Archive for the Opinion Category
Posted by: Eric in News, Opinion
When I saw Stratecast’s 22 predictions for the comms industry in 2015, my first thought was: it is easy to make fun of them. On the one hand, they predict that broadband regulation will be a big deal in the USA. Err… I think anybody – and I mean literally anybody, not just telco employees – who follows US news would have noticed US President Obama making a YouTube video asking for lots more broadband regulation. So this Stratecast prediction falls into the ‘sun will rise tomorrow’ category. On the other hand, another big story that closed the year was the so-called cyberwarfare between North Korea and the USA. Obama was involved in this story too, talking big about Sony’s handling of the malicious hacking of their systems, which was quite likely conducted by operatives working for the North Korean government. This culminated with lots of fuss about freedom of speech, as the entertainment company withdrew their comedy film about North Korea’s leadership from cinemas, and premiered it via the internet. But amongst their ‘secure networking’ predictions, Stratecast made no mention of increased government interaction with the private sector in order to prevent malicious hacking sponsored by enemy nations. So the report includes at least one blindingly obvious prediction, whilst failing to include another blindingly obvious prediction!
But then I had to think again. I was drawn to read the report because of this prediction:
Margin Assurance becomes a management discipline as purpose-built analytics help address core business needs.
I was going to lampoon this prediction for lots of reasons:
- Does this mean margin assurance was not a ‘management discipline’ in 2014, or the year before, or the year before that? When I joined Cable & Wireless in 2007, colleague Guy Howie was building superb tools to assure margins. And in 2010, when the TMF RA team started talking about extending the definition of RA to include margin assurance, I chided them because the original definition had been consciously written to include activities like margin assurance within the scope of RA. In short, margin assurance has long been a management discipline. Different telcos progress at different rates, but there is no need to insult everyone who has been doing margin assurance for many years by suggesting that people will only start doing it properly in 2015.
- What does the phrase ‘purpose-built analytics’ mean, and how does it reflect actual trends? Has there long been proprietary analytic software that could be used for margin assurance if the right data was supplied? Yes. Have RA vendors long supplied analytics suites incorporating functionality to perform ‘margin assurance’? Yes. Have real telcos been actively using such third-party software to assure their margins? Yes. Is it the trend in software to build analytic solutions designed to satisfy specific narrow purposes? No. On the contrary, the trend is towards general-purpose analytical capability being made more widely and easily available for flexible use all around the telco.
- The need for margin assurance is apparently prompted by tightening margins. But what is new about that? Margins did not suddenly narrow in 2014. Margins have been eroding for many years, depending on the maturity of the market in which the telco operates. The rationale for this 2015 ‘prediction’ has been valid for a decade, so why make the prediction now, and not before?
But then, I had a change of heart, and decided not to make fun of Stratecast. I read the full text of their prediction closely, and realized Stratecast are not guilty of making bad predictions. They are guilty of much worse: of making vapid predictions that rely on weasel words. You might think they are predicting something, but they are predicting nothing at all, because it is so hard to imagine an outcome that would clearly contradict it. Here is everything they had to say about margin assurance in 2015:
Rising from the roots of revenue assurance and fraud management, Margin Assurance is a business discipline focused on maximizing profits.
So far, they have predicted nothing, and said nothing interesting. But they did demonstrate inconsistency in how they capitalize words.
CSPs globally continue to see rising costs as data volumes increase from the roll-out of new network technologies, and through engagement in changing business models, including a sharp increase in partnerships.
Still no prediction. And nothing interesting.
CSPs are also seeing flat revenues or at least revenues that are not rising as quickly as their costs.
***Yawn*** Please tell us something we do not know already.
The result is tightening margins.
***Really big yawn***
Using the right analytical tools associated with the right types of data,
As opposed to the wrong tools, with the wrong data? How stupid do they think we are?
the Margin Assurance discipline in 2015 will
At long last, a prediction is coming!!!
become engrained in all major Operations and Monetization processes.
