Executive Insights
The Interface

TalkTalk: a mature start-up

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We travelled to Salford, Greater Manchester, to catch up with TalkTalk’s Managing Director of Technology, Change, and Security, Gary Steen regarding the telco’s commitment to thinking, and acting, differently in a highly competitive marketplace…

TalkTalk is an established telecommunications company that fosters a youthful, pioneering spirit. “I like to think of TalkTalk as a mature start-up,” says Managing Director of Technology, Change and Security, Gary Steen. “We are mature in terms of being in the FTSE 250, with over four million customers, relying on our services every day through our essential, critical national infrastructure. But that said, I definitely think we start our day thinking as a start-up would. What can we do differently? How do we beat the competition? How do we attract great talent? We’ve got to come at this in a different way if we are going to succeed in the marketplace. We are mature, but we think like a start-up.”

The telco market is growing both in terms of complexity and demand which requires TalkTalk to outthink and outsmart its competition, through products that offer great prices and value. “To deliver those products we need really smart talent,” Steen explains, from the company’s impressive Soapworks base in the burgeoning Salford Quays area of Greater Manchester. “So, we’ve been obsessing over how we make the switch to a great team.”

TalkTalk works with numerous partners on its day-to-day operations, but Steen is dedicated to refreshing its internal talent to complement the outsourcing. “This year, we brought in over 50 graduates to build some very smart teams in this building. We’re training them up and getting them onboard. Being agile is really important to creating that capability and we’ll always use partners, but I think there’s got to be a real balance between external and internal skills.”

With an ever-increasing complexity in the telco market, Steen and his team are working hard to make sure the company has sufficient IT skills within its team, bearing in mind the skills gap in tech right now. “It is a challenge and one of the reasons we’ve begun to grow our own talent is because we are using some next generation capabilities: new tools, platforms and packages,” he explains. “There is definitely a skills gap, so we are doing a mix. We are cross training people who have been in other careers over to being technologists. We get some good talent from that capability.”

TalkTalk’s graduate program has recruited 60-70 people this year already, and that will only increase, according to Steen. “They’re really hungry to work on new projects and ideas, so we’re really obsessing about putting them into cohort. What we do around the development of the careers is key, as well as what we do for our people who cross train. So, we break them into cohorts to make sure we’ve got the right talent approach to each of those segments.”

TalkTalk has grown massively as a result of some major acquisitions and that has amassed many varieties of staff, partners and legacy systems leading to a fine balancing act between internal and outsourced staff. “We’ve grown as a business, really, really quickly,” Steen explains. “And we’ve probably got a little bit too wide, not only in terms of complexity and of our systems and capability, but also in terms of the number of partners we are using. In the last couple of years, we’ve been working on slimming that down and consolidating.”

In 2018, the company had five different partners and operator models for its IT operations prompting a massive shift. “We chose a company to do a single operated capability, in our ninth transition of moving the waves over and it’s going well. In effect, that will give us a single team with a single operating plan. So, we’ve been working hard on that alongside building some capability on our side of the fence. So, it’s a balance working around our partner strategy, and what we do internally.”

The transformation of a telco

TalkTalk is currently undergoing a digital transformation too and Steen has a track record of delivering transformations working with companies such as Vodafone, BT, O2, Carphone Warehouse, Sprint, Aircell and Telstra. Back in 2015, TalkTalk worked very closely with partners such as Tech Mahindra and CapGemini on its transformation. Tech Mahindra has been a long serving partner of TalkTalk in the Operational Support System space. “They have a huge heritage having spun off from BT and they’ve really provided us a backbone to our OSS capability over a number of years. Capgemini is another partner we’ve used for a long time, and they have also provided capability around our Salesforce developments and around our business systems. We’re also using companies like TCS who provide us with great capability from a business support systems perspective.”

With regards to TalkTalk’s transformation conundrum, Steen points to an old analogy of trying to change an engine while you are driving on the motorway at 100 miles an hour. “The appetite for change in this business is quite extraordinary, and in a good way,” he explains. “We’re working on a huge range of projects, and a lot of transformations fail because they are over here trying to build something new, while the business is going in another direction. Getting the transformation and the business activities aligned on a day-to-day is one of the key things we have done to enable that the transformation sticks.”

The telco sector is a fast-paced industry whether it be regulatory change, market change because of competition or due to core service growth. “Consumption wise, we are growing 30% year on year,” Steen explains. “How do you put 30% more pipes in the ground each year just to keep up with the demand of your customers? That drives a huge amount of change into the business from an IT and a network perspective,” he explains.

Like many telecoms providers, “We’ve got a big old IT estate with over 7000 servers, which is expensive to manage. SCC provided a range of services and hardware and a whole plethora of resources around this, in terms of how we consolidated that down. We decided to build a hybrid IT model and SCC both procured and installed the hardware.”

IBM is also a key partner to TalkTalk from a technology perspective on consumer and scale systems as well as with data warehouse platforms. IBM provides the strategic storage platforms for TalkTalk’s hybrid cloud and has helped the success and growth of the telco over the years.

