Why Operational Outsourcing Works

By Ami Nissimov, Vice President – Managed Services, ECI Telecom

In today’s financial reality of fighting for every cent, where every company is looking for solutions of how to reduce costs while maintaining its position in the market, it is time to search for better ways to optimize business focus. This is particularly relevant for telecom operators. It is paramount that operators search for its core, its essence that defines what the company is and what it does best. The next step is to make sure that these operators are able to focus on this “best,” through planning and innovation, and most importantly, through outsourcing of secondary activities that could distract them from their core operations. Welcome to “managed services.”

Managed services is a broad concept that can mean a number of different solutions and engagement models, but the ultimate benefit is that it frees operators from the day-to-day responsibility of running operations or business processes by allowing an outside party to manage these. It usually involves entire operational or business processes such as monitoring and resolving network faults or network capacity planning and management. It is a shift of burden, particularly useful when resources are limited. The various models or levels of network outsourcing depend on what it is that needs to be out-tasked. Operators can outsource certain functions such as the implementation, transition and operations of a new service or outsource an entire NOC altogether.

That’s the basic definition of managed services. Now, for some more specifics:

For existing operations, managed services saves costs and increases efficiency because the idea is to utilize the skills, knowledge and resources of network vendors – as such, operators do not need to continue to invest and support in-house operations. Rather, they can rely on their network vendors who have unparalleled understanding and expertise of their own equipment and of managing a network with established support in place. Managed services can also support and enable future business development while the operators share risks with the vendor as well as gain expertise based on agreed-upon service levels. In outsourcing behind-the-scenes network operations, the operators can then focus their resources on the customer side, working on revenue-generation, customer retention and building their business. At the same time, the operators are able to share the risks with vendors in that payment for managed services are based an operator’s service level performance.

The services market has always been attractive. Prior to the economic downturn, focus has been more on the IT industry and less on network outsourcing. But the current financial situation and needs of operators have changed the playing field making managed services an attractive way to do future business. Managed services is structured in a manner that gives operators a long-term dedication of qualified service and cost predictability allowing great potential for further development.

As vice president of managed services, Ami Nissimov leads the development of business strategy of managed services and their deployment within telcos for the ECI Telecom Global Services Division. Nissimov joined ECI in May 2007, bringing more than 20 years of experience in various leading executive roles in managed services, IT management and telecommunications. Prior to ECI, he worked as a senior manager at Amdocs. Previously, he was vice president and at a manufacturer of security products, managing one of SAP Systems' pioneer implementations in Israel. He has a Bachelor of Science degree in industrial and management engineering and a master’s degree in business administration, both from Tel-Aviv University.

Share this article: Email, Slashdot, Digg, Del.icio.us, Yahoo!MyWeb, Windows Live Favorites, Furl
Add this article feed to: RSS, My Yahoo, Newsgator, Bloglines