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eUICC eSIMs perception Vs Reality: Mind the GAP!

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eUICC eSIMs perception Vs Reality: Mind the GAP!

Ian Marsden, CTO at Eseye

Anyone connected to the Internet of Things (IoT) and M2M communications industries will be acutely aware of the levels of ambition and investment being set for the Embedded Universal Integrated Circuit Card, more widely known as eUICC, or the eSIM.

A 2017 report from IHS Markit, for example, suggests that eSIM shipments will increase from 109 million in 2016, to 986 million by 2021. This growth will largely be driven by continuing IoT development, with eSIMs set to play a major role in ensuring the connectivity of billions of connected devices around the world.

The automotive industry is a prime example of a sector that has been keen to drive the technology forwards. With connected cars quickly becoming mainstream, the eUICC compliant eSIM has the potential to empower manufacturers by offering new opportunities to simplify logistics and optimise costs.

But industry ambition doesn’t stop there. The eSIM is being hailed as the next evolution of the SIM card, prompting vendors, operators and service providers to trial new eSIM-based edge solutions in an attempt to secure their position in the huge and growing global cellular, IoT and device connectivity markets.

Clearly, there is plenty of optimism around the eSIM,much of which is based on some key benefits being promoted by the IoT telecoms industry to customers. But, is there a gap between the perception and current reality of the eSIM?

Perception

Undoubtedly the most important benefit of eSIM technology – and the one most widely referred to – relates to enhanced provisioning.

Traditionally, SIM cards have been provisioned with the profile of a single mobile network operator (MNO), which once locked in, cannot be changed. This means customers must replace their SIM card every time they want to change operators. While this is a manageable task and something we are all used to when talking about a personal mobile phone, it has massive cost implications for IoT customers managing thousands, if not millions, of remotely located edge devices, over many years and across potentially vast areas.

With new, eUICC compliant eSIMs, the plan is for MNO provisioning to be managed over-the-air, with no physical access to the device required. The cards should be able to host multiple and changeable provider profiles when they are deployed. This should mean that customers can change carriers on a daily basis if they so wish, depending on business factors such as connectivity, resilience, customer service SLAs and the data rates available.

This requirement has significant implications for enterprises with large-scale IoT deployments. Embedded eSIMs remove the cost and logistics headaches that come with having to manually change a SIM card or network provider, as well, for example, as maximising device uptime by allowing a choice of the best local network operator.

There are also benefits for both manufacturers and operators to consider. As eSIM-equipped devices are ready to go straight out of the factory, IoT business managers and technologists can, in theory, streamline their logistics by removing the need for local device set up and configuration further down the supply chain, no matter where they are deployed.

With IoT customers being promised an improved cellular supplier negotiating position, increased management convenience and the removal of a considerable amount of complexity and risk of ongoing costs from operators, it’s easy to see why they are drawn to the eUICC compliant eSIM.

However, despite these benefits, the current eUICC specification doesn’t yet solve all the problems of IoT.

The Gap to eUICC delivery

The problem currently facing potential eSIM customers is that while industry discussions have so far focused on the potential benefits offered to businesses, there are also several commercial and technical challenges that will need to be understood and worked through over the coming months.

Commercial Challenges

Operators are aware of the continuing commoditisation of M2M cellular data with this newly enabled, simple,least-cost transferring option. The whole point of eSIM technology is that, unlike traditional SIM cards, it provides a means of avoiding contractual lock-in. However, this is not in operators’ interests, and may not always benefit customers in the way they imagine.

IoT deployments can be complex. Organisations will increasingly rely on the reliable delivery of vast amounts of business – and possibly even life-critical – data, drawn from huge numbers of devices,across many different locations and environments. There is a cost to maintain and deliver this service, and while some companies can reduce the TCO of a deployment with specialist wrap-around services, dynamic multi-IMSI SIM technology and expert 24/7 IoT customer support, getting the data through will always come at a price.

In addition, although eSIMs might appear to offer an easier switching process for customers, this doesn’t necessarily mean that it is contractually any different and there will still be a procedure for customers to go through.

