Copyright Ken Fletcher 2004 Australian Computer Security Pty Ltd. Printed 11-Jun-15 06:43 1 Prepared for: Monash University Subj.: CSE5806 Telecommunications

Copyright Ken Fletcher 2004 Australian Computer Security Pty Ltd.

Printed Apr 18, 2023 20:37

1 Prepared for: Monash University Subj.: CSE5806 Telecommunications Management

CSE5806

Telecommunications ManagementLecturer: Ken Fletcher

Lecture 3

Corporate Strategy

and Telecommunications

2Copyright Ken Fletcher 2004 Australian Computer Security Pty Ltd.Printed Apr 18, 2023 20:37

Prepared for: Monash University Subj.: CSE5806 Telecommunications Management

Reference Sources NOTE:

– These sources are indicative - there are many other good texts available in libraries. They are referenced here as this presentation draws on them extensively

• Hofer and Schendel (Referred to as H&S in these slides)

– Hofer, Charles W. and Schendel, Dan Strategy formulation : analytical concepts St. Paul : West Pub. Co., c1978 234 pages• Monash Matheson Library 658.401 H697S

• Gurugé and Lindgren, – Communications Systems Management Handbook,

Auerbach, 2000– Especially chapters by Beck and James

• Monash Hargrave Library 658.4038 G981C 2000



Telecommunications Manager Roles The Telecommunications Manager has two roles:

• Staff Role - Provide Advice and Guidance to Corporate Mgt• eg Technology: Opportunities, Threats;• Regulatory Situation, Policies; etc

• Line Role - Plans, Organises, Leads and Controls (POLC) all aspects of Corporate Telecommunications Facilities, including:

• Telecommunications Strategic Plan

• Contingency Planning/Business Continuity Planning

• Disaster/Disruption Recovery Planning

• Specification & Selection of facilities, equipment, software

• Installation and Implementation of equipment, systems, networks

• Operations and day to day support of users

• Maintenance and Modification

– Other areas may be included - eg Security



Questions for Later Consideration: Think about these questions as the lecture progresses:

– Does planning the strategic directions for telecommunications in an organisation differ from "normal" strategic planning? If so, how?

– What is the relationship in a (typically) large organisation between the planning and management of:• Telecommunications; and

• Information systems.

– Is telecommunications just part of the infrastructure of a company, or something more? Does it vary between business sectors? and if so how?

– What are the processes in developing a telecommunications strategic plan?


Printed Apr 18, 2023 20:37


Philosophical

Expending energy without goals or objectives in mind is wasting effort

Even with goals and objectives, a strategy is needed to provide focus

and coherence of the effort



Survival of the Fittest From Hofer and Schendel (H&S) Biological analogy:

“Over the long run, only those organisations survive that serve the

needs of their societies effectively and efficiently, that is, that provide

the benefits demanded by societies at prices sufficient to cover the

costs incurred in producing them”

• This concept applies to governments, businesses, organisations,

and to sub-organisations within these.

• Effectiveness or Efficiency? (H&S attribute this to P Drucker)

• ‘Both are needed, but if a choice must be made it is more important to – do the right things (effectiveness) than to– do things right (efficiency)’



Failures with ‘High Efficiency’

(from H&S) Consider also IBM and mainframes IBM through 1970s-1990s

– concentrated on mainframe oriented networks and systems - using PCs

as user interface while others developed towards ‘empowering the end

user’ and moving away from centralised networks

FORD vs GM 1920s - 1930s

– Ford was very efficient by retaining ‘the old way’ of doing business with

very limited range of models & proven engineering - but GM saw that

customers wanted more than Henry Ford’s famous comment of “any

colour you like as long as it is black”

Baldwin Locomotive 1950s

– very efficient USA steam locomotive builder of 1930s and 1940s but did

not change to diesel and diesel-electric technology early enough,

and hence lost the race



Strategic Planning

Determining the ‘right things’ to do (ie effectiveness) requires

Strategic Planning

Strategy as a way of thinking was originally used only in military contexts -

– term “strategy” comes from Greek “Strategos” = General• eg Napoleon’s strategy at Waterloo

