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 Channel Futures

Telephony/UC/Collaboration


The Internationalization of theTelecommunications Market

  • Written by Channel
  • September 30, 1997

Posted: 10/1997

The Internationalization of the
Telecommunications Market

How Language and Currency
Affect Customer Care and Billing Systems

By Chris Rees

The U.S. telecommunications industry is
undergoing a dramatic transformation. The sector is experiencing
increasing consolidation, as well as rapid growth funded by
entrepreneurs tapping venture capital, equity and other
high-yield financial sources. Investor interest is also
intensifying, as evidenced by the success of US WEST’s $4.1
billion bond offering and Lucent Technologies’ record-breaking
$3.025 billion initial public offering.

The industry’s transformation is being fueled by
a number of factors that include the introduction of the
Telecommunications Act of 1996, the rapid pace of technological
advances, growing demand for better telecommunication services
and increasing globalization. Many industry observers believe
that success in the new business environment will be achieved by
companies that can bundle many services.

Globalization Is an Important Force for Change

As telecom systems around the world are
privatized and opened to competition, major players are
positioning themselves to compete on several continents. U.S.
companies seeking to participate in fast-growing markets abroad
face sharp competition from Deutsche Telekom, France Telecom and
the like.

The promise of finding other sources of income
outside traditional home market revenues has brought about many
global alliances. The pending BT-MCI merger is an example of how
telecommunications companies are seeking alliances or mergers to
leverage each others’ assets and enter new markets. The Unisource
(AT&T, Telia, PTT Netherlands, Swiss PTT and possibly STET)
and GlobalOne (Sprint, Deutsche Telekom and France Telecom)
alliances are other examples of telecommunications giants joining
forces to create a more competitive, more international presence.
Together they can provide a huge array of services in many
countries and, more importantly, are in a position to offer large
multinational customers the sort of highly customized and
packaged portfolio of products and services they need.

Customer Care and Billing Systems–An
Increasingly Competitive Weapon

Central to a telecommunications company’s ability
to bring products to market quickly, contain costs and offer
superior customer service is its customer care and billing
system. A huge shift has occurred in the last 10 years (and far
more recently in Europe, where competition has only recently
become a reality) as customer care and billing has migrated from
being an expense to becoming a corporate asset.

Indeed, it was not until recently that customer
care became a much-used term. In the past, telecommunications
companies talked about billing, but no real concept of customer
care existed. In most cases, telcos did not know who their end
customer was, as they were in the business of managing lines or
connections and the end customer was less important.

The Focus Is on Customer Loyalty and Retention
and Reducing Time-To-Market for New Products and Services

In telecommunications as in any other industry,
when a customer has a choice of providers, customer satisfaction
is the key to a provider’s success. The acquisition of new
customers is invariably much more expensive than retaining
existing ones.

To indicate how serious telcos are about having
the best possible customer care and billing system, one need only
look at the investments they are making to update their existing
customer care and billing infrastructure and implement new
systems to give them a competitive advantage. AT&T recently
signed a five-year contract worth $1 billion for the provision of
customer care and billing services.

Most U.S. telcos are now investing significantly
to move into a new generation of customer care and billing
systems so they can survive in an increasingly competitive
market. It would be reasonable to expect them to leverage the
huge investment they are making domestically in customer care and
billing solutions to benefit their initiatives outside the United
States. AT&T, for example, presently uses a variety of
billing platforms. To gain competitive advantage over other
global players, it would make sense to pull together all the
company’s billing capabilities and implement one highly flexible
system to manage its global clients.

Language Considerations Are Numerous

Almost every business process is at some stage
touched by a function in a customer care and billing system. In
Europe, some of the challenges of international customer care and
billing are more clearly understood, as they are a part of
everyday life. For example, within some European countries
multiple languages are spoken, such as in Switzerland, whose
population of approximately 8 million includes German-, Italian-
and French-speaking people.

The challenge to a customer care and billing
system of handling even three languages is immense. From a
customer care perspective, a company or private customer must be
able to talk to his customers in the language with which they
feel most comfortable. Unless the customer care and billing
system can cope with that language, and multilingual operators
are put in place, these customers are unlikely to stay with their
telephone company in a competitive environment where alternatives
exist.

Assume, for example, that Mr. Duponchel, a
hypothetical subscriber, calls a customer service center to order
a second line. He speaks only French. When he calls from home, he
is automatically transferred to a French customer service
representative (CSR). But in what language are the customers’
notes and history maintained? Suppose the customer calls from a
mobile phone or a pay phone. Clearly a system could transfer a
call and customer data seamlessly from one operator to another
using computer telephony integration (CTI) technology. But what
about his bill? If the bill includes marketing messages, they
need to be in the customer’s native language.