Another key partner is Infosys which provides all of TalkTalk’s digital channel capability today and online presence, development and testing of applications in that space. “We try to use a range of partners who provide that best capability,” Steen explains. “We find that they all come with different skill sets even though they are all predominantly of a similar mould. They all have slightly unique capabilities that bring them to life.”

Last year TalkTalk decided, from an operations perspective, to slim things down from five different operator models, five different partners and five ways of monitoring and reporting to a single system.  “We decided to launch a programme go to a program called One IT Ops and we chose CGI in that respect. We chose them to take our existing model and improve the operating model and take complexity and cost out. CGI helped in our transformation of moving it to one provider but also changed the processes behind this and worked on the technology consolidation.”

Transformation in place, TalkTalk then worked to drive some of the cost out, simplify the model, and improve the service. “We are into wave nine of a transformation. We do very short waves, with short deliverables. And I think that’s one of the keys that makes it deliverable because it’s not a big long-ended open program for years and years and it’s basically cut up into short sprints of deliverables. So, we are very keen, when it goes off track, to get back on track.”

Data useage/capability

Data usage is going up year on year and capability has to respond in kind. How does TalkTalk deliver more bandwidth to its customers for less? “That’s what creates that sort of dynamic, mature start-up way of thinking. Because you go, ‘Hey, we can’t just do this. We can’t just continue to throw money at this. We need to come up with different engineering capabilities of doing that.’ I think what customers can see going forward is that exponential growth of bandwidth is going to continue. I’ve got no idea what customers are going to do with that bandwidth in five, 10 years’ time, but I can absolutely predict with 100% confidence it will be more. So, whether that’s 4K Facebook or more videos, Netflix etc., it’s just going to continue to grow.”

An example of dricving TalkTalk was recently recognised with the SamKnows Industry Invention Award. “SamKnows is awarded by Offcom as a way of looking at performance across all the providers in the UK.

A good example of improving service performance is around the work the TalkTalk team has performed on DNS performance, Ofcom (via Samknows) measures a series of performance indicators and there is a whole range of metrics about speed, and congestion, and how are we using the service, but we have been obsessing, particularly in technology recently around red and green monitoring. So, if you look at our operation here, we can tell if things are on or off. We can tell what is broken and we can push our suppliers to say, ‘Can you fix this?’ We get 13 billion requests a day to our DNS (domain name service) and 13 billion requests to point traffic in the right direction and we were fourth, or fifth place in the marketplace. We were behind some of our competition. Our DNS servers were working, they were green, but the performance on that from a customer’s perspective, was way down the pack.”

The answer, as with much these days, lay in the data, something TalkTalk has an awful lot of. “So, we did some smart stuff. We did a transformation to move that DNS capability closer to the customer, just like me moving closer to you. As we moved that DNS closer to the customer, the performance of what you see increases exponentially. And we’ve gone from fourth, fifth place in the rankings on SamKnows to being first. So that’s great. So, it’s only milliseconds, but in this world milliseconds count, when you consider that every DNS lookup takes say six, seven milliseconds. You get that down to three, then that is going to transform your customer experience.”

When you’ve got the second largest network in the UK outside of BT, many things can go wrong. “My team is looking across 3000 sites in the UK as there are always things breaking on a network. That can be diggers going through the road, it can be floods impacting servicefloods in York, there’s always things happening. So, it’s a case of keeping an eye on that network, rerouting traffic, dispatching engineers, making sure you’re offering that great customer service.”

TalkTalk is currently working with Juniper to roll out a new technology.” North Star sits on the network, looking at all the traffic flows across the network,” Steen explains. “As it sees outages, it basically dynamically reroutes all that traffic. It knows all the paths across the network and looks at how much traffic is flowing across it and can dynamically reroute that real-time, in what would take an engineer maybe five or 10 minutes to do. Now, when you’ve got 3000 sites and 5000 circuits, and four million customers, the ability to knock minutes off that and improve is phenomenal. We’ve got that deployed on our network, so it’s running side by side with our engineers. We’ve not completely let the machines take over yet, however. We’re testing it, looking at the recommendations it makes and then, this year, as we go into half year, we’ll deploy it onto the network where it will be autonomous.”

On the customer side, TalkTalk has been partnering with ASSIA to enable data-driving decisions with capability called CloudCheck. CloudCheck is a piece of software that sits on the router in the home and it scans your environment “in a good way” to collect data in terms of the WIFI signal strength, what WIFI your neighbours use and how you can optimise that in-home environment. “It will tune your environment to get the best out of it. But also, as a customer, it provides you with the data.” So, with numerous changes all occurring at once, how does Steen view the company’s progress? “Well, we’ve still got a lot to do. We really want to be the most recommended broadband provider and acknowledge that we’ve had our hiccups along the way in terms of growing the business, but I personally believe that if TalkTalk hadn’t originated, then people would be paying far more for their broadband services than they do today. I can safely say, we have created genuine disruption in the marketp

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