Key Challenges of Telco Customer Frontend Transformation 2022 

What are the top points of focus of telco leaders? Read more about our research.

Total revenue of 57 billion euros and 62 million smartphones makes the German telecommunications market one of the most developed in Europe. Hycom ordered research to understand the focus of the leaders of telecommunication companies to obtain a general understanding of which key challenges the industry faces. The key challenges of telco industry are below, and we will evaluate them further in this article.   

  • Directing customers to digital self-service 

  • Increasing the quality of digital self-service 

  • Up-selling and cross-selling for existing customers 

  • Integrating the omnichannel experience 

The above challenges depend on the design of an adequate customer experience.  

Understanding customers – their motivations and expectations 

To be successful in addressing each of the above challenges, companies need to think, design, and execute in a customer-centric manner. That will allow to tailor products, services, and purchase paths for each customer group and maximize the chances of success.  

Planning digital transformation requires first and foremost defining the course of change. A good customer understanding is essential to ensure that changes address what customers expect, not some ivory tower vision. As sophisticated as they sometimes are, they are often detached from market reality in the main direction or at least in smaller details. Developing this process helps organizations to learn more about customers and their brand relationships comprehensively and in effect allows them to empathize, design better experiences, and deliver products and services that will help to achieve strategic goals, such as an increase of ARPU. 

Once an understanding of the end customer is obtained, a dedicated service design can take place resulting in a product that addresses their challenges and needs in a defined area. That will be the basis for your roadmap where you can decide on priorities accordingly. 

At Hycom, based on multiple implementations with key market players, we have designed a process of research and analyzes of customer information. That allows in-depth analyzes of customer expectations and how the company meets them along the journey to design an optimal customer experience and drive customer engagement. 

Directing customers to digital self-service 

Self-service, especially at large scales, is a major factor in cost optimization. Customers who resolve their issues online mean less traffic in call centers and brick-and-mortar service points. That can mean a significant reduction in customer service costs.  

On top of that, contrary to popular belief, it is also beneficial for the customer. Millennials and younger generations feel comfortable enough with digital channels to handle most standard self-service scenarios. In some situations, a human agent might even slow down the process. Furthermore, not everyone likes talking on the phone when they can set everything up with a few clicks. So properly implementing self-service might mean not just a cost-benefit but increased customer satisfaction as well. Companies failing to properly integrate self-service customer journey, however, lead young users to search for self-service information outside company resources. Research shows that millennials (62%) and Gen Z customers (75%) report they would use non-company guidance (such as a subreddit, Google search or YouTube video as Gartner points out.

Chatbot/voice bot implementations among other processes assisting self-service areas are also lacking. Last year’s study by Customer Think suggests that only 22% of respondents have positive interactions with automated assistants, which suggests that this tech is not fully matured yet and should be implemented with caution. One of the key components to counter bad experiences in areas where chatbots are still lagging incapacity is human-on-the-loop, which means chatbots turning over more complicated issues to human operators. 

Properly implemented self-service is not just a user panel with few convenient options. Implemented properly, it should make it undesirable to go back to old ways of contact. As an example, imagine calling Google call center to resolve a problem with your Gmail or Google Chrome.

Increasing the quality of digital self-service 

Self-service, in particular, is an area where service design plays a major role. The starting point here is to map out specific scenarios and to draw appropriate customer journeys for each of them. Properly defined touchpoints and an adequately designed omnichannel experience are probably the most important deliverables in the whole process, especially when taking into consideration that these scenarios often contain stressful situations. Nonetheless, a well-designed process can mitigate most situations and sometimes even turn adverse sentiment into a success story.  

Our research has shown that to increase the quality of self-service channels, all self-service access channels should additionally offer the following functionalities: 

Omnichannel service request ticket tracking  

Most telco self-service CRMs do not allow users to track their requests. Whether a request was made via call center, point of sale, or self-service through digital channels, the ability to track how things are progressing significantly reduces anxiety as well as the number of follow-up costs. To imagine the impact of such functionality, just think of what package tracking did for parcel service companies. 

Smart bill presentment 

Analyzes of call center conversations show that a significant number of calls point to billing misunderstandings. These are not so many results of errors on the service provider’s side but rather a lack of clarity on the customer side. Customers are often unclear with certain charges and billing for additional services. These calls are also stressful, as an underlying presumption on the customer side is that they are being cheated. Smart bill presentment focuses on invoice clarity and guiding customer via various tolls like invoice layout wizards explaining in a clear form what each part of the invoice means. 

Smart service consumption view  

Metrics such as used transfer or hosting space may be clear as day for industry insiders, and we might think every user should know what "200GB left this month" means, but this is not the case. Less technically savvy customers might need some assistance here. So instead of displaying data transfer usage in GB, the system can add additional information like "with your average data use, you will use up your transfer in 3 days". This is a clear message for everyone and at scale will reduce the number of frustrated users out of data yet again by the end of the billing month.  