Technology Challenges

There are also some significant technology integration issues that will need to be overcome before adoption rates can really take off, primarily concerning remote provisioning. The industry has been keen to promote the idea that eSIMs enable customers to change their supplier at will, but in practice, both suppliers must be integrated at this tech level, in a way that allows data to flow.

Essentially, both parties not only have to agree to the transfer, the relevant systems must also be bolted together to actually make it happen.The device itself also has to be able to communicate with both platforms. From years of experience in dynamic IMIS routing and IoT device optimisation, I can say this is likely to be a longer and more complicated process than people think.

I believe eSIM standards are undoubtedly a move in the right direction, but there is still some way to go for eUICC to become the revolutionary innovation it is predicted to be.

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Business recovery from COVID-19 lies in implementing the practice of Open Book Management

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Business recovery from COVID-19 lies in implementing the practice of Open Book Management 1

By Suranga Herath is CEO of English Tea Shop, the leading independent speciality and organic tea company.

Over the course of the last few months, most businesses have been forced to adapt their strategy against the backdrop of the pandemic. For many companies, business growth and development slowed and certain key goals and innovations fell to the wayside in order to prioritise ‘survival’.

For my business – a speciality tea company – we place great emphasis on exporting across the globe and bringing people together to enjoy a cup of tea as part of a wider community. Neither of those things have been possible amidst the pandemic. Whilst this was initially difficult for us, we are now steadily transforming our business to function in the new world order and our business model of Creating Shared Value is instrumental in making this happen. This has not only brought us closer with our suppliers and customers during this challenging time, but also through the practice of Open Book Management (OBM) we have been able to navigate this time united and focussed. OBM fosters a unique culture of employee and stakeholder transparency, empowerment, and satisfaction; in turn leading to incredible results, loyalty and increased productivity across the board.

So as we start adjusting to the new normal, I wanted to share a couple of reflections that I believe has made a fundamental difference during this challenging time. My firm belief is that whilst the road to recovery will be a long process for any business, it is through implementing initiatives like the Open Book Management that businesses from all sectors can put their best foot forward as we enter the new normal.

Open Book Management – a definition

Open-book management (OBM) is the business practice of creating transparency through sharing financial information with employees across the company. The power of its implementation lies beyond just the practical means, as the philosophy and theory carry profound ripple effect across the entire organisation and culture. Whilst for many leaders the idea of sharing financial information with employees beyond the senior management team seems alien, the benefits reaped are worth the effort.

Open Book Management (OBM) is a system that incorporates this financial transparency alongside providing teaching, KPIs and bonus systems for employees, as well as Employee Share Ownership Program (ESOP) which gives staff a percentage of the company shares. The idea behind this is that when employees gain a better understanding of how the organisation is run, they become empowered by this knowledge and become more committed to the company and its results.

This is not necessarily limited to employees, and is often extended to stakeholders; in fact, at English Tea Shop we have been equally transparent with our community of organic farmers, reaching out to them during Covid to be transparent around our cash flow and assure them in their role as suppliers.

Road to Recovery

Regardless of industry, size or previous growth, any business leader will admit that the recovery from prolonged socio and economic disruption like the COVID-19 pandemic is a long and challenging process. Businesses that choose to shake up their traditional business models and embrace a more disruptive and progressive approach will experience a first mover advantage and put themselves in a good position for the long and hard battle ahead. In my view, initiatives like OBM and the Great Game of Business are the perfect starting point for any business that is looking to motivate its workforce through fostering a strong community and igniting entrepreneurial spirit.

Our Story

Since inception, my goal for English Tea Shop has always been to build a business of dedicated people with sustainability as our guiding force. Our model of Creating Shared Value is focused on creating win-win situations whilst finding opportunities for growth in sustainable development. All whilst looking after our Prajava (Sri Lankan word for community).

Over the last couple of years we’ve grown substantially, whilst keeping a happy and motivated workforce. This has resulted in numerous awards wins. But perhaps the biggest measurable achievement to date is the 31% improvement of productivity across our factories in just under 12 months. This came about organically without any further investment towards new technology or systems during that period.

From a business perspective, this meant we had increased capacity to do more, and reach a wider audience. It also helped us win a host of prestigious awards for Sustainability, such as the Queen’s Award, National Business Award, Gold awards at Sri Lanka’s National Productivity Awards and many others. Just this month, we were awarded the “The Great Game of Business All-Star” for our commitment to generating results through integrating Open Book Management within the Creating Shared Value business model.

