IT Technology Implementation
IT Technology Implementation
Verizon is a leading provider of telecommunication services including wireless services and equipment and wire line services tapping the mass market, global enterprise, and global wholesales (Verizon, 2016). The company’s wireless services include retail connections and retail postpaid connections. Such include Verizon LTE, 4G LTE, fiber broadband services, FiOS, internet, and cable, and video telematics. Verizon also offers technology such as cloud and security products and interactive products such as video, music, and commerce (Verizon, 2016).
The company exhibited a growing revenue and net income in the last five years in all of its business segments. Verizon’s President and Chief Executive Officer attributed the company’s revenue growth to continuous enhancement of network and technology, capacity boosting, technology shifts in network architecture, and innovation (Verizon, 2016). Verizon is currently developing its 5G for video, smart cities and other applications (Verizon, 2016).
Verizon’s challenges include thriving and excelling in the increasingly becoming competitive industry, achieving more operating efficiency and productivity of the networks, and becoming the company of the future in terms of technological services (Verizon, 2016). The company is subject to external risks such as foreign currency, changes in interest rates and corporate taxes, changes in commodity and equity prices, and market uncertainties (Verizon, 2016). Its internal risks include litigation and settlement risks (Verizon, 2016).
There are several technology trends about the telecommunication, network, broadband and internet, and interactive media. Deloitte (2016) listed the technology trends for 2016-217 and these are: increasing demand for right speed instead of higher speed, entry of augmented reality and virtual reality that will increase demand for wearable mobile. Other trends include emergence of Internet of Things initiatives, reimagining core systems, rise of autonomic platform or self-managing service provider, and integration of industrialized analytics to technology (Deloitte, 2016).
Proposed IT Advancement
Verizon is developing a 5G or fifth generation wireless system. It has higher speed than 4G at 5 GHz, and it can handle more connections. To be successful in 5G and increase competitiveness, it is advisable for Verizon to offer different types of speed capabilities for its 5G service to meet the emerging trend on right speed rather than higher speed.
The company also needs to be ready on the provision of networks applications on mobile wearables and Internet of Things, and equip its company with autonomic platform and industrialized analytics. Verizon needs to be the company of the future and needs to have operational efficiency and productivity of the networks.
Does Verizon has sufficient funds to have the advancements
Verizon’s operating revenue in 2015 increased by 3.5% and reached $131.6 billion while the net income grew by 68.7% totaled to $17.9 billion. The company’s total assets reached $244.6 billion, a 3.6% increase. Verizon’s long term debt declined to 103.7 billion in 2015 from the recorded $110.5 billion in the previous year (Verizon, 2016).
The stock performance of Verizon has been above the telecom industry’s performance since 2010, but below the S&P 500 index. The operating cash flow increased by 21.7% and reached $38.9 billion (Verizon, 2016).
Internal and External Risks
Verizon is subject to internal and external risks. The increase or decrease of services portfolio has possible benefits as well as internal risks. Acquisitions and labor concerns can be internal risks of these are not handled properly. Further, mismanagement on proper or right allotment of budget for operating expenses can be a risk for revenue returns. Litigation also provides risks of revenue reduction. Among the external risks of Verizon (2016) include changes in interest rates, foreign currency fluctuation, changes in the corporate tax rates, equity and commodity prices.
IT Advancement Assessment as a Solution to Verizon’s Challenges
The challenges of Verizon that the IT advancement will address are: the needs to continue become competitive in the industry, improve of operational efficiency and network productivity, and achieve the necessity to become the company of the future.
The proposed IT Advances are the development of 5G in various speeds, the provision of networks applications on mobile wearables and Internet of Things, and equipping the company with autonomic platform and industrialized analytics. The IT system and enterprise architecture of the Verizon should be well-coordinated to make these advances possible.
The implementation of IT advances should be according to the COBIT. ISACA (2016) defined COBIT (4.1) as a supporting toolset of an IT governance framework that helps managers to coordinate the reduction of business risks, application of appropriate management, and technological concerns. To effectively optimize the IT advance solutions, the IT management needs to analyze its risks, financial impact, and alignment of IT advances with business goals.
Risks
The risks of the proposed IT advances include possible over or under supply of the services depending on how the marketing strategies becomes successful, additional IT budget due to the proposed innovations, additional platform in the company’s IT system, adaption to the right speed of internet and IT processes, and possible disruption of services on some occasions arising from network issues.
