The ever-changing technology and digital disruptions in the current telecommunication market is pushing Telcos to focus more on their bottom-line growth. However, monitoring long term profitability is a concern for most telcos. In such a scenario, Margin Assurance is imperative to maintain a solid bottom-line for Telcos engaged in delivering a complex mix of service offerings enabled by a diverse ecosystem of partners, including both traditional and digital partners.
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The ever-changing technology and digital disruptions in the current telecommunication market is pushing Telcos to focus more on their bottom-line growth. However, monitoring long term profitability is a concern for most telcos. In such a scenario, Margin Assurance is imperative to maintain a solid bottom-line for Telcos engaged in delivering a complex mix of service offerings enabled by a diverse ecosystem of partners, including both traditional and digital partners.
The important features of Margin assurance solution are:
Product assurance: Validate the cost of products against the revenue generated to arrive at a negative margin for the products - Roaming assurance: Compare roaming cost with retail rate, aggregate the discrepancies and quantify negative margins
- Customer assurance: Compare the direct & indirect costs involved in servicing and maintaining a customer group viz a viz the revenues earned from that group
- Partner assurance: Validate complex agreements and settlements with traditional and digital service partners to ensure profitability
Product assurance: Validate the cost of products against the revenue generated to arrive at a negative margin for the products The top challenges for the operator included revenue and cost allocation across the product's complexity level. The employees lacked the skill of cost bundling and cost accounting with the desired telecom skills. The major challenges are given as follows:
- No Granular level visibility
The operator lacked insights into the cost and revenue segment and faced challenges in terms of the cost allocation parameters.
- High product complexity
The long product line shows huge complexity and revenue differentiation when bundled with a set of products like the sensor device, billing and rating device, etc.
- Ineffective real-time insights into profitability
Lack of insights into the real-time performance and the product profitability parameters led to a huge revenue loss at the different segments for the operator with network and partner level engagements.
- Lack of desired skills and accounting knowledge
The operator lacked a skill set combining cost accounting with telecom domain knowledge and so was unable to calculate profitability at the user level. Observation and analysis revealed that schemes like repayment and subscription discounts led to the loss in the margins.
The ever-changing technology and digital disruptions in the current telecommunication market is pushing Telcos to focus more on their bottom-line growth. However, monitoring long term profitability is a concern for most telcos. In such a scenario, Margin Assurance is imperative to maintain a solid bottom-line for Telcos engaged in delivering a complex mix of service offerings enabled by a diverse ecosystem of partners, including both traditional and digital partners.
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