detailed description of IT-supported functionsAppendix 2:Glossary of terms,214,Source:McKinsey,IT SUPPORT OF TELCO BUSINESS PROCESSES,Capacity and traffic planningDesign of the physical networkManagement of the network installationEngineerin
4、gInventory management.,Manage/control correct functioning of the physical networkManage the load of network trafficMaintain networkManage interfaces to 3rd party networks.,Manage/control sales forceManage sales channelsLaunch campaignsManage accountsManage customer contracts.,Manage and control the
5、order processes for telecommuni-cation servicesActivate/terminate services for customers.,Rate and bill telecommunication services according to price lists,contracts and 3rd party tariffsRate and bill 3rd party Telco servicesMaintain customer relationship.,Decision on business focusInvestment planni
6、ngDesign of products and tariff schemesDesign of market penetration approach,Enterprise resource managementHR managementFinanceAccounting.,IT supports all parts of a Telco operators value chain,Back-office administration,Strategy and marketing,215,Back office applications,Source:McKinsey,OVERVIEW:FU
7、NCTIONALITY OF TELCO IT,Network management,Inventory management,Decision support systems/data warehousing,Customer care&billing,Service provisioning,Network element management,Maintenance and workforcemanagement,Network configurationSurveillance of network traffic and performanceFault management,Tar
8、iff and customer contract managementOrder handlingBilling,invoicing,A/RComplaint management,Configuration and surveillance of individual network elements such as switches,multi-plexers,routers,etc.),Inventory management ofcustomer premises equipmentnetwork elements(e.g.,switches,mutilplexers,etc.),F
9、or detaileddescription of systemsand their functionality see Appendix 1,HR managementFinanceEnterprise resource management,Management of maintenance and repair service activities for customer premises equipment,switch network and trunk network components,Analysis of customer behavior,churn,etc.Custo
10、mer segmentationProfitability analysis,Service configuration and activation(e.g.,selection of phone number,line or SIM card activation,etc.)Call collection,216,Source:McKinsey,CHARACTERISTICS OF INCUMBENT TELCO IT SYSTEMS,Patchwork application architectureHeterogeneous architec-tural approaches acro
11、ss different BUsNo layered system structuresSystem and data redundancyIncomplete or unsatis-fying support of business processes,Performance andreliability driven system operationsReliability driven system design at the expense of high costPerformance optimization on the level of single systems with
12、reduced overall performance,Legacy issuesHistorically grown architecture with-out clear conceptComplex system interfaces(if any)Outdated technologyDifficult,expensive system maintenance,217,Source:McKinsey,ILLUSTRATION OF REAL TELCO IT ARCHITECTURE,Back officeapplications,Maintenance andwork force m
13、gmt.,Inventorymanagement,Servicemanagement,Access toredundant systemswithin one systemdomain,Access to amultitude of systemsacross differentdomains,218,FRAMEWORKS TO UNDERSTAND EXISTING IT SYSTEMS,Source:McKinsey,Which applications exist within the Telco?,Issue,Importance of understanding,Frameworks
14、 and tools,What kind of support do systems provide?,How dynamic are systems?,What is the technical diversity of systems?,Failure to develop a comprehensive view of the applications and architecture results in an incorrect focus and limited effectiveness,While technologists often understand the relat
15、ionship between systems and technology,it is their relationship with the business that determines value and effectiveness,The future viability of systems is often determined by their ability to meet changing business needs.Stable systems ideally are de-coupled from dynamic systems,Costs for operatio
16、n and maintenance of system platforms often could be significantly reduced by shared technologies,Application inventory,Application mapping,Application dy-namics/stability assessment,Technology infrastructure analysis,219,Source:McKinsey,ORGANIZATIONAL DRIVERS OF TELCO IT,With increasing age,more an
17、d more core functions are supported by outdated systems on numerous different hardware platformsIncreasing company age causes complexity costs generated by scale effects,multitude of technology platforms,offered products and services,regulatory obligations,and complexity of historically grown patchw
18、orkIncreasing size of Telcos slows down speed of decision-making process and flexibility to react to challengesIncreasing size of Telcos requires fundamental change of their overall organizational structure with major impact on the IT landscape to maintain operational efficiency,Organizational set-u
