Interview Operators are building their technological competitiveness and building their talent teams

Guest of this issue:

We Xiaojun said:

As the main force in "building a network power, a digital China, and a smart society", the three major operators have continued to increase their investment in scientific and technological innovation in recent years. In particular, the competition for opportunities in the field of industrial digitalization has a strong gunpowder flavor of various "arms races". From the development investment of large models, to the construction of industry product solution capabilities, to the expansion of the R&D team. Taking telecommunications as an example, the number of R&D personnel in the first half of '23 increased by 21% compared with the end of last year.

1.In the midst of great changes, how to understand the technological competitiveness that operators need to build?

2.How to understand the role and focus of organizations at all levels in the operator system in new capacity building?

3.For managers, how to improve the "technology" capabilities of various teams?

*To answer this question, we first need to discuss how operators' niche selection and value creation will change under the influence of new technologies.

In fact, technological evolution has always promoted industrial evolution, business model innovation, and changes in ecological relationships.

With the advent of the Internet era, the information and communication industry has undergone a reshuffle, giving birth to giants such as BAT, Google, and Amazon. These Internet companies, which currently represent advanced productivity, are also facing the impact of new technologies, and are actively reconstructing their own technology products and business models with large models to maintain their status.

What operators have to face is not "refactoring". Operators in the Internet era have not been able to fully move to the front end, and there is a lack of position. Although you can see that we also provide services in the field of government and enterprise informatization, it is more of an extension of traditional resource-based business. There is still a certain gap between it and Internet enterprises and software R&D enterprises in terms of advanced technology, industry professionalism and efficiency. Therefore, operators are faced with leapfrogging, redesigning, and rediscovering their niche in the new era.

There is still a lot of uncertainty about the future ecosystem, which gives market participants an opportunity to re-compete for a new paradigm. The conditions for the formation of this new paradigm, the new value appeal and the business model are not clear enough. But there are a few conclusions that I think are clear and certain.

First of all, the hierarchical structure of the future model system is consensus. At the bottom is the general large model, above which there will be industry models, and then up are more customized enterprise proprietary models or vertical models, and at the top are rich scenario-based model applications.

Under this hierarchical structure, enterprises must first establish their own positioning in the hierarchical structure. For example, iFLYTEK has clearly positioned itself in the industry model, and Ali has built its own competitive advantage on the general underlying model. I believe that operators do not have a significant advantage in the development and training of the general large model layer, and when deciding whether to enter the industry model of thousands of industries, they also need to make an active strategic focus, rather than being the survival of the fittest in the competition.

In order to establish an advantage in the industry model, several conditions are required:

1.There is a deep accumulation of industry data;

2.There are computing resources;

3.Ability to train models;

4.It can form a competitive ecological service system in the industry.

Compared with industry giants or information service companies that have been deeply involved in the industry for a long time, operators do not have the know-how of the industry and do not master the data, so it is difficult to gain any value from repeatedly investing in platform research and development and product application development.

The industries that are expected to form advantages are the first and people's livelihood fields. These areas have strong policy orientation, low business openness, and high requirements for data security and high service qualificationsThe operator has maintained a deep relationship of cooperation and trust with ** for a long timeMoreover, the operator's localized investment and operation service capabilities are also very suitable for the regional operation characteristicsFinally, serving government affairs and people's livelihood itself is also the mission of the operator's central enterprises. All these factors have created favorable conditions for operators to enter the field of industry models related to government affairs and people's livelihood.

Innovation at the application layer is obviously not something operators are good at, but operators still need to find ways to form some key applications and lay out their own application ecosystems. Why?Because the new infrastructure of the future is not because you have a license and a good layout, someone will naturally use it, but it will be driven by top-level applications.

Ali has driven Alibaba Cloud because of DingTalk. Because Microsoft has office and operating system, it has driven the Microsoft cloud. It is the customer who wants to use your soft service capabilities to solve his scenario problems, which brings with it the demand for new infrastructure such as models, ancillary resources, and hardware provided by you.

Although the infrastructure layer is the operator's natural positioning, it is also the most advantageous capability. But since the beginning of the Internet era, "new operators" have emerged. Large manufacturers have not only replaced the communication services of traditional operators, but also built their own infrastructure with large scale and advanced technology, and served all kinds of enterprises and individuals on their platforms. Even some ** are building their own data centers.

