NSN Technology Management Concepts Ossi Pöllänen

Table of Contents Strategy Concept Technology Management Foundations of strategy concept Elements of strategy concept Where is NSN Ecosystem Vision Trends Opportunities Drivers NSN Vision Technology Management Generic Areas for Technology Management Questions Technology Strategy Should Answer Description of the Working Environment for Technology Management in NSN NSN Technology Hierarchy Generic Technology Management Framework for NSN Learnings

Foundations of Strategy Concept Weakness of the company Strength of the company Possible restrictions for strategy implementation Starting point of strategy work Opportunity offered by the environment Possible crisis elements Possible restrictions for strategy implementation Threat caused by the environment In simplest strategy is organization’s approach to adjust with the changes in environment – proactively or reactively Source: Arto Lahti: Yrityksen kilpailustrategia, Ekonomia sarja 85, 1981 (in Finnish)

Elements of Strategy Concept Number of Elements in Strategic Planning Era for Organizational Structure Networking era Kotter: Leading Change Norton, Kaplan: Strategic Maps Porter: Competitive Advantage Network Analysis Structure System Culture Strategic Maps Adjustment era Core Competences Resource Strategies Competence Management Business Intelligence Competitor Intelligence Venturing Minzberg, Quinn: Strategy cannot be planned formally Generic Strategies Scenario Planning Portfolio Analysis Competitor Analysis Industry Analysis Strategy is young subject for academic research – there are multiple schools – there are many unproven hypothesis – 100% right answer for success does not exist – many ways to implement Planning era H. Igor Ansoff: Formal Strategic Planning 1960 1970 1980 1990 2000 2010

Where is NSN?

Basic ecosystem description for telecommunications Other Ecosystem Stakeholders: Regulators Investors Sub- contractors New entrants e.g. Google Sub- contractors xSP Terminal vendors Sub- contractors SI & ISV Subscribers Consumers Users SOHO SME Large MNC NSN Solution provider HW SW Service Operators Mobile, Hybrid, Fixed, MVNO Sub- contractors Network Operator function Service Operator function Sub- contractors Content owner Content provider Content aggregator

Applications pre-dominantly in Internet Our market vision of 2015 Applications pre-dominantly in Internet Applications pre-dominantly in Internet 5 Billion people connected Multitude of business models Broadband Everywhere

Trends: new player – new business models Disruptive business models Internet Business Models enter the Telco market Application Service Provider New players create very fast huge communities offering cool services for free (Skype, YouTube) w/ relatively little investment. Different revenue models based on advertising, subscription, and transaction They expand scope and reach (mobile services) Application services Internet Service Provider Virtual Network Operator fixed mobile Cable Operator Telco’s looking for new business Hybrid Network Operator Fixed Network Operator Expand scope & reach: MNOs enter the fixed market and vice versa Offer application services Establish new business models (triple/quad play) Mobile Network Operator Network & Connection Services Established business models

Trends: My Services Anywhere Service Mobility Service is available from different places over various fixed and mobile networks Flexible Business Models Delicery of service can vary from via own fixed and mobile access networks, partner’s access networks, intranet/Internet, own services, business partner services, subscriber services, or services from unknown parties over the internet Terminal Mobility Any device connecting easily to various access networks and moving between (rooming) User Mobility The same services available via various devices such as PC clients, mobile devices, phones…

Upcoming Device Classes Trends: devices End user wants the my-service-anywhere experience New intelligent & powerful device classes already start to support this goal Fixed Mobile Convergence driven by disruptive wireless access technologies DATA CENTRIC Voice/Data Convergence and CTI by leveraging Internet as Platform Voice/Data Convergence with multimode broadband mobile access Upcoming Device Classes VOICE CENTRIC Fixed Mobile Convergence driven by operators service offering innovations low high mobility requirements

Upcoming Device Classes Converged Devices PCs TVs Mobile PDAs DATA Upcoming Device Classes End user wants the my-service-anywhere experience New intelligent & powerful device classes already start to support this goal FIXED MOBILE Fixed Phones Mobile Phones VOICE

Two opportunities emerging to operators Applications Digital Distribution & services Internet is the key source of service and business model innovations Fierce competition 3rd party revenue models Premium content and communities have value Connectivity with a few key applications More and more connections and network capacity needed Anywhere, anytime connectivity Capital intensive, high entry barrier Connection fee based business model

Network Transformation Fixed Core Fixed Access Aggregation IP Core Transport Mobile CS Core Mobile Access Mobile PS Core Fixed Network Data Network Mobile Network Converged Network Operation and Business Support Systems Multi-Access IP Networking, Transport and Aggregation Service Core and Applications

