2016 Global Stratecast CSP Financial Assurance Market Leadership Award

Transcription

1 2016 Global Stratecast CSP Financial Assurance Market Leadership Award 2016

2 Contents Background and Company Performance... 3 Introduction... 3 Industry Challenges... 5 Stratecast Financial Assurance Market Assessment... 6 WeDo Technologies... 7 WeDo Market Leadership Conclusion Significance of Market Leadership Key Performance Criteria The Intersection between 360-Degree Research and Best Practices Awards Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices About ODAM About Stratecast About Frost & Sullivan Frost & Sullivan We Accelerate Growth

3 Background and Company Performance Introduction The global communications market now embodies more than just a network connection. In fact, communication service providers (CSPs) are transforming into digital services providers (DSPs) in different ways for different business reasons. Chief among these is the combination of digital services capabilities from third parties with network access channels such as mobile data, text messaging, and social network links. There are many moving parts to such services, which the customer holds the CSP accountable for relative to secure delivery of the service at a price that is both affordable to the customer and profitable for the CSP and its partners. Source: Stratecast Partner ecosystems continue to grow in the evolving communications marketplace. Service complexity mounts. Assuring that each service offering meets business level design requirements and delivers the right capabilities for the right remuneration amount, involves three key ODAM 1 (operations, orchestration, data analytics, and monetization) functions collectively known as Financial Assurance. 1 For more information about ODAM, see "About ODAM" on page 18. Frost & Sullivan We Accelerate Growth

4 Stratecast has taken a deep dive into the Financial Assurance 2 business solution segment, which is defined through the confluence of three business management disciplines as noted in the figure below. Source: Stratecast These three domains are: Revenue Assurance Revenue Assurance is the identification and elimination of unbilled revenue associated with the use of customer services. This situation is generally a result of misaligned processes or internal mismanagement of the data flowing between systems and/or partners. A revenue assurance condition can also come from a lack of coordination between the network, internal business systems, or partner channels. Margin Assurance Margin Assurance is a diverse set of purpose-built analytics that give CSPs additional tools outside of traditional Revenue Assurance and Fraud Management to reduce costs and increase revenue. It is a rapidly changing 2 The capitalization of Financial Assurance, Revenue Assurance, Fraud Management, and Margin Assurance is done purposefully throughout this award to highlight the importance of these terms. Regardless of whether the term refers to the market (or sub-market), a solution or set of solutions, or to a discipline, the full name with capital letters, is used and not abbreviated. Common abbreviations include RA for Revenue Assurance and FM or FMS for Fraud Management or Fraud Management Systems. Financial Assurance and Margin Assurance are less common names with no immediately recognizable abbreviation. Frost & Sullivan We Accelerate Growth

5 environment that centers not just on internal CSP cost containment but on the hunt for new ways to monetize business insight while delivering customer value. New business opportunities for both suppliers of Margin Assurance solutions and the CSPs that use these tools to improve their business processes continue to take shape. Fraud Management Communications fraud has been defined by the TM Forum as: the intentional action(s) by an individual, group (e.g., syndicate), or enterprise (e.g., partner) to receive, through deception, products, services and/or revenues from the target service provider(s) without remitting expected value for those products or services. 3 Fraud Management is the identification and remediation of fraud-based activities relative to network-based services. With increasing service complexity and sources of solution capabilities, the number of fraud opportunities is escalating exponentially. Hence, the need for Fraud Management solutions to address each potential fraud option is also accelerating. Industry Challenges Each Financial Assurance component Revenue Assurance, Fraud Management, and Margin Assurance is critical to the success of the global CSP marketplace. This is especially relevant as new business models, complex service offers, and increasing external partnerships expand the need for these management disciplines beyond their traditional boundaries. Revenue Assurance solutions verify that all revenue that should be accounted for is accounted for that no revenue leaks occur within any business or operations process. With more than a 20-year history, it is easy to falsely conclude that all of the leaks that ever were, are already plugged. However, Revenue Assurance is a job that is never done, due to the rapid and continual change in devices, networks, services, and partners contributing to the complex services that define the communications marketplace. Many of the new CSP business models involving partnerships raise the level of complexity in service delivery and asset coordination. In turn, the partner remuneration process now incorporates added challenges tied to both internal and external business needs, opening the door to a new set of potential revenue leakage problems. Fraud Management is designed to stop the fraudulent use of services that can occur from external entities gaining unauthorized access to service or network resources. It is also designed to identify inconsistencies from potential internal resource mismanagement. Unauthorized service usage, in any form (internal or external), only generates costs without a corresponding level of revenue generation. A solution that identifies and remedies such situations is a form of cost assurance. Margin Assurance is a newer discipline enabled by analytics and fueled by an underlying need to improve profit margins. In the world of ODAM, analytics has become a buzzword 3 TM Forum document GB954 Fraud Classification Guide, Version 2.4, December, Frost & Sullivan We Accelerate Growth

