When Lightening Strikes – Revenue Assurance in Botswana

datePosted on 03:34, April 15th, 2010 by admin

I recently spent an amazing week with a class of revenue assurance, internal auditor, fraud and telco operations professionals in Botswana. During the training two issues kept coming up: “How exactly do I set up a governance model for revenue assurance,” and “What model should be used for measuring how effective the revenue assurance team really is?”  These are interesting questions and certainly frequently asked at trainings.

If you are a follower of our blogs and of our new Corey’s Corner webinars, we are beginning to uncover some of the really critical areas where revenue assurance is asked to help when disasters strike. When the people in the class in Botswana started asking about the different controls and revenue assurance scenarios, it brought to mind a story reported to GRAPA recently.

It seems that a Latin American wire line carrier had one of its switches struck by lightening. Of course, the network engineers had to make some quick decisions about what to do. It happened that this carrier had been in the middle of a migration from the Class 4 and Class 5 switch environment, to an NGN (Next Generation Network) architecture, where the switching was managed via VOIP instead.

Since the old switch was already destroyed, the network engineers decided to cut over to the new NGN environment. Unfortunately, for the engineers, the carrier and their customers, the revenue assurance group had not been called in order to assist with “New Technology Assurance”. When the cut over happened no one checked to see if the new architecture was set up properly for accounting revenues. The result was that for over one month, customers were double billed for every call they made.

Since this group had not instituted their standard revenue assurance based “Ratio Controls” in billing, and did not institute “Change Management Controls” in the network, the customers of this telco got a little surprise in the mail: a bill twice as big as it should have been. The carrier was of course embarrassed, and they made refunds and corrected the problems, but what an incredible waste of time and money, in addition to the irrevocable damage to reputation.

The questions that the managers in that Latin American telco may have asked themselves after this happened was, “Should I have put the revenue assurance controls in place when I had the chance?” and “Would those controls have prevented this revenue disaster?”

The clear answer, in this case, was yes. The investment in those few critical controls would have more than compensated for the damage to regulatory standing, public relations and actual revenues that the “lightening strike” created.

It is easy to look back and to say “We should have done it this way.” It is another thing to develop the skill, judgment and capability to make such decisions ahead of time. This is where the beauty and efficiency of the GRAPA approach to risk and controls management comes in. Under the GRAPA approach, we do not try to tell managers or revenue assurance professionals how much risk they should be willing to take. That, according to the GRAPA standards, falls under the “Appetite for Risk” principle.

The GRAPA standards are not prescriptive. We do not provide members with a mindless checklist that allows them to say: “Well, I did what the standards told me to do, so if anything bad happens it is not my fault”. What the GRAPA standards provide is a principle based approach.
Specifically, what we identify for each area of a telco operation is:

  1. A method for the diagnosis and assessment for risk in that area (forensics).
  2. A set of standard controls, which is a list and explanations of the key points where the majority of telcos have been implementing controls in order to contain risks in the identified areas.
  3. A method for the calibration of those controls (a range of control levels from the extremely low cost to the extremely exhaustive).

What we then count on, is the revenue assurance professional, in partnership with the management team, to work together to build the best risk management profile for their situation. In the “lightening strike” scenario, there are clearly over a dozen GRAPA standard controls that would have identified and ameliorated the risk long before the disaster that our Latin American carrier faced. What we provide is a set of “standard control points”, control points that need to be understood and applied in the most cost effective way possible by professionals. .

These standard control points define for the executive and the revenue assurance professional a comprehensive roadmap of both the minimum points of coverage required to consider an area assured. It is up to the revenue assurance team to “scale up” those controls to the level of risk containment. The net result, for our friends who trained in Botswana, and for telco management teams around the world, is a new insight and a much better understanding of the ways they can work to combat the ever increasing risks to revenue loss being faced, in the most cost effective way possible.

That is enough for this week. Remember, the next time you see a flash of lightening, or find yourself facing a revenue crisis, maybe you need to ask yourself a simple question, “Could this crisis have been averted, or minimized if I had simply implemented some basic controls in this area”. You may find, like most telcos that the cost and trouble of implementing a controls strategy will pay for itself many times over.
Until next time, this is Rob Mattison, once again saying…. be safe.

(Keep on the look out for our upcoming articles about Revenue Assurance In Haiti, and the role of revenue assurance in the earthquake zone, as well as some really interesting articles about revenue assurance in the battle zone, and learn about the unique revenue assurance challenges in Afghanistan where one of your biggest revenue assurance issues is dealing with the fact that people keep blowing up your towers and switches. )

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