When people ask me: “What’s the best thing about the AI hype?” Sometimes I joke and say that it means I don’t have to talk about Digital Transformation anymore…unfortunately the truth is rather the opposite.
Communication Service Providers and Infrastructure players that have embraced Digital Transformation are now reaping the benefits of AI, but what exactly is Digital Transformation, and how has it paved the way for AI? Let’s dive in.
The Digital Transformation Journey
Digital transformation is all about integrating digital technology into all areas of a business, fundamentally changing how you operate and deliver value to customers. It’s not just about adopting new technologies; it’s about a cultural shift that requires organizations to continually challenge the status quo, experiment, and get comfortable with failure.
Think about it: CSPs that have successfully undergone digital transformation have streamlined their operations, improved customer experiences, and gained valuable insights from data. This transformation has laid the groundwork for AI to thrive, because AI needs data, lots of it, preferably structured.
The COVID-19 pandemic has undeniably accelerated the pace of digital transformation for CSPs. As organizations scrambled to adapt to new ways of working and serving customers, the need for robust digital infrastructure became more apparent than ever. Telecommunications companies, in particular, have seen a surge in demand for digital services, as remote work, e-learning, and online communication have become the norm. This surge has further highlighted the importance of digital agility and the ability to leverage AI to meet changing customer needs quickly and efficiently. The pandemic has not only pushed CSPs to accelerate their digital transformation journey but also to innovate at a faster pace, ensuring they remain competitive in a rapidly evolving digital landscape.
The AI and data dilemma
AI is transforming industries across the board. From predictive analytics to chatbots, AI is helping businesses make smarter decisions, automate processes, and provide personalized experiences to customers.
But here’s the catch: AI relies heavily on data. And not just any data, but clean, well-organized, and accessible data. This is where digital transformation comes into play. CSPs that have invested in digital transformation have the infrastructure in place to collect, store, and analyze data effectively. This data is the fuel that powers AI.
The Consequences of Falling Behind
Now, let’s talk about the flip side. What happens to CSPs that haven’t embraced digital transformation? Well, they’re at a significant disadvantage in the AI race. Without a solid digital foundation, these companies struggle to harness the power of AI. Their data is often siloed, outdated, or simply unusable. How many of us are still stuck with multiple billing systems and multiple customer care and order management systems for each LoB (line of business), all of them in silos without any intelligence drawn across them?
Imagine trying to build a high-tech skyscraper on a shaky foundation. It’s not going to work, right? The same goes for AI. Without digital transformation, companies lack the necessary infrastructure to support AI initiatives. This means they miss out on the efficiency gains, cost savings, and competitive edge that AI offers. This is the most common reason enterprises fail in their AI adoption. According to Gartner, more than 80% of enterprises are struggling with lack of quality of data quantity or quality.
Real-World Examples
Companies like Amazon and Netflix have successfully undergone digital transformation and are now leveraging AI to enhance their services. Amazon uses AI for everything from personalized recommendations to optimizing its supply chain. Netflix uses AI to analyze viewer preferences and recommend content that keeps users hooked.
On the other hand, companies that have been slow to adopt digital transformation are struggling. Traditional retailers, for example, have faced significant challenges in competing with e-commerce giants. Without the ability to leverage AI for personalized marketing and inventory management, they’re losing ground.
What role can IFS play?
With its flagship product IFS Cloud, IFS offers a single platform with a consistent data layer, enabling all data to be clean, well-organized, and accessible. IFS also applies “Industrial AI”, which means that AI is embedded into the applications where and when it makes sense. This also means that the AI evolves with the product and the AI governance needed is embedded. This is a superior way to use AI to accelerate your business because AI is applied in a way that makes sense to you as CSP and that clearly benefit your operations. You can say that IFS do not only help you with the AI but also the digital transformation journey. All in a symbiotic way.
The Path Forward
So, what’s the takeaway here? If your company hasn’t started its digital transformation journey, now is the time. Embrace change, invest in technology, and build a culture that values innovation. By doing so, you’ll be well-positioned to take advantage of AI and stay ahead in the competitive landscape. Don’t go the other way around and start with AI only to realize that your data foundation is too weak, so the AI investment ends up being costly and not gaining the efficiencies you hoped for.
Remember, digital transformation is not a one-time project; it’s an ongoing process. Stay curious, keep experimenting, and don’t be afraid to fail. The future belongs to those who are willing to adapt and evolve.
SOURCE: Markus Persson. (2024, Sep 2). HOW DIGITAL TRANSFORMATION HAS PAVED THE WAY FOR AI IN TELECOMMUNICATIONS. IFS Blog. https://blog.ifs.com/2024/09/how-digital-transformation-has-paved-the-way-for-ai-in-telecommunications/