And that was it. That was all they said on the matter. But what does ‘become engrained’ mean? It means nothing. If you have been doing margin assurance for the last 10 years, Stratecast could argue it was not sufficiently ‘engrained’. And whatever margin assurance you conduct by the end of 2015, that could argue it is now ‘engrained’. In ‘major’ stuff. Though not necessarily in the ‘minor’ stuff. You will do it for major stuff like your processes, as opposed to all those non-processes telcos have for operating things and making money. The more you look at the words spouted by Stratecast, the less there is to see, until you realize you have analysed pages of documentation that told you nothing at all.
I closed the talkRA review of 2014 by saying the increasing complexity and interplay of several key trends in assurance made it impossible for me to predict what will happen in 2015. An honest analyst admits the limits of their knowledge, and when they can no longer make reasonable extrapolations from the data they possess. Sadly, Stratecast lack that integrity, and feel obliged to make predictions even when they have no idea what will happen, and no data to support their hunches. What happens in 2015 will be determined by what you do, not by what they say. So go ahead and do something of substance, without wasting time on empty predictions.
A few years ago, I received an email that was more like a thesis detailing my shortcomings. It was authored by a prominent business leader in the CSP I was working for. My fault: I was “showing reluctance” in helping the company address in its fight against revenue leakages. As a result, his team was being forced to identify leakages, in effect doing “YOUR” job. The word: “YOUR” was in capital letters, bold and underlined. The latest leakage was proof of “YOUR” utter failure in “supporting the business, clearly abdicating YOUR role”. Those who have been in RA for some time know the utter shame that the RA guy feels when a leakage happens under his watch. It need not be something he did or did not do, it may not matter if it was somebody else to blame: the leakage simply haunts you. It keeps you awake. There is no need for somebody else to remind you of that mishap, or many others that have assaulted your spirit in this world of CSPs. In those lonely moments of self-flagellation, the last thing you need is some sucker helping you, particularly when his assistance is only in the form of whipping the areas you cannot reach.
Thus it came to pass that on a fine morning, I was summoned to give account of my failings. I hung my head in shame and shuffled to this business leader’s office intent on atoning for my sins, committed and yet-to-be-committed. He had gathered his team around his huge desk, no doubt, to barbecue me in front of the masses as a lesson to other RA folk who might be nursing ideas of abdicating “THEIR” roles. It did not take long for me to realize that the leakage that had been identified by HIS team (because of MY failure in this job) was only ferreted out using a report that I had painstakingly designed and scheduled to be going out regularly to that particular team. The report would show instances and quantification of the type of leakage that I was now guilty of “not” addressing. I pointed out this interesting turn of events but this guy was a real piece of work. He wouldn’t budge. Here was a man who really liked the taste of his foot in the mouth and I was interfering with his culinary experience.
Fortunately, I have now been in this business for a number of years, my hide has thickened and my blood pressure has settled quite close to the medically-safe limit. I hardly use swear words – because I have already exhausted the whole set of invectives that constitute my sailor’s thesaurus and I hate repetition. I consider it to be beneath a self-respecting sailor to recycle 4-letter words. Neither do I seethe inwardly – if I did, I would already have exploded a few years ago and in a fit of rage, mowed down a whole village using automatic gunfire. When I am really mad, I find it intensely therapeutic to think of how wonderful it would be if all countries joined together and established an Imbecile Processing Zone (IPZ) where each region could export the finest of idiots to compete against the crème de la crème of fools from other countries. Think of gladiators in the arena but this time fill the arena with fools of every race, creed and color. Over the years, I have built an impressive list of my nominations to be unveiled one day, when this dream IPZ comes into being. This guy promptly went in my list as number 378. Anyway, I digress.
I sat patiently waiting for an apology, which did not come, even after it was clear that for the single finger pointing at me, four were pointing back at the owner of the hand. It is generally not a good idea to roll with pigs in the mud so I promised I would check my reluctant attitude at the door next time. Before readers think of me as a mouse, I would like to say in my defence that when I looked at the faces of the guys who were “led” by this leader, they were truly embarrassed on behalf of their boss. I had been in the trenches with them and they knew if I was reluctant or committed. That is all that mattered.