What this tells usOne of them is:If the new infrastructure of operators wants to form a relatively strong competitiveness, then it is impossible to extend to the service capability. We must be closer to the customer in the industry where we have advantages, to understand the customer, and to deeply understand the customer scenario, rather than simply passing the project order. In order to form competitive key applications in the fields of government affairs, industrial parks, and social governance, based on the understanding of customer scenario needs, and then give full play to the advantages of ecological integration, explore a model that uses scenario-based services to drive the expansion of new infrastructure resources, and bring cloud, security, and intelligence, which is the strategic direction of operators.

In the past, operators were taking a "horse race" approach in the development of production and data services, and entered many industries and levels. But in fact, "what not to do" is also an important strategic issue, and to some extent, "giving" is more important than "taking". In areas that cannot be applied and uncompetitive, both the investment in industry models and infrastructure investment in the future need to be rationally evaluated according to the needs of ecological cooperation.

The second revelation is that:The new generation of infrastructure will inevitably have a situation of "co-construction and sharing". Operators must consider how this co-construction and sharing model can be realized and how to form a sustainable business design.

The third revelation is that:When operators have chosen their own track and value proposition, how can they cooperate with some general large models, or achieve competition and cooperation, how to cooperate with other industry models, and how to cooperate with developers and super individuals at the application layer, it is necessary to form their own ecological strategy. This determines which aspects of future operators will rely on us to achieve their own investment in scientific and technological capabilities, and which will complement each other with ecological partners through "borrowing".

This will force operators to open up their relatively closed operation systems, and work with partners to complete the closed loop of value creation through ecological strategies, moving towards a new model of open operation. Just like Apple designed the Apple Store, and recently Open AI also released the GPT Store. Whether it is in the form of a store or an open source, operators need to design an orderly system and convenient and advanced tools and components to unite the developer team, access the thriving ecosystem, promote everyone to jointly complete value creation, and let users use various applications with confidence.

To sum up,Operators in the intelligent era have three roles and tasks:

1.How to become an excellent operator of industry models and data;

2.How to be a co-builder and sharer of a new generation of infrastructure;

3.How to do a good job as a node of ecological cohesion and an enabling platform in the industry field with its own core advantages.

Discuss the strategic layout of operators, and it will be clearer in which aspects of technological competitiveness will play a role. It is inevitable to arm themselves with technological capabilities, but operators will not do upstream technology R&D and high-tech manufacturing like HuaweiI will not blindly do a general model or enter the industry field that lacks my own accumulation to build an industry model;When we enter an industry at the application level, it must be based on strategic trade-offs, not opportunitiesIt must be through an ecological model rather than a closed system;You must be able to form a linkage effect with your own model capabilities and infrastructure service capabilities, rather than transforming yourself into a software R&D enterprise or a project company.

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How do you understand the role that telecom units at all levels should play in the process of building technological competitiveness and serving market customers?How is the focus of their capacity-building different?

I would like to divide this into two battlefields.

A battlefield is the second curve of the operator, that is, the information integration service;The other is AI models and data operation services for the future intelligent cloud-network era, which is the third curve for operators.

Focus on capabilities in integrated services

Integration services are the main opportunity right now. The dilemma is that because we don't know enough about the industry and lack of ability, we often do some low-value projects in the way of single orders and integration. Low interest rates, long cycles, and high risks have brought instability to operations, and even the profits of the first curve have to be used to fill the deficit, and the situation of capacity hollowing out has not improved.

Therefore, we try to do some self-development of software platforms by increasing the way of self-delivery. However, in my opinion, these products are relatively few of them at a high level, and they have done good things for themselves, but they have not brought new value creation to the industry and customers. Because of the lack of core competitiveness, the speed of industry breakthroughs is not fast. And we are eager to expand rapidly in a staking way, and disperse resources into various industries, which is even less likely to make waves.

