New year, new leakages?

Firstly, happy new year to all talkRA readers. I hope 2009 will be a beneficial one for you.

RA practioners have many options to extend their analysis and assist their companies. If we look at “leakage” and, you will have to accept my definition, that it is about identifying where business rules have not been properly implemented, resulting in an undercharge to the customer and subsequent lost revenue. This could include all manner of things – call records being lost, rating errors, discounts incorrectly applied, provision of services in the network but not in the billing system etc. Many of us continue to have enough work validating just these areas but do we know the marginal return from working in these areas as opposed to spending our time and resource elsewhere?

If you return to my simple definition of leakage, then this can be applied to other areas of the business beyond the traditional call/event flow, billing and provisioning processes. What other business processes may be leading to leakage? Top of mind for me is the giving of credit adjustments to customers and understanding to what extent these are appropriate or otherwise. Don’t think just fraud here either but whether the customer was entitled to a credit and also whether the amount given was appropriate. Another potential area surrounds the charging of fees – if there is need for manual intervention then there is a risk that this won’t be fully charged. This could be any fee for anything that is charged a fee for and so would be unique to the rules of each service provider.  These are but two examples and I am sure you would all know of more.

If I can return to the leakage definition, it is focussed on business rules being correctly implemented. RA should look at these rules to see if they make sense in the first place. The classic example is the hyper short duration calls that came out of the fraud world. Numerous short calls are made to premium numbers – the duration is below a threshold for retail billing and so is discarded but is of sufficient duration for the premium service provider to expect payment. I am sure you can guess the rest. In this case, the business rule of discarding these short duration retail calls is not beneficial to the service provider and rules should be changed (either in the retail billing or content settlement system) to close this gap. But what other business rules may exist throughout processes and systems that were, in all likelihood defined years ago for a now, unknown reason, and are not optimal. Find some of these, make the case for a business rule change and RA is not just ensuring all entitled revenue is being billed and charged for, it is also growing revenue.

Mike Willett
Mike Willett
Mike is a Partner at Ernst & Young, Australia. He is responsible for enterprise intelligence, helping clients to improve their management and use of data. He can be contacted at: mike.willett@au.ey.com.   Mike was previously the Director for Fraud & Revenue Assurance at Telstra. He started his career at BellSouth (now Vodafone) in New Zealand and then moved to Praesidium Services in the UK. Mike graduated from the University of Auckland in New Zealand with degrees in psychology and marketing.