OSS dragon-slayers, the veterans of our industry who have built the OSS of today, are being quietly laid off and struggling to find re-employment for the first time in their careers. The industry has many reasons to explain why they are no longer employable.
However, as telco infrastructure shifts into the hands of long-horizon investors, there might just be an interesting twist hiding in plain sight in relation to this macro trend.
The experts with the deepest experience and operational knowledge are also the ones with the biggest pension or superannuation balances. Rehiring them shouldn’t just be seen through the lens of them being an increased operating cost for network operators. It could actually be a high-yield reinvestment that delivers immediate and compounding returns for telco and tech infrastructure investors.
Today’s article is simply a playful thought experiment into ways to tap into this available skills-base.
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Pension funds and institutional investors are steadily acquiring the infrastructure behind global telecom and tech networks. This includes fibre, towers, OSS and BSS platforms and even full-service telcos. They are drawn to the stable cashflows, essential services and multi-decade investment horizons of telco assets. Clearly, these are long-hold assets built for predictable yield, not high-risk speculation.
But with this shift in ownership, there is a hypothesis I’d like to run past you. The operational experts who designed, scaled and maintained these systems, many of whom are now pension fund members themselves, are being laid off in cost-cutting waves. This may suit short-term budgets, but in an interesting twist, it might just risk undermining the long-term stability that investors seek.
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As we discussed in this earlier article about dragon-slayers being overlooked, the skills and knowledge of these professionals is not always outdated. In OSS, survival of these experts has always depended on continual learning. Veteran dragon-slayers have spent years evolving with each generation of systems.
They know the workarounds, the architectural dead-ends and the integration risks that do not show up on handover documents. Moreover, they know where the bodies are buried in the legacy systems and integrations. They have managed transitions that vendors said were impossible. They have a track-record of untangling issues no roadmap or transformation plan predicted.
Lay them off and companies lose institutional memory, operational resilience and the potential mentors who hold entire unwritten knowledge bases in their heads.
In isolation, it makes sense for a network operator to reduce costs and progressively refresh its workforce. You’ll get no arguments from me on that point! It’s an important part of operational evolution.
But, the increasing trend for pension and superannuation funds to acquire telco / tech assets has the potential to create a virtuous loop with both financial and strategic benefits.
I’m not saying a virtuous cycle WILL eventuate, but this article will explore the possibility of one occurring.
From a fund-wide perspective, retaining veterans who are already pension members flips the narrative.
Anyway, that’s the premise for this article so let’s dive in!
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There are two parts to this story:
It’s the second dot-point that is the new paradigm to consider within this story. It facilitates the possibility of the feedback loop:
If we only take the simplistic view, senior professionals are likely to command higher salaries than new-starters (ie higher network operator OPEX). But this view misses the broader system dynamic.
New-starters may cost less, but they contribute less to the fund and require more onboarding / up-skilling as well as carrying higher turnover and operational risks.
In other words, dragon-slayer value is not limited to the network operator balance sheet. It ripples through the investor’s financial system and operational ecosystem.
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This creates a positive cycle that looks like this:
Could this be smart finance, smart HR and smart portfolio management all in one move?
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So how might pension funds actually do this? Here are a few practical models:
Each of these models protects operating continuity, strengthens the fund’s AUM base, and deepens its strategic advantage over passive competitors.
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Let’s run a 3-year comparison using the following assumptions:
New starter:
Starts with a salary at $90,000, receives a 5% salary increase each year
The starting balance of their pension fund is $25,000
Veteran:
Has a fixed salary at $180,000 per year (no raise)
Superannuation is 10% per year for both
| Year | Base Salary | Super (10%) | Total Cost |
|---|---|---|---|
| 1 | $90,000 | $9,000 | $99,000 |
| 2 | $94,500 | $9,450 | $103,950 |
| 3 | $99,225 | $9,922 | $109,147 |
| Total (3 years) | $283,725 | $28,372 | $312,097 |
| Year | Base Salary | Super (10%) | Total Cost |
|---|---|---|---|
| 1 | $180,000 | $18,000 | $198,000 |
| 2 | $180,000 | $18,000 | $198,000 |
| 3 | $180,000 | $18,000 | $198,000 |
| Total (3 years) | $540,000 | $54,000 | $594,000 |
| Category | Veteran | New Starter | Difference |
|---|---|---|---|
| Starting AUM (Pension Balance) | $750,000 | $25,000 | + $725,000 |
| Annual Contributions | $18,000 | $9,000 ? $9,922 | + $8,078 total |
| AUM After 3 Years @ 5% | $927,711 | $59,518 | + $868,193 |
| Management Fees @ 0.6% (over 3 yrs) | $15,480 | ~$1,070 | + $14,410 |
| AUM Retained After 3 Years | $927,711 (no drawdown) | $59,518 (not drawing yet) | + $868,193 |
| Category | New Starter | Dragon Slayer | Veteran Advantage |
|---|---|---|---|
| Base Salary (over 3 years) | $312,097 | $540,000 | -$227,903 |
| Super/Pension Contributions (10%) | $28,372 | $54,000 | -$25,628 |
| Training & Onboarding Costs | $15,000 | $3,000 | + $12,000 |
| Ramp-up Time (6 months vs. 1 month) | -$30,000 (lost productivity) | -$5,000 | + $25,000 |
| Rework / Avoided Errors | -$60,000 (cost of fixes/escalations) | $0 | + $60,000 |
| Project Efficiency (speed to delivery) | -$45,000 (delays, overrun) | $0 | + $45,000 |
| Knowledge Transfer & Mentoring | $0 | $20K (Equivalent to hiring a part-time trainer) | + $20,000 |
| Risk Mitigation (systemic failure, vendor lock-in) | $0 | $50K (Value of avoided critical failure) | + $50,000 |
| Pension Management Fees @ 0.6% (over 3 yrs) | $1,070 | $15,480 | -$27,121 |
| Net Cost Differential (over 3 years) | -$27,121 |
Under this scenario
The veteran costs $253K more in salary to the portfolio business over 3 years
However, the pension fund has over $868K more in retained AUM after 3 years
The fund earns 14x more in fees from the veteran
Operationally, the veteran adds $212K in avoided risk and higher delivery output
The veteran’s impact compounds: higher AUM, longer retention and faster up-skilling of newbies as well as reduced risk to the portfolio business and the pension fund
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Instead of seeing dragon slayer salaries as high opex, pension funds can reframe them as:
OPEX that returns to the fund in the form of contributions
A way to retain more capital in long-term AUM
A hedge against early pension withdrawals and portfolio churn
It’s a virtuous loop that seems to make strategic, actuarial and human-resourcing sense.
The dragon-slayers are still here. If they’re not already part of your fund, they could be. And in a capital-constrained, skill-strained world, leveraging a largely untapped skills-base might just be the smartest edge left.
Invite them back. The return might surprise you.
So…. what do you think? Is it plausible? Is the hypothetical scenario reasonable? What else am I missing (apart from there being no obligation for the veteran to hold their pension in a fund of the investor)? What other lines of thinking or calculations should be included in the model?
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