Therefore, in the integration service, professional companies with R&D capabilities need to focus on building product competitiveness in our strategic track. At the same time, the product solutions of professional companies should be expanded nationwide through our prefecture and city system. Therefore, it is necessary to consider how to reduce the decision-making cost of customers and how to reduce the complexity of front-end delivery and deployment in the customization and complexity of government and enterprise customer needs. In some complex integration projects, how to open up the multi-vendor and multi-platform operation system to help customers and the front line solve the problems of efficient operation in the future. Only by empowering the front line can we achieve a rapid opening of the situation.

For municipal companies, it is particularly necessary to build the ability to provide localized services. One of the reasons for this localized service is to accurately understand customer needs and complete the light customization of scenario solutions. The second is to build the ability of project delivery - this delivery includes project management, including multi-system integration, including localized deployment and configuration of software platform products, and small iterative development.

Delivery is the best scenario to establish deep trust with local customers, an opportunity to further explore customer needs, a scenario to form a good synergistic relationship with the ecosystem, a scenario to improve customer satisfaction and improve their gross profit space with lean management, and a scenario to train the team to cultivate talents. Of course, if the delivery is not solved well, it may be lifting a stone and shooting yourself in the foot, and the customer will close the door to you.

After delivery, it is a customer-oriented operation. For the customer, the integration stage does not produce benefits, and it is more important whether the output project can be transformed into productivity. In the future, in addition to the continuous enrichment and iteration of platform systems and applications with the extension of customer scenarios, there is still plenty of room for innovation in how operators can participate in data operations as a new productivity element.

S3 should concentrate on big things in breaking the game

In terms of operators' role as enablers of new infrastructure such as industry models and big data services, technology must be the first driving factor. The group needs to concentrate on big things, gather and integrate the strength, data resources and talents of professional companies to do the overall layout development. Avoid blind paving. The other is to study the ecological cooperation model that is suitable for us, which can transform external resources into the ability to jointly create value for customers.

The front line of the prefecture and city should identify the needs of various scenarios that can give full play to the value of data, fully promote our integrated service capabilities and the ecosystem to the market, and form a deeper stickiness with customers.

The execution system of the organizationIt has to be aligned with where the strategy wants to go

With a clear strategy and business, it is necessary to think about and promote the reform of the organizational system, the construction of the talent team, the adjustment of the incentive mechanism of the management system, and the adjustment of culture and leadership around the creation of these core competencies. The organization, talent, and culture should be systematically sorted out, and what changes may need to be made to our current budget management performance, resource allocation, including our work process or work model, compared with future needs.

In particular, the S2 curve is a transitional work, not a complete reincarnation, but a malleable innovation. How to identify the emergence of systematic changes and unchanged, we should do some systematic, step-by-step, and stage-by-stage reform and innovation after combing. Try to avoid fragmentation, stress, and take one step before thinking about the next step to solve the problem.

In the transition period of new capacity building, the contradiction of resources may be more prominent on the front line. That is, I want to stabilize the basic disk, and then I have to increase the number of production increments, especially in the incremental disk, the lack of core capabilities of the empowerment, there will be a more blind investment and construction ability or a passive response situation.

However, the premise of solving this problem is to have a clear strategy, think clearly about how to build your core competitiveness, and do a good job in the distribution planning of capability positioning. In this way, groups, professional companies, provincial companies, and municipal companies can focus resources and go all out to build their own professional capabilities. Under the premise of increasing this kind of leadership, increasing the cultural atmosphere, and increasing the systematic design, I think it is entirely possible to come out with time and a year or two of hard work. This clear system design is where consensus is most needed at the moment.

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In the process of initializing the production capacity, how should the leader accelerate the scientific and technological capabilities of various teams?How to think about your own role to play?

Capacity-building does require a process, but it is not a one-size-fits-all approach to defining goals. This speed of construction should be fully integrated with the needs of the market. With a customer project, we develop talent on a rolling basis in the project. Use the project to establish industry influence and drive market expansion. Once the quality of your project goes up and the quantity increases, the fission speed of talent will also increase.

Of course, it will be slower to rely purely on endogenous and self-exploration, and some mature fields should be introduced and cooperated, and we must be determined to use more professional people to do professional things and lead the team professionally.

