In today’s tough economy the telecoms sector has a lot to teach us about outsourcing. The telecoms industry not only represents a large proportion of IT spend (Gartner recently predicted this to be more than 57% in 2009) but the competitive nature of this industry and the consumer demand for service providers to deliver rich applications at lower costs means that the industry experts cannot afford to make the wrong decisions when it comes to outsourcing.

Due to intense cost cutting measures many CIOs are looking at outsourcing as a way to lower operating costs while simultaneously introducing modernisation and integration of systems. In fact, Amdocs recently commissioned a survey which found that 91% of service providers regard modernisation as a key component of operational support systems.

The survey of more than 100 executives with financial and operational responsibility from wireline and wireless service providers around the world highlights how important it is to go beyond simply surviving the current economic climate by cutting operational costs. In fact, increased service profitability improved customer experience, and improved time to market ranked nearly as highly in the survey as a reason to outsource as operational cost savings, demonstrating the expanded business value of OSS outsourcing.

As expected, outsourcing helps service providers to overcome major OSS challenges such as the moves towards complex next generation services and overcoming long delays in launching new services. The survey also found that some two thirds of the respondents would prefer to outsource business support systems (BSS) with OSS to help create a seamless integration between their BSS and OSS— a way to improve the customer experience and give them a competitive advantage.

If service providers don’t succeed in transforming their OSS/BSS systems as we move out of downturn, they miss the opportunity to re-define their cost base and position for growth ahead. Transformation of OSS/BSS systems in conjunction with managed services will ensure that service providers are ready to capitalise on market opportunities now and into the future, as we move beyond these turbulent times.