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A CFO in the front-row seat of 5G roll-out

Thivanka Rangala, FCMA, CGMA, is the CFO at edotco Group, a telecommunications tower company that is building network infrastructure for 5G technology in Asia. He shares insights on preparing for 5G roll-out and advises finance professionals to stay ahead of the curve.

What you’ll learn from this episode:

  • Disruption in the telecommunications tower industry and changes to edotco’s finance team.
  • Examples of finance business partnering from Rangala’s earlier role in commercial finance.
  • His finance team’s preparation for 5G roll-out.
  • How finance professionals should learn continuously.

Play the episode below:


To comment on this podcast or to suggest an idea for another podcast, contact Alexis See Tho, an FM magazine associate editor, at Alexis.SeeTho@aicpa-cima.com.


Transcript:

Alexis See Tho: Thivanka Rangala, FCMA, CGMA, is the CFO at edotco, a telecommunications tower company headquartered in Malaysia with operations across seven countries in Asia. As the CFO of a tower company, he is at the forefront in spearheading 5G implementation in region. In this episode, he shares how 5G technology will change how finance teams work, his observation of how the finance function has changed since the 1990s, when he first started his career in Sri Lanka. Here is our conversation.

Thivanka, thanks for joining us on FM podcast.

Thivanka Rangala: Thank you for having me.

See Tho: So you've moved around in a company going from finance, to the commercial aspects, to investor relations, and now a CFO. How did you get to move about two different teams in the company? That doesn't seem like a conventional path for a finance person?

Rangala: Very true. I, actually, in a way, I credit this to my education, right? So I started off life trying to do bio science, and then I decided I don't want to be stuck in a hospital and be on call to manage patients and all that, and strangely enough from bio science, ended up doing accounting, and I took up CIMA, because I didn’t want to be a number cruncher.

I wanted to be a management accountant. And that’s honest right to the core, because that’s exactly what I wanted. It so happened when you’re going through the different modules, et cetera, you see different aspects of the business. And I was always a very curious person, because doing numbers is one thing, but understanding what’s behind those numbers is very different. So I got terribly involved in what we call value-added services those days. So the unit I ran actually developed the value-added services for Dialog, which was the largest mobile operator in the country at the time, and is still today.

And we used to develop products. So we did software development. We did products. We did three products which actually, in three consecutive years won the GSMA awards as well. So it’s been a pretty decent and interesting ride, it allows you to get the drivers that are there for the business.

I was always the guy who would go down to the production floor to understand what’s going on. That’s how I ended up in different portfolios, so to say.

See Tho: You were just at the Future of Finance workshop in Jakarta, Indonesia, that CIMA co-organised. You talked about how companies have to change the finance function performance to meet challenges. Can you talk about what are those challenges that companies in Asia are facing?

Rangala: Absolutely. I think we’re on the cusp of very significant changes, and there’s a lot of data out there, and it’s a significant amount of content to digest. If you can’t process that in an understandable manner which is useful to us, we will get into what you call a Kodak moment, right? We’re just going to get obsolete, because everything that is out there is so accessible to anybody that is starting out a business.

Look at Uber. Look at Airbnb. They’re just erasing a lot of hard work that has been done by the conventional taxis, and hotel chains, et cetera. Now when it comes to us in finance, it’s fundamental that we get on the big data, digitisation, and automation that is out there. If you want to really ensure your business part of the organisation, you need to be an adviser rather than a reporter of the past.

See Tho: So this is the concept of being a finance business partner, but how does that look like on a day to day basis?

Rangala: I’m going to actually go back to my Dialog days. I’ll tell you something about how we looked at it — and I had to do this to the previous CEO, giving insights.

We were told to look at the foot traffic at a bus stand in various city locations, and we just looked at him at the time and was wondering what has this got to do with network planning, right?

Rangala: He wanted us to clock the time. He wanted us to find out how many people, what are they doing, and observation, and it’s a very simple thing. All he was trying to do was see when to put capacity where. Because bus stops at the time was where a lot of people were waiting in respects to their rides home at the time, and he was trying to see where the highest number of foot traffic was. There weren’t huge malls, et cetera, and this is where he felt needed adequate coverage, so that we’re able to cater to a congregation of people. This is back in the days when 3G was just getting about, so we needed to do adequate coverage at the time where there’s a large concentration of people.

