Don’t Fear the Black Swan, Take it as an Opportunity to Soar

By Kevin Peters, President and CEO, NetNumber

When a black swan event, an unexpected occurrence that has a substantial impact on society and business, happens, businesses typically retrench, cut investment, freeze hiring and look to ride out the storm. However, for some businesses this is the wrong strategy. Counter-intuitively investing, restructuring and building for the future can be far more productive, delivering accelerated development and a transformed and rejuvenated business.

The Covid-19 pandemic provided exactly this situation with the whole world hitting pause in early 2020. Many companies assured their survival by furloughing workers, pausing investment in research and development and effectively mothballing their businesses, minimising operating costs while they wait for the business climate to stabilise. However, NetNumber, a provider of signalling control solutions that enable carriers to accelerate implementation of new services across multiple generations of networks, took the opposite approach. We identified the pandemic as an opportunity to accelerate our transformation into a cloud-based business that is better equipped to serve our telecoms operator customers’ future needs.

We made a conscious decision to press the accelerator rather than the brake, to neither hunker down to wait for the future nor to maintain the status quo. Although there was risk, there was an opportunity to take advantage of the downtime while everyone was sequestered in their homes to do forward-looking work. It was logical for us to double down on our transformation journey.

We found ourselves particularly well-positioned to maximise the opportunities.  5G and cloudification are trends circling our industry but nobody knows when they are going to land so we needed to retool to be ready.  We decided to take advantage of the situation to propel ourselves forward. But the bottom line is that if you decide to transform while there is chaos surrounding the business, you still have to keep the business afloat. We therefore shielded the business from the future-facing work until it was necessary for people to engage in it.

That didn’t mean excluding our workers from the transformation. In fact, the opposite happened as our teams rallied round the transformation projects. People want something to attach to in challenging times and this was a challenge our employees could really engage in.

In addition to being in an industry that is changing yet has a clearly set-out transformation journey, we were also well-positioned at the start of the pandemic because we had already started our transformation, bringing in consultancy Blue Rocket to help with both our strategy and implementing the transformation. Blue Rocket had been working with us to identify future strategic options and this head start on the unexpectedly available time the pandemic resulted in proved to be an enormous benefit.

Time to retool and rethink

The leadership team had already identified the need to retool and rethink our offerings for the transforming telecoms market but was keen to gain insights and advice from industry outsiders which is why I selected Blue Rocket to work with. Blue Rocket counts innovative SaaS and IT companies such as Cisco, Google and Salesforce among its customers but it is not a telecoms-focused organisation. This is exactly what I wanted in order that the transformation could be assessed and explored outside the constraints of traditional telecoms.

When you look at our leadership team there’s a lot of telecoms experience and I’m a seasoned telecoms industry veteran so I didn’t need help with understanding traditional telecoms and the trends in the market. I wanted a nimble partner that would be provocative and press us and me in particular. What was unique about Blue Rocket was they did it with us as if it was for their own company.

Our executive team worked closely with Blue Rocket to identify which directions to take and to define how to make the transformation a reality. It was clear there were things that must be done and the pandemic was a good time to make those changes, but it wasn’t a digital decision. We were still going to have to keep the old business and in future pivot to the new. To do that we needed transform the platform, the process and the culture while keeping this tied to how the industry might transform as 5G and greater cloud reliance continues.

A black swan event in executive leadership terms means you have to do something different, it’s an opportunity to change. How a company’s products are built, sold and deployed are all impacted. With the move to cloud in telecoms, it’s an opportunity to change not just software but to accept the new reality and to change your business, and we made a bold commitment.

Blue Rocket was able to map how software-as-a-service (SaaS) companies have moved to cloud and how telecoms is also moving there. It was clear that the industry is not ready to accept 100% cloud solutions yet but greater acceptance of cloud is underway and therefore hybrid cloud solutions are needed. For telecoms operators the mechanism is similar but security and ownership requirements are different because operators work in regulated environments and have a high-availability, high customer service mentality. Telecoms is a different animal so the challenge was to find a way to build software that could be deployed anywhere, including in the cloud.

We took a calculated risk. It’s a bet between the result of doing nothing which could be reduced sales and slowed innovation or the potential reward for doubling down.  We considered all the options but the black swan event was an opportunity to devote resources to transformation and doing nothing was not an option because you can’t survive if you can’t transform engineering and make the business more agile. Because we were already in flight with the transformation, we were lucky in terms of timing setting us up for success. I realized we had both the time and the opportunity to go forward.

One of the challenges for us is that our old mode of operation needs to be in place as we shift to the new. We are very aware that the arrival of 5G, software-oriented networks and increased virtualisation within telecoms are not overnight sensations and it will take years for these dynamics to come through in their entirety. In addition, different operators will move at different paces, moving to new network technologies and looking to take advantage of cloud opportunities when their businesses and customers are ready.

 A lot of vendors don’t want the baggage of the 3G and 4G worlds as they shift to 5G but we’re happy to move at the pace customers want to. We have pulled forward some of the older technologies into the new capabilities we have. 4G customers are going to be around for a while because large investments and deployments by carriers don’t happen overnight.

Outcomes

The prime outcome of this work has been that our new TITAN.IUM framework is more technologically advanced and able to support 5G. It is the cloud native companion to our TITAN product.

A second result has been that we’ve transformed our development approach. We’ve transformed our engineering teams into an Agile shop at what I think is an unheard of rate. And, we’re delivering large packaged software on time and on a consistent basis at a much faster level than we’re used to so it’s a home run on the engineering side of the business. 

We’ve benefited on the sales side, and also benefited by being able to get everyone across the company on board with the transformation because they were involved with it on a day-to-day basis. The efficiency of the organisation is amazing.

I believe the company’s overall transformation has been accelerated thanks to turning a black swan event into an opportunity. The alternative would have been to come out of the pandemic still retooling and still trying to formulate the company’s future state.  Instead, we’ve tried to do things to the benefit of customers by getting people to engage and be productive. It has been a win-win situation and I’m very proud of how NetNumber as a team has responded.

Lessons Shared

During difficult times look for challenging and exciting work to propel you forward because it occupies you, advances you and is better for your customers. Be bold during tumultuous times. I’d like to say I knew this ahead of time but I didn’t, it is something I have learned during this latest black swan event and it has been particularly good to collaborate with Blue Rocket because they engaged full throttle alongside our team. We were both focused on what we’re doing and the outcomes have been highly positive.

To read my expanded white paper, please visit www.netnumber.com. 

About the Author

Kevin Peters joined NetNumber, Inc. as President and Chief Executive Officer on February 1, 2018. He had been a member of the company’s board of directors since June 2016. Peters brings to NetNumber a wealth of leadership experience gained over the course of a 28-year career with AT&T, as well as broad industry and executive advisory experience across the global technology and telecom industries. Peters retired from AT&T in 2014 as the executive vice president of global business customer service, in which he led the company’s multinational customer service operation.