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Navigating the complexities of billing transformation

Lessons learned from the telecom industry

Evolving customer expectations and new digital revenue streams will require businesses to rethink their billing capabilities. Learn more about the biggest hurdles to billing optimization and what companies can learn from transformation in the telecommunications industry.

Why is change needed?

The advancement of true on-demand access to services and products requires businesses to reimagine their customer experience, redefine offerings, reinvent business models, and reprogram sales channels. Evolving customer expectations and new digital revenue streams will require new capabilities and support for offer-centric and/or customer-centric billing.

In the 1960s, when computing was in its infancy, telecommunication providers were early adopters of main frame computers. With the growing volume of wireline calls at the time, large telecommunication providers implemented stand-alone billing platforms. Despite the cost and the limited scalability and processing power, this automation provided faster, more accurate, and efficient billing operations than previously experienced.

Today, telecommunications providers are increasingly offering value-added products to augment their connectivity services. They are packaging innovative cross-channel content and elevating personalized customer experiences, while striving to enhance their operational efficiency.

This movement away from billing to real-time decisioning at the network edge shifts the focus away from billing and necessitates a reevaluation of the billing architectural approach. Further, the degree and speed with which digital transformation is occurring compels companies to reexamine the billing road map and the path forward to right size the billing footprint.

Three approaches to billing transformation

Over time, telecommunications companies recognized the imperative for strategic evolution to remain competitive in an environment marked by rapid go-to-market strategies, innovative product offerings, and a commitment to superior customer experience. To keep up with the lightning-fast pace of change in the marketplace, they needed to unleash innovative products, dazzle customers with splendid experiences, and dance with agility in the billing ballet.

But a billing metamorphosis is no small feat. Billions of dollars currently flow through the legacy billing systems, content with their routine. Telecom executives fear putting revenue at risk in the perilous journey of transformation, and who can blame them? This sentiment is corroborated by a Gartner survey indicating that 59% of CIOs perceive digital initiatives as protracted processes, with 52% asserting a delayed realization of value.

Several other factors contribute to the challenges of billing change, including heavy financial investments, the complexity of billing systems, and resistance to change. Despite these inherent difficulties, the imperative for telecom companies to undergo billing transformation remains. The strategic approach to this change is pivotal, helping to ensure alignment with business objectives and minimizing operational disruptions. In navigating this complex landscape, a judicious blend of foresight, planning, and adaptability is requisite. As inputs for these approaches, we offer three options for consideration:

Option 1: Break the monolith

Finding the right balance of foresight, planning, and adaptability for a complex billing transformation can seem daunting. One approach a company can take is to “break the monolith.” This option can be tackled incrementally to strategically minimize the challenges and uncertainties inherent in a billing transformation. Based on the organization’s level of risk tolerance, leaders can choose to set their own pace to decouple non-billing capabilities step by step, with the end goal of creating a more modularized architecture

Option 2: Take the plunge

While the option of breaking up a monolithic billing system into more manageable pieces may provide some level of comfort and convenience, some companies may prefer the challenge of effecting a complete departure from their existing billing platform. Making this leap can offer considerable benefits to an organization looking to leverage a new, state-of-the-art platform.

Option 3: Keep and evolve

Even with multiple options and an evolving technology stack, businesses may choose to retain their existing system if they have already invested heavily in it and believe that making incremental changes going forward is ultimately the most cost-effective strategy.


The path forward

As market demands, customer expectations, and regulatory requirements change, so, too, must the billing application. The sizes of billing footprints vary, as do the approaches for the evolution of billing. And while the trends of new monolithic billing implementations are waning, the ramifications of these colossal applications remain.

Business leaders’ uncertainty and apprehension around “ripping and replacing” an entire billing platform is understandable, given the financial reliance on billing. Yet one imperative is clear: A successful billing transformation journey must start with thorough evaluation of each option’s advantages and disadvantages in the context of the company’s business strategy.

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