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One of the charms of American football is that the action is broken up into a series of plays.
As the offensive team huddles to decide their next play, the sports commentators have time to run an instant replay or speculate about what play will be called next -- a run up the middle, a short pass to the sidelines, or a long ball towards the goal post? Thinking about these strategies exercises the brain in the moments before helmets go crashing on the field again.
And the process flow of American football -- run the play, stop to assess, then plan the next moves -- is similar to the management of a business. Is it any wonder that Americans often talk about business in football terms?
One football phrase you hear quite often is “blocking and tackling”, which means being good at the fundamentals of the business, as in: “Our strategy is sound, but if we don‘t execute in basic blocking and tackling, our competitors are going to walk all over us.”
In telecom industry terms, the order-to-bill process is about as basic a blocking and tackling operation as you can get. It’s what every operator does and it better do it well.
Overland Park, KS-based TMNG Global has built a sizeable consulting business helping telecoms improve their order-to-bill process and Senior Vice President Ron Angner is here to explain some of the important order-to-bill programs his firm helps carriers enable.
|Dan Baker: Ron, I’m curious why TMNG puts so much emphasis on order-to-bill in its consulting business?|
Ron Angner: Dan, when an operator gets order-to-bill right, it delivers two key benefits-increased cash flow and customer satisfaction. The winners of the telecom game will be those who execute on those two things very well, especially in a tough economy.
Obviously, if the order is entered incorrectly, that’s a big problem, but equally important are the other vectors coming out of ordering: to billing, to provisioning, to installation/test, and to turn up.
If you get it right the first time and the customer gets what they ordered, you can tick the box for customer satisfaction. You also don‘t have any rework. And since it’s on the bill correctly, you’re getting your cash a lot quicker because there’s nothing to dispute.
|Is cash flow management more critical today than it was previously?|
It absolutely is, and the key reason is that carriers are making big investments in technology and the delivery of new services.
For example, a major Tier 1 carrier is making a capital intensive program to migrate their wireless equipment and access from legacy TDM to IP. A program like that is a big drain on OPEX and CAPEX, and many operators are embarked on similar programs — cash is at a premium
Another dynamic is the shift to smartphones which implies wireless operators are subsidizing phones that are far more expensive than previous generation devices, and that means the cost of carrying inventory has risen.
All of these factors put the squeeze on cash flow.
|When you want to increase an operator’s cash flow and customer satisfaction, where do you look?|
For TMNG, improvement begins by looking at provisioning intervals. Now the overall interval is an interesting metric to look at in itself, but the real key is to get control of the many sub-intervals in order entry, order management, provisioning, installation/testing, and entry onto the bill. The idea is to tighten the execution time and improve accuracy across all these sub-processes.
The client will tell us: “I need to decrease my order interval from 28 to 24 days because my competitor is doing it a week faster.” So the mission is to reduce the interval and maintain it.
Maybe there’s poor coordination between the provisioning team and field techs. Whatever the cause, you need to meet the order-to-implementation interval 99% of the time so when a salesperson commits to something, the customer gets it on time. It’s like cooking Thanksgiving dinner. A lot of things need to come together before the family sits down together at 4 PM.
By the way, the consequences of order-to-cash failure are tremendous. If you don‘t do it right, your order interval could stretch, say, from 10 days to 14 days. And that’s when things go haywire: your customer doesn’t get the service they are promised, it takes longer for you to get paid, or worse, the customer churns to another provider.
|It must require quite a bit of coordination among your consultants because the problems are coming from vastly different areas.|
That’s true though it often depends on the service. If it’s network-intensive, where a lot of provisioning is needed to stand up the service, then the inventory aspects become critical; what assets are available? How do I turn those up? So we have people who focus on that area.
Order entry and management is also vital; ensuring the transfer between the customer and the phone reps is working. If you get a lot of rejects, that means call backs from customers to manage.
So it’s generally getting that front end order entry/order management correct and then ensuring the backend provisioning process is fine tuned. That’s where most of the issues lie. Getting the service on the bill is usually handled pretty well.
|How can operators get a handle on their order management problems?|
They need to standardize or simplify as much as they can. Problems occur when order processes move out of the well-defined or productized ordering box. Now that’s not to say operators shouldn‘t try to satisfy a customer’s unique needs, but it’s in those special tweaks for individual customers where the higher costs and interval delays occur. Poor coordination in the order entry/management chain causes processes to loop and loop without moving forward. Then it requires somebody else to go in and try to figure out what the salesperson or customer had in mind.
Another big issue is making sure the elements required to execute the order, such as the time frames, installation addresses, and so forth — are included, and are correct!!
|What services are carriers having the most trouble with?|
Generally the biggest problem areas are the relatively new services and the complex ones. Take T1 Service. It’s been around for decades, so companies large and small have pretty much figured that service out. But if you are establishing a new network, say moving from legacy to IP or introducing a new IP PBX service, that’s where paying attention to the details becomes real critical.
Consumer services are usually the easier thing to control. The greater complexity lies in serving large enterprise customers. That’s where we do a lot of our consulting work.
|In the enterprise customer area, telecoms have long experienced problems with so-called Individual Custom Basic (ICB) contracts where the terms were highly specific to a customer’s needs. Has the industry evolved out of that issue or not?|
Well, there’s certainly more sensitivity to the problem, but there is still a lot of work to be done in many carriers.
One of the biggest issues is sorting out the interactions between the salesperson, sales engineer, and customer.
We deal on both sides of the transaction. We have enterprise customers as clients and many of them are frustrated and wait 140 days for orders to get fulfilled. Then, on the other side, carriers sometimes can‘t even verify the status of orders in their provisioning pipeline.
|What should a consulting organization do to fix these issues?|
First, it is critical to understand where the carrier is today, so we conduct interviews, assess the current process, and look at the technology that supports the process.
Most importantly, we look for metrics to understand how a company is performing. Often neither documentation nor a process book exists. So we’re sometimes called on to build that baseline. More typically, the carrier has it 70% figured out and needs help working out the remaining 30%.
But the baseline is key because that allows us to go back to our industry statistics; KPIs, OPIs, SLAs. We can tell clients what the industry standards are, so they can set a target to achieve. In that way we help them answer the question: “How do I get to industry best-in-class practices?”
Now the prescription could be many things: new systems, new processes, better training, and anything in between. But where TMNG adds value is by knowing what the industry standards are and how to put together a transition plan from where a company is today to where they want/need to be.
Typically it’s not one problem, but several problems compounded together that need improvement. Especially, if the operator recently merged or their processes are not documented properly.
So the challenge becomes: how do I integrate these improvements with the current processes? You can‘t destroy the process you have because there’s business as usual to take care of. Now that’s tricky to do because it’s like changing the engine of a Boeing 747 in mid-flight.
In summary, it is back to the basics of providing the right service to the client, providing it when you said you would, and providing it as cost effectively as possible and with highest quality.
Copyright 2012 Black Swan Telecom Journal