Six Imperatives to Accelerating Through the Telecoms Inflection Point

Executional clarity in an AI-driven telecom future has become a strategic necessity. The industry’s complexity, margin pressure, and rate of change demand cultures that reward simplicity, accountability, and speed. As one CEO put it at MWC: “If your teams aren’t clear, aligned and quick, they’re obsolete.”

Creating this environment starts at the top. Leaders must communicate a focused strategy anchored by a few key metrics, not sprawling governance structures. Teams should be tightly aligned around shared goals, with clear roles and permission to experiment without fear of failure. Growth and innovation need discipline in the core business to create financial room to invest.

Yet clarity remains elusive. Our GLM data shows that while telco leaders rate their culture higher than peers in other industries, they are significantly less motivated by their company’s mission (Figure 2). Worse, they’re more likely to consider leaving their industry than their goals peers. The risk is a brain drain of high-potential talent just as transformation becomes existential.

Figure 2: Telecom leaders’ views on their organization’s culture

^{Source: Russell Reynolds Associates’ H1 2025 Global Leadership Monitor, n= 139}

This isn’t just about structure. It’s about creating a culture where decisive action is expected, progress is measured, and every team understands how their work connects to long-term growth.

Digital transformation is talent transformation. Telcos know they must compete with tech firms for top skills in AI, cloud, data, and product. But few are moving fast enough to build the teams required to deliver their future strategy.

This starts with internal talent. Teams need to be pushed beyond their functional silos and comfort zones. Roles must be restructured for agility, collaboration, and clear impact. Career paths need to stretch across digital functions—and be backed by credible long-term plans. External hires are vital too, especially in domains like AI and platform innovation. But true success depends on integrating—not just acquiring—that talent.

Our conversations showed strong consensus: a five- to seven-year talent plan is now a prerequisite for credibility. The most attractive telcos bring a modern employer brand, visible leadership on innovation, and the ability to act as a magnet—not just a home—for high performers.

Winning the race for talent means making bold moves: rebranding roles, insourcing critical capabilities, and showing that transformation is more than lip service.

Customer-centricity is often discussed, but rarely embedded. But with retention flatlining, differentiation low, and the future being about anticipating—not reacting to—customer needs, this imperative is particularly urgent.

That means going beyond NPS and frontline CX. It requires rewiring the organization to make decisions through the lens of customer impact. Products need to keep pace with changing expectations. Processes must be redesigned for speed, not bureaucracy. And data must flow freely across functions to enable joined-up experiences. Teams need to be empowered to act on insight.

AI plays a critical role here. By anticipating customer behaviors and personalizing interactions, telcos can improve both satisfaction and sales. Verizon’s integration of Google’s AI assistant into its customer support channels has already delivered measurable revenue gains—proof that customer-first thinking can drive commercial outcomes.

Despite this, our research shows a gap between aspiration and confidence, as telco leaders are less likely than their digital and software peers to agree that their products and services are truly keeping up with changing expectations (Figure 3).

Figure 3: Technology leaders’ views on their organization’s products and services

^{Source: Russell Reynolds Associates’ H1 2025 Global Leadership Monitor, n= 201}

Embedding customer-centricity isn’t about rhetoric. It’s about aligning systems, decisions, and incentives around one goal: delivering value that feels personal, fast, and reliable.

For telcos, digital transformation is no longer about adopting new tools. It’s about re-engineering the business around technology—simplifying operations, unlocking new services, and building scalable, unified experiences.

This means fully embedding AI, automation, and digital platforms into the operational core—not layering them over legacy systems. The shift to platform-based models is already underway, with digital-first teams driving faster execution and enabling more personalized, multi-channel experiences.

But there’s a readiness gap. Our Global Leadership Monitor shows that while 87% of telecom leaders agree that GenAI fluency is a must-have skill for future C-suite leaders, only 50% believe they currently have the right skills to implement it (Figure 4). Even more striking, 35% of these leaders remain uncomfortable using AI at all. This is especially jarring when we compare this to leaders across industries globally, where only 22% say the same.

Figure 4: Telecom leaders’ personal comfort engaging with generative AI

^{Source: Russell Reynolds Associates’ H1 2025 Global Leadership Monitor, n= 308}

That discomfort threatens to delay action at a moment when speed matters. Encouragingly, the appetite is there—but the challenge is activation: building digital DNA into leadership teams, simplifying governance to support innovation, and expanding offerings into high-growth areas like cybersecurity, analytics, and content for SMEs.

AI has disrupted how telcos approach innovation. Now, it must also disrupt how they scale.

Telecom operators are facing intensified scrutiny from capital markets as returns on invested capital (ROIC) decline. Recent analyses indicate that the average ROIC for telecom services hovers around 5.6%, significantly lower than sectors like energy, which average 14.5%. This disparity underscores the need for telcos to reassess their financial strategies to remain competitive and attractive to investors.

The surge in demand for AI and digital services has spotlighted the value of digital infrastructure assets. Data centers, in particular, have become highly sought-after, with global investments reaching $57 billion in 2024 alone. This trend presents an opportunity for telcos to capitalize on their infrastructure by exploring asset monetization or partnerships.

However, the integrated nature of many telecom operators can obscure the value of individual assets. There's a growing perception that the sum of a telco's parts—such as towers, fiber networks, and data centers—may be worth more than the integrated entity. This has led to a wave of asset divestitures, with operators selling tower portfolios and other infrastructure to unlock value and improve financial flexibility.

To navigate this landscape, telcos should: Reevaluate KPIs: Shift focus from traditional short-term metrics to those that reflect long-term value creation and strategic ROI. Enhance transparency: Clearly communicate the value and performance of individual business units to stakeholders. Strategic asset management: Consider partnerships or divestitures that can unlock capital for reinvestment into growth areas like AI and digital services.

Capital markets are not inherently hostile to telecom. But they need to see credible ambition backed by financial logic. That means aligning finance not just to operations, but to strategy.

The next wave of growth will be ecosystem-driven—requiring collaboration with partners across technology, content, and infrastructure to deliver integrated, high-value services, rather than the go-it-alone strategy of the past.

While European operators continue to optimize their core businesses, leaders in emerging markets are moving faster into adjacent services. But regardless of market, the imperative is clear: build platforms, not products. Build partnerships, not dependencies.

This means co-developing offers with cloud providers, engaging with startups and scale-ups, and creating new business models around shared data and APIs. It also requires stronger segmentation: understanding customer needs more deeply and designing for relevance, not reach.

Our MWC conversations highlighted this shift. Telco leaders are increasingly looking to industries like aviation and banking for inspiration—sectors where loyalty and lifetime value are driven by ecosystem participation, not one-off transactions.

Ecosystem leadership isn’t about control. It’s about orchestration. The winners will be those who can connect capabilities across boundaries to solve real problems, fast.