Towards Dynamic Charging and Billing

Towards Dynamic Charging and Billing
Guest blogger Henk Ensing, Technical Consultant at TNO, looks at why ‘context’ is the key to dynamic charging and billing.

What makes a good market merchant? Someone who’s able to present and sell his produce in such a way that his customers are satisfied and keep returning, while at the same time keeping an eye on his revenue and margin. How can we capture this dynamicity in tomorrow’s charging and billing solutions?
A couple of years ago a discussion started within our Billing Group with at its core the question: ‘what should a 21st century billing system be like?’ The immediate response was: ‘it should be flexible!’ Although a true answer, it was also a bit unsatisfying, as most billing vendors claim their systems to be flexible – which of course they are. But while flexibility sounds like a great characteristic to have, in its bare essence flexibility just provides a few extra degrees of freedom with regards to a fixed baseline. And that doesn’t really sound 21st century at all, now does it?
Although it seems hard to fathom for quite a few operators, the time of customer ‘ownership’ or ‘lock-in’ is gone. These are remnants of bygone days of state-owned monopolies, where as a customer you were expected to be grateful to have access to their services at all. Conversely, nowadays there’s a large audience out there that is not merely satisfied by what the marketers come up with. People just don’t like to be categorized in market segments and are actually offended when confronted with this behaviour from the brands they are associated with.
No, today the internet has become a central and integral part of our daily routine – so much so that a single tweet or YouTube video has the power of evaporating a company’s share value because of the viral nature of social media. We’re not only consumers any more, we’re producers as well – or ‘prosumers’ as some like to call us. The sharing of information and the specific way this information reaches us is something unheard of just a decade ago. In other words, this isn’t a world that’s just flexible, ours is a world that has become truly dynamic.
With that – and billing systems - in mind, it shouldn’t come as a surprise that a lot of organizations face problems coping with today’s demands using their trusted legacy systems. Sure, convergent billing and subsequent application rationalization provided some breathing space and a lot of organizations are implementing eBilling solutions in order to enhance customer experience and provide some sort of ‘real time’ information sharing. But it’s not enough to keep up because those solutions are still firmly rooted in the traditional ‘volume based billing’ paradigm and that’s one of the main reasons why the ‘bill shock’ discussion still rears its ugly head from time to time.
This is exactly where dynamic billing comes in, breaking with traditional concepts.
First of all it’s addressing the chasm between purchase and payment for a service that customers felt for a long time. Because that, in essence, is what bill shock is: the inability to match the amount on a received bill with the perceived benefits of having consumed a specific product or service. Which when you think of it is odd, considering that the moment a customer is considering a service, most - if not all - information is available to provide a pretty good prediction of how each monthly bill will appear for the duration of that service. Can you imagine being able to provide your customers with a detailed overview before they are actually signing up for a service? Now that’s what I call customer service!
In order to realise this we need a paradigm shift and start thinking in transactions, and define constraints in the form of business rules that govern these transactions. A business rule differs greatly from traditional price and product plans because it generates tailored results based on unique situations, which of course leads to the dynamicity we want to achieve. These business rules capture the essence (and core competence) of an organization and clearly need some intelligence for them to work.
Having said that, there are numerous examples where rules (in one form or another) have become an integral part of large and complex systems (e.g. PCRF) and it’s about time they play their part when it comes to governing business aspects of organizations. Keeping the importance of well defined business rules in mind, being able to automate business rules not only enables an organization to instantly respond to a changing market (reducing time-to-market) but also to simulate the effects of rules in certain situations and optimize before implementing them.
All that is left now is to properly populate the carefully drafted business rules with relevant information or context. Context is not only what makes Google, Facebook or Amazon tick. Context is just as available in every other organization as well: it’s knowledge about the products and services they generate, their customers’ behaviour over time, the way they perceive their market and the way they are influenced by the economy in general.
Context is therefore a combination of tacit knowledge and explicit data available through revenue assurance and business intelligence departments. It is available and used implicitly throughout organizations, but so far only few enterprises have been able to tap its full potential. Business rules just cry for explicit use of every scrap of relevant context information and with proper feedback loops in place become practically self-sustainable.
It is not a question of ‘if’ but ‘how soon’ an organization is dynamic enough to play its part in this changing world of ours. And if that’s not enough enticement, just consider the ever-increasing difficulties in finding suitable financial investment. Knowing your customer cash flows in advance has the positive side effect of being able to provide investors and shareholders extremely accurate revenue and profit figures; that’s also ‘customer service’ and will definitely make an organization stand out in times of economic uncertainty.
I’ve used the example of a market merchant on many occasions to describe the way I perceive dynamic billing in a nutshell. That entrepreneurial spirit is what we’re going to see demanded more and more in the immediate future. But in order to facilitate that way of business one needs the right tools, and a dynamic billing system is most certainly one of them.