Network Architecture Vision Operation and Business Support Systems Service Core and Applications Network Architecture Vision IP Networking, Transport and Aggregation Multi-Access

Technology Management

Generic Focus Areas for Technology Management NSN MAIN PROCESSES Product Creation Product Delivery Customer Engagement Management & Support Technology Strategy is the cornerstone of technology management Management of technologies Identification of technologies Selection of technologies Acquisition of technologies Exploitation of technologies Protection of technologies Activities Technology strategy Technology Forecasts IPR, patents, standardization Technology Intelligence Collaboration strategy Innovation R&D strategy Etc. etc.

Questions Technology Strategy Should Answer Six key Dimensions: Which distinctive technological competences and capabilities are necessary to establish and maintain competitive advantage? Which Technology position we have and which one we want to achieve – leadership, followership? Which future scenarios are possible in case of uncertain long term developments ? Which technologies should be used to implement product and service concepts and how should these technologies be embodied in products or services? What should be the level and timing of investment in technology development? Should technologies be sourced internally or externally? Should the technology be public, NSN proprietary or Stakeholder proprietary? Are there strategic partners visible in the technology environmental ? When, how and where should new technology be introduced to the market? Which market countries will be covered by the technology (trade restrictions, patent protection) Is it necessary to support the technology by official lobbying work How should technology and innovation be organized and managed? Source: Burgelman, Strategic Management of Technology and Innovation

Description of the Working Environment for Technology Management in NSN Technology Vision and Strategy is formulated in two different hierarchies NSN Strategy Hierarchy NSN Technology Hierarchy Corporate Business Unit Operational

NSN Technology Hierarchy Simplified Technology Hierarchy of NSN Technology Level Technological Substance Level 5 Service enablers to end users Service Technologies Level 4 Network functionalities End-to-End solutions Lead services Solution Technologies Level 3 Product Portfolio of Business Units Product Technologies Level 2 Product / Tech. Pltf. of BUs Platform Technologies Architectures Interfaces Level 1 Implementation technologies Implementation technologies HW SW

Consolidation of NSN Technology Strategy Implementation Technologies Platform Technologies Product Technologies Solution Technologies Service Technologies Level 1 Level 2 Level 3 Level 4 Level 5 Technology Strategy Positioning – Where are We? Forces – What are the forces in our environment? Organizational Dynamics – Who are We? Technology Roadmaps – How do we Answer to six questions - How Do We Create Value? Consolidation of NSN Technology Strategy covers the whole value chain including analysis on positioning, forces, organizational dynamics and technology roadmaps with the weight necessary to realize the NSN vision and Network Vision.

General Framework for Technology Management in NSN

A Strategy Map Represents How the Organization Creates Value with Intangible Assets Long term shareholder value Financial Perspective Productivity strategy Revenue Growth Strategy Improve cost structure Increase asset utilization Expand revenue opportunities Enhance customer value Customer Perspective Product / Service Attributes Customer Value Proposition Relationship Image Price Quality Availability Selection Functionality Service Partnership Brand Operations management: Produce and deliver products and services Supply Production Distribution Risk management Customer management: Enhance customer value Selection of customers Acquisition Retention Growth Innovation processes: Create new products and services Opportunity identification R&D portfolio Design / development Market launch Regulatory and Social: Improve communities and the environment Environment Health and safety Employment Community Internal Process Perspective Human capital Learning And Growth Perspective Information Capital Organizational Capital Culture Leadership Alignment Teamwork Source: Kaplan, R., Norton, D., Strategy Maps

Learnings Strategy Concept NSN Position Technology Management Simple topic – complex implementation – multitude of schools NSN Position In middle of changes with a strong vision Technology Management Key tool is technology strategy Coverage area vast: innovation, environmental scanning, IPR, R&D, intelligence, collaboration Understanding value networks helps Good ol’ Porter helps, nothing beats position and competitive advantage except superior execution ;) Consolidation of technology strategy Map position, forces, organizational dynamics and technology roadmaps to understand the dynamics of change Focus on the essential, value points. Create scenarios, analyze risks, plan Create a vision, Innovate, roadmap, execute, measure, control, correct Strategic mapping can help but complexity of the map can be a show stopper Simple is beautiful Best mission is a statement that everybody understands ‘Coke adds life’ ‘Connecting People’ ‘Failure is not an option’ ‘Shrink the radios’ ‘5 billion people connected’