WHAT YOU SHOULD LOOK FOR IN A REVENUE ASSURANCE PARTNER


The RA team will develop relationships across the business and with the system suppliers. If you take an objective view, some relationships will work better than others. We need to understand why this is to ensure the team continues to be effective and become smarter with those relationships that are not as smooth.

The best relationships come when both parties are genuinely working for the same goal – there is co-operation between the teams and no finger-pointing or point scoring. And surprisingly, the best relationships are not the ones where the most money is found. Finding money can obscure the underlying tensions between teams – which only surface when the success ends.

This is also true when dealing with your RA System provider. The usual problem comes from the different aims of the two parties. The business is looking for a partnership to provide the support and controls it wants as the business grows. Some vendors appear to have little interest in the business plans of their customers unless there is an upselling opportunity.

So, what makes a good partner?

  • Someone who can support your team by providing additional expertise in revenue assurance, not just help in using its tool.
  • Someone who will listen to you and help you find practical solutions to your problems.
  • Someone who talks with you about your business and where it is going, working to make sure that the right tools are available just when you need them.

Which then leads onto how do you identify these partners – many organisations promote themselves by shouting about how much they have found, they use fancy mathematics to inflate the benefits, so choosing based on what they say they will find is fraught.

A good RA Tool Supplier will be able to identify a customer as a reference, someone you can talk to independently to get some feel of how they operate. Don’t just ask about the quality of the tool, the ease of use, the maintenance, ask also about the role they have played in the growth of the organisation, how well they understand and align themselves with the objectives of your business, how they responded to managements requests for support and how they are viewed by people at different levels of the organisation.

Although never explicitly mentioned, there is the corresponding side – the Tool Vendor will want to know how easy you are to deal with, committing resources to an unproductive relationship is bad business for both sides.

Ideally you want to find someone who can become a long term partner – do the background research to choose the right one for you. Spending the time to choose wisely in the beginning is never time wasted.

Talk to XINTEC, find out what they have to offer, you will be pleasantly surprised.

HOW A TELECOM FRAUD SOLUTION CAN PROTECT YOUR PROFITS

In 2017 alone, the CFCA estimated that US$29 billion was lost due to telecom fraud. Telecom fraud is four times larger than credit card fraud, yet it’s less often discussed in the media. Telecom companies need to protect themselves through the use of reliable telecom fraud management solutions, if they want to avoid costly surprises for their customers. Most telecom companies will see some level of fraudulent traffic – whether they are able to identify this traffic will depend on the tools at hand.

The True Cost of Telecom Fraud

Telecom fraud occurs when malicious attackers take advantage of the telecommunications system to complete calls or transactions that benefit them financially. Methods of telecom fraud vary considerably across the world, though scams are most often perpetrated by highly organised criminals, operating either alone or in gangs.

For instance, a malicious attacker may entice customers to return a “missed call”, without the customer realizing that the number is a toll or premium number that will charge a significant amount of money to their bill or prepaid account. This is called a “Wangiri” fraud, a Japanese term that literally means one (ring) and cut.

In a security attack known as “phishing”, a fraudster will get access to a customer’s personal details to make purchases using their account, and subscribing to services without the customer’s knowledge. As individuals spend more time on their phones, using voice and data services, they become more vulnerable to these types of threats.

At a corporate level, malicious attackers may hack VoIP PBX systems to make long- distance calls, again to premium-rate numbers. The attackers could also take advantage of quirks in a telecommunications system to make it seem as though calls did not go through (by recording a false disconnection notice), while still charging for completed calls. Calls can be routed and transferred incorrectly, all of which lead to artificially inflated charges.

When telecom fraud does occur, someone has to pay – and often, that someone is the telecom company itself. Telecom companies can also lose money through wholesale interconnect charges, customer refunds, investigations, and additional customer support hours. Telecom companies may also eventually lose the faith of their customers, leading to fewer new customers and fewer customers retained.

Luckily, there are answers. Companies can reduce the cost of telecom fraud – and thereby improve their profitability – by avoiding telecom fraud altogether. This can be done with the help of an advanced telecom fraud management solution.

Mitigating Your Threats With a Telecom Fraud Solution

Using a telecom fraud management solution, your telecom business can prevent a significant fraud from taking place altogether — therefore potentially saving millions. A telecom fraud solution is able to automatically detect suspicious activity, making it easier for the organization to mitigate it before the damage is done. Some newer solutions are able to learn from past behaviours, identifying even threats that haven’t been seen before.

