| Using the Maturity Model for Benchmarking
A common framework and methods for revenue assurance help Telenor and its affiliates in Europe and Southeast Asia focus on stemming the flow of cash out the door. By Einar Nymoen, Project Director, Telenor ASA/Global Coordination Through the Telenor Revenue Assurance Program (TRAP), Telenor has implemented a common framework and methods for revenue assurance throughout the Telenor affiliates in Europe and Southeast Asia. Performance monitoring is one of the key elements of TRAP, focusing on the following questions: - Which leakages have been discovered?
- To what extent are all products and parts of the value chain covered by controls?
- To what extent are the organization and resources allocated to RA adapted to future needs?
Measuring Progress Reporting of trouble cases and the monetary effect of RA activities has been part of TRAP from the beginning in 2003. Telenor affiliates have experienced the same development as most other telecom operators - as maturity increases, the number of cases and the size of the leakages diminish. 
Sizing a leakage and assessing a value to blocking it, is an ongoing discussion that falls beyond the scope of this article. More to the point is the fact that relying on historic cases as the only basis for planning future activities is not enough. To get a better basis for long-term planning, Telenor has introduced two strategic benchmarks: - The Coverage KPI
- The Maturity Model
The Coverage KPI was introduced in 2005 with the aim to get a measurement as to what extent the Telenor affiliates have implemented controls in the various parts of the value chain. The value chain is split into five main processes and a number of sub processes, covering all parts of the value chain from product development through collection. The assessment is done on a product level, and aggregated results are computed for each of the main revenue streams and processes. As with the Maturity Model, we use a 5-step scale ranging from Unreliable to Optimized. In addition to leakages and controls, we needed a measure of the RA organization. To get this, we decided to implement the Maturity Model developed by TM Forum. The TM Forum Maturity Model provides a comprehensive assessment of the main dimensions of the RA organization: - Organization
- People
- Influence
- Tools
- Process
These dimensions align well with what we need to focus on when making long-term roadmaps for developing the RA function. The Maturity Model has been run in 2007, and we intend to make another assessment using the same KPI in 2008. Going forward, we plan for this to be an annual or semi-annual exercise. How Did We Use the Maturity Model? The Maturity Model consists of a questionnaire with more than 50 questions. Each question is given a weight, so we can compute a total score for each of the 5 dimensions. A total score is calculated as the average score of the 5 dimensions. We decided to use the questionnaire as it was from TM Forum instead of making our own version of it. The reason was that we saw this as an opportunity for benchmarking not only between the Telenor affiliates, but to be able to compare our results with the rest of the industry. On an annual basis, we run what is called the TRAP Review, which means that all affiliates are visited in order to go through the status and discuss the roadmaps going forward. The Maturity Model was the main item on the agenda for the TRAP Review last year, and we went through the questionnaire in workshops with local RA managers. Representatives from the Telenor Group level were part of the assessment in the affiliates. The intention was to secure consistency in the interpretations of the questionnaire. The results were compiled at Group level, and each affiliate could compare the results on the aggregate level, as well as per dimension and each of the individual questions in the questionnaire. Combining the Maturity Model and the Coverage KPI Coverage could be built into the Maturity Model as a sixth dimension. In my view, however, the TM Forum Maturity Model and the Coverage KPI supplement each other. The results can be presented in a combined graph (the scores do not represent actual scores and are only for illustration purposes): 
The expectation is that high levels of maturity will coincide with high coverage. Although this will be the trend, it is possible to have wide coverage in controls, but (a relatively) low level of maturity as it is defined in the Maturity Model. It is conceivable that an organization may have a narrow scope for RA combined with a high score in the Maturity Model, even though I think this will be a situation that is not commonly found in practice. It is important to note that both KPIs attempt to measure the status in the whole organization, not just the RA department. Using the KPIs as a Planning Tool The total score for an affiliate gives an indication of where this company stands compared to the other affiliates in the Telenor Group. Looking into the individual dimensions of the Maturity Model and comparing on a question by question basis makes it possible to identify strong and weak points in the individual affiliate. The same is true for the Coverage KPI. Because the assessment is made on a product and process level, it is easy to identify for which areas there is a need to extend the control coverage. This means that to get the full value of these KPIs, it is necessary to analyze the results in detail and spend time on discussing what can be done to improve the score. Used in this way, it makes sense to run the assessment more often than on an annual basis on the local level.
