Posted: 10/1998
Carriers Follow New Pattern in Buying Support Systems
Making Off-the-Shelf Solutions Fit
By Peter Antoniewicz and Stephen Holanov
Since the passage of the Telecommunications Act of 1996, more than $70 billion of new market capitalization has been created to fund the development of new competitive local exchange carriers (CLECs). All of these carriers are looking for ways to differentiate their service offerings from those of incumbents--and, increasingly, from each other.
Many CLECs are looking to new service offerings as a primary means to differentiate their businesses. The operations support systems (OSSs) infrastructures they now are putting in place can help them effectively deliver these differentiated services. Others are looking to beat their competition by achieving operations cost efficiencies. Again, OSS provides the key to achieving this differentiation.
The challenge for new telecommunications companies is the need to develop the same level of automated operations processes that the mature incumbents have in place to deliver service at a reasonable and competitive cost. High labor costs for manual methods are driving new carriers to seek out computerized solutions. Even those carriers who have not yet achieved high volumes of service and still are surviving on investment capital are looking to invest in automated computer solutions. New carriers can benefit from automated OSS support for such functional areas as:
- Sales and order entry
- Order management
- Inventory management
- Provisioning
- Trouble management
- Network engineering and design
- Fallout and work management.
To meet this challenge, many CLECs are taking a whole new approach to automating operational processes. In an environment where time to implementation is vital for competitiveness and market positioning, CLECs are looking for ways to get away from homegrown solutions or custom design efforts. They are beginning to leverage rapid implementation techniques, and to seek solutions with a much greater off-the-shelf content.
The benefits are clear. Not only is this approach providing CLECs robust operations management infrastructures in rapid timeframes, it also is allowing them to implement OSSs at a fraction of the cost of traditional OSS implementations. In addition, this new approach helps CLECs to differentiate their service offerings through an advanced OSS infrastructure that supports capabilities such as services bundling, customer network management and fully automated operational processes.
Ready To Wear
Gone are the days of centrally developed applications, built by a common research organization, that then are fed to 22 homogeneous monopolistic telecommunications companies. Those applications were designed for large carriers, each operating with an identical business model. The rapid proliferation of new telecommunications companies and convergent service providers has opened the marketplace for commercial off-the-shelf (COTS) applications designed to help these new companies automate their operations functions.
The costs of implementing COTS applications can be dramatically less than having an informations technology (IT) staff build them from scratch. Further, and often more important, time to market is reduced dramatically. Because telco operations processes are complex, carriers benefit from buying COTS from vendors who specialize in such functional areas as billing, service activation and customer care focused on the telecommunications industry. Applications designed by industry experts also leads to reduced long-term support costs. The IT staff only will need to support the integration and configuration of the applications--which comprise a fraction of the entire application.
As nice as it would be to achieve pure "off-the-shelf," most COTS applications are designed to be tailored to fit how a company does business. For example, a carrier may wish to offer a single bill for local, long distance, cable and Internet services, or it may wish to offer customers an individual point of contact for any of the same. While taking advantage of the cost benefits of COTS systems, it also is important to create a process model that reflects the unique business process requirements of a carrier. These requirements will be used to direct the customization of COTS products as the system is implemented. Incidentally, the cost of tailoring COTS applications often exceeds the original license fee for the software, though the total cost still comes in substantially lower than the equivalent cost of building a custom system with the same functionality. COTS vendors themselves can provide COTS tailoring, or systems integrators can perform such tailoring as part of a broader integration.
Source: Beachwood Data Systems Inc.
Designed To Fit
Another reason for choosing robust, proven software applications is growth. Carriers realize they cannot support a double- or triple-digit percentage annual-growth company with manual processes and custom-built support systems. Many new carriers still are struggling to run their businesses using PC-based applications. No matter how resourcefully executed, applications built on Microsoft Access, FoxPro and paper soon are blocked by limitations in volume, integration and accuracy.
In contrast, taking an enterprise-wide systems approach to OSS and incorporating off-the-shelf applications lets carriers quickly implement a support system infrastructure that's up to the job. Integrating the right applications helps the new carrier provide service that is necessary to compete, including the all-important customer service. It also provides a platform that will support the growth needed to gain market share.
No one would argue that telecommunications carriers of all stripes are looking to minimize the risk of their technology investments. An important method for reducing risk in an OSS is to use a staged implementation methodology. At the completion of each stage, the carrier and OSS service provider can assess progress against the implementation plan and assess actual costs against the budget, making adjustments to the plan if necessary.
All of this adds up to a way for carriers to enter the market quickly, while building an infrastructure for the future--at a reasonable cost.
However, the COTS approach leaves two challenges unresolved: how to make disparate applications work together, creating flow-through process automation for the carrier's business processes spanning provisioning, order management, customer care, billing and trouble administration; and how to customize the applications to make them work to support the carrier's unique strategies.
