WeDo Explains Praesidium Transfer

Last week I reported that Praesidium, formerly the consulting division of WeDo, has been transferred to Mainroad, WeDo’s sister company. Admittedly, talkRA dropped the ball, failing to notice the original press release, which was issued in February. The move raised questions about WeDo’s perception of the revenue assurance consulting market, so I was glad to speak with Sérgio Silvestre, WeDo’s Marketing Vice-President, about the reasons behind it. He identified two motives for the move: independence and fit.

When Praesidium was acquired by WeDo in 2007, the British firm already boasted a strong brand, punching above its weight in a specialized global consulting market. However, the feeling is that joining with WeDo critically altered customer perceptions about the independence and objectivity of Praesidium’s advice. Now that Praesidium has joined Mainroad, WeDo apparently have no plans to recruit or acquire a replacement consulting team. Customers who ask WeDo about consulting services will be referred to Mainroad and Praesidium. Praesidium is still scheduled to provide one of the training sessions at WeDo’s upcoming worldwide user group meeting.

The impartiality of consultants is a subject which provokes different responses from different telcos. Some telcos want their software providers to provide them with consulting services at the same time. Others want a separation between the two, to ensure consultants do not behave like salesmen in disguise. Though the amount of consulting work done by vendors has gone up and down over the years, some of WeDo’s competitors continue to earn a significant share of their revenues by providing consulting services in parallel to selling software licences. We will need to monitor the market to determine if the separation of Praesidium from WeDo is part of a trend towards accommodating stricter procurement expectations, or whether some of WeDo’s rivals will continue to prosper by offering a mix of solutions and services. For WeDo, it is clear they are streamlining one side of their business in anticipation of the growing diversity of software products they will offer, and of customers they will sell them to.

Sérgio also highlighted that demand for information security consulting will drive Praesidium’s future growth. Praesidium’s expertise covers the connected domains of fraud management and information security. If customers are spending more on security – which seems likely given current global priorities and risks – then Praesidium’s best sales pitch will more naturally fit with Mainroad’s IT-centric business offerings, than with WeDo’s assurance-centred value proposition.

Again, this may be an interesting indicator of trends. Over the years there have been many arguments about how to organize and coordinate various risk and control silos, and the extent to which these silos should be kept apart. Whilst one debate focuses on the pros and cons of linking revenue assurance to fraud management, there is a second debate which revolves around the relationship between fraud management and security. If spending on security rises, it becomes natural to order these debates so that a telco first decides if it will handle fraud management as a component of an overall security strategy. And if fraud is treated as a subset of security, this will have a knock-on impact on how the telco will divide responsibilities and coordinate work between its fraud management and revenue assurance teams.

For several years WeDo have explained their suite of products by reference to the umbrella concept of business assurance. Rising expenditure on security may create opportunities, but also challenges for WeDo and their rivals. Security is not amongst their core strengths, though the risk mitigation provided by their products has some overlap with the goals of security. And in the context of security, customers will be less forgiving towards any supplier who over-promises and under-delivers. Like telcos, suppliers will also need to develop a more sophisticated and consistent understanding of the telecoms risk universe, the relationships that exist within it, and which elements they are competent to deal with. In that respect, WeDo already does a better job than some of their peers. Having sister companies will help WeDo to perform a balancing act between refusing to do work outside their range of competence, whilst still being able to satisfy customers and draw incremental revenues into their corporate group. Rival vendors should consider the extent to which they have formal and informal partnerships that would help them to connect their areas of proficiency to other parts of a holistic risk universe.

Eric Priezkalns
Eric Priezkalns
Eric is a recognized expert on communications risk and assurance. He was Director of Risk Management for Qatar Telecom and has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and others.   Eric was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He was a founding member of Qatar's National Committee for Internet Safety and the first leader of the TM Forum's Enterprise Risk Management team. Eric currently sits on the committee of the Risk & Assurance Group, and is an editorial advisor to Black Swan. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.   Commsrisk is edited by Eric. Look here for more about Eric's history as editor.