Value-based business process operations

Yoav Guez, Head of Business Services, Global Strategic Sourcing, Amdocs, Jonathan Kaftzan, Marketing Manager, Global Strategic Sourcing, Amdocs

Johannesburg, 27 Feb 2014
Read time 4min 40sec

Are loss of revenue, unnecessary order fallouts, inefficiencies and high costs inevitable for service providers? Or can an innovative solution fix today's systems and processes?

There is a growing chasm between IT and business operations that spans all business processes. When it comes to building end-to-end ownership of business processes, traditional BPO (business process operations) models are no longer effective in bridging the IT and business gap.

In addition, the core of BPO directly links costs with the volume of transactions required to fill service requests or address service transactions, resulting in escalating BPO costs, which makes it increasingly difficult for service providers to fund operational improvement innovations on a continual basis.

Considerable challenges

IT challenges include improving underlying systems and operations performance. But with scarce or insufficient funding, attention and focus, the service provider's IT business traditionally reaches out to third-party IT services vendors to manage the software development life cycle, ongoing releases, and application development and management. On the other hand, business operations are focused on day-to-day service delivery challenges, customer satisfaction and churn reduction. In order to achieve their targets, business operations rely on BPO vendors to address their operational challenges and reduce headcount.

When it comes to O2A (Order to Activation) and O2C (Order to Cash) processes - two of the most critical and complex processes that service providers deal with - there is a lack of definitive ownership and process visibility, resulting in objective, goal and priority misalignment.

The impact on the bottom line is dramatic [1]:

* Order fallout rates as high as 25%.
* Service activation failure rates as high as 35%.
* Missing customer due dates as high 50%.
* Revenue loss due to low customer satisfaction.

Looking to the near future, there are three primary drivers that are influencing how BPO will be addressed:

* A super-connected world - GSMA predicts that by 2016, there will be 24 billion network-connected devices. But for service providers, this exponential growth means they will need to manage ever-increasing volumes across their O2A and O2C processes.

* Shifting service provider focus - increased focus on small-to-medium business (SMEs) along with growing multi-play ordering process complexity is inspiring service providers to implement robust optimised order handling processes. These processes combine a structured methodology with the right technology to fulfil orders efficiently, cost-effectively, and on time, while complying with stringent service level agreements (SLAs).

* Balance cost pressures and customer experience improvements - According to the Yankee Group, service operators are under relentless pressure to improve customer service levels, while reducing order processing costs and order cycle times. These are among the primary factors driving service providers' investment in a streamlined order management system that will manage all aspects of the O2C process, from order capture to fulfilment and settlement.

Higher efficiencies; reduced opex

Amdocs Value Process Operations (VPO) addresses existing and future challenges by redefining how BPO is managed. Characterised by an ecosystem that is driven by business KPIs (key performance indicators) and managing key processes with aligned interests and seamless operations, the VPO model achieves:

* A positive impact on customer experience;
* Significantly reduced costs and revenue leakage;
* A streamlined ordering process and reduced fallouts; and
* Improved reaction to unknowns and business changes via real-time monitoring.

The Amdocs VPO business model establishes an aligned operation for streamlining and driving ongoing optimisation, enabling service providers to reduce TCO (total cost of ownership) across specific business processes. While the direct costs of BPO (eg, headcounts) are directly linked to transaction volumes (eg, services requests) and indirect costs and revenue loss (eg, bad customer experience, cancelled orders, goodwill adjustments) due to inefficient operations, the Amdocs VPO model enables business growth, significant cost savings and improved customer experiences through operational improvements, such as containment of operations costs, decrease in revenue loss and indirect costs and improved customer experiences.

Amdocs order-to-activation VPO

Made possible through technology and business innovation, proactive analysis, real-time monitoring and alignment of interests, Amdocs Order-to-Activation (O2A) VPO helps service providers streamline disparate systems and automate the manual processes that support all the steps required between the time a customer orders a new service, and the moment that service is available for use.

Amdocs O2A VPO assumes end-to-end operational responsibility for the order to activation process through business and IT process re-engineering and requirements management, using tools and automation. Driving year-over-year O2A ongoing business KPI improvements, the model is flexible and adaptable to the specific needs of any service provider, allowing service providers to rapidly and confidently deploy competitive cross-product bundled services, reduce costs and create a seamless customer experience.

Sustainable business results and improved customer experiences

The Amdocs Order-to-Activation managed services solution ensures year-over-year improvements in end-to-end business KPIs, including:

* Improved order flow-through;
* Reduced complaint calls;
* Decreased order lead time; and
* Reduced order cancellations.

In today's always-on, always-connected communications landscape, service providers are evolving from traditional BPO models that focus on reducing operational costs to innovative models, such as Amdocs VPO, which delivers sustainable business results and improved customer experiences.

See also