Even during the most difficult years, such as Brexit, we were able to keep our head high and remain profitable despite the numerous external challenges, and this was because everyone worked towards a commonly shared goal and had a high level of accountability in terms of their individual actions; no matter how little they believe them to affect the bigger picture. This is the magic of OBM.

While for my business and many alike financials have been strong, the most profound impact of OBM lies on the level of understanding it fosters greater understanding of business. When everyone started thinking and acting like commercially-minded business people they understood challenges better, and they applied their knowledge and skills much better. Hence, we are confident of a long-term approach that will make us a uniquely sustainable business.

Why now?

From my perspective, there is nothing more powerful than a business driven by entrepreneurially minded employees, that understand how their role plays a part in the bigger picture and strategy of the business. This is exactly the type of mindset and culture that OBM fosters, and embedded across the entire organisation, and if our results are anything to go by the potential is endless.

I urge other businesses to take stock of their current operations and means of growth, and look beyond the traditional strategies as it is through progressive approaches like OBM that the combination of business growth and employee satisfaction can be achieved.

And with more uncertainty heading our way, now is the time to start.

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The Impact of Covid-19 on Planning

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The Impact of Covid-19 on Planning 2

By Nilly Essaides, Sherri Liao and Gilles Bonelli, The Hackett Group

The economic consequences of the coronavirus outbreak vary by country and company, but one common factor is that most financial planning and analysis (FP&A) teams have had to go back to the drawing board to revise their forecasting process and update scenario plans. The unprecedented level of disruption in business conditions compels FP&A to abandon their traditional, tedious, bottom-up forecasting processes to produce forward-looking insights faster and more frequently. To accomplish this, FP&A should deploy high-level, cross-functional teams that, by working with a small number of KPIs, can assess how different scenarios are playing out in the market and recalibrate the business outlook.

Forecasting at the speed of change

The human and economic devastation caused by the rapid spread of Covid-19 upended budgets and rendered performance targets obsolete. At most companies, even worst-case scenarios did not account for an event of this magnitude – and for some, their very survival is on the line.

Under normal conditions, forecasting and scenario planning are distinct activities. Forecasting is about understanding where the business is landing compared to expectations (monthly, quarterly or on a rolling basis); scenario planning considers what could happen to the organization given one or more material changes in the business environment. At present, the line between the two is blurring as circumstances can change so fast that it is no longer possible to create a forecast based on past data. In addition, scenario plans must be reviewed frequently to ascertain which are becoming more likely.

Consequently, FP&A teams must exchange their traditional bottom-up, granular approach with a top-down, high-level methodology and conduct the forecast more frequently – but few are set up to accommodate this new process. More often, forecasting involves an all-consuming effort to collect data from business units and functions. To enable a more rapid response, FP&A should assemble a senior-level, cross-functional “SWAT” team with the mandate to review a limited number of KPIs (five to six, at most) in order to build a forecast that can be altered quickly as trigger events validate or disprove scenario plans.

This small team of experts can triage activities effectively while assigning specific areas of responsibility to more junior staff, such as forecasting working capital or discretionary spending. These specialists should work with a set of more granular KPIs. So, while the SWAT team may use a single cash metric, the working-capital team would dive deeper into DSO, DPO and inventory levels.

The first step is to alter the forecasting process, and the next is to adjust the feedback loop created through the management review meeting. Typically, these meetings focus mostly on BU-by-BU, actual-to-forecast and actual-to-budget variance analysis, using historical data. However, for many organizations – particularly those that have experienced a major reset of market demand and ongoing operations – spending time looking back at low-level comparative narratives is unproductive.

Instead, management should spend the bulk of its time reviewing the company’s best-case, minimum-viability and worst-case scenarios to determine which one seems to be playing out. To make sure planners target the right activities, management must ask the right questions: not how the company performed versus budget, but how conditions have changed and how that affects the forecast for emerging supply and demand scenarios.