Omnichannel notification and alerts 

These days, we have notifications everywhere. If you are a heavy phone user and not overly careful about your settings, chances are you don't even read a significant part of your notifications, there are so many. That is why it is vital to make it easy for users to customize alerts or even better – apply machine learning based on user responses over time to automatically customize alerts for them.  

Up-selling and cross-selling for existing customers 

Up-selling and cross-selling in digital channels require mastering several aspects out of which each requires specific approaches and infrastructure: 

Data collection and data understanding 

To sell, we need to understand the customer's needs. Luckily, in the telecommunication industry, the number of associated scenarios in which a customer has one thing and also needs another thing is limited and for the majority of scenarios can be relatively well defined. Despite this, it is advisable to measure it with existing data. Based on the information gathered, proper recommendations should be designed within various contexts – product collections, seasons, and customer segments. Only an exquisite understanding of customer contexts can provide high conversions. 

Cross-silo product catalog mapping 

Especially in larger organizations, it is vital to cross-sell across teams and channels to properly address customer needs. Selling business plans for mobile plans needs to go hand in hand with data plans for laptops and possibly some niche/specialized product lines as well as VoIP or IoT. Some of these products may prove to be of low yield or low margin, but they might prove to be customer portfolio drivers and major decision factors, i.e. "If I can't get this here, I will take my business elsewhere". 

Integrating omnichannel experience 

One of the biggest challenges might be confronting the monolith. Legacy infrastructures tend to be designed as homogenous, large blocks of software servicing wide functional scopes but often divided across organizational silos. These divisions create barriers in both the digital and mental space of companies. It is probably the only greatest obstacle in building true omnichannel experiences for customers. Customers do not care about internal company divisions. Actually, it is impossible for them to know the internal setup of their telco providers, yet they are subject to them on a daily basis having to cope with different helpdesk numbers, different contact persons for each task, and sometimes even different portals for different product lines. This kind of detached experience does not make things easier. Coherent integration of these areas, however, needs one main prerequisite: 

Why Composable Architecture 

Legacy infrastructures tend to be designed as homogenous, large blocks of software servicing wide functional scopes. An alternative is to divide the monolithic IT structure into separate systems connected by APIs like OpenAPI and Databus systems like Kafka. This change of architectural paradigm allows for several advantages. Some of them are: 

Ability to implement best tools for the job.  

Separating sub-systems allows for purchasing or developing internally a better suited software. This means a company doesn't need to purchase a billing solution from the CRM provider, and instead of using automated marketing tools designed for this CRM that might not be as great, any other platform can be selected for optimal results. API integrations have become highly standardized, which means that most tools can be integrated quickly and painlessly. 

Independent development and release calendars 

Dividing large systems allows teams working on them to be smaller and more agile. This means more releases and less dependency on other systems. 

Diversified risk 

Whether software is developed independently or on-demand, system separation can greatly reduce risk. One team's progress delay less significantly will affect others, if at all. 

Going Composable 

The first step to adopt the infrastructural groundwork will be to plan its division along the functional lines and to decide on the API framework. Luckily, there are industry standards to fall back on. After designing the implementation roadmap, functional areas can be separated piece by piece. This approach ensures a smooth transition and is generally considered more manageable and safer.  

At Hycom, we specialize in developing high-performance composable architectures and self-service solutions to deliver optimal operational efficiency and tangible savings for our clients. With our Composable CX Architecture, you will achieve improved resiliency after failure. It also improves infrastructure agility and elasticity to enable the implementation of better customer experiences. Instant deployments reduce implementation costs. Lower maintenance optimizes overall TCO.  

To speed up the implementation of digital transformation (up to 40% TTM), at Hycom, we have developed the Omnitel Telco Self Service accelerator. Omnitel is a set of headless services, tools, and good practices that we use to help our clients to conduct their transformations faster relying on industry best practices like TM Forum and taking advantage of our 10+ yrs of experience from previous implementations. 


Digital transformation with its diverse set of challenges is no small undertaking. The very scale of change for some institutions will make the trial and error approach unfeasible, and this creates understandable resistance on an organizational level. Using proven methods and know-how gathered from the biggest European transformations can greatly reduce risk and accelerate these strategically transformative programs.  

We invite you to take advantage of our experience with composable architecture deployments and use our Composable Architecture Platform developed over time while working with clients like Deutsche Telecom and Orange, and many more.  

We invite you to get in touch with us if you would like to learn how we have been helping these industry leaders to put this new paradigm to work. Contact us, we will be more than happy to discuss.