At a conference I attended last year, somebody asked what the audience felt about outsourcing of billing. To say they were against it is to put it mildly. The recurring criticism was that outsourcing results in a loss of control. I found that a bit strange. Outsourcing involves agreeing a contract with another company; the contract governs who does what. The same is true of someone working ‘in house’. Their work is also governed by a contract; a business has no more control over its employees than it has over its suppliers. In fact, it can be easier to replace a failing supplier than to replace failing employees. Nevertheless, it is common for outsourcing to generate suspicion, resentment, and even hostility. Some of that is due to the contract negotiations. By their nature, they clarify that all parties should profit from the deal. That means if things go wrong, it can be hard to persuade either side to take remedial action if this also implies increased costs and reduced profits. Which of course means that relationships with outsourcers are no better or worse than the contracts that get negotiated. A genuinely good deal for both parties will be respected and will work well. A poor deal for one or other will lead to tensions. Areas of vagueness or uncertainty in the contract can compound those tensions. Finally, from time to time circumstances may arise that were not anticipated in the contract. So it is not surprising that billing, which can be error-prone, poorly documented and difficult to understand, can be especially problematic for outsourcing. But perhaps the challenge of writing a contract can help to refine insights into what are the key principles for effective billing.
They say people learn most from their mistakes. If that is right, Vodafone UK should be able to share a valuable lesson about how to outsource billiing. According to The Register, Vodafone UK’s outsourcing deals have contributed to a series of problems with billing; read here and here. If you read the comments on those pages, you get the feeling that many customers are fed up with it. They blame Vodafone, of course. One thing we cannot know from the outside, however, is which company really is to blame. Of course, one possible answer is that they all are ;)