A revised approach to identifying scenarios

For planning purposes, most companies develop three scenarios: base, best and worst. Given the nature of the Covid-19 crisis, a revised set of scenarios is needed:

  1. Best-case scenario: The best-case scenario should be anchored within tested hypotheses and initially focus on an assessment of demand conditions and capacity constraints. Current data may be mostly qualitative, but it should include insights gleaned from other countries and regions, particularly those exhibiting early signs of recovery.
  2. Minimum-viability scenario: This is the “new” base for companies hard-hit by the crisis or the scenario with minimum acceptable results to key stakeholders while remaining in business. This scenario must include a set of potential cost-reduction options in case conditions deteriorate rapidly. For instance, a minimum-viability scenario may include an X% reduction in workforce based on demand and supply projections.
  3. Worst-case scenario: The coronavirus pandemic may pose an existential risk to some organizations, so FP&A teams must also develop a scenario based on the worst possible conditions, including circumstances that may put the company out of business. In this case, FP&A should identify and monitor indicators that pose the greatest threat to the company’s status as a going concern.

Digging deeper into each scenario

Each key market or country or region should be categorized according to a variety of possible GDP growth scenarios.

A U-shaped recovery assumes the fastest rebound in key countries where GDP quickly reaches or nears pre-Covid-19 levels. These will be geographies where evidence of fast, effective control of the virus’s spread is combined with a strong policy response to prevent structural damage to the area’s economy.

Gilles Bonelli, Associate Principal, The Hackett Group

Gilles Bonelli, Associate Principal, The Hackett Group

A W-shaped recovery assumes a quick, partial recovery followed by a second wave decline in GDP in key countries or regions. These will be cases where evidence of fast, effective control of the virus’s spread is not accompanied by a strong policy response to prevent structural damage to the national economy.

An L-shaped recovery assumes that there will be no rebound in GDP. These will be countries or regions where there is no evidence of effective control of the virus’s spread.

The team should identify specific actions to be taken under each scenario so that management can act as economic conditions unfold. Additionally, FP&A must determine how changes in the environment may affect the company’s commercial and SG&A functions. Further, the trajectory of GDP will vary, driven by the public health and economic response of each country or region. Both inputs will be critical as companies determine how to proceed.

Due to the interdependence of different markets, it is important to consider elements of each in the entire strategic portfolio’s value chain. If a component of the value chain in any strategic portfolio is reliant on activities taking place in countries where a U-shape recovery is expected, then this component should attract more investment compared to those in countries where a slower recovery is likely.

If a component of the value chain in any strategic portfolio is reliant on activities taking place in countries where a W-shape recovery is expected, then investment in this component should be maintained. Accordingly, if a component of the value chain is directed to markets in countries where an L-shape recovery is expected, consider gradually divesting from the portfolio and phasing out related activities.

A catalyst for change

Covid-19 has underscored the discrepancy in planning and analytics capability between top-performing and typical peer-group FP&A organizations. The Hackett Group’s 2018 EPM Performance Study revealed that top-performing FP&A organizations have invested more in technology, which has enabled them to run more analysis and deliver reporting faster and more efficiently. Of top performers, 67% have implemented a primary financial planning and forecasting system to consolidate corporate and country, region or BU information.

Consequently, top-performing teams complete the forecast 3.5 times faster than the peer group and are twice as accurate. These capabilities are essential, as FP&A must provide information more quickly to help make operational decisions. Further, top performers have automated more of their data collection processes and use a standard set of data definitions across categories 92% of the time. This means their staff spend 44% more time analyzing data than collecting it, meaning that the team can redirect capacity to focus on Covid-19-driven demands for information and analysis.

While adoption of rolling forecasts remains generally low, top performers are 55% more likely to have done so than the peer group. Consequently, they can transition more easily from a fixed budget to planning based on a dynamic forecast. Additionally, one-third of forecasts among this group already rely on cross-functional collaboration, almost double the rate of the peer group.

Planning in the age of Covid-19

The coronavirus pandemic’s immediate and long-term repercussions will have a lasting effect on the way organizations plan and forecast, as well as how they approach scenario analysis. Early in the crisis, most FP&A teams had to scramble to adjust forecasting cadence, redraw scenarios, identify new KPIs and establish cross-functional emergency action teams. In contrast, FP&A top performers were able to adjust their existing processes relatively easily.

