Has Your Telecom Revenue Assurance or Fraud Management Practice Become Stagnant?

June 8, 2012 - PRLog -- Plenty of communications service providers (CSPs) have failed because their business became too rigid. Their fatal flaw?  A belief that old industry models will serve telecoms in a new era.  

Many of U.S. CLECs who emerged in the early 2000s had this trouble.   When the business climate changed, they simply couldn‘t evolve to a different model than the one they originally put down on paper.

So what about your revenue assurance or fraud management shop?  Were its current operating rules conceived in the Jurrasic Age?  Is your RA or fraud software merely monitoring old problems?  Are the tasks you perform at your job today the same ones handed down to you by your predecessor four years ago?

Without the continuous guiding light of seasoned revenue assurance leaders, even the best teams of RA professionals, technology, and business processes can fossilize and lose their vitality.

Jim Marsh, one of those RA seasoned leaders, made himself available for an interview with Black Swan Telecom Journal.  Currently a Lead Transformation Consultant at Wipro Technologies, Jim has had many interesting RA and fraud management roles at operators as diverse as MCI, Williams, PCS and Qwest.  

The interview http://bswan.org/forensic_fossils.asp is entitled, "Forensic Fossils: Is Your Revenue Assurance Shop Fit for Display at a Natural History Museum?"

In the interview, Jim gives us plenty of nuggets to chew on in subjects as diverse as margin assurance, purchasing management, staffing, third party partner management — even fraud management as a marketing weapon.

But the key message he brings is that you can‘t just flip a switch and expect to run an RA or fraud department on auto-pilot.

Here are highlights of the advice he delivers in the interview:

1. The problem most the small- to mid-sized carriers have is they often have no assurance specialists on staff.  Very offten they need to think more strategically about their products, risk, and their payment processes.

2. Purchasing is a good example of an area that deserves more attention.  Early on, a small service provider will strike deals just to get its business rolling.  But after a while,
they should look strongly and say, “What am I actually paying for and can I get a better rate?”

3. Be careful of expense management firms who earn their 30%+ commission and come back to you a year later knowing full well that the processes that caused the original leakage were not fixed.

4. You'll be amazed at the savings you can achieve by simply holding vendors‘ feet to the fire.  Don‘t be afraid to negotiate with your vendors.

5. You need an on-going program to ensure you are protecting margins on your products.  And those margins can quickly erode due to bad debt, expenses and cost to the business.  So you must either lower your costs or migrate customers into new products that have healthier margins.

6. Revenue assurance and fraud experts need to put their best foot forward.  Their broad knowledge of the business puts them in an ideal position to recommend new product strategies that marketing can run with.

7. It's hard to conceive of fraud assurance as a money-making operation, but if you sell services wholesale, you may not know who the end user of your reseller is but you can detect an abnormal amount of traffic.  At one firm I worked for, we informed the reseller saying, “you need to look at this customer because it’s very suspicious.”

8. The watchword for mobile these days is “revenue optimization”.  Wireless is giong through a shift right now.  You’re moving from the direct collection of money on a pure transactional basis such as voice to getting a commission from a third party app provider.  In the old days, the operator provided the commission as they collected the money.  Regardless, the key is to follow the money.

9. Revenue assurance -- particularly the small- to medium-sized service providers -- needs to drive a strategy down to the lowest individual possible.  One way to do that is to initiate roundtables and brainstorming sessions with different groups such as customer service, operations, and billing.  

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.