I was reflecting on this last week as I wondered what I have really learnt about RA. Thinking of that incident, it reminded me of what we all set out to achieve in RA space. What we all want to see, at the end of our work, is an organization that has become “RA” oriented in its thinking and doing. An organization that does not look towards the few guys who work at the RA workstations but takes the challenge of revenue assurance as one of every team’s key objectives. I will be the first one to admit that I have spectacularly failed in effecting this culture change so many times that it no longer hurts as much as it used to but the wounds are still raw. However, I have also been fortunate, in this career, to have witnessed a few times, somebody in a team within the organization, living according to this ethos. For that I am eternally grateful to the gods of the RA universe. I bow down to them because I know my evangelism has sown some seeds somewhere.
As 2014 came to a close and one more year of this evangelism cycle starts, I hope to gain just one more follower in the organization who will take upon himself the challenge of being RA-aware in his work. If more followers should be found, I shall bless the gods of RA universe even more but for now, just one more follower will do. Should that happen, I think it might just make up for the apology that I never received, years ago from idiot number 378.
The music I hear is the sound of those sparse victories, that graced our past and the beginnings of the few that are yet to come, laced with Auld Lang Syne.
Posted by: Eric in Opinion
In Auld Lang Syne, Scots poet Robert Burns poses a question: should old acquaintance be forgot, and never brought to mind? The answer is no! So, old friends, new acquaintances and fellow travellers, let us remember who did what during the last 12 months of telecoms business assurance and risk management.
Keynote, makers of test equipment, purchased Meucci, specialists in detecting bypass fraud, for an disclosed price.
Public concern over surveillance prompted Vodafone’s Group Privacy Officer to openly challenge the legality of various government spying programs.
In a positive move, WeDo appointed Raul Mascarenhas as their new Vice President with responsibility for pushing business assurance to companies outside telecoms. In a less positive move, somebody from cVidya started trolling talkRA.
Law enforcement in Bangladesh arrested 44 people and seized USD128mn from telecoms fraudsters.
Mobile World Congress prompted lots of companies to make announcements. We understood the upgrades to the Lavastorm FMS and to the WeDo FMS, but were mystified by cVidya’s press release.
Mike Willett asked why I founded talkRA, so I told him.
WeDo’s annual results showed a 12% rise in revenues. Meanwhile, they sold their Praesidium consulting division to sister company Mainroad.
The annual Trendlabs security report highlighted the rapid spread of mobile malware.
A former GRAPA insider exclusively told talkRA that Papa Rob’s training organization had made staff redundant and was on the brink of collapse. GRAPA’s subsequent inactivity validated those suspicions.
cVidya turned Hadoop, the open source big data technology, into an enabler for their software.
BBC undercover cameras revealed London’s black market for stolen smartphones.
WeDo’s annual user event was successful, though there were hints that the format would need a major overhaul next year, to involve customers and targets from outside the telecoms sector. Despite this being their biggest conference yet, and despite taking on increased responsibility for sister companies within Sonae’s SSI division, WeDo CEO Rui Paiva still appeared incredibly relaxed.
Telstra Global and Subex received an innovation award from Global Telecoms Business, for their project to unify billing operations with a common implementation of Subex’s ROC partner settlement solution.
The annual results from Subex showed that the business is fundamentally sound and on an upward path, but still weighed down by debt.
The TM Forum published version 2 of the RA Maturity Model. I slammed it for asking biased questions.
Subex CEO Surjeet Singh exclusively talked to talkRA about his plans to turn Subex into a USD100mn turnover business within the next three years.
The UK Revenue Assurance Group extended its record as the longest-running meeting of telecoms RA professionals, anywhere in the world. Attendees of their Summer get-together celebrated the 10th anniversary of RAG with a slice of birthday cake!
American journalist Ryan Block called Comcast because he wanted to cancel his internet service. Comcast’s Customer Service Advisor had other ideas. Block taped the conversation; it took just two days for 4 million people to listen to their exchange.
