Blame Game

Posted: 07/2002

Blame Game
Billing Department Frequent Scapegoat for Process Problems

By Linda Gimnich and Cathy McDonald

BILLING PROBLEMS TOP THE FCC's quarterly consumer reports listing of the top complaints regarding telecommunications services. No doubt telco executives are calling their managers of billing operations on the carpet for the failure of their billing systems.

On behalf of billing managers everywhere, we say: "Enough! These are not necessarily billing problems, but symptoms of problems that may originate elsewhere in the company."

In fact, disease usually is hidden in the operational inefficiencies of an organization and simply culminates with customers calling in to complain about their bills. However, most telecom service providers don't take the time to diagnose the problem. Instead, they treat the symptom.

How many times has a customer service representative given credit to a customer for a bill that is wrong without anyone in the organization following up to find out why the bill was wrong in the first place? Hence, the problem is attributed to billing while the true origin of the error goes undetected -- and untreated.

The potential sources of the so-called "billing problems" that might exist within a service provider's organization are many. The most efficient way to determine such root causes is to look at the service provider's processes from end-to-end -- from customer acquisition to cash. This means reviewing every step in the process required to bill customer ultimately for services they receive. The process extends from initial order entry, through provisioning, through posting of service rates, accumulation and rating of any call or message detail, to production of the invoice.

This exercise reveals several critical junctions that can lead to downstream billing problems, including:

Initial Sales Process. Many times what the salesperson sells customers and what customers think they are getting are two different things. Customers might hear one rate and are surprised when their first bill shows another. Providing a summary of the initial bill to at the time of the order (especially for complex orders) is an effective way to eliminate or reduce the potential for misunderstanding. This simple step can reduce customer service calls down the road and improve overall customer satisfaction.

On complex orders requiring equipment engineering, installation of CPE, multiple facilities, etc., it is beneficial to have a quality review step early in the order process. This ensures that a second pair of eyes has reviewed the order and increases the likelihood that potential pricing or implementation errors will be caught before the order is processed. In industry surveys, as many as 50 percent of orders provisioned are out of synch with the billing data required to bill customers accurately.

Order Entry. Order entry is the source of most problems that result in customer billing complaints. Some of the potential problem areas are:

• The current order-entry system does not support new products, requiring the manual input and tracking of orders, which often results in errors.

• Product catalogs are not up to date with new product information or correct pricing. Product/service codes are, therefore, entered incorrectly or left out.

• Services/products cannot be validated for a particular customer so they are ordered but not "provisionable." Many times, they appear on the bill even though they never were provisioned.

• There are never enough edits in the system to prevent human errors. Some systems are better; others are worse. This often includes simple things like address validation and correct state abbreviations.

Service Provisioning. Too many times what the customer ordered and what was provisioned on the network do not match. Some typical errors that can occur include:

• Service/feature setup in the switch or other network elements

• The PIC selection is not configured correctly

• Installers onsite do not configure CPE correctly or add CPE that may be required but fail to add it to the order for billing.

Collection of Billing Data. At this point, the customer has some type of service, whether it is what was sold or not. Each day, or at some scheduled frequency, all events are collected from the network to use in the billing of customers for actual usage. This area often escapes careful scrutiny. Common errors include:

• Errors in the formulas and methods to separate "billable vs. nonbillable events" results in incomplete calls;

• Duplicate records generated because of a variety of reasons in the actual network device or call-collection practices results in complaints about being billed twice;

• Missing time periods or "gaps" not identified results in lost revenue;

• Resetting or rebooting of switch or network devices that creates erroneous dates or times on records;

• Unexpected values in specific fields;

• Incomplete "trash" records that never can be billed.

Processing/Rating of Billing Data. The events are collected and separated into a "billable events" file, where the system(s) must determine who made the call, what product or service the customer has, which features may have been used on the call and then rate the call and append all necessary data to the record for subsequent processing at the time of billing.

For this to work well, the customer database, the product catalog/rate tables, industry tables, Time Point Master (TPM ) and all other input data must be accurate. Additionally, all the input data must match what the customers were sold and what they think the costs will be. Typical problems encountered here include:

• Inability to match information in the call record to anything in the customer file so that the record can be billed.

• The product indicated, when matched to the customer file, does not exist in the rate tables.

• Business rules prevent the assignment of any usage to a customer if X days before the order-entry date or X days after the cancellation date (every company has a different formula for this).

• No rates exist in the rate table for specific features used on the event (i.e., three-way calling).

• Given all of the inputs, the possibilities for error are endless.

Billing Calculation and Invoice Creation. Again, this process is fraught with the possibility of errors given the input required to be in sync. Input includes: customer database information, tax tables for each jurisdiction, product tables, A/R tables and the actual call records of good, rated calls.

The types of errors that can originate in this process include:

• Invalid, incomplete or nonexistent customer records. (Yes, they can disappear from the database between the time you rate and the time you bill);

• Incorrect designation of recurring charge features in the customer database such as call waiting, call holding, caller ID, etc;

• Old or incomplete tax tables and incomplete identification of jurisdictions;

• Incorrect/incomplete recurring charge product tables for all features, by product;

• Payments not applied in a timely manner, resulting in incorrect outstanding balances and payments received. (This accounts for the greatest number of customer complaints);

• Error files that are not worked in a timely manner that result in old calls on the invoice when they are finally recycled and billed out.

These are just the primary functions and a short list of the types of problems that can occur. The good and bad news about billing systems is that they relentlessly execute exactly what they see. If the input is good, the output is good. Anything incorrect or missing along the way results in erroneous information or charges on the bill. Are these all "billing problems?" The answer is "no!" In most reviews of items classified as "billing problems," 70 percent or more can be attributed to bad data that goes into the billing process as opposed to billing application malfunctions.

Just because an error appears on a bill does not necessarily mean that the "billing system caused it." To conquer this challenge, telecom service providers must review each billing error conscientiously to find the root cause. Once the cause is determined, fixes -- additional edits or changes in processes, procedures or business rules -- can be put into place. This is the only way to attain "irreversible corrective action" to eliminate continuous "billing" complaints and rework.

Revenue Assurance Challenges Everywhere
Source: TMNG

Linda Gimnich is the co-general manager of Revenue Assurance Practice for TMNG. She can be reached at linda.gimnich@tmng.com. Cathy McDonald is a senior consultant with TMNG and can be reached at Cathy.McDonald@tmng.com.