Vodafone UK Enterprise Chief: Brexit, BT-EE merger could be positive

The head of Vodafone’s enterprise business in the UK has said Brexit could lead to companies buying more homegrown products as the country becomes more “nationalistic”.

Phil Mottram also said that the entrance of a combined BT-EE into the business market could boost the unified communications (UC) market in the UK.

The exec was speaking at a roundtable Vodafone held on Wednesday, at which it unveiled a report on how UK companies can boost productivity.

Asked by European Communications what impact the UK's decision to leave the European Union was having on his business, Mottram said there were positives and negatives.

He said: “I think we will become more nationalistic probably as a country and therefore I would imagine there will be a greater theme around buying homegrown products.”

He added: “I think that will stimulate growth in SME and mid market so I think that’s the positive.”

Mottram said the downside was that he was hearing “some noise occasionally about projects being put on hold”.

He added: “I’ve not seen a massive amount of that myself but when I talk to...some of the big IT vendors we partner with they do cite that as an issue.”

Wary of the sensitivities surrounding Brexit, Mottram later sought to clarify his comments via email.

He said it was “too early to tell” where Brexit would lead and that “regardless of what is happening in the macro environment,” businesses would “continue to look for opportunities both globally and locally”.

Although not as seismic, the merger of BT and EE is another event that Mottram and his team must navigate.

Vodafone has been the dominant telco in the UK enterprise market as it was the only one to offer both mobile and fixed services.

BT-EE is starting to bring its various elements together, although it is still some way from offering a truly converged service to companies.

Mottram said he expects it to become “quite a formidable competitor” but added that he was looking forward to not being “a lone voice in the UC market”.

He explained: “BT-EE at some point will have a good UC product.

“When you have two big players what that could do is polarise the market to force customers to decide whether they want UC or not and if you do then you buy either Vodafone or BT-EE.”

The enterprise market is Vodafone’s primary focus in the UK given it has only just launched a fixed broadband service.

A much-delayed TV service has also been pushed back to next year as the operator looks to get its consumer business back on track following problems with a billing system that led to a £5 million fine.

As the enterprise market set to get more competitive thanks to BT-EE, Vodafone is looking to press home its advantage.

Productivity gap

With the UK’s lack of productivity becoming a political issue – the Chancellor announced a £23 billion National Productivity Investment Fund last month – Vodafone is seeking to position itself accordingly.

The operator commissioned the London School of Economics and Political Science to look at how businesses can become more productive.

The report author, Dr Alexander Grous, said productivity – defined as the amount of hours it takes a business to produce something – could be boosted by up to 20 percent by focusing on three key levers: changing management practices, using technology and increasing workforce flexibility.

The good news for Vodafone and other telcos is that Grous said businesses should reach out more to their network providers to help them.

“Managers say they don’t know where to go to get help to be more productive,” Grous said.

“They all thought that to be more productive they had to hire a lot of consultants, a new CIO or technology director.

“We say to companies ‘look around you, who from a technology perspective do you know’.

“The first is the operator who provides fixed and mobile telephony. A lot of them don’t tend to think [that way].”

Two Vodafone customers were on hand at the roundtable to share their experiences.

One, outsourcing and energy firm Mitie, said the 10-year relationship meant they now worked together more as a partnership.

But Simon Priestley, Special Projects at Mitie, hinted that Vodafone had not always got its priorities right.

He said: “They kept on focusing on the management team but we said we didn’t want to do any of that.

“We wanted to put in a workforce mobile platform solution because our cost base is our fieldforce.

“So we partly ignored them. You have to be pragmatic.”

He added: “Vodafone’s marketing team leads them a bit, they’re ahead of themselves before they can deliver...but they do have experts that have good advice.”

When challenged on this, Mottram said: “The relationship [with Mitie] is a long one, he’s probably commenting on the last 10 years.”

He added: “Customers are a lot more knowledgeable..they’re a lot more tech savvy, they know what they want compared to 5-10 years ago.

“Nowadays, more of them have far better idea of what the problem and the solution is.

“However, some are interested in the tech and wider engagement in terms of how you implement it.

“Some of the tech stuff is reasonably straightforward to implement – the hard yards are how you change your personnel policies.”

Mottram said Vodafone often uses an in-house advisory services group – “a team of consultants essentially” – to help with this.

Nevertheless, Vodafone is also looking to push new technology such as the Internet of Things onto businesses.

The company is helping public sector bodies to monitor flood defences and prevent things such as fly tipping. It also has a world leading business in the automotive sector.

But Mitie’s Priestley demonstrated the challenges associated with other areas such as smart buildings.

“We threw 800 sensors into a big manufacturing site [belonging to Red Bull Racing].

“We used some of Vodafone’s IoT technology – measuring lighting, temperature etc – [but] we’re still trying to work out ‘So what?’

“We’re measuring things but we’re still not sure what the heck it means!”

Mottram admits that Vodafone has “struggled” with market readiness when it comes to some of its products.

He maintains that new services are important as the conversation with customers changes towards business outcomes.

Amid the uncertainty of Brexit and new market entrants, Vodafone needs to ensure it is focusing on its customers and their wide range of business needs.

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