Basset, the Swedish revenue management firm, was acquired by a Canadian software conglomerate for USD10mn. No mention was made of their business assurance offerings, raising questions about the prospects for other peripheral players in this market.
The ongoing farce of UK billing accuracy rules reached a nadir when the regulator scrapped the toughest accuracy measures in the world, whilst pretending this was necessary to make bills even more accurate than before.
Mara-Ison Connectiva underwent a rebrand that placed more emphasis on their analytics offerings.
Tony Poulos left his role with the TM Forum to become a market strategist for WeDo. Meanwhile, WeDo’s parent division, SSI, augmented their umbrella of risk offerings by strengthening their holding in security business S21sec.
Against the background of changing markets and evolving relationships between business assurance and disciplines like analytics and risk management, I asked talkRA readers what they expected from this website in future. The general conclusion was that they wanted more of the same!
In one of the most heavily-read posts of the year, an anonymous RA practitioner slammed the management team in his telco for being obsessed with inefficient short term leakage targets instead of making fundamental changes to prevent future losses.
Street protests forced the Hungarian government to suspend a new internet tax.
A poll of talkRA readers demonstrated a pronounced division between those practitioners who believe revenue assurance and fraud management should be in the same department, and those who insist they should be kept apart.
Vodafone withdrew a USD23k bill they issued to a victim of organized crime in Barcelona, after a lawyer intervened to argue such bills cannot be legally defended.
American politicians Barack Obama and Ted Cruz both said misleading things about net neutrality, making it sound like it is about technical standards or censorship or the speed of downloads, when mostly it is about who gets billed for the internet.
Subex held their annual user conference in Istanbul, and I went along to chair the event. The audience enjoyed it so much that we closed with an impromptu dance on stage!
Ghana’s government promised a crackdown on simbox fraud. The Communications Minister said this was to protect Ghanaian businesses from missing important calls because of misleading CLIs. Everyone else thought it was motivated by the government’s desire to collect more stealth tax from callers.
Despite the telecoms industry spending USD354bn on network capex in 2014, a survey conducted by the TMF’s Network Asset Management team found that 57% of telcos do not know which network assets are failing to meet financial targets.
By popular demand, Lee Scargall returned with a new lunch time teaser.
Telcos are changing. Assurance is changing. The market for assurance software is changing. We know that we must constantly live with change, but those changes can be hard to predict. For the first time, I feel totally unable to speculate what will happen in 2015.
To say we are at a tipping point would be too simplistic, as it implies foreknowledge of which way our markets might tip. We are balanced on the point of a needle; the industry will fall into new patterns of doing business, but nobody can be certain of the direction we will fall. The rising complexity of threats will force assurance to become more closely aligned to security, but it is unclear how this will be realized in practice, or if businesses are prepared to make the investment necessary to mitigate increased risk. The relationship between telcos and other businesses will alter, but whilst the paradigm for the telco business model is under strain, it is not clear which paradigms will succeed it. Big Data creates the potential to understand and think about business like never before, but that does not mean that human behaviours and decision-making will change to take advantage of it. Public concern about surveillance is on a collision course with the business imperative to accumulate and protect intellectual property, and nobody knows if governments will side with the interests of the public, with the interests of business, or only with the interests of the government itself. And the virtualization of networks will change the practical realities of assurance, but there is no settled opinion on whether it will affect its principles or priorities.
There is a Chinese saying: “better to live as a dog in an era of peace than a man in times of war.” However, our most peaceful years are behind us. In 2015, I expect the battle for the future of communications to heat up considerably, waking the sleeping dogs and calling men to arms. People will dislike many of the changes to the industry, but we must face them.
One thing is certain. We will be giving talkRA a facelift, and revising the scope of its coverage to maintain its relevance. As our world gets more complicated, knowledge becomes even more valuable. We intend to continue providing a valuable service to communications professionals, giving them news and views they will find nowhere else, whilst making sure the service evolves to anticipate and support changing needs. To find out more, you had better stay tuned!
As 2014 draws to a close, I am forced to think back across the year of the Revenue Assurance Group, and also to the coming year.