6 wherever there is data to analyze. Within the communications industry, there is no lack of data it is all Big Data. To provide resolution to specific business problems and to help mitigate those problems, e.g., improving profitability (margin), purpose-built analytics are applied to the data collected from all applicable sources, particularly from billing data and direct cost information. Stratecast Financial Assurance Market Assessment Stratecast's 2016 assessment of the Financial Assurance market will be released in the coming weeks. 4 This report examines the major global suppliers offering Financial Assurance solutions as well as an evolving crop of additional suppliers. The report discusses the importance of each part of the Financial Assurance domain and provides a market share analysis of the 46 identified suppliers within this market. The report also assesses the direction each of the three markets that define Financial Assurance is heading in the coming months, and why. The findings, as published in this report, show that WeDo Technologies leads in market share for the global CSP Financial Assurance market. Stratecast believes that WeDo addresses approximately 12% of the Financial Assurance market based on revenue collected from the sale of these solution capabilities. The next four competitors address approximately 11%, 9%, 9%, and 8% of the market respectively by revenue. For this report, Stratecast examined and interviewed 46 Financial Assurance suppliers that address one or more of the above mentioned market segments that total includes 31 suppliers that offer Revenue Assurance solutions, 38 that offer Fraud Management solutions, and 26 that offer Margin Assurance solutions. Many suppliers provide solutions that cover all three Financial Assurance functions. Stratecast revenue estimates include vendors with software solution offerings that obtain revenue from license fees, maintenance fees, services associated with the initial installation and configuration of a solution, service bureau fees, cloud services fees, and installed solutions managed by a supplier. Internal CSP spending attributed to internal work teams or assistance from professional services consulting resources is not included. In addition, hardware-related revenue and revenue generated by systems integrators or companies without their own Financial Assurance solutions are not included. The professional services fees for integration of new solutions with existing systems, and updates to CSP business processes are also not included in the market share analysis. The market share analysis is developed by analyzing multiple sources including information supplied to Stratecast through direct interviews, information from public sources, and raw market data. The analysis is developed from 2015 company-level revenue, projections of future earnings, global financial market insights, as available, and our strategic acumen concerning Financial Assurance functions. 4 Stratecast report, Global CSP Financial Assurance 2016 Edition: Market Forecast, Market Share analysis, and Supplier Assessment, to be published December, Frost & Sullivan We Accelerate Growth