One clear recommendation is to include target scores in these KPIs in the targets for the RA manager. Doing this, the RA manager can assess the effect of a project on the KPIs and use this as part of the justification of the project. This helps direct attention and resources to the areas where the effect is greatest. Just as important, this can help maintain management focus and attention to the long term development of RA – not only short term focus on leakages but also the “dollar” effect of reactively blocking these.
Back to top
Kill the Bill, Save a Tree  By Tony Poulos, Head of Revenue Management Sector, TM Forum
I’m a little perplexed. I live in the era of e’s and i’s. Everything that’s hot seems to begin with an ‘e’ or an ‘i’, e.g. commerce is not ‘hot’, ecommerce is, ordinary phones are not ‘hot’, iPhones are. In our world billing is, well, billing and e-billing isn’t cutting it. Why? We hear about climate change and caring for the environment day in and day out but many of us don’t think twice about opening the mail each day and sifting through all those paper bills, the biggest and meanest of which are usually from telcos. To make matters worse, my main telco (I buy and test products from a few) provides me with three post-paid mobile services, my broadband access, my digital home phone, public Wi-Fi access, an HSPA dongle for my notebook and a myriad of cable channels bundled into packages that defy all logic. For these services I receive no less than five bills on a monthly basis and one whenever I use that particular service by mistake. Each bill averages three to five pages in length plus the envelope it is sent it and another pre-paid envelope supposedly provided to send back my payment that I have never done in seven years because I pay electronically through my bank account. If we count each of the envelopes as a sheet of paper I calculate that my telco bills from the one supplier amount to about 30 sheets of paper per month, or 360 per year. I have it on good authority that my annual bills use up 5% of a tree that was once 40 feet (12m) tall and 6 to 8 inches (15 to 20cm) in diameter. To add to my other vices, I am now a tree killer! But that is not of my own doing or choice. You see, my service provider in Singapore still does not offer e-billing to its post-paid customers. My bank is able to provide everything electronically, as does my credit card company. However, the company that is the bastion of access to all things electronic does not! What’s wrong with this picture? Although e-billing is offered by many of the world’s leading service providers, many others lag behind. The reduction or total removal of paper bill printing would save the industry millions of dollars per year, and the savings would be reflected directly to the bottom line. Customers could easily be convinced to go e-billing if it was the only choice, was offered with a discount on the monthly subscription or if a surcharge was levied for paper bills. Why can’t we deliver the bill to the handset in mobile SPs? I know it’s a legal requirement in some countries to provide a physical bill but surely we could lobby against this archaic methodology. Mobile service providers are replacing diesel generators with solar power for their remote base stations, so why we don’t we remove paper bills from our industry altogether and do the environment a big favor. Back to top
Billers’ Club Next Meeting Set for Nov. 12 The last Billers’ Club Call on Oct. 1 attracted service providers from North America and Europe with the interesting topic of ‘Increasing the Uptake of e-Billing’. Co-chairs, Jonathan Jensen from BT and Stuart Madeley from VirginMobile have given permission to share some of the main points raised on the call: - It was noted that large carriers are nervous about migrating large numbers of customers to e-billing, especially if a charge is levied for those who wish to stay on paper bills as it raises a potential PR problem.
- One problem with forced migration is that customers sometimes don’t pay the bill because they say they didn’t get the usual paper notification. Using a return receipt on email notifications is OK as long as the email addresses are accurate.
- SMS can be used as a notification of the direct debit or other auto payment or as a follow up reminder to pay a bill when it is due. A post card could be used as a reminder to do this where SMS is not possible – such as for fixed telephony – or automated voice.
- Moving to e-bill can be used to drive more customers to self-serve customer care.
- Some customers are resistant to consolidated billing because of Bill Shock. This can be overcome by use of weekly direct debits to smooth a monthly bill or monthly debits to smooth a quarterly bill. A lot depends on when customers are typically paid.
