Ovum’s Findings Challenge Conventional RA Thinking

Businesses like Ovum, that do research and provide analysis, can never rest easy. No matter how good their research is, they may always fall victim to the syndrome of the Emperor’s new clothes where everyone repeats a falsehood for fear of seeming foolish. So when Ovum makes statements that run contrary to received wisdom about revenue assurance, one should take note. It means either Ovum found some unusual people to talk too, and atypical sources of data, or that people are seeing through the Emperor’s suit to the truth that lies beneath. This article from Ovum deserves a close look because it intertwines RA platitudes with some rather atypical insights. Decide for yourself which are true and which are false, but here are my observations about Ovum’s conclusions:

  • RA is an increasingly important lever of growth… when has this sentence ever been false, and when will it stop being true?
  • Responsibility for RA has moved from the CIO to the CEO… excuse me? The majority of research suggests that RA Heads report to the CFO, so how did Ovum identify this peculiar handover from CIO to CEO?
  • The report says there are conflicting views about the RA world… but notice what those views are, according to Ovum:

    Vendors are marketing their tools and software as a means of identifying current and future revenue leakage; systems integrators and professional services firms would like us to believe that regular audits and process improvement projects are the magic bullets for RA; whereas major outsourcers’ visions of the future are full of RA shared service centers and end-to-end managed services. Consequently, it is difficult to see where the future lies for the RA function.

    Hmmm… so why not tell us the trends for how much is spent on, say, outsourcing and compare that to the amount spent on, say, professional services? That should give us a pretty good idea of where the future lies, at least as far as it is determined by decision-makers. I think the problem here is that such an analysis will not make for snappy reading, and probably tell us that this three-way split was included by Ovum so they could appease the interests of each kind of supplier they talked to, and not reveal the real trends (which may be less even-handed). This analysis could have been summarized as ‘it’s complicated’, but credit to Ovum – at least they said that much. Most sources paint a much more simple picture: ‘the future is what we sell’.

  • Saying all that, it is not in the least bit hard to see where most RA functions want the future to lie. Report after survey after press release after presentation says that RA Heads want more money spent on software and more money on people sat in chairs pushing buttons on keyboards. Whether that is good or bad is another question. But suggesting that the future might be outsourcing or process audit is like saying that the cosy consensus between RA Heads and software vendors is breaking apart. It would mean the C-level (CIOs, CEOs, CFOs, whoever) are asking hard and strategic questions about why routine RA checks need to be performed in-house by a dedicated department, and how checking for the same basic errors every single day is treated as consistent with an efficient and well-run business. I would like to think that the C-level does ask those questions about revenue assurance, but my fear is they simply do not think that hard about the topic.
  • “Process expertise is indeed a key differentiator for the RA supply side, as telcos’ current expertise is still in the legacy switch-to-bill area.” Can you hear the sound of dozens of RA managers and vendors falling flat on their backs, stunned by the realization that they have been found out?
  • “Dramatic improvements have been accomplished in stopping revenue leakages across switch-to-bill processes, although these gains are fast evaporating as legacy networks change to IP.” And that was the sound of them turning in their graves.
  • “…Some telcos focus on leakage detection while those with mature RA functions are increasingly focusing on leakage prevention, thanks to a range of tools at their disposal such as baseline reporting.” And that was the sound of RA managers resurrecting their careers by burying the vendors of detection software in their place.
Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.