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8 RAID Telecom is a modular platform, which is designed to allow WeDo's CSP customers to purchase only the functionality needed to address current business issues, but with the flexibility to address others when necessary. As described by WeDo, the various modules include: RAID Revenue Assurance This module provides the ability to respond to both current and future needs, ensuring services are billed for accurately, and collected for accurately. Revenue Assurance enables CSPs to reduce revenue leakage, improve margins, and capture more earnings by improving the customer experience and reducing customer churn. RAID Fraud Management Fraud Management provides real-time fraud protection by identifying suspicious or fraudulent activity. The module offers visibility, automation, flexibility, and scalability to protect today s rapidly changing telecom environments against increasingly sophisticated fraud threats. RAID Partner Incentives Assurance This module enables CSPs to keep new customer acquisition costs at a minimum. Partner Incentives Assurance identifies fraudulent activity, classifies and profiles partners, as well as accessing the efficiency of incentive schemes. RAID Supplier Cost Assurance Supplier Cost Assurance monitors the procurement process. It audits purchase orders and payments, related invoices, and contracts. The module also evaluates the relationships between CSPs or internal approvers and suppliers looking for fraudulent behaviors. RAID Customer Collections Assurance This module allows CSPs to monitor the efficiency of the customer credit scoring process, along with collections and dunning strategies. Customer Collections Assurance also measures the performance of internal and external debt recovery agencies. RAID Equipment Management Assurance Equipment Management Assurance audits activities and systems related to inventory management, covering a CSP's physical assets deployed in customer installations. The module also supports CSPs in keeping inventory costs under control, while avoiding revenue losses either from wrong or late provisioning, or due to increased costs caused by obsolete or defective equipment. RAID Order Handling Assurance This module enables CSPs to measure and improve order management performance, by monitoring provisioning orders, costs, delays, and system outages. Order Handling Assurance also controls backlog task size, and supports CSPs in identifying underperforming systems, teams, and process designs. RAID Customer Problem Handling Assurance Customer Problem Handling Assurance audits the internal process of customer incidents resolution, from creation through problem solving. The module also monitors resolution accuracy, customer satisfaction, resolution time, costs, and compensation measures. Frost & Sullivan We Accelerate Growth

9 RAID Service Problem Management Assurance This module allows CSPs to have a proactive analysis of incidents and problems occurring with their service delivery. Service Problem Management Assurance also audits the relationship between resource outages and customer incidents. RAID Bill Inquiry Assurance Bill Inquiry Assurance monitors customer bill inquiries and credits related to those inquiries. This module provides insights into both billing performance, and into the customer care organization performance. RAID Workforce Management Assurance This module continuously monitors the CSP field staff activities, and profiles the work force based on their activities and outcomes. Workforce Management Assurance also monitors costs related to overstaffing, overtime, travel costs, service levels achievements, and invoice disputes. RAID Resource Trouble Management Assurance Resource Trouble Management Assurance provides CSPs with a specific set of controls to ensure proactive analysis of incidents occurring within their network resources. Different Financial Assurance users within a CSP organization need different levels of, and focus points around, information. For example, a business analyst may need the details concerning a specific instance of revenue leakage or fraud to resolve a problem, while an executive requires a summarized view of the same information. RAID Telecom provides business sensors that graphically represent key performance indicator (KPI) data, and that provide the key metrics that each type of user needs, which are configured based on the user s position within the organization. RAID Telecom supplies integrated rules-based case management to prioritize and resolve identified risks more efficiently. To provide an integrated vision of how risks are impacting an organization s overall performance for managers and executives, RAID offers a Balance Scorecard that links strategic objectives from the organization to the KPIs from the solution. WeDo s other solutions, which support the Stratecast definition of Margin Assurance, include: ShapeTelecom Designed to improve the effectiveness of marketing campaigns, increase customer satisfaction, and improve customer loyalty. The solution addresses such business function areas as: profitability, customer optimization, churn, social value, and monetization. netclarus TRAFFIC This solution provides network traffic analysis for planning and traffic cost management and is offered as a SaaS solution. netclarus TRAFFIC is designed to enable CSPs to optimize traffic cost management, prioritize voice peering, reduce OPEX, and maximize profit. IncentivesBroker CSPs use dealers and indirect sales channels to sell their products and attract and retain customers. IncentivesBroker provides incentive management, assuring the compensation processes, while reducing costs and dealer Frost & Sullivan We Accelerate Growth