- Online chat is a useful method to bridge the gap between self-serve and call queries – one agent can service 3-6 chat queries simultaneously.
- In some cases, operators can be tied to paper billing because the discounts offered to e-bill customers would affect revenue. Other reasons might be that the paper bill carries advertising for third parties that drives revenue. The charges for paper bills, in some cases, are a good revenue stream.
- E-Billing opens up the possibility of producing bills in house, which is rare for paper billing.
- Paper bills act as a prompt to pay.
- Differences between how to handle existing & new customers – new customers have a much higher propensity to leave or go bad, so it’s more important to reduce the cost of serving them. Good idea to ‘force’ new customers online.
- Financial and environmental – ‘Switch to e-billing and we will provide a discount and we will plant a tree’ or by negative reinforcement, ‘Sticking with paper bills will cost you $X per month.’
- Offer online e-billing at every customer contact/call.
The next Billers’ Club call is scheduled for November 12 at 9 a.m. U.S. Eastern Time / 2 p.m. U.K. Time. It will concentrate on bill design, both print and e-bills, including: - How does the bill affect the customer experience?
- What are the organizational and political issues around bill design – who owns the bill design?
- What is the impact of multiple products (convergence) on bill design?
- How can the success of bill design be measured?
Contact Tony Poulos for call details and to sign up. Back to top
Status of Charging Debate & Mapping to eTOM By Tony Poulos, Head of Revenue Management Sector, TM Forum I’m getting the feeling from the number of emails I am receiving that you are all on tenterhooks waiting to hear the outcome of our two main objectives set earlier this year. Before I do that, let me recap. When the GBA merged with TM Forum, one of the main objectives was to tie the existing GBA Billing Map to the relevant areas of the Process Framework (eTOM) and identify areas that were either missing or required redefining or clarification. This was kicked off at Team Action Week (TAW) in Lisbon last January and then again at TAW in Virginia in June. Over the summer, it was quite difficult to get everyone coordinated but we managed to get a number of working documents completed. Sadly, we had been working with Release 7.0 of the eTOM, and when Release 7.5 came out had to go back and make some major changes. The result was an Updated Revenue Map that replaced the old Billing Map, including a history of its evolution, a document linking the components of the Revenue Map with Release 7.5 of the eTOM and suggested changes to eTOM for Release 8.0 in time for Management World Orlando later this month. The key element of change was the inclusion of Charging in the Revenue Map and eTOM that took into account the requirements of content pricing and brought us into line with terminology being used by 3GPP and IMS. You might recall this was the subject of some lively debate reported in a previous issue of Inside Revenue Management. By the time the new definition reached the eTOM team, it was subjected to even more alteration. The current recommendations can be seen below, but it is likely to evolve further in later releases of the Revenue Map and eTOM.
Those of you that have registered with the Revenue Management Initiative Team in the ‘Collaboration Workspace’ can access all the relevant documents in the ‘Document Workspace’ under the folder marked ‘Submitted Documents’. To summarize, the following three recommendations are in the final stages of approval for Release 8.0: - Proposed Level 1 Column name change from ‘Billing’ to ‘Billing & Revenue Management’.
- Suggested name change for Level 2 "Rating & Discounting" to "Charging" and a replacement of the existing definition for this with:
Process Name (L2): Charging
Brief Description: Managing the assignment of a value (monetary or other) to an event or product, or combination (bundle or aggregate) of the above.
Extended Description: The purpose of Charging is to assign a value (monetary or other) to an event or product, or combination (bundle or aggregate) of the above. The charge may be either a credit or a debit. The processes involved in assigning a value (charging) and application of the value to a balance include rating, application of discounts, and aggregation. Rating processes are responsible for calculating the assigned value by multiplying some quantity of items by a price. These processes can be as simple as a price multiplied by a quantity of one or may involve more complex calculations using accumulations or aggregations of items. Prices may be expressed as monetary or other units of measure. Prices are established through mechanisms such as contracts, tariffs, service agreements or price lists. Prices may be affected by the application of discounts. The values resulting from rating and the application of discounts can then be applied to a customer's balance. The balance affected by the value may be monetary or other balances such as minutes, points or tokens.