Now used more broadly– in sports - eg game strategy, race strategy etc– in entertainment - eg TV strategies to attract viewers– in normal business etc



Strategy in Business Was not studied in business context until recently (after 1940s)

– Before 1940, businesses had unwritten (and ill considered) ‘strategies’• eg to ‘expand’, ‘grow’, ‘make a profit’ were seen as self-evidently

good ideas - but are essentially open-ended aims, not strategies

– Few considered drawing up a strategic plan to achieve these aims within specified time-frames, or within specified constraints

Initially strategy had a narrow focus in business:– founder or ‘driving entrepreneur’ philosophy - eg Henry Ford,

and – product orientated rather than infrastructure oriented

Now ‘strategy’ is a normal part of all aspects of business planning



What Is Corporate Strategy? Wide spread of definitions, with focus ranging from narrow to

broad. Various authors have discussed it as:– Drucker (1954)

• ‘what is’ is our business?

• what should it be?

– Chandler (1962)• the determination of the long-term goals & objectives of an

organization

• the adoption of courses of action

• the allocation of resources necessary to meet goals

– Andrews• the pattern of objectives ... purposes ... goals ... to define the

business the company is in …

– Ansoff -• the common thread of the business



Goals and Objectives (H&S P20-21)

H&S Definitions:– Goals - long run, open ended attributes or ends desired ie

unbounded and untimed statements of aim– Objectives - intermediate term targets towards achieving goals

Objectives should be stated to cover:– the goal or attribute being sought– an index measuring progress toward that goal

• a target or hurdle to be achieved; and– a timeframe in which to achieve the target or hurdle

Strategy is the planned approach to achieve objectives• Good understanding of objectives leads to better strategy• Poor understanding OR poor objectives

always lead to bad strategy



Components of Strategy (P21 to P25 H&S)

H&S page 25 – “Strategy is the fundamental pattern of present and planned

resource deployments and environmental interactions that indicates how the organisation will achieve its objectives.”

Components of Strategy:– scope or domain of the activity in its environment– skills and resources available to undertake the activity

(‘distinctive competencies’)– competitive advantages resulting from the activity– synergy - the degree to which activities above reinforce or

negate one another

• The first three points are ‘effectiveness’ issues, while fourth point is ‘efficiency’ related



Hierarchies of Strategies H&S pages 27 to 29

1.Corporate level - “what business should we be in”– broad and multi-divisional considerations– ‘scope’ or ‘domain’ components are main concerns

2.Business level - “how to compete in this marketplace”– business oriented - both production and marketing sides– distinctive competencies (skills and resources) and competitive

advantages are the main emphasis in these

3.Functional Area – Synergy (working together) and development of competencies

are the main concerns at this level– e.g. a Telecommunications Unit functions



Matrix for Comparing Businesses H&S P31 Boston Consulting Group (BCG)

developed this matrix in 1970s Example shows comparison of 12

products or business.• Axes show business growth

rate vs relative market share. • Diameter of circles indicate

relative size of or business “Stars” (upper left quadrant)

high growth and good market share “Cash Cows” (lower left)

well entrenched in market with reasonable growth

“Dogs” (lower right)poor growth and poor market share



Comments on BCG Matrix Note logarithmic scale on horizontal axis

• this better reflects reality than a linear scale - ie increase in sales by $1M pa is minor to a large organisation, but major to a smaller one

As shown, this example is at a Business level• however similar examples can be drawn at ‘functional

levels’ Model is too simplistic

• H&S Page 32 to 34 discuss conceptually similar models with more parameters

A similar approach is useful to assist in determining strategic directions for telecommunications networks



Product or Infrastructure? Is ‘Telecommunications’ a product for your

organisation? – Currently - it is for Telstra, Optus, Vodaphone, Orange etc– Future - and many more

• BUT -– even Telcos need infrastructure networks to support operations,

marketing, financial activities (bills etc) and management

Is your organisation’s network only an infrastructure service?• Can today's infrastructure be tomorrow's products?