See Tho: So he was thinking of putting some sort of transmitter at the bus stands?

Rangala: Correct. At the time not micro [transmitters] but ensuring there’s adequate coverage and capacity in those areas where there’s a large concentration of people. And just to take that analogy, if you look at it, it’s about trying to predict where we should go, rather than saying this is what happened, and this is why we didn’t make it, right? That is what’s important today. Today as finance, we work with the other senior members in the organisation. We’re looking at how we can navigate the space. We’re a tower company, right? We started pretty late in comparison to how other nations, and the Americans, and even the European markets have been.

But we have grown to be, I would say, the go-to regional tower company player in this part of the world. That is by looking at where the market is, how to evolve our services, and to look at what makes sense for us as a tower company player to be there without getting obsolete.

See Tho: What are the disruptions happening in the tower business?

Rangala: If you look at us as a tower company, we actually build towers, literally. We had this ugly red and white structures in the middle of everywhere you see and we had antennas hanging on them. That was becoming difficult because cities and people were not wanting these structures all over the place. We started getting on top of the roofs and called them rooftops. Today these are embedded in the street furniture — in signage, and bus stops, and lampposts and stuff.

And if we can’t change our mindset to move from those four-legged structures like you see with the power cables, to these new structures, which are a lot more challenging to execute and deliver, we will very soon eliminate our growth.

So as technology increases, evolves, for our customers, we need to ensure we also cater to those needs. It’s very disruptive. These are the Shell signages. We have antennas embedded through a partnership with them inside the signage, so you don’t see the ugly antennas out there. We do the signages sometimes on the roads. Bus stops, we’re starting to convert them to smart bus stops as well as lampposts. The street lighting, we put antennas and other monitoring devices there to make it a smart lamppost.

See Tho: Take us back to when you were in Sri Lanka 20 years ago, and then later on Malaysia. How different was finance done back then compared to what you’re doing today?

Rangala: So back then, 20 plus years ago, we were literally just focused on reporting, and we report the past, right? We make sure this is accurate, as timely as possible, focus on audits and protection of our assets. Make sure our affairs are in order, et cetera. Today it is about getting all that I said done fast and accurately, but actually using that and a lot of the other data that is out there in the market to help strategise, plan for the future, and to try and make us a relevant organisation in the footprints that we’re operating.

It’s significantly different. There are people who come from some of the old school organisations, I would call it, in finance where they’re still reporting. They come here and I can see them for two to three months, trying to figure out, what on earth are these guys trying to do? They’re crunching data which makes no sense, but over time they start realising, “Ah, this is why you guys look at this”, because they see how that fits into the big picture and how we start executing as we go along.

See Tho: What about the software or technology you’re using today? Are they very different?

Rangala: Let me put it this way. We use a few bots. We have a lot of software-as-a-service platforms so it enables us to execute faster instead of buying millions of dollars of hardware and racks we put in server rooms. But in fairness I’d say we’re not anywhere close to what we would like to be.

We haven’t really dwelled on getting into AI and all that. We’re not really executed on the blockchain capabilities, but we do have a project that’s spanning over three years. We’re looking to try to use decentralised processing so that we can get a faster, more accurate output of what we’re doing. We’re trying to use a bit of AI so it’s more predictive analytics.

I’m going to take a step back given this particular part, on the question that you raised earlier, in terms of finance, how we look at things differently. So in all this digitisation that we’re doing, we do what we all like to play with — drones.

So we use drones to look at our sites. Usually it’s a rigger that goes up on the stairwell with all the harnessing, checks the place up at the tower, comes down, and reports it to the engineer.

That’s the traditional way of doing a tower survey, to find out what is there, whether it’s corroded. Today we send up a really funky, expensive drone that rotates 360, goes all the way from the bottom, right to the top, in a few minutes, no risk, comes down, and the AI engine that’s fused to the back of the software for taking the camera input is able to detect what types of antennas, whose antennas, what is the cabling that is there, whether there is rust on the tower, whether there is leaning or any angle of deflection that needs to be corrected as well as anything that is out of place, including taking inventory count of what’s on the antenna.

