Analysing the relationship between NaaS implementation and customer success metrics in enterprise network services

NaaS implementation can lead to material improvements in customer success metrics

Network operators have historically struggled to deliver excellent customer experience

Delivering market-leading customer experience is not something that comes naturally to the telecom industry. With a sector average net promoter score (NPS) of 31, telecom operators have the lowest NPS of any industry surveyed as part of CustomerGauge’s ‘B2B & CX Benchmarks Report’.

NPS by industry vertical

Some of the classic pain points for an enterprise connectivity customer for a legacy network operator include:

• Service provisioning: Enterprises face long provisioning lead times, complex deployment processes and delays due to infrastructure constraints and coordination issues with third parties (e.g., installation contractors, local public sector).
• Service assurance and visibility: Network operators have struggled to deliver real-time service because the service assurance features supported by proprietary network components often do not correspond to customer service priorities. In addition, fault detection and resolution can be slow due to reliance on manual processes.
• Commercial inflexibility: Rigid contracts, high termination fees and difficulty scaling bandwidth or adapting services to changing business needs create financial and operational constraints.
• Poor customer service: Slow and manual response processes, coupled with limited capabilities for customers to self-serve (either for visibility or service adjustments), lead to frustration for customers.

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Customer satisfaction impacts acquisition and retention. Indeed, a recent case study from Bain & Company, albeit on the consumer side, demonstrated the potential impact of customer experience improvements on the bottom line. In select customer experience trials, sales conversion increased by 20%, while NPS saw a 50% rise. On the enterprise side, the impacts of prioritising customer experience on the bottom line can also be seen.

In enterprise connectivity, certain early adopters of NaaS solutions have outpaced the industry in terms of customer experience benchmarks, leveraging a cloudified architecture and cross-domain data flows to solve customer pain points such as service assurance via real-time dashboards and commercial flexibility by means of pay-as-you-go offerings. This evolution in customer engagement and experience is impacting the bottom line, with NPS up, churn rates down and customer lifetime value up.

While NaaS is a core enabler of market-leading customer experience, it cannot be thought of as a silver bullet. To deliver a truly leading experience for your enterprise customers, NaaS must be considered as the technical enabler of a wider customer-centric operating model, alongside streamlined customer engagement processes, investment into people and capabilities, as well as senior sponsorship for prioritising customer centricity as a core business value.

Early NaaS adopters lead the industry in NPS

To test the impact on customer experience of NaaS implementation, we have analysed the relational NPS of a select group of network operators which demonstrate fundamental components of a customer-centric NaaS solution, alongside a select pool of more traditional Tier 1 network operators. All data within the graph below is taken directly from the network operators (e.g., from annual reports). We looked at four key indicators of NaaS adoption as it impacts customer experience:

• Customer portal availability – a web portal available for customers to access information about their service
• Customer integration – availability of APIs to allow customers to ingest data from their network operator into their own IT stack (e.g., NOC alerts or service assurance reporting)
• Commercial flexibility – availability of pay-as-you-go commercial model
• Hyperscaler marketplace listing – service availability through a hyperscaler portal

The seven virtues of a differentiated customer experience

Table of contents

• Executive summary
• The coming storm: evolving enterprise networking priorities
• Defining NaaS and its benefits in enterprise network services
• NaaS is the on-demand delivery of flexible, modular network services
• NaaS adoption benefits both network operators and their customers
• NaaS implementation can lead to material improvements in customer success metrics
• Network operators have historically struggled to deliver excellent customer experience
• Early NaaS adopters lead the industry in NPS
• Leveraging NaaS-enabled data to create a differentiated customer engagement model
• Conclusion

Related research

• Networks for AI: Segmenting the growth
• 5G: The next phase
• Simplifying NaaS for easier enterprise consumption: Capturing the USD100bn opportunity
• Productising NaaS: A case study from India’s most disruptive player

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Joe Hurman

Joe Hurman

Principal Consultant & Data Centre Lead

Joe is a Principal Consultant at STL Partners, having joined last year from a background in technology and operations consulting. Since joining STL Partners, he has worked with telcos and their partners on strategic engagements across a variety of topics, ranging from enterprise service development across edge and IoT to network innovation, including cloudification, automation and API exposure. Joe holds a BA in Economics from Durham University.