Como bien dijo Gordon Gekko, en la película Wall Street (1987), “La mercancía más valiosa que conozco es la información”. Afortunadamente para las compañías de comunicaciones y sus Directores Financieros, no carecen de esta “mercancía valiosa”, la cual pueden aprovechar mediante analíticas.
Descubre cómo los Directores Financieros pueden aprovechar sus datos mediante analíticas de telecomunicaciones, para tomar mejores decisiones que impulsen el crecimiento y mitiguen los riesgos, viendo la grabación del webinar llamado “No te quedes atrás: una guía de Directores Financieros para aprovechar las analíticas avanzadas”, que tuvo lugar el 14 de diciembre.

But let’s go back a moment.
The world of telecommunications, as we know it, is evolving and, with it, the role of Financial Directors is also undergoing a drastic change. Its role is no longer limited to focusing solely on past performance, numbers and financial information, but the mandate seems almost universally exceeded, and the CFO also needs to provide information on where the business is going and how fast it is doing.
The participation of the Financial Directors in the corporate strategy has also become an integral part of the work, since they now have the capacity and the mandate to contribute directly to the business management, as well as to review and report on their performance. All this means that today’s Financial Directors must be more strategic and need to ensure that they are more aligned with the strategic imperatives of the business, and this requirement places the Financial Director at the focal point not only for the presentation of financial reports, but also also for management reports, in addition to maintaining a solid and healthy balance sheet.
But, as we know, the dynamic nature of the telecommunications environment poses multiple obstacles to the modern CFO, which includes – but is not limited to – the following:

_ CFOs today must ensure that they are able to increase the margin and return on profits.
It is a well-known fact that ARPUs have been steadily declining in all regions of the world and, together with the slow growth of revenues, is leading to a steady erosion of margins since 2010 in most regions. In the midst of these challenges, the Financial Directors’ mandate to increase margins and profit performance is increasingly critical and difficult.

_ Organizational attempts to increase revenue are deflating due to errors and leaks.
Addressing Income Leaks is a major concern for telecommunication operators, and it is fast becoming a mandate for Financial Directors, considering that currently most of the RA teams report to them. Given that Income Leaks have a direct impact on revenue growth, the CFO’s role now is to take a proactive stance in the treatment of any error or loss.

_Evaluate the risks and develop measures to prevent security breaches.
Like revenue leaks, security breaches and telecommunications fraud can cost operators a lot, and is an obstacle to ensuring that CFOs maintain a solid balance sheet. $ 38.1 billion (USD) were lost due to fraud in 2015 and, although the number is decreasing, Telcos continue to feel the impact of losing money due to fraud, and the task of resolving this lies with the Chief Financial Officer.

_Increase Capital Expenditures during a period of decreased income.
A recent survey conducted by TMForum, led by Subex, revealed the following conclusions:
– 1 in 3 operators does not measure the returns on investment in CAPEX.
– 77% of respondents consider that the inappropriate use of assets leads to an increase in costs.
– 55% of respondents believe that network planning is based on assumptions.
– 64% believe that capex planning is driven by technology and not by business objectives.
On the other hand, CSP’s global revenues decreased by 5.3% for the year ended March 2016, while gas responded to volatility and speed of change
The signs indicate that revenues from traditional services will stabilize in the next 10 years. In fact, some analysts anticipate that revenues from traditional communications services will be reduced by 50% from current levels by 2025. This means that CSPs must embrace the digital revolution and can no longer be stupid but must be seen as smart tubes By offering digital services and being seen as DSPs or even LSPs (Lifestyle Service Providers) to capital increased, raising capital expenditures (capex / revenue) to 19.8% for the year.

_Increased competition, even from OTT players.
According to Ovum, it is expected to cost the Telcos a combined total of $ 386 billion between 2012 and 2018.