The Financial Impact and alignment with business goals
The proposed IT advance are aimed and expected to drive at least 6 percent growth in revenues, achieve operational cost efficiency by 10 percent in the next two years, and to provide sustainable revenue growth in the first four years of implementation. These expected impacts are in line with the business goals of continuous competitiveness, operational efficiency, and being the company of the future.
Enterprise Architecture Framework
The new enterprise architecture coordinates the network, operations, marketing, and PLM (Slideshare, 2010). Verizon’s business-centric architecture focused on bottomline, provide business and technical leadership, close coordination and partnership with stakeholders, reduces cost, improves the speed to market, inputs business into technology strategy, and places IT into business requirements (Slideshare, 2010).
The current enterprise architecture of Verizon shall be retained. However, there must be an improvement to be aligned with the proposed IT advancement. The improvement is the addition of a department that will take care of the software development and analytics needs of the company to be able to apply the augmented reality and virtual reality applications, autonomic platform, and industrialized analytics.
The Networks departments will be the responsible for the provision of various speeds for the 5G that is under development of the company. The IT department will be responsible for tracking the IT system efficiency, back-up, and security of all the departments of the company. It will also be responsible for deploying the right internet speeds for every department according to operational efficiency goals.
The software development and analytics will be responsible for producing the new software products, applications, and Verizon’s needed software for its advancement. It will also be responsible for coordinating with the operations for analytics of the processes and with the marketing department for its sales and marketing analytics.
Applicable IT Governance for Verizon
Given the new enterprise architecture framework as a result of the planned IT advances, the applicable IT Governance for Verizon is having Chief Information Officer to head the three senior executives, the Deputy Chief Information Officer for Networks, Deputy Chief Information Officer for IT, and Deputy Chief Information Officer for Software Development and Analytics.
Under the Deputy Chief Information Officers are Directors for System Architecture, Director for On-site Technology, and Director for Speed and Innovation. Reporting to the Directors are Network and Systems Managers, On-site Managers send Speed and Innovation Managers. The next in ranks are Technical Supervisors then Technical Analysts.
The IT governance of the Verizon shall be highly subjected to security and privacy compliance, ethics, international quality standards, and standard operating procedures. The executives and staffs shall be hired based on competence and qualifications. Merits and promotion shall also be given based on the performance, such that the performance exceeded the company’s expectations and the teams achieved better than the corporate set targets and goals.
Gender sensitivity and working environment without discrimination of any form shall be implemented. Anti-sexual harassment and anti-bullying shall also be included as prohibited practices in the departments as included in the corporate ethics.
The IT governance shall also detail the coordination policies of the Networks, IT, and Software Development and Analytics departments to other departments to clearly identify the roles and responsibilities of each department and employee. Utmost integrity shall be imposed as inherent practice and trait of each employee.
The detailed key points of IT governance are the practical ways to create strong departments that can implement innovative products and services, processes, and operational excellence. It is also a way to create a healthy, harmonious, and respectful working environment in the technology-related departments and tasks.
Maturity models and frameworks to illustrate the applicability and management technologies/IT advances
According to The Open Group (2016), a consortium that enables the achievement of business objectives through IT standards, Capability Maturity Models (CMM) describes the best practices of the companies to improve its processes, measures these processes periodically, manage the improvement efforts, arrange practices into levels, and manage the development environment.
The CMM also evaluates the state of architecture processes, the architecture its, and the buy-in of the architecture and the processes. It addresses the issues process implementation and audit, measurements of quality, competencies of the employees, and management of the investment (Open Group, 2016).
Vangie Beal (2016) defined the IT Capability Maturity Framework (IT-CMF) as a framework that optimizes the value of IT Investments through management roadmaps. Its four macro processes include: managing IT like a business which places focus on customer service rather than on technology and production; managing the IT budget which makes IT investment and innovations more yielding as these are expected to yield better performance and results; and managing IT for business value which identifies the benefits of the IT investments to the company.
Ian Grant (2016) stated that IT-CMF incorporates the techniques and maturity models such as ITIL, CMMI, and CoBIT to assess the benefits of the IT management to the business. In relation to the IT Advances that is planned and proposed for Verizon, the company needs to enhance its customer service in the delivery of 5G services. Such can be done by providing contact center for customer services and sales, digital and omnichannel marketing with customer analytics. Such shall be provided in line with the commitment to provide quality products and services.