10 fraud. CollectionsBroker Revenue loss due to customer bad debt can be significant. CollectionsBroker provides credit control and collections management, and integrates with existing network and business systems. The solution also includes a negotiation module to manage payment agreements from establishment to conclusion, and an external collections module to manage the interaction with external collection agencies. Stratecast Insights Change has long been the norm within the global communications marketplace, but the level of change today and coming tomorrow is at a level never before seen. Many CSPs are attempting to become more agile to become digital service providers and compete with so-called over-the-top (OTT) providers of customer-desired services. Networks are moving quickly towards virtualized software-driven functions integrated with existing network nodes, thereby creating a very complex hybrid network environment from which to operate for the next several years. Expansion of service opportunities through use of 5G technology is just around the corner. In addition, partnerships are becoming increasingly important as CSPs look to counter pressures on revenue with new ways of doing business. The level of change from each of these business opportunity windows makes Financial Assurance more important than ever. Stratecast believes that WeDo Technologies is the revenue leader in overall Financial Assurance. As Financial Assurance opportunities continue to evolve, Stratecast expects WeDo to grow its market presence in not only the communications sector but within each of its target markets, including retail, energy, and healthcare services. WeDo Market Leadership The 2016 Stratecast Global Market Leadership Award in CSP Financial Assurance is judged based on ten criteria detailed later in this document. WeDo Technologies was compared against two other leading suppliers in the CSP Financial Assurance space. The following details a selection of the comparisons from the ten criteria. The data behind the comparisons comes from the soon to be published Stratecast report: Global CSP Financial Assurance 2016 Edition: Market Forecast, Market Share Analysis, and Supplier Assessment. Implementation Excellence Stratecast recognizes that to be a leader in CSP Financial Assurance, in an individual segment of CSP Financial Assurance, or in any of the areas of CSP ODAM, a supplier must be able to implement the solutions they have sold; each and every time. Stratecast's knowledge of the excellence in implementation with regard to WeDo is well founded based on several customer testimonials, continued press from WeDo that identifies CSPs by name, and the ongoing discussions Stratecast has with both WeDo and Frost & Sullivan We Accelerate Growth

11 its competitors. Together, these actions indicate that the company is keeping its existing customers happy as it continues to gain new ones in all aspects of its current and developing business strategy. In addition, both the Financial Assurance market, and the ODAM market in general, is becoming more accepting of cloud-enabled solutions, which will reduce implementation complexity. WeDo shared with Stratecast that it has spent the last few years re-tooling its solutions to better support cloud-based deployments and expects the number of cloudbased deployments to increase significantly in the coming months. Brand Strength Brand is often of great importance to a customer when choosing a product for purchase. This is true of consumer goods and it holds for CSPs when they choose their ODAM systems with price tags that usually reach into the millions of dollars. In the area of CSP Financial Assurance, CSPs trust a supplier s ability to assure their revenue the revenue measured in millions or even billions of dollars that enables them to stay in business. This trust is bestowed on software and services suppliers when the observed quality of a software solution and the accompanying services repeatedly delivers success in the markets they serve. Trust in the products and services delivered by a supplier are of utmost importance. Stratecast is certain revenue correlates strongly with CSP brand trust. WeDo leads the Financial Assurance market as measured by revenue and it also has a global customer base of over 190 CSPs. This level of market penetration should reinforce WeDo as an organization with very strong brand strength. Product Quality Similar to the previous two criteria, product quality is very important to CSPs, who expect any solution they purchase to not only work as promised, but to meet their specific business needs within the timeframe of delivery they agree to with the software supplier. Poor quality solutions immediately cause issues with the CSP customer and, bad news travels fast, which is hard to overcome within the communications marketplace. Stratecast is certain market strength indicates that CSP customers continue to put trust in a supplier, the quality of their products, and in the supplier's ability to satisfy all needed business change needs in order for the new solution to operate effectively. WeDo s ability to lead the Financial Assurance market over the last few years is a strong indicator that its CSP customers find the company's products and solution delivery capabilities to either meet or exceed expectations. Customer Purchase Experience, Customer Ownership Experience, and Customer Service Experience Often, when thinking of customer purchase, customer ownership, or customer service experiences, one relates those experiences to one s own life. Even the definitions of these criteria are easy to relate: Frost & Sullivan We Accelerate Growth

