Is Your Telecom Revenue Assurance Department Designed to Fail: Time for a Forensics Methodology

May 29, 2012 - PRLog -- Over the last 10-20 years, the telecommunications industry has undertaken many "first  generation" revenue assurance initiatives in areas such as rating, billing, and collections.  Carriers established dedicated revenue assurance teams, commissioned audits, fixed their processes, improved controls, and then implemented software monitoring tools with dashboards that continue to watch for anomalies and send alerts on an ongoing basis.

These efforts were very successful in finding egregious forms of leakage that had previously gone undetected.  Common examples include rejected call detail records never recycled and rated, lack of correlation between usage revenue and costs, and long-distance and cellular usage rate calculation errors.  

However, once the high-volume, easy money was found, executives and boards shifted their attention away from revenue assurance believing most of the savings that could be gained from RA were realized.

But according to the communications industry experts at ProCom Consulting, senior executives should be reinvesting in revenue assurance.

Curtis Mills (founder/CEO) and Van Howard (revenue assurance expert) of ProCom Consulting not only believe RA’s best years are still at hand, but they also make a strong case as to why every board and senior management team needs to put RA back on the front burner.

In an article published in Black Swan Telecom Journal entitled, The Magical Market Cap Multiplier http://bswan.org/magical_multiplier.asp, Mills and Howard discuss why significant revenue and cost leakage can still go undetected, even in companies with dedicated departments.

Their analysis offers an updated, broader definition of revenue assurance; and describes the benefits of a “forensic” approach to revenue assurance which will help the bottom line, regardless of the automated tools already in place.

The term "forensic” is not used in the criminal evidence sense, but to describe an intensive hands-on, detail-oriented investigation using a heuristic method that analyzes a variety of technical --- and often esoteric -- data.  

Usually one finding leads to a subsequently deeper layer of exploration -  a “peeling the onion” exercise.   The article explains four key success factors to a good forensic program:

1.  Use outside proxies for internal cable/telco operations and systems experts as needed.   This ensures experts are on the team with long-term, legacy operations backgrounds who know where and what to look for.

2. Give the experts (whether internal or from outside) direct, unfiltered access to raw data. They need switch-level and other raw data right from the mechanical or digital source through billing, prior to processing by any internal or external systems.  

3. Give the project senior management ownership and direct involvement. It’s essential that these initiatives be viewed as positive undertakings that won‘t result in blame or retaliation for any systemic weaknesses the review uncovers.  

4. And finally, Follow through.  Significant recovery opportunities are often not seized or, due to lack of follow-through, they are often never implemented.  

According to Mills and Howard, Forensics are key, but investments in revenue assurance monitoring and analytic tools are also part of a winning program.  Software tools enable day-to-day vigilance.  Telecom and cable operators simply need to understand the limitations of software and learn how to compensate for those.

About the Black Swan Telecom Journal

The Black Swan Telecom Journal http://bswan.org is a zine dedicated to the professionals and executives who protect and grow a robust communications business.   The Journal covers a broad range of strategic issues, operator case studies, consultant perspective, and solution vendor advice, particularly in the fields of revenue assurance, fraud assurance, cost/margin management and security.