BSS transformations: Five ways to drive success

by Michael Lawley, Christopher Isaac,
    Adam Vandermyde, Stacy Glisson
    and Dina Manci
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The global communication services industry - including fixed, mobile, broadband, cable and satellite service providers - is experiencing a wave of core systems transformations. The reason is that communication service providers (CSPs) keep deciding to replace their legacy business support systems (BSS). That isn’t a step to take lightly because, once achieved, it can transform a CSP’s ability to control costs, increase revenues, serve customers and support new services. In recent years, those benefits have accompanied the major role that successful BSS transformations have played in improving the performance of CSPs.

The size of the impact on the business reflects the central role BSS plays for any CSP. These environments encompass the important information-technology systems, processes and tools CSPs use to manage and deliver business-critical processes, such as product catalogues, ordering, billing and customer care. As a result, virtually everything a CSP does is affected by these systems. Platforms for BSS also can play an important role in emerging services that draw insights from ‘big data’.

In the past two decades, digital technologies have become dominant and CSPs have rolled out an ever-expanding array of services. And their efficiency in developing and operating BSS platforms also has become a decisive factor in CSPs’ ability to compete in the industry’s new, agile environment.

With BSS at the heart of a business, transforming them means both big opportunities and major risks for any operator. On the downside, poorly implemented transformations have negatively affected what customers experience – including unexpected changes in products or bills and disrupted service – and have led to substantial customer churn. In extreme examples, some CSPs have been forced to seek financial restructuring and/or bankruptcy protection after poorly executing the conversion of billing and ordering systems. Yet for those that get it right, the upside is equally dramatic.

Objectives and demands: what’s behind transforming business support systems

A number of factors generally trigger the decision to transform business support systems. Three factors are on the operator side of the billing and service relationship, and three are on the customer side. On the operator side, three important objectives usually fuel the replacing of these systems:

  1. Cost. By transforming its BSS, a CSP can achieve a permanent downward step change in information-technology fixed costs (and better align variable costs to either growing or declining revenues). Moving from the legacy systems to a lower-cost target platform typically leads to fewer applications and lower maintenance costs.
  2. Efficiency. Migrating to a new, consolidated platform creates opportunities to streamline systems and processes across the BSS, which leads to substantial operational efficiencies in both front-office and back-office functions. With fewer systems and increased mechanisation, CSPs can, for example, reduce manual processing, improve flow through, shorten the time for handling customers’ calls, more easily support growing transaction volumes and systematically reduce revenue leakage and fraud.
  3. Agility. CSPs need a more agile and adaptive operating environment if they’re to grow and meet their customers’ quickly evolving needs and demands. Demand is rising for new digital services and experiences like machine-to-machine technologies, digital life, connected cars, mobile advertising, sponsored data, giving of content and sharing content within family units - to name a few.

These factors on the operator side are mirrored by three main factors on the customer side – and all reflect changes in how customers behave and what they demand and expect of the communication services they use and buy. Customers are now looking for:

  1. New digital services. Customers require instant access to emerging and innovative services that meet their needs at a competitive cost.
  2. New channels. Using alternative forms of media and a wider range of channels – increasingly, digitally enabled – customers want to engage with other users and with their service providers anytime, anywhere.
  3. Seamless experiences. Customers expect to have a simplified, seamless, consistent experience in every interaction, across all channels and from every service.

Transforming BSS can help an operator fulfil both sets of objectives simultaneously. Put simply, by meeting the three imperatives on the operator side, the company can position itself to meet the three requirements on the customer side. The result: enhanced experiences for customers leading to loyalty and revenues – and blended with a tighter rein on costs.

Problem areas that typically endanger a transformation programme

Once the decision has been made to undertake a BSS transformation, careful planning and execution are vital. Without them, the programme risks encountering a range of problems that could cause it to fall short of the targeted outcomes, overshoot budgets and/or timelines or fail altogether. An operator could be stuck with its legacy BSS. Problems typically occur in one or more of three areas.

Business. In the business domain, issues can arise around ‘scope creep’ in functional requirements. Or when time and costs can be added by overly extensive or complex product set and price plans, complex customer account hierarchies or failing to make sure business requirements and use cases are complete before embarking on the transformation. Further problems can occur when existing processes need to be re-engineered, and when service-level agreements and performance metrics need to be aligned to suit the new BSS. Solid buy-in and participation from business stakeholders are also critical. And when their participation is inconsistent or incomplete, the project’s success can be seriously affected. When one or more of these problems arise on the business side, the impacts on customers can be significant.

Technical. Meanwhile, on the technical front, inadequate planning and execution may lead to scope creep in the technical requirements. Delays and extra costs may result from incomplete test cases and poor or rushed test planning. Failing to start the implementation with a complete, detailed, end-to-end architecture plan can lead to more development and reworking. Further common technical pitfalls include incompletely identifying required interfaces, issues about data quality and a lack of institutional knowledge of applications and data stores. Finally, failing to maintain code at a high quality will both affect the transformation and create problems for future maintenance and enhancement.

Execution. The third area where problems tend to arise is in execution. Here, issues can occur because of failing to make sure the planned project timelines are practical and achievable within budgets and resources, or failing to maintain strong governance and oversight, including the attendance and engagement of important stakeholders. Poorly integrating the solution among stakeholder groups or lacking alignment within the organisation also can undermine progress. Further common problems in execution include work plan inconsistencies, communication gaps and insufficiently managed risks and issues. Any or all of these pitfalls can lead to budget overruns, which can in turn compound the problems as people lose faith and cut corners to save on costs.

Five priorities for managing risk during a BSS transformation

Because a BSS transformation is critical to an operator’s future success, and because a wide range of problems can arise, managing risk closely throughout the project is vital. Drawing on our experience in helping communication service providers achieve smooth and successful migrations to new BSS platforms, we’ve identified five priorities CSPs can focus on to increase the likelihood of achieving what they planned.

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This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.