12 Customer Purchase Experience - Customers feel like they are buying the most optimal solution that addresses both their unique needs and their unique constraints. Customer Ownership Experience Customers are proud to own the company s product or service, and have a positive experience throughout the life of the product or service. Customer Service Experience Customer service is accessible, fast, stress-free, and of high quality. Whether we are looking at our own experiences or examining the experiences of a CSP buying ODAM systems with million dollar price tags, the purchase experience, the ownership experience, and the customer service experience are extremely important. When a company is the market leader of a highly competitive market such as the CSP Financial Assurance market, this provides a level of proof that the company is highly regarded by its customers. WeDo leads this market for the second time and has over 190 CSPs as customers around the world. Stratecast believes this is a strong indication that the customer purchase experience, the customer ownership experience and the customer service experience provided by WeDo Technologies are excellent. Frost & Sullivan We Accelerate Growth

13 Conclusion Stratecast recently concluded its most recent assessment of the global CSP Financial Assurance market. In so doing, Stratecast analyzed the insights from more than 45 suppliers, covering various aspects of the CSP Financial Assurance marketplace, which includes Revenue Assurance, Fraud Management, and Margin Assurance capabilities. Stratecast analysis of the global Financial Assurance market revealed that WeDo leads in market share based on 2015 supplier revenue. Stratecast analysis also concluded that WeDo presently addresses approximately 12% of this market by earned revenue, as shown in the figure below: Source: Stratecast In recognition of WeDo's ability to lead in market share and address CSP key challenges, Stratecast awards the 2016 Stratecast Global Market Leadership Award in CSP Financial Assurance to WeDo Technologies. Frost & Sullivan We Accelerate Growth

14 Significance of Market Leadership Ultimately, growth in any organization depends upon customers purchasing from your company, and then making the decision to return time and again. Loyal customers become brand advocates; brand advocates recruit new customers; the company grows; and then it attains market leadership. To achieve and maintain market leadership, an organization must strive to be best-in-class in three key areas: understanding demand, nurturing the brand, and differentiating from the competition. Understanding Market Leadership As discussed on the previous page, driving demand, strengthening the brand, and competitive differentiation all play a critical role in a company s path to market leadership. This three-fold focus, however, is only the beginning of the journey and must be complemented by an equally rigorous focus on the customer experience. Best-practice organizations therefore commit to the customer at each stage of the buying cycle and continue to nurture the relationship once the customer has made a purchase. In this manner, such companies build a loyal, ever-growing customer base and methodically add to their market share over time. Frost & Sullivan We Accelerate Growth

15 Key Performance Criteria For the Market Leadership Award, Stratecast Frost & Sullivan analysts focused on specific criteria to determine the areas of performance excellence that led to the company s leadership position. The criteria that were considered include (although not limited to) the following: Criterion Requirement Growth Strategy Excellence Demonstrated ability to consistently identify, prioritize, and pursue emerging growth opportunities Implementation Excellence Processes support the efficient and consistent implementation of tactics designed to support the strategy Brand Strength The possession of a brand that is respected, recognized, and remembered Product Quality The product or service receives high marks for performance, functionality and reliability at every stage of the life cycle Product Differentiation The product or service has carved out a market niche, whether based on price, quality, uniqueness of offering (or some combination of the three) that another company cannot easily duplicate Technology Leverage Demonstrated commitment to incorporating leading edge technologies into product offerings, for greater product performance and value Price/Performance Value Products or services offer the best value for the price, compared to similar offerings in the market Customer Purchase Experience Customers feel like they are buying the most optimal solution that addresses both their unique needs and their unique constraints Customer Ownership Experience Customers are proud to own the company s product or service, and have a positive experience throughout the life of the product or service Customer Service Experience Customer service is accessible, fast, stress-free, and of high quality Frost & Sullivan We Accelerate Growth