19、p determines split of responsibilities between central and decentral IT units and therefore influences consistency of IT design and granularity of systems(monolithic vs.decentral)Organizational set-up influences make or buy decisionsFragmentation of user demand and system ownership across organizati
20、onal units determines the degree of stakeholder conflicts,Since the IT structure is not aligned to the business processes,IT functions are accessed by a variety of users located all across the value chainConflicting user expectations and unclear responsibilities in combination with scarce resources
21、cause conflicts,OrganizationalissuesinfluencingTelco ITsystems,Organiza-tional age and market position of the Telco,Organiza-tionalset-up of Telco IT,Process organization,220,ALIGNMENT OF IT WITH THE BUSINESS,align,Company objectives/strategy,Objectives/strategy for IT architecture,align,Business un
22、it organization,IT organization,align,align,Source:McKinsey,IT architectureApplication landscapeTechnology platforms,Organizational set-up of companyCore process organizationGovernance model,Key challenge:Align IT organizationand strategy to companysstrategic objectivesand organization,Targeted mark
23、ets/customer segmentsTargeted market positionProduct/service scopeetc.,What is the right degree of organizational integration or decentralization of IT functions?Central vs.decentral application supportOrganizational split between network management and business operations functionsWhat is the appro
24、priate IT governance model?Budget responsibilityProcess for prioritization of requirementsWhat is the best way to allocate the limited resources given the heterogeneous or contradicting system requirements of different user groups?How can 3rd parties like standard software providers or system integr
25、ators best be involved?,221,Source:McKinsey,DESIGN CRITERIA FOR A VISIONARY ARCHITECTURE,Alignment of business strategy and IT architecture to establish a more business-focused rather than technology-driven IT,Consolidation of proliferated platforms and applications to re-duce complexity of tech-nol
26、ogy stacks(e.g.,hardware,OS,middle-ware,applications,etc.)and achieve economies of scale and scope,Flexible,process-oriented rather than functional integration of applications,Strict layering between network management and business operations to encapsulate network complexity and free up business op
27、erations,High performing IT architectureFunctional co-verage aligned to new and emerging business needsLow operating costLow cost of new development/additional functionality,222,Source:McKinsey,ARCHITECTURAL VISION:MAIN BLOCKS OF AN“IDEAL“TELCO IT,Event processor,Order entry/provisioning,Workflowman
28、agement,Network elementmanager,Networkconfiguration andmonitoring,Front office,Factory,Billing,Contractmanage-ment,Business partneradministration,Core business operations,Support systems,Managementinformationsystems,Back officeapplications,.,Wireline network,Shared services,Network elementmanager,Ne
29、tworkconfiguration andmonitoring,IP network,Productdefinition,Contractmanage-ment,Productdefinition,Core business,Customeraccountmanagement,Maintenancemanagement,Business unit 1,Order entry/provisioning,Workflowmanagement,Customeraccountmanagement,Maintenancemanagement,Business unit n,.,.,Inventorym
30、anagement,Network elementmanager,Networkconfiguration andmonitoring,Wireless network,Inventorymanagement,.,Business partneradministration,Corebusinessopera-tions,Serviceprovisioning,Converter and router middleware(message broker,CDR gateway),Opportunityto replicateblocks within eachlayer:consciousde
31、cision betweeneffectivenessand efficiency,223,TRADITIONAL MIGRATION METHODOLOGIES,Source:McKinsey,“Patch and swap”approach,“Lifeboat”approach,“Isolate and replace”approach,Standard software approach,Use standard software to replace existing systems,Use middleware to wrap legacy system and add new fu
32、nctionality in small steps,Built up new systems from scratch and migrate in a big bang,Undirected evolution in highly complicated application architecture tends to increase the chaos,Opportunistically replace single systems,Incorporates the tendency to start mega-project with a high likelihood of fa
33、ilure,Over time increasing amount of functionality built into the middleware creates additional legacy,Often available systems are inflexible to match dynamic business requirements and require huge amount of customization,Risks/barriers,Methodology/technique,224,Source:McKinsey,PRINCIPLE OF A RISK-L
34、IMITED MIGRATION APPROACH,(Partial)Implemen-tation of architectural vision,Radical,revolutionary changes as enabler for further evolutionary steps,No IT mega-projects!,Evolutionary development within the boundaries of the strategic vision,Migration prerequisite:Define long-term IT vision,Migration r
