The document discusses the theory and implementation of managed services in the telecommunications industry. It notes that traditionally telecom operators controlled end-to-end operations but that managed services are now shifting to improve customer experience, increase revenue, and reduce costs. The value of the global managed services market in 2013 was $2.59 billion, third largest after financial and manufacturing services. Key drivers for managed services are improving operational expenses, reducing costs, and enhancing customer experience. The document also examines the adoption of managed services in Indonesia and provides an example analysis of one company's experience.

1. Company
LOGO
Managed Service
Theory Versus
Implementation

2. Background
It is becomes old paradigm when the telecommunication
operator should control the end to end operational and
business of the telecommunication industry, some key
points why the telecommunication operators should
managed service are:
• Improving customer experience
• Expecting growing revenue significantly
• Dramatically reducing operational cost
Refer to outsourcing index, the value of the managed
service on 2013 are around US $ 2.59 Billion, It is becomes
the third largest industry segment, after financial US $ 5,3
Billion and manufacture US $ 3,48.

3. Key Drivers
The composition of the managed
service key drivers refer to the TM
Forum, it is still dominated with
the improving operational
expense (88%), since the
invention at the data service
business have changed the
customers behavior where it’s
changed the operator revenue
stream.
Follows by the reducing opex
(55%), improving customer
experience 48%.
This condition have been
influenced the Indonesian market
too, and the all of
telecommunication at Indonesia
will shifting becomes managed
service company at the near
future.

4. Managed Service in Indonesia
The figure of the managed service at Telecommunication industry in Indonesia :
Managed service Company:
1. Axis (Merged with XL Axiata)
2. XL Axiata
3. Three
4. Smart Telcom
Non Managed service
Company:
1. Telkom Indonesia
2. Telkomsel
3. Indosat
Operational cost, customer handling
and revenue level expected improved
significantly.

5. Managed Service Milestone
1980
Overall customer experiance
In order to ptotect & grow revenue
PIC 10.x
2000
Offshoring MS
At Other Country
Efficiency & cost
improvement
2000 - Now
Initial MS at
IT Industry
1990
Manage Service 1.0 Manage Service 2.0 Manage Service 3.0

6. Key Drivers Customer Experience Program
Managed Service 3.0 objective is
to improve overall customer
experience, the key drivers for
the customer experiences:
88% to increased customer
satisfaction
68% to reduced operating cost
and
62% to increase revenues.

7. Xl Axiata Practice - Opex
The lesson learned from the XL
Axiata which have beem
implementing the managed
service several years ago, shows
that:
1. The operational cost expense
doesn’t reduce significantly
2. The salary (wage) of the
employee decrease slightly

8. Xl Axiata Practice - Revenue
During 2010 up to 2013, XL
Axiata have stable revenue
growth, but the value of the
revenue is not significantly
increase as a targeted on
managed service objective.

9. Xl Axiata Summary
The above data and highlight of the XL Axiata corporate profile before and after
implementation of the managed service shows that:
 The first objective implementing the MS is reducing the operational cost, but
from the above comparative data, it doesn’t impacted significantly to the
reducing opex, the employee salary (wage) could be decrease but not for other
operational cost.
 The revenue from the 2010 up to 2013, increased up to 4 billion rupiah, but 2012
vs 2013, the revenue relatively flat in term of revenue.
 CSI (customer satisfaction index) claimed increased compared to other
competitor, refer to award which received by their customer service from line.
On the managed service implementation, not the all of objective could be achieved
well as mentioned on the target, since there are many parameter influencing the
process, such as market profile & competitor attack.