– Consider UE (an electricity distributor) - UE Telecomms– Consider AAP (news wire service) - AAPT

• Telecommunications in both started as infrastructure networks supporting their primary products/services



Communications Issues (1)

Visibility - The communications infrastructure can be: – ‘backroom’, keeping the company's processes running

• eg corporate voice or data networks, process control networks

– ‘just another resource’ - visible to customer, but of low impact • eg routine telephones, faxes, data services, or

– the company’s ‘front desk’ (highly visible to customer)• Used to be the Telephonist and ‘easy to remember’ phone numbers

• Now - Domain names, Web pages, customer support call centre etc

Facilitator, It can be used for enabling activities that– could not be done before, or

– could only be done imperfectly

– eg EDI, EFT, B2BCustomer self-service (request brochures, orders,

bills, etc.)



Communications Issues (2) Network physical, logical and management structure can be

– centralized (all power rests in the centre) “Centrally oriented”– distributed (power is shared around the sites)

(can have severe coordination problems)– localized (each site does its own thing) (can lead to anarchy)

Limited planning/operational horizon (max. 5 years)– Technological changes and telecommunications needs are

changing too rapidly to permit longer view

Enables corporate productivity gains:– fewer people– fewer levels in the hierarchy - flatter management structures



Strategic Communications Planning Changing approach of management focus:

• was primarily load-based - eg• how much load or traffic to be carried?• how many lines?• what bandwidth is required?

– ie was focussed on technology and cost

• now focussed more on:• telecommunications products and services available

(existing, future)• users and their needs (in-house, customers)• services and products that can be offered• user support, customer self-serve etc• What telecommunications deals are being offered, and where

– ie now focuses on functionality, possibilities for its use, and on seeking best deal for purchased services

The key aspect is the future requirements or needs


Printed Apr 18, 2023 20:37


Telecommunications Strategic Issues

The Telecommunications strategic planning function needs to understand:

• Mission of the organisation

• External influences

• Technology

• Internal influences



Mission of the Organisation The Telecommunications network(s) must be subordinate to

the overall corporate mission But do we know what these are?

Issues:• Is there a corporate mission statement?• Are there corporate objectives and strategies?• What can be done if there are no corporate level goals,

objectives and strategies?• What if the corporate goals/objectives/strategies make

unrealistic demands on telecommunications?• Is a Telecommunications Unit mission statement

(separate from the organisation mission statement) required?



External Influences An understanding the external influences is necessary, including

– Business cycle (recession, expansion, inflation, ...)• Which stage are we in now, and when is going to change

– Competitors • if a service or content provider, need to consider competitors work

• If telecommunications is only an infrastructure for your organisation, you need to consider how your competitors are positioning themselves for the future in terms of telecommunications

– Regulatory environment & trends

– Technology available in marketplace

– Support levels available

– Financial modeling and sources• Availability of external finance (if needed)

–



Broad Financial Models EG

• Funded centrally (off-the-top) vs paid by usage

• Out-sourced vs in-house operation

• Minimal private network (VPNs, etc.) vs full private

network Issues:

– establishment and operational costs– management complexity– exposure to risk– potential new products– synergy



Technology Issues What technology issues are important?

• Existing Networks– Architectures

• existing networks and existing equipments - eg can these be upgraded?

– Design issues• link and equipment load utilisations - ie above / below 50% loaded?

• bottlenecks in the networks - where, how severe, can be alleviated?