This we ran as a project because that’s my FAR [fixed asset register]. That’s my revenue assurance. That’s preventive maintenance, being alerted in a proactive manner that only we would be able to do, because the rust — the 360 angle is not something a rigger can do. It’s able to go in the middle of the antenna, it’s able to go around the tower, as well as go around it. This is extraordinary in terms of the efficiency, the quality of the information, and having our engineers look at this height real time, and be able to focus and zoom in. And the data is there, even 10 years later, to evaluate to see what is moved from that time to now.

See Tho: So the Malaysian government is pushing for 5G technology in the country, and being a tower company that’s linked to the government, edotco plays a central role in laying the foundation. What is your role as CFO in making that happen?

Rangala: So this is somewhere — when you do something like 5G, you need a lot more capacity, from the M&O [maintenance and operations] point of view, and you also need locations which is effective to have that capacity in. What we do as a tower co and from the finance point of view is we look to see where it’s the most effective to have that coverage site, and instead of inside of the towers, as I mentioned earlier, you need infill, and you need street furniture, unlike the earlier days. These are the lampposts, bus stands, and in-building solutions and desks. So what we do is work with our engineering teams and look to see what is the most impactful land-efficient to place, to put our coverage, so that our operators and customers are able to come onto those sites.

It’s plug and play, and ready to go live in a very short time span compared to the previous times.

See Tho: What are the countries leading if 5G today?

Rangala: I think you see Europe is very aggressive in this space. South Korea has really fronting data throughput speeds. China as well, and in this part of South Asia, you see Malaysia trying to get on the bandwagon pretty fast, and you do see the US talking about it, but due to all sorts of trade conflicts, they’re not actually executing yet.

See Tho: There’s a lot of excitement surrounding 5G because it’s not just one level up like we moved from 3G to 4G, but there’s a lot of groundwork that needs to be done for 5G to even be possible, and you’re part of the supply chain building the infrastructure for it.

Rangala: Absolutely. If you recall 3G, the experience wasn’t that great. We had issues and all that. 4G comes along, and I think the average consumer is fairly happy and we get pretty decent coverage. Now in my mind as a personal opinion, from an individual point of view, 5G is not really going to make a huge difference. Because if your Netflix comes on your screen in 5 seconds versus 15 or 20 and you’re still able to watch it without getting buffered, which you can do on 4G without any problem, it’s not going to change your life. Downloads, you’re going to see the difference. But where 5G comes into play is really on the enterprise segment, autonomous cars, where you have like surgery where you need precision, real-time information that’s going through.

So you’re doing say a laser accurate surgery. You need that information flowing in real time. If you have a gap of 5 seconds you’ll be chopping the person up in the wrong way. Augmented products, this is where 5G can really make a difference, because its throughput is much more significant in terms of latency, as well as the capacity that it can give you.

And it also revolutionised our whole broadband, because instead of cables and hacking all over the house, you’ll be able to put a router and possibly wire-up speeds which are not even possible on the fibre networks today, or at least what is delivered today.

See Tho: What is a final word you want to deliver to finance professionals so they can stay ahead of the curve?

Rangala: I think it’s key that as finance professionals, we don’t be complacent, and sit back, and just report numbers. We need to continuously learn, because the environment around us is evolving. So if you stay old school, you’ll possibly get obsolete and possibly redundant very soon, because a lot of this automation and digitisation can do some of the mundane work we do. So if we don’t as humans use the intellectual capacity we have and use that for thinking and strategising, we’ll get taken over by robotics of this world.

So we need to evolve. We need to develop ourselves. I think we should embrace the change that’s coming on to be more effective and better business partners to our colleagues.

See Tho: Where do you learn? Who do you learn from?

Rangala: There is knowing what’s going on around you. You need to mix around with other parties who are a little bit ahead of the curve, not to be benchmarking yourself, then you eventually try to be the benchmark by using everything that’s out there. Who would have thought AI is relevant to finance unless you think it, right? Blockchain, and cryptocurrency, that’s going to impact our life over time. So you have to start looking at these evolving norms and evolutions that’s coming up — and see how it can impact us as finance, as a company, so you can start thinking about it and be prepared when it hits you. If you just sit on the sidelines, I think you’re going to get wiped out.

See Tho: Thank you, Thivanka, for your time.

Rangala: Thank you. Thanks for having me.