From Revenue Assurance to Business Assurance
The beginning: Revenue Assurance
Revenue Assurance (RA) is a special term in the telecommunications industry for which I have not yet found an immediately understood translation in any language! Actually RA is a ubiquitous process across all service and manufacturing industries at the heart of cash-flow management! Every company needs to ensure that they receive payment from their customers for their goods and services, as scheduled, and for the correct amount.
Often RA was seen as simply “counting” CDRs (Call Data Records - the individual call records for telephony services of all kinds with their associated billing rates). However, there is much more to the subject. Here are a few simple easy to understand examples:
Does a granted discount end after the specified time period?
Does each customer receive a (correct & prompt) invoice and pay on time?
Is the combination of tariffs and services valid?
Of course, these are all questions that many other branches of industry are concerned with and certainly revenue assurance controls already exist in various companies, even if they are termed differently, perhaps quite simply "controlling" or “cash management”.
Among others, the Telemanagement Forum TMF (www.tmforum.org) started early to define uniform standards such as metrics and KPIs in the RA environment. In this way, companies could benefit from the experiences of others and even compare themselves e.g. with the key figure "% value of recovered losses". (For further details on metrics, KPIs or the entire RA framework of the TMF, you can contact the TMF directly, but I am also available for discussions and information).
The TMF has been conducting regular surveys on the state and development of RA worldwide for more than 8 years and I will discuss some of the findings of the just finished report later.
Not only do the revenues have to be assured, but also the costs of delivering that revenue have to be verified and accurately attributed - so called Cost Assurance. For telecommunication companies, these costs can be considerable, especially if they do not operate their own network. Such costs will include all upstream service provider infrastructure charges, roaming charges, special numbers (e.g. 0800) and also increasingly application services of many kinds that are paid for via the telephone bill e.g. mobile payments.
The telecommunication company will have supply and service agreements and of course therefore cash, credit and debit flows with a diverse ecosystem of partners which have to be verified and audited. Many telecommunication companies consider this area of auditing as an integral part of RA.
With the availability of all data on costs and sales across the supply and customer service chain, the step to detailed margin analysis is then made more easily. Depending on the effort required and support of appropriate analytical tools which are readily available, a margin analysis can be broken down to single customer on a per product basis. This enables a detailed customer value analysis as a basis for further customer contacts and targeted marketing measures.
The consequence: Business Assurance
In the context of constantly changing customer requirements for telecommunications companies coupled to rapidly advancing technologies supporting e.g. digitalization, IOT, SDN, 5G / SD-WAN, Edge) additional security measures and risk management disciplines have been combined under the extended umbrella of business assurance for some time now.
About 90% of the participants of the last RA survey of the TM Forum see Business Assurance (BA) as a natural extension of Revenue Assurance (RA):
According to the current TM Forum definition, the following disciplines belong to Business Assurance:
Revenue / Cost Assurance Management
Asset Assurance Management
Margin Assurance Management
Migration Assurance Management
Transformation Assurance Management
Ecosystem Assurance Management
Regulatory Assurance Management
Customer Experience Management
The evolutionary path so far shows that BA experts do much more than just analyse data sets. While RA has always been an area that has had to communicate with most departments of the company, the RA activity itself sits mainly in Finance in about 60% of the companies surveyed with increasing involvement with IT and Billing and Marketing when introducing new products. However, the requirements for a Business Assurance department are much more diverse with greater impact on company performance, business planning and customer service. This also means that different skills and roles have to be filled e.g. Business Analysts, Operational Analysts, Data Analysts, Data Scientists etc.
Completely new techniques such as block chain, machine learning and AI are also likely to play an increasing role in business assurance. So far, however, there has been little active consideration of these, so it will be interesting to see how developments develop in the next survey.
Here is the management summary of this year's survey.
In addition to the facts described so far, you will also find information on the general coverage of the audits, the losses found, the planned extensions and some other details, all also considered in the development of the past years.
The complete survey can be found here:
Further information about Revenue and Business Assurance can be obtained, as already mentioned, directly from the Telemanagement Forum.
And I am looking forward to a lively exchange on the topic. Thank you.
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Katrin Tillenburg is an independent telco consultant, specialized in the BSS, Billing and Business Assurance. Since more than 25 years working in international projects, she is also an active TMF member and founding partner in the SolutionHeads network.