_Responder to volatility and speed of change.
The signs indicate that revenues from traditional services will stabilize in the next 10 years. In fact, some analysts anticipate that, by 2025, revenues from traditional communications services will be reduced by 50% from current levels. This means that CSPs must embrace the digital revolution, and can no longer remain dumb channels, but should be seen as smart tubes that offer digital services, and be seen as DSPs or even as LSPs (Lifestyle Service Pviders).
And the challenges do not end there! Today, CFOs need to devote more time and effort to managing the future rather than residing in the past and, therefore, need to further analyze the analytical data to connect the dots and predict the future. To their advantage, Telecommunications Financial Managers possess unprecedented amounts of data, from multiple sources, including customer data and network data, and can take advantage of this data through the power of telecommunications analytics.
If taken advantage of in the right way, through the application of advanced analytics, Telecommunications Financial Managers will be able to address the challenges they face and achieve business results that align with their agenda, through the generation of actionable telecommunications knowledge. CFOs can have a 360 degree view of their business context and identify and even proactively predict problems, opportunities and threats, and help them address them before internal audits. For these reasons, it has now become the mandate of the CFO to conduct analytics for both strategic and operational decision making.
Through the generation of Telecommunications Knowledge, an Advanced Analytics Solution can help Financial Managers to meet the growing expectations placed on changes in their roles, enabling them to:
_Proactively predict and direct resources to counteract risks and take advantage of opportunities .
_ Reduce uncertainty by anticipating disruptive changes, and respond and adapt to create growth opportunities.
– Predicting Income and Fraud Leaks to face risks proactively.
_Predending redundancies and reassigning budgets to reduce and control costs.
_Increase the impact of pricing decisions and promotions through optimization.
The Advanced Telecommunications Analytics solution has the scope to help the Financial Directors of telecommunications operators to meet business objectives drastically, and we have even seen or, better said, helped a Level 1 CSP, based in North America. , to save costs, simply by helping them resolve disputes. Through the generation of telecommunication knowledge, the association helped the CSP improve its ratio of predicting and resolving disputes to 9x, which in turn helped them save up to millions of dollars. This is the power of the Advanced Telecommunications Analytics solution.
For more information on how CFOs can take advantage of telecommunication analytics to maximize revenue and mitigate risks, see the webinar’s recording “Do not Stay Back: A Guide for Financial Managers to Take Advantage of Advanced Analytics,” on March 16. February.

Sandeep Banga

Sandeep is responsible for Product Marketing of Subex’s Analytics portfolio. In addition to this role, he also looks after Public Relations and Analyst Relations for the company. He comes in with 9 years’ experience in the Marketing domain.

As Gordon Gekko from the movie Wall Street (1987), rightly said, “The most valuable commodity I know of is information.” Fortunately for telecom operators and their Chief Financial Officers, they possess no dearth of this ‘valuable commodity’, which they can leverage through telecom analytics

Find out how CFOs can leverage their data through telecom analytics, by gener to make better decisions to drive growth and mitigate risks by viewing the recording of the webinar on ‘Don’t Get Left Behind – a CFO Guide to Leveraging Advanced Analytics’, which took place on December 14^th .

But let’s take a step back for a moment.

The telecom world as we know it is evolving, and with it, the role of the CFOs has also been undergoing a drastic change. His role is no longer confined to be solely focused on past performance, on the numbers, and on financial reporting, but the mandate seems almost universally to have been exceeded, with the CFO needing to also provide information about where the business is going and how quickly it is getting there. [1]

The CFOs involvement in corporate strategy has also become an integral part of the job, with CFOs now having the ability and the mandate to contribute directly to the direction of the business as well as reviewing and reporting on its performance1. This all means that today’s CFOs need to be more strategic and need to ensure that there is better alignment with strategic business imperatives and this requirement puts the CFO at the focal point for not just financial reporting but also managerial reporting, along with his core objective of maintain a strong and healthy balance sheet.

But, as we know, the dynamic nature of the telecom environment places multiple hurdles in the face of the modern day CFO, which include, but are not restricted to the following:

• CFOs today need to ensure that they are able to increase margin and earnings performance
  • It is a well-known fact that ARPUs have been steadily declining in every region of the world, and coupled with slow revenue growth is leading to a steady erosion of margins since 2010 in most regions[2]. In the midst of these challenges, the mandate of CFOs to increase margins and earnings performances in becoming increasingly critical, and difficult.
• Organisational attempts at growing revenues are being deflated by errors and leakage
  • Addressing Revenue leakages are a major concern for telecom operators[3], and is quickly becoming a CFO mandate considering currently most RA teams ultimately report to the CFO[4]. Considering that revenue leakages have a direct impact on revenue growth, it is now the role of the CFO to take a proactive stance in addressing any errors and leakages.