With the planned initiatives and the 2015 financial results, it is safe to augment the IT budget by 10% given that the net income grew by 68.7% while the cash flow increased by 21.7%. The 10% additional allocation is within the net income and cash flow growth, hence, the budget is very feasible. The additional investment should yield growth by 50% of the total budget. The growth in the first year from the IT advances should help drive at least 6% revenue growth by 2017 and double in 2018. Below is the illustration of the IT-CMF of the proposed IT advances.
IT- CMF of the Proposed IT Advances
Recommendation
It is very possible to implement the proposed IT advances in Verizon given its good financial condition. The IT advances should start to be implemented in the last quarter of 2016 until the end of 2015. Completion of 5G and its various speeds should be finished by the end of 2016 and pilot testing should be done in December 2016.
Verizon needs to formally launch the product in January 2017. It must start to introduce more of the IOTs and deploy autonomic platform and industrialized analytics in the first half of 2017, and improve sales and processes in the second quarter of 2017. The company should enjoy growths of the IT advances in 2018 and achieve higher sales in 2019-2020.
The proposed IT advances are expected to mature by 2021. In the fast changing technology business environment, fast introduction of the possible emerging trends can give a company a competitive edge. Innovations with continuous improvement of features can help Verizon achieve and sustain competitive edge in the telecommunication and technology industry. The company is in the best position to invest on IT advances due to its good financial condition.
Aggressive and effective marketing as well as the coordination of the departments should help Verizon achieve its sales growth targets. The IT executive team and staffs must efficiently implement the IT advancement plan stage by stage until it has successfully achieved the optimization stage. The IT team also need to another innovation or IT advancement after the maturity of the current IT advancement plan.
With the presence of stiff competition with other large telecommunication corporations that can also offer similar capabilities, it is very important to conduct researches on the current product features of the competitors to develop differentiated, well-meaning, and most appreciated services to be stronger in the US market. It is also important continue become updated on the current capabilities, financial data, and initiatives of the competitors to be able to create competitive strategy.
The proposed marketing activities to support the growth of the IT advances of Verizon may include trade seminars, conferences, press conferences, new product launching, newsletter, press releases, social media marketing and digital marketing. Verizon also needs to identify and apply the best marketing practices and relationship building to overcome the competitors and be the leading telecommunication provider. There may also be a need to increase the marketing budget to properly promote the new IT advances of Verizon.
Aside from minding the competitive advantage, part of the Verizon’s goals should be a contribution for the growth of the industry while it is also addressing the concerns on sustainability. The telecommunication industry needs to continuously sustain the number of employees if it cannot be added.
It must also ensure and recognize the important contribution of Verizon to the US economy as among the firms with large number of employees. The company must also make sure that its IT advances and departments are socially relevant in terms of work ethics. The company must need to be alert of the potential innovations and must also create its own to produce good technology breakthrough that can benefit the consumers and move market.
References
Verizon. 2016. 2015 Annual Report Verizon. Retrieved from http://www.verizon.com/about/sites/default/files/annual/verizon-annual-2015/downloads/15_vz_ar.pdf
Verizon. 2016. Our Technology. Retrieved from http://www.verizon.com/about/our-company/our-technology/
Deloitte. 2016. Tech Trends 2016. Retrieved from http://www2.deloitte.com/global/en/pages/technology/articles/tech-trends.html
ISACA. 2016. COBIT 4.1: Framework for IT Governance and Control. Retrieved from http://www.isaca.org/Knowledge-Center/COBIT/Pages/Overview.aspx
Slideshare. 2010. Enterprise Architecture Evolution at Verizon. Retrieved from http://www.slideshare.net/taliyakula/ea-evolution-at-verizon-may-2010
The Open Group. 2016. Architecture Maturity Models. Retrieved from http://pubs.opengroup.org/architecture/togaf9-doc/arch/chap51.html
Beal, Vangie. 2016. IT Capability Maturity Framework. Webopedia. Retrieved from http://www.webopedia.com/TERM/I/IT_Capability_Maturity_Framework.html
Grant, Ian. 2016. CIOs help build new IT capability maturity model. Computer Weekly. Retrieved from http://www.computerweekly.com/feature/CIOs-help-build-new-IT-capability-maturity-model
