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Use new information technologies to transform your business models

Editor's Note: Kay Plantes will be a keynote speaker at the 2012 Fusion CEO-CIO Symposium and a member of the Fusion 2012 Advisory Board. The Keynote is "The New Basis of Competition and Its Implications for C-Suite Leaders and Information Technology Professionals".


The newest information technologies ­on the block – social, mobile, cloud and data analytics – can and should do more than boost your organization’s efficiency. Far more than past IT innovations, these new technologies can positively transform your organization – where it competes, why it wins and how it operates. Smart leaders understand this. Meet one in this blog.

As a young but experienced telecommunications industry professional, Nancy Peckham founded Madison, Wisconsin-based Valicom in 1991 to help companies reduce telecommunication costs. Valicom’s value promise for its direct services is very powerful: “We average 30.4% savings in telecom expenses across our client base,” according to CEO Peckham. Her company produces this savings by helping clients better manage the complex supply chain associated with providing their workforces with wired and wireless voice and data communications, internet connections, and wireless services.

As device options and mobile communications expanded, this expense area has become increasingly complex, with a lot of data errors in billing, averaging 5-12% according to Forrester Research. In Valicom’s 20+ years of doing telecom audits, they’ve found that over 35% of invoices have some type of error. Often these errors remain hidden without an audit. “One memorable client example is a health care facility that had torn down a building. But our audit,” according to Peckham, “determined that they had been getting billed and therefore paying for fifty landline telephones in a ghost building that was now a parking lot! For twelve years!”

Valicom’s original business model provides direct services through consultants who audit client telecommunications bills, secure the right plans, order devices and manage their inventories, negotiate contracts, process invoices, allocate costs to the right budget lines and benchmark overall spending. An internal IT platform enables consultants to do this work efficiently and effectively. The model was not easily scalable, however. Furthermore, Valicom faced growing competition from Accenture and other consultancies whose names were “top of mind” in IT and CFO departments.
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What to do? Midsize companies, Peckham determined, had similar telecom expense management needs to larger companies, but could not easily afford direct services. This insight led Peckham to leverage its internal platform to create a “software as a service” business model that cost-effectively addresses the needs of mid-size clients at a price they can afford.

The new solution opened doors beyond CIO, CFO and Telecom Managers in mid-size companies. Managed Service Providers, Telecom consultants and Telecom agents also benefit from the SaaS solution. By serving the needs of these under-served markets, Valicom has been able to achieve 21% more revenue and 18% more profitability over the past year.

The new approach to providing services also makes Valicom more customer-centric. According to Peckham, “Through the development of Clearview, our software as a service tool, we are well-positioned to give our clients the choices they need to fit how they want to do business. All three bases are covered, from our fully outsourced model (We Do It) to our hybrid model (We Do It Together) to our self-serve model (You Do It).”

The change had its moments, to be sure, as it was crucial that Valicom execute well while continuing to provide a high level of service to its clients and partners. During the development phase, the research, design and actual work involved to adapt Clearview to the Software-as-a-Service (SaaS) was new in terms of functionality and architecture. “This new business model was a new line of thinking for us internally. We not only had to navigate and educate our clients and partners, but also our own internal resources. With the new software, we are continuing to learn and adjust to ensure our operational efficiency, as we continue to gather ongoing feedback from our clients and partners for continued software enhancements,” Peckham shared.

It would have been natural for Peckham to look at new technology opportunities solely through the lens of “How can they make my consultants more efficient and my company more profitable?” Instead, the strong strategic leader asked different questions: “How can I use these new technologies to reach new markets with a hard-to-copy value promise? How can I use them to offer existing customers an even better customer experience?”

How are you thinking about and applying social, data analytics, mobile and cloud technologies in your enterprise?

More articles by Kay Plantes

Kay Plantes is an MIT-trained economist, business strategy consultant, columnist and author. Business model innovation, strategic leadership and smart economic policies are her professional passions. She resides in Madison, Wisconsin and Oslo, Norway. For more information visit her website - Business Model Innovation and read her most recent book - Beyond Price.

The opinions expressed herein or statements made in the above column are solely those of the author, and do not necessarily reflect the views of Wisconsin Technology Network, LLC. WTN accepts no legal liability or responsibility for any claims made or opinions expressed herein.

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