Many carriers have found that picking the right telecommunications systems implementation and integration partner makes all the difference in addressing both of these challenges.
A key piece of this is the creation of an integration platform comprised of the enterprise architecture, the middleware and the "accessors" to each of the COTS systems (see diagram). The top layer of this platform, the messaging layer, should provide a flexible and easily changed approach to implementing new business processing rules. The bottom layer, the messaging layer, should provide the secure and reliable communications that are required to support complex transactions that might span the multiple OSSs required to fulfill a customer order or other complex business transactions.
Many integration firms have found that the optimal choice of integration platform components and architecture varies based on carrier requirements. Some carriers require transaction-processing capability in their integration platform. Others require a common object request broker architecture (CORBA) backbone. Yet others require a message-based infrastructure.
During the project initiation phase, integration firms should design the systems and their functions across the enterprise, taking into account the required business functions and the functionality of COTS systems, and embedded systems. Each system should have functional entry points at the integration platform to support flow-through processes.
One of the purposes of the integration platform is to encapsulate or hide the intricate details of each individual COTS from the other systems. As a result, each system is not "hard-wired" to the other, but rather designed to work together under a flexible architecture based on business functions that a carrier can grow upon. This also provides a total enterprise solution that adapts more easily in the inevitable swap-outs of particular COTS vendors.
The benefits of implementing a robust integration platform include:
- Additional flexibility as to service offerings,
- Realization of automated process flow-though across different business functions,
- Faster provisioning times due such flow-through,
- The ability to take advantage of future technology advances,
- Freedom to choose different OSS applications down the road, and
- The ability to support changes in the business or industry.
In addition to an integration platform, carriers implementing new OSS environments need to develop a data model. The critical issue around the data model is, Who will own the data? The answer to this question determines the design of the enterprise data structure, addressing issues such as whether or not to repeat key data elements in the model to heighten performance or create redundancy.
Given implementation of the above systems integration approach, carriers can strive to achieve the following three benefits: automated operational process, services bundling and customer network management.
At Your Service
In a competitive environment, carriers must plan and execute automated operational processes that support the growth necessary to meet their business plans. At the same time, carriers need to automate as a way to manage the costs associated with expansion.
Labor-intensive processes are expensive and they limit growth. Even the best customer service reps and technicians can process only so many orders in a day manually. Automated and integrated applications combined with high-performance, low-cost hardware are a lethal combination in today's marketplace.
Leveraging a flow-through solution, one incumbent LEC (ILEC) with a large out-of-region CLEC business was able to automate its order process quickly, allowing it to tackle 50,000 long distance carrier change requests per day.
Another benefit from automated operational processes is accurate service delivery. Manual processes are inherently error-prone, as they are dependent on paper and people. Very often these processes require redundant data entry into multiple support systems. This, of course, can lead to poor customer service and reduced customer loyalty. In an automated process, there's no need to rekey data, which eliminates duplicate data entry, improves accuracy and further streamlines labor requirements.
Further, automated operational processes can support the delivery of service when the customer wants it and how the customer wants it. For example, automated processes that are integrated at the front end allow a single point of entry for customer-related order information. Data can be validated and confirmed on the spot, then automatically flowed through to provisioning and service activation and on to billing. With the proper network facilities in place, service can be activated while the customer is actually on the phone.
Wrap It Up
New carriers already have begun to differentiate themselves from incumbents by bundling service offerings to their customers.
One such forward-looking company is Princeton, N.J.-based RCN Corp. In June 1998, RCN announced the acquisition of Interport Communications, bringing RCN more than 10,000 dial-up accounts and 500 dedicated line and web-hosting customers. The company is poised to become the largest single-source, facilities-based provider of telecommunications services to the residential market--as well as the largest regional Internet services provider (ISP) in the Northeast. RCN has embarked on an ambitious project to automate its business processes around all telecommunications operations, and already provides an integrated bundle of services to its customer base.
Bundling services naturally can lead to more revenue per customer. Bundling services also can lock the customer in to the provider, and can lower costs per customer. Costs can be lowered by, for example, having a single dispatch (and dispatch system) to a customer's home to install both phone and cable service. Also, a single OSS and workforce infrastructure can support this customer. The customer will call one number for any type of inquiry and they will receive a single bill. This will build customer loyalty and customer retention--critical success factors to gaining market share. Customers are willing to try something new, but they only will stick with something good.
Do It Yourself
Given the previously described approach to integrating OSSs, carriers can attain added value by implementing customer-oriented systems, ones that allow customers to provide direct input to obtain data, manage their networks and inspect and even pay their bills.
Just as automated teller machines (ATMs) improved customer satisfaction for banks in a self-service manner, customer network management grows customer loyalty and helps drive costs out of the business.
Peter Antoniewicz is director of technical oversight and Stephen Holanov is senior systems engineer for Beechwood in Clark, N.J. They can be reached at (732) 382-5400.
