Christophe Châlons, Chief Analyst at European market research and consulting company Pierre Audoin Consultants (PAC), on T-Systems'core beliefs.

M. Châlons, you are fond of saying “a crisis is the right time for slaughtering sacred cows” – what baggage do you think companies should be shedding?
In times of crisis, the tendency is to keep one’s head down and move slowly and cautiously – by way of harmonization, automation, integration and collaboration. But a crisis is exactly the right time to get rid of dead wood, streamline the portfolio, and maybe even reposition the company – in other words, to take big steps forward.

How can an ICT provider help? With this in min, what is your view of T-Systems’ strategic focus on five core beliefs and the corresponding alignment of its portfolios and services?
It makes perfect sense. It’s always essential to be focused, and I believe T-Systems has set the right priorities. It has chosen areas where, unlike some of its competitors, it is able to generate major synergies as a member of the Deutsche Telekom Group. Five core beliefs that offer the company significant opportunities today and in the future, and where T-Systems has an appealing and credible vision to share with customers.

On the subject of opportunities – cost predictability and transparency is a critical issue for enterprises – how would you rate dynamic net-centric sourcing in this context?
As IT evolves, business models evolve, too. And in terms of enabling the flexibility that requires, the dynamic provision of IT services, along with pay-as-you-go pricing, is key. So we need to make costs more predictable and give customers more room to maneuver. Dynamic net-centric sourcing helps companies prepare for the radical changes that virtualization and cloud computing will bring.

For the new generation of employees, Facebook, Twitter etc. are everyday communications channels. At the same time, Web 2.0 has accelerated the development of new business and collaboration models. In your view, how well prepared are T-Systems customers for this new trend?
In many companies, it’s unclear what new habits and applications today’s digital natives will bring with them, but the fuss will soon die down. I don’t believe that everything young people customarily use today can be usefully employed in a business context. But in principle, Web 2.0 creates a basis for finding information faster, pooling knowledge, and exchanging experience within personal networks.

That doesn’t sound 100% positive.
You’re right. To put it plainly, the range of new information and communications channels that enterprises will have to deal with is almost infinite. But there’s no cause for concern. In light of this diversity, enterprises need an adviser, a coach if you like. And T-Systems – and service providers in general – are called upon to encourage their customers to embrace these new communications channels. Because declaring Facebook, Twitter and the like to be no-go areas is not the best way to secure the loyalty of young talent.

Mobility is seen as the biggest driver of growth, even in times of recession. What benefits do companies gain from T-Systems’ Mobile Enterprise offerings?
It’s essential to deploy the latest tools and integrated communications technologies to enable you to work efficiently in difficult times. By giving staff access to information any time and anywhere – not just from their office desktops – you can accelerate a great many processes. That not only saves time, it also cuts costs. T-Systems has recognized this and drawn the right conclusions.

How can end-to-end and role-based security concepts help address the huge range of requirements associated with security and governance?
Security is a key factor in all areas, whether we’re talking about mobility, collaboration, Dynamic Services, or cloud computing. End-to-end services help to minimize or completely eliminate potential risks at the interfaces, e.g. in collaboration with other companies, but also between telecommunications and IT. In terms of user-friendliness, or secure, legally compliant data processing, or standardization, the question of “who’s allowed to do what” is critical. This creates the need for role-based security concepts, for example. The question is, do I want a piecemeal solution, or a comprehensive, end-to-end service? If you want to be on the safe side, the choice is obvious.

Now that statutory regulations are turning corporate and consumer responsibility and sustainability into “must haves” rather than “nice-to-haves”, what do IT service providers need to offer?
As far as green IT goes, virtualization has a key role to play, especially as it offers a way of keeping costs in check. It’s about environmentally-friendly data centers, desktop virtualization and cloud-based models, and it’s about the role of IT in smart power grids. If you optimize the control and management of production plant and supply-chain processes, you can slash energy consumption – in all industries. So firstly, greater energy efficiency is required of IT itself. But above all, IT can be employed to curb energy use across a whole array of business processes. So I see IT as an enabler of sustainability.

By closing deals with the likes of Shell, Philips and BP, T-Systems’ CEO Reinhard Clemens is pursuing a very clear strategy. What part do you believe the company’s core beliefs have played?
Dynamic Services was often key to deals like these. T-Systems’ competitive edge in this space has enabled it to win these deals and demonstrate its global delivery capabilities. And it’s important to recognize that its core beliefs are not only relevant for the future, but take account of where enterprises stand today, and the markets where T-Systems already has a strong presence.

What does that mean in practice?
T-Systems is leveraging its current strengths to build future success, by offering Dynamic Services to a market where it already has the credentials of a major global player. With the benefit of this strong base, it can then address more innovative topics such as collaboration and mobility. And T-Systems will continue to develop its own and its customers’ strategies.
That’s why I find the core beliefs so compelling – because they don’t map out a hypothetical future and say “Where do we start?”. They look at the situation T-Systems and its customers face today, and offer a way forward based on the ICT specialists’ bread-and-butter business. The fact that T-Systems already possesses the knowledge and skills required in one key area – the scalable delivery of IT services with pay-as-you-go pricing – creates confidence and ensures that customers will trust T-Systems when it comes to achieving their other goals.

What is the relationship between the five core beliefs and T-Systems’ position within Deutsche Telekom?
Within the Deutsche Telekom Group, T-Systems is the ICT enabler, allowing the group to create value-added services by combining a wide variety of components. As Reinhard Clemens’ experience at EDS has no doubt taught him, focusing on infrastructure and services is no longer enough if you want to earn money. Ultimately, you need to understand how your customer’s processes are evolving, where they are going, because this is where issues like collaboration and mobility will play a key role in the future. Customers want value-added, and T-Systems delivers just that.

How do you see T-Systems in comparison to competitors?
Sustainability, security, cloud computing – none of these were invented by T-Systems. They are important to everybody, and everybody has something to say about them. Where T-Systems has an edge is its ability to integrate and combine these topics and its credibility in pursuing them. What’s special about T-Systems? That’s no secret: It’s not a traditional IT service provider like Cap Gemini, doesn’t have a complete portfolio including hardware and software like HP or IBM, and it’s not just a provider of telecom services like AT&T. It’s the combination of IT and telecommunications that makes T-Systems special. That’s its chief asset, and against that background, its five core beliefs fit T-Systems’ USP like a glove.

Thanks to its strong cloud computing capabilities and dynamic offerings, T-Systems is becoming an increasingly attractive partner for targeting specific markets.