The high cost of integrated billing

Creating that perfect, easy-to-read, unified bill isn’t just about making life easier for customers. It’s about creating a billing system that can keep up with the pace of rapidly diversifying product lines while sustaining customer enrollment — in fact, it’s just as much about consolidating

wallet share as paperwork.

The largest proponent of consolidated billing has been the telecommunications industry, which has extended its reach in the last decade to offer services like wireless telephone, digital cable, and data provision.

“In the telecom industry we see two overarching priorities: one of those is to increase their operating efficiencies, and we can tie that directly into their effort in consolidation of systems, the other business priority is how do they keep, acquire and grow their customers?” said Darren McKinney, director of regional marketing, North America, for Amdocs, a global provider of billing and CRM software to the telecommunications industry and a partner in Bell Canada’s One Bill program.

McKinney said that from an operating efficiency standpoint, operating separate billing systems for separate product lines, as many companies currently still do, really doesn’t make sense in the long term.

“When you have a myriad of billing systems, by virtue you have a number of people working to tie things together to put things on one bill, and there is a manual component to that. Carriers are looking to streamline that with the goal of how do we increase our operating efficiencies,” said McKinney.

Though simplifying the back-end is a motivator, David Inns, vice-president of marketing for Bell Canada, said that the One Bill initiative — which combines billing across the Bell Mobility, Sympatico, ExpressVu and land line products — was borne primarily out of customer demand.

“(Customers have) said they view us as one company and they want to deal with us as one company,” said Inns.

Bell Canada has worked with Amdocs to transition some of their legacy systems to a more efficient, integrated billing system. But it’s not easy to just replace a decades-old billing system with a shiny, new do-everything package.

“Our legacy billing systems on, say, the land line side are significantly large and would be very expensive to try to port over to an entirely new platform per se. So it is more of a consolidator technology that we’ve implemented,” explained Inns.

McKinney said that for most companies, the transition to a unified bill is necessarily gradual.

“People don’t go from a very fragmented multiple system environment to overnight it’s all consolidated. It tends to be a very phased approach whereby there’s typically dozens upon dozens of systems and we’re determining what systems can be decommissioned and supported by an incumbent system.”

While outside consolidation solutions like Amdocs’ are necessary for some telcos, other, younger companies like Sprint Canada, are able to make the transitions more smoothly on their own.

“I think billing is such a competitive advantage for us that it’s a core competency we want to maintain inside the company,” said Serge Babin, chief technical officer for Sprint Canada. Sprint currently offers combined billing for their local and long distance telephone services, as well as wireless and Internet. Its billing integration is done in-house.

An added vendor benefit of consolidated billing is the ability to more efficiently keep track of — and sell to — their customers. If it was hard for Jane Q. Customer to sort through her four different bills from Bell Canada last year, imagine how hard it was for Bell to keep track of her and her needs before integrated billing.

Integrated billing “provides a more holistic view” of the customer, said McKinney.

And what about sticker shock? Isn’t there a risk of overwhelming the customer with a fully integrated bill?

“People seem to know how much they’re spending with us, so combining it isn’t that big of a deal. A lot of the customers that we’re putting on one bill now are signing up to the bundle from Bell, so they’re aware of what they’re signing up to,” said Inns.

How the customer signs up for the billed services makes a difference as well.

“If you’re actually putting them on the bill at the same time as you’re signing them onto the bundle, because they’re actually signing up to something, they’re hearing a price point. They get the invoice and it matches that price point and they move on,” said Inns.

McKinney sees bundling as a vital maneouvre in business development for these companies.

“Bundling is a key way by which they want to grow their share of wallet. By selling me more services, they’re increasing the share of wallet they have from me. They’re also creating service differentiation, because it’s harder to compare a bundle, whereas comparing one wireless service to another might be easy,” said McKinney, who added that the desire to bundle is a big incentive for companies to consolidate their billing processes.

“When you have a number of different backend systems, it’s very hard to bundle. It is much easier to bundle services if you have multiple services/networks supported on a convergent, common billing infrastructure.”

Comment: info@itbusiness.ca

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