Women In Comms

AT&T Takes 'Startup Mentality' to Wholesale

CHICAGO -- International Telecoms Week -- AT&T has spent the past two years transforming how its partner solutions division does business, and its next goal is to scale that model up to its wholesale division -- and eventually the entire company.

Two years ago when AT&T Inc. (NYSE: T) was given a directive to improve how its Partner Exchange program reached mid-market solutions providers and resellers, Brooks McCorcle, head of AT&T partner solutions, decided she would set up a startup business within the walls of AT&T. This would not be the same as the carrier's Foundry, where it fosters innovation through startups. Instead, it would be an AT&T business with its own employees, working against the constraints of a traditional carrier. (See AT&T Opens Up for Partner Program.)

That said, McCorcle borrowed a lot from the Foundry, including 30 of its brightest employees from all areas of business, the open floor plan, glass walls, the scooters and ping pong tables type of vibe and the motto of implementing changes fast and correcting mistakes after they have been made. (See Pics: AT&T's Foundry of Things.)

The end goal was to build a business model around solutions providers that was flexible, responsive and improved the customer experience -- all within 90 days.

"By putting the 90 day stake in the ground, it caused them to think differently about solving it," McCorcle said in an ITW interview. "We built the basic model and put the IT team together with the business team and customers, and they worked in four to six week sprints to build the functionality that is the engine behind the partner exchange."

That was about two years ago. One year ago, AT&T decided to API-enable the entire platform so that its customers could more easily tap the carrier's resources to automate functions of their sales cycle, such as instantaneous quoting, determining service availability and compiling contracts. (See AT&T Opens up WebRTC API, AT&T Unveils Mobile Security API and ESDN: AT&T Calls for SDN APIs Now.)

Light Reading is hosting its fourth -- and biggest -- Women in Tech breakfast at the Big Telecom Event on June 10 in Chicago. If you are a woman in the industry, you're invited to attend free of charge! Find out more and register here.

AT&T's Partner Exchange division lives on the third floor of its Foundry in Plano, Texas. And, with two years of success around its belt, the carrier is turning towards figuring out how to scale this new model of doing business, including the API platform and the culture shock that may come with it, to its wholesale business.

McCorcle is confident this model will translate to other parts of the carrier, because she said AT&T had allowed her to stay independent with her own marketing, pricing and operations support. She's also feeding those employees she brought over to Partner Exchange back into AT&T to help spread the culture. What's more, this isn't the first time AT&T has tested the waters on a more startup-like culture. It's Digital Life division, under Kevin Peterson, and its Network On-Demand business, under Josh Goodell, are run the same way. (See CTIA: Digital Life Pays Off for AT&T and SDN Powers AT&T's Rapid On-Demand Expansion.)

"When we want to start up new different ideas within the size of a company like AT&T, it's nice to give them the space and independence to do well, then incorporate them back into the larger AT&T," McCorcle said. "It works well for startup ventures."

The approach differs slightly from that of carriers like Telefónica and Orange (NYSE: FTE), which actually spun off their startup divisions --Telefonica Digital and Libon, respectively -- instead of trying to build them in-house. Interestingly, both of these carriers ultimately brought the companies back in-house, noting that they now plan to incorporate their learnings throughout their businesses. (See Disrupting Telefónica in a Small Way and Innovation Makes Life Better for Orange.)

AT&T also says its ultimate vision is to transform the entire company. It's a process that certainly won't happen overnight as we're talking about a huge, established operator with a long history of operating in a certain (typically slow, top-down) way. But, the good news is, AT&T and others like it increasingly seem open to evolving how they do business to keep up with a more API-driven, open, fast-paced industry -- one business segment at a time.

"Part of it is opening up the space, then it's who you put in the space," McCorcle says. "We are starting to open up floors. We're starting to see that kind of culture. It's also about who you put in that space. If you put marketing all in one floor, where are the IT people they work with? We want project teams working in open spaces downtown. Making this kind of cultural shift is big, but it's one that our chairman has championed. It's the culture he wants at AT&T."

— Sarah Thomas, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editorial Operations Director, Light Reading

MordyK 5/18/2015 | 6:47:18 PM
Re: Spin Whether it was a cynical play or a true commitment, the fact that they're recognising its effectiveness and making some real commitments to it albeit slow, speaks volumes and holds real promise for teh future IMO.

I never thought I'd say this, but Kudos to AT&T.
danielcawrey 5/18/2015 | 1:01:29 PM
Re: Women in Tech I really like this idea. I think other large companies should be doing the same thing. There are a few interesting things that larger organizations like this are doing to try to compete with upstarts.

I would think this model is a much cheaper one than having to buy a company outright later one. 
sarahthomas1011 5/18/2015 | 11:11:27 AM
Re: Spin That seems like a fair characterization, although AT&T's original mission was to solve a problem -- find a better way to serve mid-sized businesses -- but it worked so well, they decided to revamp other parts of the organization in the same way. I'm not actually sure if they set out to create a model to replicate or just to find a way to improve operations in one unit, but it worked out that way. The Foundry really started driving this mindset for the entire orgnaization.
kq4ym 5/18/2015 | 11:08:40 AM
Re: Spin I wonder if there's some rule of thumb that would decide on which way to go, in house or spin off. "When we want to start up new different ideas within the size of a company like AT&T, it's nice to give them the space and independence to do well, then incorporate them back into the larger AT&T." Maybe the big guys only have that luxury?
MordyK 5/15/2015 | 1:52:11 PM
Re: Spin From the way you describe it, it looks like an insurgency operation aimed at the company, whereas ALu and Libon appear to be more of a niche capability that's not attempting to spread into teh entire corporate DNA.
sarahthomas1011 5/15/2015 | 1:28:38 PM
Re: Spin That sounds more akin to AT&T's actually -- Telefonica and Orange actually spun their companies out, so they were completely separate. Nuage stayed in house. In practice, they should operate the same way, but I wonder how much autonomy they are given in house. I'm sure it varies by company and mission of the startup.
mwagner919 5/15/2015 | 12:24:31 PM
Spin The Telefónica and Orange approach is also used by suppliers such Alcatel-Lucent with its Nuage business, and Cisco with Insieme. These wholly-owned subsidiaries, or "spin-ins," create an arms-length relationship that fosters innovation. 

I'm skeptical when I see big, established companies buying scooters and ping-pong tables. It's like a hjigh school guidance counselor dressing like a teen-ager to look cool. 
sarahthomas1011 5/15/2015 | 8:43:34 AM
Women in Tech Speaking of Women in Tech...McCorcle is a great example of a female leader in our industry. She is a big advocate for women in our business and half of the people she employees are women. She also talked about the importance of mentoring and investing in STEM at the high school level. Her goal is to recruit women who have that background and develop them to be leaders in the company.

It's great to hear that AT&T has a number of initiatives -- Women of AT&T, Women of AT&T in Finance, etc -- to support women at the company and the industry at large.  


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