Many telecommunications businesses now use self-learning algorithms to identify the patterns on a customer’s profile. This is similar to fraud detection used for credit cards. With these patterns, the company can identify activity that seems strange for a customer, blocking suspicious payments and costly subscription fees. The smarter these algorithms are, the less likely they are to produce disruptive false positives.

Improving Profitability With a Telecom Fraud Solution

As discussed, telecom fraud itself is expensive, and a telecom fraud solution can help you mitigate threats. In so doing, telecom fraud solutions improve profitability in three major ways:

1. Mitigating direct costs:
There are direct costs of telecom fraud. Telecom companies will often need to audit and review their systems, and update their software, hardware, and business processes. Companies may also find themselves needing to reimburse customers for fraudulent charges, or absorbing costs that were fraudulently relayed across their system. All of this is going to lead to additional expenses.

2. Customer retention and brand reputation: 
If a telecom company experiences enough fraud, it will get low marks from its customers and may not be able to retain customers. Customers will not trust a company that often falls prey to fraud, and they will not want to continue using a company on which they have experienced fraudulent transactions or charges.

3. Reduced labour and troubleshooting costs:
Telecom fraud management solutions are able to automatically enforce many security protocols, thereby reducing the amount of time that administrative personnel and IT teams need to spend tracking down and mitigating threats. Telecom companies may be able to reduce their internal IT staff by using automated fraud detection solutions for mundane and routine tasks.

Whether your telecom company is large or small, it’s probably already the target for malicious attackers. The time to begin protecting yourself and your business is now. 

PROTECTING THE CFO – THE SIMPLE SOLUTION TO REVENUE LOSS THROUGH FRAUD

Irrespective of a communication providers’ size, a CFO or Finance Director’s nightmare is to have to explain to his executive team, to his shareholders, to his/her own customers, even the general public in some instances, why they didn’t detect an ongoing financial loss or couldn’t prevent a sudden fraud hit.

The increase in scale and complexity of fraud types around the world creates situations of genuine uncertainty for operators and in turn, their financial controllers. No operator wants to constantly face the threat of being attacked by fraudsters and of having hundreds of thousands or even millions of dollars wiped off their bottom line in a single incident.Yet we see this happening, a lot.

But what price is worth paying to stay protected from financial losses?

Smaller Operators more at risk

Losses directly attributable to fraud and revenue leakage can range from 0.5% of gross revenues all the way up to 15% in certain cases, according to a Gartner report. International Revenue Share Fraud, the deadliest of all fraud types, costs the industry in the region of $6.1bn a year, roughly 20% of all estimated communication fraud.

Although the types of financial risk to which operators are exposed are essentially the same, owing to the global nature of telecommunications, the smaller operators are at a clear disadvantage when it comes to managing risk and preventing major losses. They simply don’t have the experience, the maturity, or the resources to get losses fully under control.

Whether traditional MNO, VoIP, fixed-line carrier or MVNE/MVNO, the price point at which they should seek to acquire loss prevention technology or related services is a critical deciding factor. So, the case for simple and cost-effective tools to de-risk their business becomes a compelling one. There has never been a better time to promote a low-cost technology proposition to the global telecommunications market, even for incumbent operators seeking to drive down supplier costs.

At XINTEC we can help de-risk a business in a very simple and cost-efficient way with a suite of products that are flexible, adaptable, quick to install, and able to deliver measurable results fast.  

THE HIDDEN VALUE IN REVENUE ASSURANCE TOOLS

A good Revenue Assurance software platform will play a key role in mitigating risk within a business.It can provide assurances in relation to the accuracy and completeness of the billing process; it can address regulatory concerns; it can be used to manage customer complaints; it can help reduce customer churn; it can assist in identifying network issues, etc.

Revenue Assurance solutions have been around for many years now, and the discipline of Revenue Assurance itself has reached a measurable level of maturity in many organisations. But the experts believe there is a lot more hidden value in these tools, to the extent that they can even be the drivers of a risk management culture within an organisation.

