Drill Down

Posted: 9/2003

Drill Down
Driving Enterprise E-Billing Adoption
By Khali Henderson

Electronic bill presentment and payment (EBPP) represents an invoicing nirvana for service providers seeking to reduce costs of printing and postage of thousands of monthly customer bills. For service providers serving commercial customers the benefits are compounded, because many statements of CDRs and management reports are so voluminous as to fill boxes. Like heaven, online-only billing remains a lofty destination such service providers can only dream about. Whats standing between them and billing bliss? Low customer adoption. Fortunately, experts say this is a temporary situation. They cite advances in the technology and experience-based techniques that promise to speed enterprise customers embrace of online billing and payment processes. In particular, they implore: Forget presentment and payment; its online management thats the ticket.

Some self-service offerings for corporate customers are indistinguishable from those for consumers. That is the challenge and the opportunity for service providers, says Seth Nesbitt, group manager of product marketing for Amdocs Ltd. Service providers can now differentiate themselves by the breadth of their self-service offering by going beyond the good, but simple electronic bill payment and presentation technology to empower the corporate customer to manage their own telecommunications services.

Amdocs Corporate Self Care System allows service providers to empower enterprise to manager their own internal telecom operations from cost allocation to feature and service provisioning as well as viewing bill summaries and facilitating online payment.

What weve seen is that EBPP is growing into a mature self-service offering, Nesbitt says. Customers are looking for functionality beyond bill view.

Integrated communications provider CIMCO Communications Inc. has embraced this philosophy. CIO David Braner explains: We call the whole thing Web Services. We did not want to call it billing because we were trying to do more than just provide an electronic image of the bill. We try to provide services within the product that helps people manage their telecom. Thats the paradigm shift that CIMCO has not only attempted, but also accomplished.

We are not just providing a bill; we are taking away the burden of managing the internal cost-recovery functions that take place in corporate America, he adds.

KEY TOOLS

As one example, CIMCOs proprietary billing system provides a comprehensive set of tools for its commercial accounts. Upon login to a secure site, the customer is presented with an overview of billing and services available to them. A number of prepackaged reports filter and sort CDRs by data elements such as cost, minutes, number, description, etc. A reverselookup feature allows the customer to see the name, as well as the number, of the party called.

Among the advanced management features of CIMCOs system are the ability to assign and manage cost centers; allocate expenses for shared services (e.g., an Internet T1 that is used by several departments) based on headcount, square footage or other parameters; associate specific lines to cost centers/allocations; and break out service types or charges by cost center. Uniquely, CIMCO also allows customers to change their line descriptions and allocations right up to the bill run so that they dont have to wait until the next cycle to reallocate expenses.

The real-time nature of the data has additional benefits, Braner says. Customers have real-time access to call detail  a feature that has been adopted by one inbound call center to provide the traffic analysis sorted by time of day it needs to plan staffing at its center. It also enables another service CIMCO calls WatchDog that alerts customers to calls outside preset parameters. The idea is to find out about unusual calls during the month so one is not surprised when the bill comes, he says, adding that CIMCO runs daily inquiries on customer call records and send them an e-mail with a link to the detail when a potential problem is identified.

Adrienne Steiss of CSG Systems Inc. says there are a lot of advantages to the electronic method. Instead of going through paper bills to sort, if you have 100 employees and 50 have cell phone bills, you can assign privileges to users to review those charges and tell which ones are personal and which are business. Today, that has to be done through a manual process.

She says CSGs customers also are moving beyond e-billing to self-service. Check my account, update my account, changed billing address, e-mail  those changes can be completed online, she says.

CONVERTING CUSTOMERS

CIMCO introduced its service 18 months ago and now claims 99 percent adoption among its customers, which primarily are medium-sized and large enterprises. CIMCO CEO Bill Capraro says the quality of its e-billing system and the nature of the customer base emboldened his team to systematically roll out the service and manage the exceptions.

You have to realize that our customers are getting huge boxes of paper, he says. When someone is spending $40,000, call detail is unmanageable. The concept of having it all online in real time is a big advantage.

He adds, We had many customers beta testing the systems before we put them into general production. ... We spent a lot of time and energy doing one-to-one marketing with our customers to determine what the needs were.

In contrast, InfoHighway Communications Corp., which is just embarking on its e-billing migration, is taking the one-to-one approach. Initially, we started with house accounts and friendlies and we are expanding it, says Peter Karoczkai, senior vice president of sales and marketing for InfoHighway. The company in June announced it would be using the COMX customer care, order management and bill software from Telution Inc.

Karoczkai says a concerted conversion campaign is planned for 2004 when InfoHighway is more experienced with the software and determines how best to position it with customers. He is optimistic about the prospects. What we are experiencing is that once people use it, its tough to give up. Its a little bit of a bug; once you catch it, its tough to let it go, he says. Once you reach critical mass, it will become the norm and thats what people will demand.

