billing and revenue management

billing and revenue management

Optimizing Billing and Revenue Management: Strategies for Efficiency and Growth

1. Introduction to Billing and Revenue Management

In conclusion, operators spend vast amounts of resources trying to acquire customers. When a decision is made by the customer base to leave, the business impact of a customer departing is immediate and painful, considering the sunk costs from the acquisition. The value proposition for billing and revenue management is to retain and nurture the customer then transfer them to leaner, more competitive operations within the telecom community. The concept of Customer Lifetime Value suggests that each customer has a financial as well as social value to the operator. This concept is developing special metrics that can assist managers in evaluating specific strategies, such as targeting marketing campaigns or retention promoting investments. These metrics and other consumer relationship management (CRM) techniques can be employed in the billing and revenue management organization’s strategy to optimize customer retention. The telecom operators’ customer base is usually the business core that contributes to long-term growth and profitability. The competition, while fierce, creates a difficult challenge for the operator faced with more discerning and confident customers. The operator’s ability to segment, rate, and offer various service bundles underscores the importance of the billing and revenue management aspects. The operator’s ability to innovate will, in part, depend on the quality and standardization of the billing and revenue management functions.

Now the essential characteristics and requirements of the telecom market are a useful backdrop for examining billing and revenue management. Enabling communication, directly and indirectly, leads to commerce. The umbrella “telecom industry” term includes a number of segments. The first, and perhaps the most visible segment, is the mobile operator who is the primary focus of this eBook. The mobile operator is further characterized by its direct relationship with both the end user (retail customer) of the service and the business customer whose mobile customer base is broader. Mobile operators provide more than just communication services. One of the unique characteristics of mobile operators and the services they provide is the user’s location. Wireless has unique capabilities that can be leveraged to create innovative and interactive services. Services that store information or influence a result based on location are called location-based services. The common characteristic of all technology segments related to billing and revenue management are flows of interaction, services, and information. These flows can be aggregated and re-aggregated to varying levels of detail, depending on the organizational focus. Currently, operators are busy increasing service levels and converging IP with traditional systems.

Today’s telecom operators are faced not only with dramatic changes in the market structure and competitive dynamics, but also with new regulations and higher customer expectations that are pushing them to become leaner and more efficient. This eBook discusses the strategies to optimize billing and revenue management in light of an operator’s desired financial value while maintaining the customer’s satisfaction at acceptable levels. It is important to note that evolving market trends affect billing and revenue management in a number of ways. The specifics will depend on the operator’s level of operation, the types of customers, and the billing and revenue management structures already in place. The eBook focuses broadly on strategies that first ensure the billing and revenue management organization is operationally meeting requirements through effective execution strategies. Then the next step is to design efficient billing and revenue management processes that will contribute to the operator’s financial growth.

2. Key Components of Effective Billing Systems

Effective billing operations can generate and maintain substantial profits over time. Companies that focus on billing efficiency can realize significant benefits in terms of bottom line profits as well as freeing resources for greater customer and market emphasis. Expert ability to manage complexity, contain costs, implement appropriate technologies, and adapt to market changes are key benefits of focus in the area of billing and revenue management. Billing can be a direct extension of marketing and sales that ties directly into customer service, market positioning, and product line management and is highly strategic to achieving market share and growth objectives. Key components of an effective billing system include rational and efficient billing design, correct billing, effective and efficient bill tracking, prompt and accurate collection methods, and the capability to efficiently handle exceptions such as customer queries and resolution of disputes.

3. Revenue Recognition and Compliance

A company may desire a billing, revenue, and compliance interface to handle a variety of systems that integrate other languages and currencies with a simple structure that can handle price changes and multi-pricing points. An interface can be leveraged to facilitate invoicing and compliance operations, such as sales invoice transactions and compliance message transactions. Compliance with ever-increasing regulation and investors’ awareness of revenue recognition accounting have led companies to continually adapt to new requirements and to become engaged in continuous improvement of finance operations. Leaders engaged in finance transformation projects continually emphasize integration of statutory, or enterprise billing, revenue, compliance, and reporting processes. Businesses adapt to these requirements in various ways, and it is often during discussions and planning for new billing and revenue management processes that finance and operations leaders recognize that updates to current systems cannot be ignored.

Companies find themselves operating in a variety of revenue-generating activities and have the challenge of knowing when, and how much, to recognize as revenue. This can include understanding fair value accounting for a company’s derivative instruments and determining revenue recognition from long-term service contracts. The finance function can partner with the business to implement revenue recognition and compliance systems to address these issues. These systems can shorten lengthy close processes and reduce dependency on manual data gathering for complex accounting determinations. With the volume of regulations and the different ways to geographically operate, there is an increasing demand for revenue recognition technologies that provide flexibility and extensive automation that spans entity, jurisdiction, business, and billing platform variety.

4. Innovative Technologies in Billing and Revenue Management

A wide set of business processes used. A strong business support application that creates a continually strong customer organization. Tiered product launches, driven by the customer success that creates market positioning, competitive features, open interfaces, and customer value. The Customer Success Lifecycle. Amdocs’ core capabilities are the skills required to design, develop, customize, and implement the open solutions that have enabled client success. The Amdocs application enhances the Customer Success Lifecycle as it provides two primary engines of customer success. The application enables the flexible business processes that clients can modify to accommodate their operational environments. It also supports customers’ iterative improvement strategies by providing customers with the necessary tools to maintain Amdocs applications.

Founded in 2001, Amdocs has helped its clients to charge for quadruple play bundles and profitable delivery to multiple screens and devices by constantly advancing its strategy to leverage its experience and expertise to support service providers in transforming their businesses from a customer experience company to a customer value company. Amdocs’ strategy is built on the following key factors: a series of breakthroughs taking advantage of innovation from across the industry, including a broad set of industry partnerships; a multiple market approach; a flexible approach that enables direct-to-user interaction, web and mobile platforms, and enterprise and partner markets, switched by vertical solutions, business line solutions, and geographic expertise; a best leveraged business model based on an open architecture—an extremely adaptable and flexible product set; a skilled services team focused on delivering frequent success in small agile projects.

5. Case Studies and Best Practices

This framework is a radical shift from how billing occupied a central role in the telecommunications growth strategies of previous decades. Then, strategic planners of telecommunications corporations looked to the technology as a strong mechanism to recover costs and stimulate usage. With the advent of the internet and its millions of users who wanted to exchange everything from email to files and music to video, the usage of telecommunications networks surged. The more novel the technology, the more expensive it was. The more expensive it was, the more important it became for operators to ensure that they recover the costs. It wasn’t long before billing was seen and accepted as the way that telecommunications would recover their costs. But in just the past few years, we have seen a significant shift in this model. After a decade of phenomenal growth in billing, businesses around the world have figured out that it is no longer necessary to pay for telephone usage. Wanted and unwanted long distance, local and mobile calls and facsimiles are made from the wire-line and mobile phones and all the e-business is conducted in the world.

In this chapter, we will describe a framework used to develop a robust billing and revenue management practice. The strategies to be used to enhance billing and revenue management performance could emanate from good vanilla practices or the establishment of a robust billing and revenue management practice. We will be sharing with you a conceptual structure and then provide specific details to help stimulate the executives out there in the telecommunications business to desire to be innovative in how best to employ best case practices to significantly improve their revenue growth.