• Assessing risks and developing measure to prevent security breaches
  • Like Revenue Leakages, security breaches and telecom fraud can cost operators heavily, and is an obstacle in the way of ensuring CFOs maintain a strong balance sheet. $38.1 Billion (USD) was lost to fraud in 2015, and though the number is decreasing YoY, telcos are still feeling the pinch of losing cash to fraud, and the task to resolve this lies with the CFO.
• Increasing Capital Expenses during a period of decreasing revenues
  • A recent survey that was conducted by TMForum led by Subex revealed the following findings:
    • 1 in 3 operators do not measure returns on CAPEX investment
    • 77% of the respondents believed that inadequate asset utilization leads to increase in costs
    • 55% of the respondents believed that network planning is based on guesses
    • 64% believed that capex planning is driven by technology and not business objectives

Moreover Global CSP revenues declined by 5.3% for the year ended March 2016, while capex increased, pushing up capital expenses (capex/revenues) to 19.8% for the year.[5]

• Increasing competition, even from OTT players
  • Which according to Ovum, is expected to cost Telcos a total combined $386 billion between 2012 and 2018
• Responding to the volatility and velocity of change
  • The signs are that revenues from traditional services will plateau over the next 10 years. Indeed, income from traditional communications services is anticipated by some analysts to decline by 50% from current levels by 2025. This means that CSPs need to embrace the digital revolution, and can no longer remain as dumb pipes but need to be seen as smart pipes by offering digital services and be seen as DSPs or even LSPs (Lifestyle Service Providers)

And the challenges don’t just end there! Today CFOs need to spend more time and effort managing the future rather than dwelling in the past, and hence need to take an even closer look at data analytics to connect the dots and to predict the future. To their advantage, telecom CFOs possess unprecedented quantities of data, from multiple sources including customer data and network data, and can leverage this data through the power of telecom analytics.

If leveraged in the right way, by applying advanced analytics, telecom CFOs will be able to address the challenges they are facing, and achieve business outcomes that align with their agenda, through the generation of actionable telecom insights. CFOs will possess the power to have a 360 degree view of their business context and identify and even predict issues, opportunities and threats proactively, and will help them address them before internal audits. For these reasons, it has now become the mandate of the CFO to drive analytics for both strategic and operational decision-making.

By generating Telecom Insights, an Advanced Analytics Solution can help CFOs to meet the increasing expectations placed on their changing roles by enabling them to:

• Proactively predict and direct resources to counter risks and leverage opportunities
• Reduce uncertainty by predicting disruptive changes and respond and adapt to create growth opportunities
• Predict revenue leakages and fraud to proactively address risks
• Predict redundancies and reallocate budgets to reduce and control costs
• Increase impact of pricing and promotion decisions through optimization

Advanced Telecom Analytics has the scope of helping CFOs of telecom operators meet business objectives drastically, and we have even witnessed, or rather helped a Tier 1 CSP, based in North America save costs by purely helping them resolve disputes. Through the generation of telecom insights, the partnership helped the CSP improve their hit ratio of predicting and addressing disputes to 9x, which in turn helped them save up to a few million dollars. Thus is the power of Advanced Telecom Analytics.

To find out more about how CFOs can leverage telecom analytics for revenue maximization and risk mitigation, view the recording of the webinar on ‘Don’t Get Left Behind – a CFO Guide to Leveraging Advanced Analytics’, on December 14^th.

[1] https://www.ey.com/gl/en/issues/managing-finance/the-dna-of-the-cfo—perspectives-on-the-evolving-role—the-cfo-s-contribution

[2] https://www.strategyanalytics.com/strategy-analytics/news/strategy-analytics-press-releases/strategy-analytics-press-release/2015/01/23/global-trends-for-mobile-operators-show-stagnant-revenues-and-declining-margins#.WD-iJeZ9600

[3] https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/global-revenue-assurance-survey/Documents/global-revenue-assurance-survey.pdf

[4] https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/global-revenue-assurance-survey/Documents/global-revenue-assurance-survey.pdf

[5] https://www.ovum.com/research/communications-service-provider-csp-revenue-capex-tracker-1q16/

Sandeep Banga

Sandeep is responsible for Product Marketing of Subex’s Analytics portfolio. In addition to this role, he also looks after Public Relations and Analyst Relations for the company. He comes in with 9 years’ experience in the Marketing domain.