Jump-starting innovation for a telecom solutions provider - Bain & Company

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Case Study

Jump-starting innovation for a telecom solutions provider

With its major product line nearing maturity, a mid-sized telecommunications solutions provider needed innovative new products to turbocharge growth. Bain helped refocus NetworkCo around surging demand for mobile Internet networking products, putting the company back on track as a market leader.

  • min read

At a Glance

  • 10% revenue increase
  • 20% gross profit margins increase
  • 30% share price increase

The Full Story

The Situation

In the rapidly changing telecommunications marketplace, NetworkCo* found itself without a new profit engine. NetworkCo had curtailed investment in its innovation pipeline, and was left without a new line of products to fuel sustained growth.

The combination of low-cost competitors and a consolidating customer base intensified NetworkCo's need for a clearly focused growth strategy.

Our Approach

Bain helped NetworkCo reprioritize its R&D investments, weeding out low-margin product lines and focusing investment in high-growth areas like mobile Internet solutions.

Our Recommendations

Bain developed an adjacency strategy, resulting in the acquisition of a promising new product line. Finally, Bain strengthened cost management to ensure that growth products hit cost targets.

The Results

NetworkCo has revitalized growth with the product strategy that we helped craft.

The company's focus on mobile Internet solutions for telecom service providers has delivered rapid returns: new high growth products accounted for a 10 percent increase in revenues and gross profit margins shot up almost 20 percent. The stock market also responded, with NetworkCo's share price surging 30 percent over the course of a year.

 

* We take our clients' confidentiality seriously. While we've changed their names, the results are real. 

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