• design parameters - lifetime, reliability, repair / replace philosophy

• Marketplace– What is available– How stable and mature– Cost and performance – Maintenance and support



Internal influences

Understanding the internal influences, including • What is required of the network • Strategy for change• Knowing the finances available

– dollar value– when and how

• (eg initial buy, or rent now and buy later, or lease and return)

– cash flow issues

• Operational interface• Production resources available

– staff - numbers, skill levels, trainable or not– installed base - buildings, cabling, equipment, contracts– technologies in use (or technologies known and understood)


Printed Apr 18, 2023 20:37


Developing the Technical Network Strategy

A technical strategy study is required to guide the technical designimplementation and

support

of the organisation’s network(s)



Outcomes The outcomes are (at a broad level):

• directions• policies• techniques• budgets• implementation timetables

which guide the Telecommunications Manager in the ‘line management’ aspects of the job - ie the management of the Telecommunication Unit



Network Technical Strategy The key point is to recognise and obtain acceptance

• that it is providing infrastructure for the whole organisation, but

• is not the Infrastructure Plan for the organisation

WHY?• Because the network should support the organisation,

not direct and control it. Having the infrastructure network technical strategy as the Infrastructure Plan for an organisation is like putting the cart before the horse.

If the network is a “Product”, then things are different



Infrastructure Strategy Studies Scope Include all forms of communications in study

– Voice, data, Internet, fax, telemetry, video, fire & security alarms– Don’t forget needs of ‘roaming’ or mobile users for data– ‘Scope’ may also cover non-electronic communications -

eg ‘hard-copy’ communications, including • couriers, mail, etc

• advertising brochures (consider having them on web pages, or requested via (IVR)

In order to:– gain understanding of trends and intentions– look for possible rationalisation– avoid simply automating yesterday’s approach and technology,– ensure that future changes are allowed for, and– to ensure that current (and future) technology is used to best

advantage



Strategy Study in Six Stages

Stage 1 Analysis of EXISTING Networks

Stage 2 Identify FUTURE Requirements and Constraints

Stage 3 Definition and Evaluation of Options

Stage 4 Strategy Consolidation

Stage 5 Report to Management

Stage 6 Recording the Concept for Later Detailed Design



Stage 1 Analyse EXISTING Networks Traffic Loads and Capacity Reliability and functionality Residual working life of

– current systems, – facilities (buildings and power supplies etc), – communications and support equipment

Consider existing contracts for – systems, – equipment, – facilities, – provision of services such as telecommunications services, – facilities management, etc



Stage 2 FUTURE Req’ts & Constraints

Identify Future Network and Facility Requirements– Architectural Broad Brush Estimates– Don’t worry about How, concentrate on WHAT is required

Traffic Loads and Characteristics

Functions and capabilities needed (not only ‘wanted’)

Available buildings and environmental supporteg is the company vacating suitable buildings somewhere?



Stage 3 Consider Options Define and Evaluate Options and alternative solutions

– This is where you consider the questions:• ‘HOW to do it’ and

• ‘HOW MUCH would it cost if done this way’

A major creative effort– Can use brainstorming, think tanks, seminars, etc.– Essentially draws from:

• existing installed base

• information about current & emerging technology and techniques

• bright ideas

• future requirements

– to produce a short list of options (combination of evolution and revolution)



Stage 3a Evaluation of Options tests to be applied:

• flexibility under change, particularly– increased load– new traffic types

• cost effectiveness (use DCF techniques)• resilience (failure of components, industrial action)• future safe (ISDN, satellites, mobiles, etc.• integration of voice, data, video• security• management ease

– expansion– monitoring– record keeping– diagnosis of problems (maintainability)



Stage 3b Trade Studies Capture evaluation of alternatives in ‘Trade Studies’

– A ‘Trade Study’ compares costs, benefits, risks, timescales and other factors of several alternatives• eg Is it better to use a cheap, slow network, or

a faster but more expensive one?

• Often a simple spreadsheet is used– Eg comparison of coffee mugs

– Which is best?