For instance, in the event of an unexpected incident which may incur a financial or reputational loss for an operator, teams are tasked with effecting changes within their departments to avoid a reoccurrence of this incident. In doing so, they are encouraged to collaborate and think about other potentially significant risks to the business. These could be as far reaching as losing the licence to operate, major network failures, significant system failures, data breaches, losing key customers, etc. 

Lately there has been a lot of talk about Enterprise Risk Management (ERM) – an approach to risk management in which all such risks are looked at. More than just Revenue Assurance or Business Assurance (which covers revenue assurance, cost assurance, margin assurance and partner assurance, or basically wherever one set of data can be reconciled against another),

ERM provides a framework for risk management which typically involves identifying risks and opportunities, assessing their potential impact, and determining a response mechanism which will ultimately protect and create value for stakeholders.

A good risk management strategy should recognise the value and importance of an effective Revenue Assurance solution in supporting the business in reaching this end. If a Revenue Assurance solution is used to its full potential, it should encourage Revenue Assurance operatives and senior management to think outside the box when it comes to mitigating risk, and to taking a risk-based approach to managing the enterprise, such as ERM.

REVENUE ASSURANCE: AN INSTRUMENT OF GROWTH

Chief Financial Officers (CFOs) or Finance Directors (FDs) play a pivotal role at company leadership level, helping to make crucial financial decisions and leading the execution of those decisions.

They also know that accounting – the backbone of measuring business performance – is a black art of sorts, masquerading as a science.

By adopting a Revenue Assurance approach, they can uncover the story behind the data, sharpen their decision-making ability, and drive new growth opportunities for the company.

At this time of year, CFOs and FDs are preparing their regular financial statements and updates for their stakeholders. But how can they add more value without losing sight of the core values of the business? 
Could they make the next period’s results better?

There are several traditional areas that get looked at, such as new products or campaigns to be launched, 
or costs to be cut, etc., all of which come with some risks attached. 

New campaigns and product releases could end up cannibalising already profitable revenue streams, 
or potentially triggering price wars with competitors. Cost reductions could result in poorer operational performance, leading to increased volumes of calls to the call centre, increased complaints, not to mention potential regulatory scrutiny. All this takes resources and effort away from running the business.

We are always surprised to learn that that “improving Revenue Assurance capabilities” seldom gets mentioned, although it has proven to be a winning strategy. 

So, what is different about Revenue Assurance? 

Adopting a Revenue Assurance approach has several tangible benefits, effectively improving the accuracy of supplier invoices and customer bills, which usually results in better cash flow positions and improved financial performance. 
Leading consultancy firms suggest that the average leakage in a telco is about 2% of gross revenues. And these are organisations with an established Revenue Assurance function, even a respectable Revenue Assurance system. 
However, in the absence of suitable Revenue Assurance capabilities, leakage levels within Telco’s can quickly exceed 5% of their revenues. And let’s not be caught out: as the costs have already been incurred, the money that can be unearthed from Revenue Assurance directly impacts the bottom line. Even a 1% revenue recovery can make a significant difference to overall margins.

OK, so where do we start?

Is it difficult to get started on the Revenue Assurance journey? Not at all. The only difficulty is finding people with the right mindset to take Revenue Assurance forward within the organisation. More than just a good manager or analyst, a good Revenue Assurance operative should be of an enquiring nature, challenging assumptions, and always seeking the truth. When in doubt, asking to see the original (unprocessed) data, and checking that answers given by others are reasonable and independently verifiable. People can be taught how to use tools, but what comes naturally is the right mindset – that spontaneous inquisitiveness that challenges the information provided.

Assigning good people to Revenue Assurance is just the start though. They need the right tools to help them put their skills to best use. 
A Usage and Subscription Assurance tool would relieve them of much of the routine data gathering and processing tasks and allow them to focus on what they actually want to be doing – finding lost revenues.

In Summary

Revenue Assurance is firstly about having the right people on board, about establishing a risk management culture within the organisation, and about creating a structure and processes to support the function.
Secondly, it’s about moving from spreadsheets to tools that will crunch data automatically and that can be expanded simply and painlessly as the function grows. It’s also about making wise decisions about this sort of technology, ie. not paying for over-engineered Revenue Assurance solution capabilities that will not be used for years, if ever.

This combination of people, processes, and tools, ultimately driven from the top down by the CFO or FD, has the potential to quickly recover lost revenue and to unlock tremendous growth potential within the business.

Why not talk to us, and see what we can do to help?