Operational efficiency for an Asian telecom operator

For most telecommunications operators, operational efficiency — through sustainable process improvements — is no longer simply a mantra. In many markets, it is an essential way of doing business and if implemented properly a true source of competitive advantage.

A large Asian operator agreed to the principles of both lean manufacturing (developed by Japanese to reduce waste, improve timeliness, and cut costs) and six sigma (pioneered by Motorola to reduce process variation through the smart use of statistical tools). The company wanted to build on these principles to develop and embed a process improvement methodology.

Challenge
Lean and six sigma are proven management philosophies for generating tangible results in production/industrial businesses. However, their application is more challenging in services industries, such as telecommunications.

The Asian operator engaged A.T. Kearney for support in developing a methodology tailored to the company, including a test of their methodology on two product lines, and training for top management and practitioners. The challenge of culture change in the organization was critical, especially getting the top management team to "walk the talk."

Approach
A.T. Kearney worked with a core team of the Asian operator on a day-to-day basis. They established three main workstreams:

• Methodology development – leveraging A.T. Kearney’s existing process improvement methodologies (including lean and six sigma) to prepare a customized approach, using the company’s own internal business language to facilitate its adoption
• Application for immediate results – applying the methodology for two product lines (DSL and leased-line) to the entire value chain (marketing, sales, order processing, provisioning, billing/collection, operation/maintenance, servicing, and termination), including steps to baseline existing processes, develop breakthrough hypotheses for improvement, collect relevant data, analyze for root causes, generate improvement opportunities, and implement the solutions with line management
• Training and culture change – developing and running a series of differentiated training programs ("Bootcamps" for practitioners and Executive Workshops for top management), initially led by A.T. Kearney to train-the-trainers and then by company core-team members, and conducting culture change diagnostics to understand the organization’s barriers to adopting the methodology

Results
The initiative was very successful, due mainly to the strong working relationship between the company and A.T. Kearney team members, CEO-level endorsement, and broad alignment across all areas of the business.

In particular, the operational efficiency initiative has resulted in the following key improvements:

• Improved customer experience through demonstrated reduction in lead times for activating and servicing customers
• Increased efficiency of short-term processes with the redesign eliminating tens of thousands of hours of non-value-added work
• More than $10 million in productivity improvements from longer-term initiatives through radical process redesign

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