Rating and application of discounts may occur in real-time, near real-time or may be executed on a periodic basis. These processes will also support pre-paid and post-paid pricing arrangements. The charge may appear on a customer invoice via Apply Pricing, Discounting, Adjustments & Rebates.
- Suggested addition of new Level 3 ‘Aggregate Items for Charging’
New L3: Aggregate Items For Charging
Brief Description: Manages the accumulation of items that may be used in the selection of a price or in calculation of a rate/discount.
Extended Description: Aggregate Items for Charging is the process that accumulates contributing items, which can be quantities, revenues or both. Aggregation can occur over time or can be initiated to gather a "snapshot" of the items at a point in time. The aggregated items may be used in Perform Rating or Apply Rate Level Discounts to determine the applicable price or discount and may further be used as a quantity in the calculation of a rate or discount.
In addition to the above, we have often talked in the past about how the eTOM framework is applied within enterprises, and Mike Kelly has been busy developing a new document that is based on this, labeled ‘GB921G’ for ‘Guide to Applying the Business Process Framework (eTOM)’. This will take the form of an Application Note, with the intent of publishing this as part of the upcoming eTOM Business Process Framework Release 8.0. It addresses how users can safely manipulate the visible eTOM structure, while maximizing alignment with the core eTOM decomposition hierarchy, visible in the familiar top-down eTOM model. The ongoing discussions with the Revenue Management community are reflected in the inclusion of the RM Map as application of the ideas set out in the document. I will bring you more details of this in our next newsletter. Lastly, I would like to pay a special tribute and give thanks to a core of people who have given much time and effort in getting us to this point. They include Alex Leslie, Ian Best, George Huitema and Henk Ensing from TNO, John Brooks, Graham Cobb, Pat McCarthy, Graham Carey, Brian Pawlus, Brian Truex and Mike Kelly. My apologies if I have left some people out as this list is far from complete, but you know who you are. I hope many more of you can attend Team Action Week in Lisbon in January, where we will be having joint sessions with the Process Framework (eTOM) and Revenue Assurance teams, fine tuning our recommendations as well as adding some missing pieces around real-time and pre-paid functions. Back to top
Ask Dr. Bill  Dear Dr. Bill,
Over the years, our fixed line service provider business has grown by introducing or acquiring new products and services such as ADSL Internet access, IPTV and resale of mobile service much like an MVNO. Our legacy billing system was hardly geared to cope with the introduction of new products, so we introduced or inherited smaller adjunct systems to manage the rating and billing of new products and sent individual bills out for each product.
Now we find that we have disparate customer information across a number of systems, which makes billing and customer enquiries a major hassle, let alone reconciling payments to each accounts payable ledger when the customer just sends a check back. We are also unable to offer ‘bundles’ or ’packages’ to our loyal customer base.
I have been handed the task of getting this mess sorted out. Any hints on what I should suggest to management and where I should start? Alistair Dear Alistair,
Don’t panic, you are not alone! You are about to embark on your own ‘transformation’ exercise, and there are many ways of handling it depending on your resources and budget. Firstly, it is imperative that one of the billing systems be selected as the core system and if none of the ones you have is suitable then go out and look for a convergent system that is capable of handling multiple products. It is imperative that customer data is ‘clean’ and resident in one central database that all other systems refer to. There was a time when we spent millions of dollars on CRM systems to manage this, but there is a growing trend to have any one of your database repositories as the main database and to allow other systems, including customer care, to interface with it. Once you have the data cleansed and centrally located, you can look at migrating the products and customer financial records to the main system or work around combining the product billing information into the central system for billing production, bundling, discounting, etc. (adjunct billing). I’m making it sound easy, but I can assure it’s not. You will need some help from a specialist like a systems integrator or a vendor’s professional services team. I would also strongly suggest that you utilize the TM Forum’s Process Framework (eTOM) as a guide. I must stress again that starting with clean data is the main criteria, and do not underestimate how difficult that may be to achieve. Regards, Dr. Bill If you would like Dr. Bill to help you with any billing-related problems, write to askdrbill@tmforum.org, and your question may be answered in a future column. Back to top |