16 The Intersection between 360-Degree Research and Best Practices Awards Stratecast Frost & Sullivan s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree-view of industry challenges, trends, and issues by integrating all 7 of Stratecast Frost & Sullivan's research methodologies. Too often, companies make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360-degree research methodology provides an evaluation platform for benchmarking industry players and for identifying those performing at best-in-class levels. 360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS Frost & Sullivan We Accelerate Growth

17 Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Stratecast Frost & Sullivan Awards follow a 10-step process to evaluate award candidates and assess their fit with select best practice criteria. The reputation and integrity of the Awards are based on close adherence to this process. STEP OBJECTIVE KEY ACTIVITIES OUTPUT 1 Monitor, target, and screen Identify award recipient candidates from around the globe Conduct in-depth industry research Identify emerging sectors Scan multiple geographies Pipeline of candidates who potentially meet all bestpractice criteria 2 Perform 360-degree research Perform comprehensive, 360-degree research on all candidates in the pipeline Interview thought leaders and industry practitioners Assess candidates fit with best-practice criteria Rank all candidates Matrix positioning all candidates performance relative to one another 3 Invite thought leadership in best practices Perform in-depth examination of all candidates Confirm best-practice criteria Examine eligibility of all candidates Identify any information gaps Detailed profiles of all ranked candidates 4 Initiate research director review Conduct an unbiased evaluation of all candidate profiles Brainstorm ranking options Invite multiple perspectives on candidates performance Update candidate profiles Final prioritization of all eligible candidates and companion best-practice positioning paper 5 Assemble panel of industry experts Present findings to an expert panel of industry thought leaders Share findings Strengthen cases for candidate eligibility Prioritize candidates Refined list of prioritized award candidates 6 Conduct global industry review Build consensus on award candidates eligibility Hold global team meeting to review all candidates Pressure-test fit with criteria Confirm inclusion of all eligible candidates Final list of eligible award candidates, representing success stories worldwide 7 Perform quality check Develop official award consideration materials Perform final performance benchmarking activities Write nominations Perform quality review High-quality, accurate, and creative presentation of nominees successes 8 Reconnect with panel of industry experts Finalize the selection of the best-practice award recipient Review analysis with panel Build consensus Select winner Decision on which company performs best against all best-practice criteria 9 Communicate recognition Inform award recipient of award recognition Present award to the CEO Inspire the organization for continued success Celebrate the recipient s performance Announcement of award and plan for how recipient can use the award to enhance the brand 10 Take strategic action Share award news with stakeholders and customers Coordinate media outreach Design a marketing plan Assess award s role in future strategic planning Widespread awareness of recipient s award status among investors, media personnel, and employees Frost & Sullivan We Accelerate Growth

18 About ODAM The processes and tools that communications service providers (CSPs) have utilized to run their businesses have changed over time. More than a half-century ago, CSP network and business management processes were manual (OAM&P). As CSPs evolved over the years, so did the operations support systems (OSS) and business support systems (BSS) that address CSP business and network management needs. In recent years, the lines between OSS and BSS have become less clear, with much overlap. In addition, the roles in which OSS and BSS operate have expanded beyond traditional boundaries. As such, Stratecast now uses the term Operations, Orchestration, Data Analytics & Monetization (ODAM) to encompass both the traditional OSS and BSS functions and the new areas in which business and operations management must now work together, including virtualized networks and telecom data analysis. About Stratecast Stratecast collaborates with our clients to reach smart business decisions in the rapidly evolving and hyper-competitive Information and Communications Technology markets. Leveraging a mix of action-oriented subscription research and customized consulting engagements, Stratecast delivers knowledge and perspective that is only attainable through years of real-world experience in an industry where customers are collaborators; today s partners are tomorrow s competitors; and agility and innovation are essential elements for success. Contact your Stratecast Account Executive to engage our experience to assist you in attaining your growth objectives. About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best in class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages almost 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 31 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan We Accelerate Growth