As companies start to shift from crisis mode to operationalizing changes required by the pandemic, post-crisis scenarios are starting to take shape. Expectations are for a prolonged period of uncertainty and a second wave of infections this fall, however, which makes it imperative that FP&A organizations update their approach to scenario planning immediately.

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Covid-19 can reboot belt and road initiative towards a sustainable future

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Covid-19 can reboot belt and road initiative towards a sustainable future 3
  • A new CMS report reveals that Covid-19 has boosted Chinese enthusiasm for adopting the principles of BRI 2.0, leading to an increased focus on sustainable and environmentally friendly projects such as smart cities and renewables & hydro
  • The appetite for an improved ‘Health Silk Road’ has significantly increased among the majority of both international and Chinese senior executives involved in BRI
  • Meanwhile, the research uncovers a clear mismatch in sentiment between Chinese and non-Chinese towards BRI and the success of projects

As global economies strive to build back better and greener from the global pandemic, global law firm CMS’s 2020 Belt and Road Initiative report reveals that the pandemic has boosted Chinese enthusiasm for adopting the principles of BRI 2.0, which will pivot it towards an environmentally friendly future.

BRI 2.0 is a new phase of BRI intended to encourage international involvement, which was announced in April 2019 by President Xi Jinping at the second Belt and Road Forum for International Cooperation in Beijing.

The study was conducted in partnership with global research firm Acuris and TianTong Law Firm and included a major survey of 500 senior executives from both Chinese and international participants in BRI projects. Their views were sought on a range of issues around BRI, including likely future involvement and obstacles they have encountered to date.

Increased enthusiasm for sustainable projects

The research found that nearly two-thirds of both Chinese (63%) and international (62%) executives agree that it is important that their BRI projects should be sustainable and environmentally friendly. Furthermore, the majority (84%) of Chinese respondents believe that sustainability and environmental considerations will be given greater importance when planning and completing BRI 2.0 projects.

Enthusiasm remains for traditional sectors like logistics, roads and rail, and now, particularly among Chinese executives, there is growing interest in relatively new sectors like energy networks and power grids, smart cities and renewables & hydro. For international respondents, the emphasis on sustainable projects is also increasing, with only a handful (13%) previously involved in renewables and hydro but nearly three times as many (34%) planning to target the sector for future opportunities.

Importantly, CMS’s research reveals that Covid-19 has given a boost to the ‘Health Silk Road’, which aims to increase medical infrastructure and public health in BRI countries. Nearly all the international executives (93%) and 85% of Chinese respondents see Covid-19 as a major catalyst for it.

Munir Hassan, Head of CMS Energy Group, said: “It’s clear that interest in more ‘modern’ and sustainable sectors, such as smart cities, healthcare and renewables has increased in significance. Renewables projects typically require less capital commitment, are quicker to complete and are likely to be judged at lower risk, which will be attractive to international and Chinese participants. As efforts to limit climate change intensify, there will be a major role for BRI investments to play.”Covid-19 can reboot belt and road initiative towards a sustainable future 4

Mismatch between Chinese and non-Chinese views

The research reveals that general sentiment towards BRI has declined in the last 12 months and one reason for this is geopolitical uncertainty, particularly among international participants. The survey has also uncovered a clear mismatch between views of Chinese and international executives that are involved in BRI projects.

Over two-thirds (69%) of international respondents said they found the process of participating in BRI related projects more challenging than they had expected, compared to just 40% of Chinese respondents. Likewise, only 37% of international participants said they were satisfied with the process and outcome of their involvement, compared to the majority (75%) of Chinese equivalents.

International participants have experienced difficulty with transparency, information flow and equality in partnerships and for many, this had impacted their view of BRI. But there are signs that more projects are now being structured to accommodate these concerns providing attractive opportunities for those international participants still keen on BRI involvement.

Regarding future partnerships / JVs, Chinese respondents are more enthusiastic than non-Chinese, with 77% likely to consider them, compared to just under half of non-Chinese (48%).

Munir Hassan added: “A key area of growth is likely to lie in projects that meet the trends of the future. Affordable projects, embracing modern technologies and methods, as well as the “open, green and clean” approach of BRI 2.0, will be those that stand the greatest chance of success.”

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