New Business Innovation in the Telecommunication Industry — Case Studies of Telecom Carriers in the World

Abstract

This chapter offers two insights from research on the strategies and organizations of telecommunication carriers in developed countries in this new era of IoT, AI and big data. The first is an observation from the viewpoint of the eight subsystems of a radical innovation system (RIS) and an incremental innovation system (IIS), the two contrastive systems that comprise a strategic innovation system (SIS) as discussed in Chapter 2. Telecommunication carriers have upgraded, improved and expanded their services under their current infrastructure based on an IIS, and at the same time have moved ahead with new business development in recent years through convergence with other industries by taking advantage of the exponential growth of the internet including SNS together with IoT, AI and big data based on a radical innovation system (RIS).The second insight is the existence of “hybrid networks” consisting of “exploratory networks” and “exploitative networks” as organizational infrastructure common to telecommunication carriers, and the existence of a multi-layered network structure that integrates “leader teams” as a third network structure which acts as connecting nodes of exploratory and exploitative networks. Such network structures that crisscross within and outside of these companies are deeply embedded within the companies as core structures. This type of “triad system,” a network structure that is deeply embedded in organizations and companies and crosses within and outside companies (1) creates strategic innovation capabilities (SICs) with capabilities that integrate dynamic capabilities (DCs) promoting exploration and ordinary capabilities (OCs) (or DCs and OCs) promoting exploitation, and (2) indicates that a balance between an “environment creation strategy” and an “environment adaptive strategy” is possible.