Option 1-Thin Plastic Option 2 - Ceramic mugs Option 3 Metal beakersRequirement Weighting % meets Score % meets Score % meets Score

holds hot coffee 5 100 500 100 500 100 500Insulated 2 10 20 50 100 0 0Has handle 2 0 0 100 200 0 0

Totals: 520 800 500



Stage 3c Special Issues In many organisations there are some special issues which must be

addressed in a planning study:• special manufacturers and / or vendors

• eg If your organisation has a subsidiary that manufactures communications equipment, then you will probably have to use their products

• a pre-existing problem that is assuming high importance• often a carry over from earlier era –

– eg demands for redundant equipment and power supplies (backup generators)

• management and owner prejudices• must or must not use certain equipment / services etc

• technologies eg• wireless LANs and mobile phones are not permitted in many areas

– near explosives

– in highly secure environments

– in hospitals



Stage 4a Strategy Consolidation Consolidate the viable options identified in Trade Studies

into two or three alternate architectural designs– I usually present options as follows:

• Option 0 – Do Nothing– What will happen if nothing is done

• Option 1 – Do minimal changes– Minimum changes to continue operations as indicated– No real preparation for future evolution

• Option 2 etc– Progressively more changes with each option– Option 2 is basically an evolution from the present– Options beyond 2 are progressively more advanced (and risky)

• Option n – Revolutionary extensive changes– Probably too ‘state of the art’ for safety and comfort



Stage 4b Prepare Study Report

– Describe project background and rationale

– Briefly describe each major architectural option• Include Costs & Resources (dollars), people, buildings

• Schedule (Time Table)– Milestones and Proposed payment schedule if applicable

• Risks, and their mitigation

• Benefits of that option - absolute benefits, and in comparison to alternate architectures

– Issues which are independent of the architecture (eg colour of paint on boxes, constraints on locations or vendors)• Identify these issues separately for resolution



Stage 5 Report to Management

Present the highlights of the written report to higher management and answer their questions

Why do we do this?• Remember the Golden Rule

Follow up and respond to their directions and guidance

“The one who has the gold makes the rules”



Stage 6 Recording Concept for Later Document the concept or architecture for posterity

• If a particular style or option has been selected then write a System Specification

• This is a formalised description of the system

• Use precise and quantitative language eg– "The coffee cup shall hold 250cc of liquid when the liquid level is

1cm below the top the rim." is precise and testable, while

– "The coffee cup is to be of normal size" is vague and imprecise, and can not be tested. Whether the product meets the specification is a matter of personal opinion - thus leading to arguments.



Written Requirements A project without stated requirements can never be

considered to be wrong - but it will be a failure

Unwritten (and un-agreed) requirements inevitably lead to mis-matched expectations between stakeholders. Verbal statements and assumptions lead to mis-understandings

Interpretations/understandings of statements of requirements are renown for variations - even in co-operative environments.

Common sense is rare, and is dependent on each person’s own personal history

DO NOT RELY ON ‘COMMON SENSE’



What’s next?

An Action Plan is needed.• This should contain (or cover development of) the

following for the Telecommunications Unit– mission statement

– goals, objectives & strategies, aligned with corporate strategies and expenditurenote that this requires statements of future needs

– implementation plans - who is to do what, when, and under what budget

• The action plan needs to be agreed with peers and higher management



Points for Discussion (if time permits)

These questions were raised in the first few slides:– Does planning the strategic directions for telecommunications in

an organisation differ from "normal" strategic planning? If so, how?

– What is the relationship in a (typically) large organisation between the planning and management of:• Telecommunications; and

• Information systems.

– Is telecommunications just part of the infrastructure of a company, or something more? Does it vary between business sectors? and if so how?

– What are the processes in developing a telecommunications strategic plan?

Documents

Copyright Ken Fletcher 2004 Australian Computer Security Pty Ltd. Printed 11-Jun-15 06:43 1 Prepared for: Monash University Subj.: CSE5806 Telecommunications