In fact, vendors and service providers already are reporting that customers are seeking out e-billing capabilities. CIMCOs Capraro says more than half his prospects request a demonstration of the e-billing capabilities, and its a primary reason they buy.

Corporate customers are pulling e-billing functionality out of service providers, adds Amdocs Nesbitt. The burden is being put on the service provider to tell [the customer] what is its self-service offering. They are being challenged to provide more functionality, to turn more functionality over to the corporate customers.

Ironically, it is by offloading more of its tasks to the customer that service providers may improve adoption, experts say.

By providing those types of value-added services, you then start to build a culture of encouraging that customer to go to the Web so that becomes part of their normal way of doing things, says John Konzcal, vice president of product marketing for Telution Inc. I dont think its sufficient enough to tell them they have to go to the Web site once a month. You have to build a whole program around it that continues to proactively tell the customer to go to the Web site but also when the customer goes to the Web site, there are some other value-added capabilities there that encourage them to come back.

Konzcal lists the ability to view unbilled usage, sort charges and allocate costs as examples of value-added capabilities. Telution also provides for a push-pull invoicing. We send out an e-mail with a link, explains Ken Kennedy, vice president of client delivery for Telution. That cuts down on the barrier for the customers. Instead of taking them to the corporate site and prompting for a password, we actually take them to the invoice with a click of a mouse. From there, they have the ability to do automatic payment by credit card or EFT. To Johns point, its about simplifying how the customer can get there and providing incentives.

Incentives also can be financial in nature, sources say, proposing credits for customers that migrate to the service. Brad Linden, vice president of Xpedite, a provider of multimedia messaging solutions, says most customers will change if you make it worth their while. He recommends offering customers discounts off their next bill or prizes to the first 100 users that switch to the online service.

Others expect the e-bill to become mainstream and the paper bill to become a premium service. We foresee a model down the road where the electronic format is the norm and if you want paper, that will be something you pay for, says Karoczkai. [We are considering sending the] summary for free, but we may charge for paper bill.

Steiss of CSG says one Tier 1 carrier customer that deployed its TotalCare e-billing and self-care solution has experienced an 8 percent adoption rate. Of those, more than 40 percent have turned off paper completely.

Vendors caution it may not be possible to go paperless, however. Now that companies are obliged to provide auditable records, they may require hard copies of CDRs, says Telutions Konzcal. Furthermore, he says, some customers view the paper invoice as representative of the contractual relationship with the vendor. There is still a belief among end customers that the bill is like a contract between the end customer and the service provider. Unless I get that in paper form, it doesnt have the legitimacy I require in order to pay that bill, he says.

Similarly, sources say electronic payment also may be a slow conversion in the enterprise market. Particularly, if there is an existing payment infrastructure in place, that may be one of the last things to move to an e-care platform, says Amdocs Nesbitt. That said, after weve done ordering, reporting, bill view and all of that, I think eventually payment functions would be migrated.

InfoHighways Karoczkai agrees. I think the future is take a look at the bill online, review it, show them what causes the variations and give them an option to pay online. This makes life simpler for everybody. At the end of the day, we benefit because we get our money faster.

He adds, I would go out on a limb to say that option is so attractive that I see the industry potentially offering discounts to customers if they pay on time and pay online.

CIMCOs Capraro says his company sends out a remittance slip and summary invoice but will set up EFT on request. Even with that reduced printing and mailing requirement, Capraro says CIMCO has reduced the number of days sales are outstanding by 25 percent since going to e-billing. Braner says this reduction is because CIMCO is able to get the bills out quicker  in time for an earlier bill-paying cycle.

CSGs Steiss says another unintended consequence of e-billing is a reduction in customer service calls relative to billing and usage questions. Now, what we are seeing in the last 12 months ... is measurable results in terms of decreased calls into the call center, she says.

A June study by Gartner Inc. confirms business-to-business billers (not telecom-specific) can save from automatic delivery of billing and migrating phone calls to Web-based self-service. The typical business biller in the Gartner survey, conducted in January, could save $2.7 million per year. If service calls were automated, the average surveyed biller could save $1.36 million per year. The most significant savings accrue to billers from automating invoice disputes, Gartner repots. Surveyed billers could save more than $3.2 million by managing disputes online and more than $1.6 million if just half are resolved online.

Automating disputes also has the significant benefit of reducing days sales outstanding for billers, thus enabling the billers to put money to work faster for their own companies, says Avivah Litan, vice president and research director for Gartner.

Litan adds, By looking at cost savings, however, a biller can forget that e-billing generates significant business value for the company by enabling it to deliver superior and efficient customer service that keeps customers coming back, and attracting new ones as well.