Revenue Assurance considerations for Telecoms operators
I am a revenue assurance consultant, I often get asked to perform assessments of an operator’s control coverage (that is assessing whether the revenue control coverage the operator has in place is adequate). Usually it is not, and the reason more often than not is the view or perception the organization has on the revenue assurance function itself.
Revenue Assurance at the moment is a hot topic, now is the time to be a freelance revenue assurance consultant that’s for sure! All over the globe operators are struggling to make positive revenue growth. Average Revenue per User is declining everywhere (except New Zealand for some reason). Nowadays, customers are expecting more features and services from their operator and willing to pay even less. As a result, operators are releasing more and more products into the market to stay competitive. With features and services bundled in such a way you almost need a PHD to understand what it is you are getting when you sign up for one.
In developing countries with mostly a prepaid subscriber base, operators release regular top up discounts within their market to limit prepaid customer churn. Nowadays, operator’s subscribers are so use to discounts appearing nobody tops up until the monthly discount is released. As a result, revenue for operators is getting tighter and tighter!
The other characteristic I see which is often a cause of revenue leakage is the buying behavior of operators. Operators will have equipment vendors in a price war frenzy slashing prices to get kit into the network. Operators think they are getting an absolute bargain but too often operators fail to consider revenue assurance and what they end up with is equipment that gives them the services and features their customer require, but fails to integrate seamlessly with other nodes and causes issues with the collection of real time data.
In this competitive environment, revenue assurance should be at the forefront of everything an operator does. From capital expenditure, to process changes, product development and even risk analysis. In the past where telecoms seemed an un-limitless creator of profits and revenue’s, nowadays operators need to tighten up their operations and revenues if they are to be profitable at all.
The ability for an operator to be as competitive as it can be is bound by its abilities to manage its operations across its various revenue chains. If an operator wants to increase its margins, it just can’t raise its prices. If it did, it would watch customers churn over to the competitor! For a telecoms company wanting to improve its margin, it has to ensure it has good revenue assurance. Good revenue assurance can improve revenues by up to 10%!
When considering Revenue Assurance, consider it end to end. All organizations within an operator will benefit from revenue assurance practices. Distribute accountability for revenue assurance across all business areas that impact the revenue chain and watch your bottom line improve! Good trending will help everybody in the organization, Fraud will catch sim-boxing, RA will detect CDR issues, and Marketing will see how some products are cannibalizing others! Good revenue assurance practices will improve how the operator does the business it does, and if there is anything that is true in business – what makes a Company successful is not the business they are in but how they do the business they are in.
Daniel McDonald (MBA)
Principal Telecoms Consultant
Posted
08-26-2010 1:04 AM
by
Daniel McDonald