Why the Transition Stalls : Internal Barriers to Investment Governance Reform in Legacy B2B Telecom Vendors

Sammanfattning

Background: Traditional B2B telecom equipment providers face severe disruption from digital servitization and hyperscaler competition. While transitioning to cloud-native, recurring revenue models is a strategic imperative, legacy capital allocation models structurally misalign with the agile, continuous investments these service models require. Purpose: This study explores the internal barriers preventing traditional B2B telecom equipment vendors from adopting investment governance models aligned with recurring revenue (XaaS) service models. Method: Utilizing a qualitative, exploratory design grounded in abductive reasoning, the study analyzed empirical data from eight semi-structured interviews with senior practitioners. The analysis was guided by a multi-theory sensitizing framework integrating Service-Dominant Logic, the Resource-Based View, Real Options Theory, Transaction Cost Economics, and Platform Economics. Results and analysis: The findings reveal four coupled internal barriers: Financial-Evaluation Misfit, Commercial-Incentive Drag, Identity-Cultural Inertia,and a Capability and Infrastructure Gap. These dimensions form a self-reinforcingloop that reabsorbs single-component governance reforms into the dominant logic. Furthermore, a "decoupling counter-narrative" emerged, indicating that full servi-tization is rationally contested by senior strategists for capital-intensive corehardware portfolios. Conclusions: The study concludes that successful transition requires coordinated, multi-dimensional governance reform. A five-component framework is proposed, encompassing differentiated parallel appraisal logic, reinvestment ring-fencing, durable-value sales compensation, foundational telemetry infrastructure, and explicit portfolio segmentation. Recommendations for future research: Future research should conduct longitudinal studies on coordinated reform implementations, explore the decoupling counter-narrative across multiple vendors, and test the proposed four-dimension structure in adjacent hardware-intensive B2B industries.