While we focus on the capacity building of the second curve, we also need to re-examine the optimization space of basic business operation efficiency. As a mature business, can it reduce costs and increase efficiency through the improvement of management efficiency and the application of its own new technologies and means, and accelerate its own digital transformation? For example, the AI model is used to replace the routine operation command, customer service, contract processing, and information synthesis to enhance the value creation efficiency of our individual employees. Through this initiative, 10% of the personnel released from the traditional business can be transferred to the development of the production data business every year.

Another example is the optimization of the investment model. Although the current project investment has been much improved compared with the past, the operator's investment in the basic disk every year exceeds 100 billion. With such a huge investment, can the capital investment be reduced by 10% per year by improving port utilization after the business enters the steady-state stage?When the investment can be reduced by 10% per year, the depreciation and personnel investment will be greatly saved in the next few years. In this way, the cost space of the public market business will be opened up at once, which is not only good for S1, but also creates more space for S2 and S3 to move resources.

The success of S3's business must not be won by using crowd tactics. OpenAI has done such a big thing with only a few hundred people. Therefore, for the group and professional companies, it is necessary to gather top masters, give enough resources, and create a good innovation soil and platform.

Provincial companies should pay attention to technology application and technical cooperation. Chat GPT has allowed people who have not been trained to design and generate applications, and the enhancement of large models has greatly lowered the technical threshold, and it is enough to use ordinary technicians to go through some simple training.

Comrades on the front line, what needs to be strengthened is to match the customer's problems with our technical service capabilities.

At the level of new infrastructure, I don't think it's possible to solve the problem at scale. It is no problem for these college students who are recruited every year to invest in the operation of emerging technologies with strong learning ability and technical foundation. So I don't think there's much of an obstacle in terms of overall talent.

It's time for a review

More critically, leaders at all levels need to address the root causes of clear planning, and these things will be solved. The most afraid is that maybe the group has not thought about it, everyone is building capacity, at this time, coupled with a lot of demand in the market, we can't tell it, or there is no way to choose, it will create a situation of blind construction and blind contracting, and take some detours.

For large enterprises, the most important thing is to take the initiative in niche selection before the technological paradigm changes. It's really strategy-led innovation, not market opportunity-led.

This means having to figure out who you are and who you want to be. If a role like an operator spends a lot of money on R&D investment, and continues to lose tens of billions of dollars every year, it will mislead the strategic direction of the entire company and cause significant losses, which is something that large companies need to avoid. On the contrary, the investment based on the company's strategic intent, even if it does not produce results in the short term, must maintain strategic focus.

It also means that large companies should be careful to avoid piecemeal innovation. In terms of process, operators have indeed reached a stage where they should conduct a strategic review, form a strategic focus, and clarify the major tasks under the strategy. See what is right, what is in a fuzzy area, and what is problematic. This is not only done from an internal perspective, but also from the perspective of external professional companies and investors. After a few years, what kind of stage is it in? Whether these reforms under the guidance of the current strategy are in line with the direction of future development.

Transformational change is a test of leadership

Leaders can't just do things for the sake of responding to the demands of the above, which is likely to lead to some short-term behavior, or piecemeal, or to do something in a hurry, without any traction at all.

Leaders can't afford to fail to do things in order not to make mistakes. There's a lot of innovation and reform involved, and are leaders willing to take these risks?Or do I stay in the same pattern and wait until all the instructions from my superiors are clear before I start acting? It may not be wrong, but the market has lost its head start.

After a long-term steady state of development, the leading cadres who have grown up internally have their own empiricism model, and the department can come up with opinions to revise and revise anyway. However, at a stage when the industry is about to face major adjustments, when the pattern is not yet clear, leaders are particularly required to have strategic thinking ability, independent judgment ability, special sensitivity to perceive changes in market customers, and an open attitude of learning and listening. The shortened technology evolution cycle in the ICT industry has led us to constantly adapt to changes and learn to navigate them.

Manuscript arrangement:

Ms. Duan Ying, Consulting Director of Wanwei Junzhuo Enterprise Management Consulting Company, was the Director of Chinese Talent Development of LG Chem and the Director of Shenzhou Academy of UCAR. He has accumulated rich theoretical and practical experience in organizational change, innovation capacity building and leadership transformation.