For me, being a part of the RAG has always been a great privilege, and being lucky enough to be the Chairman during its 10th year has made it even more special.
Over the past year, in the three meetings we’ve had, we’ve covered a great variety of topics, shared views and challenges, and debated differences in opinion.
In March we looked at the importance of Number Plan Management, how an RA team functioned within an MVNO, and we spent some time looking at the familiar challenges being faced within utilities.
In July, our focus was on risk management and RA across different industries, as well as RA’s involvement with reviewing business cases, and the importance of assuring assets in the telco estate – not to mention celebrating the 10th birthday with cake & champagne!
However, for me, our November meeting was my favourite: Big Data and analytics! And not just for the theme, but also because of the involvement and speakers from the UK, the US and Australia. The contents included:
- Big Data and managed analytics opportunities: how analytics can reveal counterintuitive customer behaviour, and how to maximise the relationship with customers to improve their experience and subsequently their life-time value
- smart metering in utilities: the challenges in knowing what data can be used for what, for improved customer experience and to gain better/trustworthy data into the BSS and OSS
- smart asset and energy management: looking at the less traditional RA activities of cost saving and margin improvement, rather than revenue recoveries, and how these efficiencies can dramatically strengthen the existing bottom line of an energy and maintenance hungry organisation
It’s been a good year for RAG and 2015 is shaping up the same way, with more topics for discussion, great insights and more members and attendees than ever before. We’ll continue to grow in size and worth, covering the issues that matter to us.
The RAG is only made possible by the efforts of speakers, members and attendees – and of course by the generosity of Cartesian who host, cater and sponsor the event, and who have done for 10 years.
Posted by: Eric in News, Opinion
Would you invest in a business that loses money? Probably not. Or, at least, you are more likely to invest in a business that makes money. That is why investors read the numbers reported in the press, and rely on auditors to check financial statements. What if you already own the business, and were considering investment in some new machinery? Again, you might buy the machinery if you thought it would generate profits, but not if the cost outweighs the returns. That is why accountants go to a lot of trouble to map costs to assets, and hence determine which assets are driving profits, and which are not worth keeping. So would you make a major investment decision, knowing you will be ignorant of the returns generated by the investment? That is exactly how most telcos are run, according to a new report from the TM Forum. Net global capex network investment is estimated to have cost USD354bn in 2014. In response, the TMF’s Network Asset Management team conducted a survey into how telcos track and manage their network assets and the returns they generate. The findings make for grim reading, including the fact that 57% of surveyed telcos had no data on whether existing assets were generating a positive return or not.
I found the survey results to be confusing in some respects. For example, 29% of telcos stated they do not bother to measure any returns generated by assets, after they have been deployed. But what are the other 71% measuring, if more than half of telcos have no data to determine if an asset is underperforming? Perhaps they are measuring returns across a class or category of assets, which may be some help but still fails to provide sufficient detail to improve future investment decisions.
The conclusions about data integrity were equally grim. On average, respondents believed their network inventory records and fixed asset registers were only 74% accurate. Their expectations were also low, believing that accuracy levels below 90% would still be ‘acceptable’.
Reading between the lines, I draw my own conclusions from the messages about poor data quality and scrappy methods for measuring returns. Determining the profitability of a network asset would involve a lot of hard work, so mostly we do not bother. This is understandable from the perspective of the poor schmo who is asked by his unreasonable boss to generate numbers without receiving the data, tools, and thanks that such a task demands. But from a collective, corporate perspective, this blind spot in decision-making is nothing less than insanity. How many of you have worked in a telco where the stationery cupboard was locked to prevent people using too many staples, or where your phone calls were scrutinized to determine they were all made for genuine business reasons? These things are controlled because they are easy to control, but the values involved are trivial. In contrast, the amounts spent on network capex are enormous, but hardly anyone can say where the money was best spent, or where the telco failed to generate the results it hoped for. If we do not gather the knowledge, we cannot learn from the past. In the case of network asset expenditure, that means we are doomed to repeat our most expensive mistakes.