Why 5G requires operators to take a new look at an old challenge.
An interview with Fadila Boumaza, Executive Director of Business Services at TEOCO

Revenue leakage is the unintended or unnoticed loss of revenue. While leaks can occur on both the revenue and the expenditure side of telecom, most commonly they are the result of not billing customers correctly for services provided. It typically means that something is broken or needs to change – and if it doesn’t get fixed, the losses keep piling up.  Revenue leakage may be caused by a network issue, a billing issue, an accounting error, etc. There can be many culprits, but according to a recent survey by the Risk and Assurance Group (RAG), the top five are due to bad debt and errors in: billing and collections, rating and tariffs, usage, and subscription fees.

RAG is an organization for communications industry risk and assurance professionals. Every year, they issue their Revenue Assurance Fault Management (RAFM) Survey. Last year, 175 communications professionals involved in revenue assurance and fraud management functions responded.  According to Fadila Boumaza, Executive Director of Business Services at TEOCO, several of the findings reflect some concerning and financially risky trends. In the interview below, she tells us why.

Fadila, you have been focused on revenue assurance and the financial side of telecom for most of your career, which has included roles at Sprint, T-Mobile, Century Link, and now TEOCO. You’ve also been a member of RAG for many years. Was there anything that surprised you in the recent survey?

The 2020 RAFM survey showed that the telecom industry lost USD $94bn to revenue assurance related leakages last year.  Most – if not all – of these losses were preventable. Part of the problem is that those responsible for overseeing revenue assurance in telecom organizations are often disseminated across various groups. Overall, based on last year’s survey, there were 136 functions that were responsible under the umbrella of revenue assurance. That tells me that despite efforts taken to implement solid revenue assurance processes, organizations still have work to do in this area. Implementing a cohesive strategy is key.

Q) Do you feel there is enough executive sponsorship within telecom companies when it comes to revenue assurance?

Fadila: I believe one of the most critical factors when it comes to revenue assurance is having teams with the influence and the support necessary to drive the changes that need to happen. This includes staffing, with a focus on subject matter expertise and the collective ‘know-how’ of the organization. Unfortunately, 64% of our survey respondents stated they have a lack of executive sponsorship when it comes to supporting revenue assurance initiatives. It’s concerning that after so many years, executive sponsorship is still an issue. With all the changes our industry is going through right now- revenue assurance should be an embedded practice within the organization. It’s not a luxury – it’s a necessity.

Q) Why do you feel revenue assurance is so critical right now, and as an industry, what are the challenges you feel we need to be mindful of?

Fadila: In my opinion, we are at a crossroads in the telecom industry. 5G and IOT are providing the potential for operators to truly redefine their services and their market, but whenever you add more systems, more partners, more services, and more complexity- you also get more revenue leakage. I think that as 5G matures, there will be an explosion in innovation. But operators are already overloaded by billions of event records generated by a multitude of digital services. If you don’t already have a good handle on assuring these records, the losses will climb.

5G is just a technology. It’s the products and services that the telecom companies need to leverage to be able to start generating a real increase in revenue. There must be the right systems, tools, and processes in place to assure and monitor everything on the financial side of the fence.

Q) How do you see advancements in machine learning and AI impacting revenue assurance within operators – is it being embraced?

Fadila: Operators need to understand that with 5G the risk for revenue leakage is increasing, and they need to get themselves ready. I see operators putting a lot of investment and resources into machine learning, but it continues to be done in a siloed fashion and is primarily directed toward the network. According to the survey, fewer than 20% of revenue assurance respondents said their teams already use machine learning, and 42% have no plans to use it. Unfortunately, it’s apparent that the use of machine learning may not be as widespread across the industry as previously thought. Over time, this will have to change. With new 5G services, the utilization of more systematic, automated, machine learning-enabled tools such as robotic process automation will become indispensable.

Q) How does TEOCO help?

Fadila: TEOCO has been providing revenue assurance for our clients for over 25 years – it’s at the heart of our business. We have extensive in-house expertise and offer a holistic approach that utilizes the latest machine learning techniques and robotic process automation to improve business efficiencies and eliminate human errors. To-date, we’ve recovered billions of dollars for our customers, which include some of the world’s largest wireless and fixed service providers, along with IoT and media companies.

For more information, you can view the full RAG RAFM survey, or visit TEOCO’s website.