35、oadmap and implementation plan,Right mix ofevolutionary andrevolutionary movesbased on traditionaltechniques,225,Source:McKinsey,RISK LIMITED APPROACH TOWARDS THE TARGET ARCHITECTURE,Upfront definition of long-term strategy and IT vision,Develop long-term strategic view of future business,Develop vi
36、ew on future business system,Develop best fit architectural vision of future IT infrastructure,Develop long-term master plan for migration into new IT world,Opportunistic but directed migration path,(Partial)Implementation of architectural vision,Evolution of business system and business environment
37、,Evolution of business system and business environment,Implement new business requirements in small stepsEach implementation step needs to be justified by business case(NPV analysis),Make revolutionary move that brings IT closer to architectural visionMove only if economical or structural factor for
38、ces you,226,DEVELOPMENT OF A MIGRATION ROADMAP,Source:McKinsey,Strategic vision,Master plan,Revolutionary change of IT infrastructure,Evolutionary implementation of new business requirements,Vision of future business system,(Partial)Implementation of architectural vision,Architectural vision,Identif
39、ication of business requirements,Validation and prio-ritization of business require-ments,Bundling of requirements into imple-mentation projects,Development of technical implemen-tation alternatives,Development of project portfolio(timing,resources),Implemen-tation,Decision:Go/no go for specific alt
40、ernative,227,KEY FACTORS OF SUCCESS FOR MIGRATION,Source:McKinsey,Reduction of business complexityIn order to avoid over complexity in future applications reduce as far as possible the complexity of the business system(80:20)Filter out all business requirement that do not clearly foster a competitiv
41、e advantage and create significant return on investmentQuick implementation of basic architectural movesIdentify architectural move that can be implemented with manageable risk and that create an maximum amount of freedom for evolutionary stepsEspecially introduce technologies like middleware that h
42、elps to reduce the handling of system interfacesSize of migration stepsFor each migration step chose a project size that is still manageable in the light of the available skills,experience,source quantity and technical complexityUnder those constraint maximise the size of migration steps in order to
43、 avoid unnecessary efforts for interfacing legacy systems,228,CONTENTS,Management summarySituation and demands on Telco ITAssessment of existing Telco IT environmentsIT architectureIT organizationVision of a future Telco IT landscapeOutsourcing of Telco ITHow to get startedAppendix 1:Detailed descri
44、ption of IT-supported functionsAppendix 2:Glossary of terms,229,Source:McKinsey,HOW TO LOOK AT IT ARCHITECTURE-OVERVIEW,Situation analysis:Characteristics and pitfalls of current incumbent Telco IT system architecture,Drivers of current situation,Tools for assessing a specific Telco IT system archit
45、ecture,230,Source:McKinsey,FRAMEWORKS TO UNDERSTAND EXISTING IT SYSTEMS,Which applications exist within the Telco?,Issue,Importance of understanding,Frameworks and tools,What kind of support do systems provide?,How dynamic are systems?,What is the technical diversity of systems?,Failure to develop a
46、 comprehensive view of the applications and architecture results in an incorrect focus and limited effectiveness,While technologists often understand the relationship between systems and technology,it is their relationship with the business that determines value and effectiveness,The future viabilit
47、y of systems is often determined by their ability to meet changing business needs.Stable systems ideally are de-coupled from dynamic systems,Costs for operation and maintenance of system platforms often could be significantly reduced by shared technologies,Application inventory,Application mapping,A
48、pplication dy-namics/stability assessment,Technology infrastructure analysis,231,Source:McKinsey,APPLICATION INVENTORY,Applicationportfolio/interfacecomplexity causesinflexibility and highcost of support,Example:Network OSS,Applicationinventory=map showingeach application(representedby a box)and int
49、erfaces to allother applications(re-presented by linesbetween boxes),232,Source:McKinsey,MAPPING OF APPLICATIONS,Shows functional redundanciesDisplays diverging functional cutsIllustrates deficits in application connectivity on a corporate level,Applicationmapping,Functionalmapping,Coreprocessmappin
50、g,Identifies processes with no or weak application supportLooks for instances where multiple systems perform the same task,redun-dancies and unnecessary complexity may existIdentifies“standalone systems”(such systems often do not support re-quired cross-functional information flows),Analysis purpose