In short, telecom providers need a
customer-focused system in which information about a customer
always remains with that customer, even if he moves from one
location to another, and the customer details are kept in his or
her preferred language.

If the customer care and billing system is fully
data-driven, this task becomes easier. Some systems have been
designed to be reference data driven. A unique identifier (field
number), which sits in a table and is mapped to the appropriate
language, references each field in the CSR’s screen. The CSR can
choose the language in which he operates and also identify the
preferred language of the customer. Incorporating an additional
language involves the relatively simple task of translating all
the screen field definitions to the additional language.

Some complications do need to be considered. In
Spanish, for example, most words are longer than English words,
so abbreviations must be used. Further technical challenges exist
with languages like Chinese, in which double-byte character sets
are needed, or Arabic, which is written from right to left.

Multilingual capabilities also need to be taken
into account when offering customer care and ordering facilities
over the Internet. Customers must have the ability to select
their preferred language through an Internet interface just as
they do when talking to a CSR. This has the additional benefit of
eliminating some of the complications of multilingual CSRs as
well as reducing CSR costs, which usually constitute a major
proportion of total customer care and billing expenditure.

At the bill level, telecom providers also need to
design a customer care and billing system that is reference
data-driven for payments, charges, called locations and service
types. Customers should be able to select the billing language
they prefer during the ordering process. At a simple level, a
code would exist for each billed item. This code would reside in
a multilingual table to allow a choice of languages on the bill.

At the collections level, a template of letters
would exist in multiple languages to allow the CSR to send out
letters in different languages. This process can probably be
accomplished more easily by interfacing to a word processing
system, for collections and other standard letters.

Currency Is Also an Important Part of the
System Design

At the simplest level, having two or more
currencies in a customer care and billing system is, like
language, a relatively easy thing to do as long as it is
reference data-driven. The interesting thing about a country’s
currency, though, is that it changes dynamically in relation to
other currencies. Also, some currencies use a decimal point, and
some currencies experience huge inflation (in some cases hundreds
of percent per year).

Consider the following example: A U.S. company
with subsidiaries in France, Germany, the United Kingdom and
Austria seeks the best rate for its communications needs. The
customer asks its global provider to aggregate in U.S. dollars
all charges, including those of the European subsidiaries, and
apply a bulk discount. The customer then asks that the discount
be replicated back down the hierarchy and each local subsidiary
be sent an invoice in the local currency, as well as summary
details sent to the corporate headquarters in the United States.

Suppose the customer then decides it wants to pay
the entire bill in U.S. dollars and that the European
subsidiaries should receive summary-only bills. In addition to
this, assume that after two months, the French subsidiary
realizes that it has been overcharged by 10 million French
francs, and during this time the French franc has devalued by 20
percent compared to the U.S. dollar.

This scenario presents a whole range of issues
and potential problems that a customer care and billing system
will need to be able to manage. It is a challenge for both
information technology systems and for policy. Credit card
companies and banks have been faced with these sorts of problems
for some time and have come up with some solutions. These
solutions are, however, not as flexible as those that
telecommunications companies will need to implement.

One telecom solution is to normalize all
currencies to a base and update the base at regular intervals. A
similar system is used for GSM (Global System for Mobile) roaming
clearing in Europe. In Europe GSM companies have roaming
agreements with each other and even outside Europe in countries
which have the same GSM-standard network. These roaming
agreements define the process whereby a customer can visit (roam)
on another country’s network and be reimbursed for hosting those
calls.

If a customer of ABC Cellular in Spain uses his
GSM mobile telephone on XYZ’s network in Germany, the German
company will rate the call in Deutsche marks. It will then be
converted to a normalized rate (called SDR) which is published
and updated regularly and used to create a special record (called
TAP). These TAP records are settled by a clearing house, of which
there are three in Europe. ABC Cellular in Spain will then
convert the normalized rate to pesetas and will settle with XYZ
in Germany. This solution has been working for some time in
Europe and seems to be successful.

In Europe, the Euro will significantly simplify
currency issues and inter-carrier settlements. However, European
telecommunications companies will undergo a transition time in
which they will need to support both the Euro and their home
currency. This issue needs serious, immediate attention for
customer care and billing systems not designed to support
multiple currencies.

Large international corporate clients will almost
certainly need individually negotiated contracts which outline
the process for refunds, deposits and payment terms in detail and
which cover every eventuality. These clients also will need a
facility to change the structure by which they are billed, so
that they can make use of tax benefits in certain countries.

Any telecommunications company seeking to be a
truly global player needs to consider the effect of language and
currency on its customer care and billing systems. Consideration
must be given both to the design of the system and to the
business processes put in place for managing interconnection and
settlement between carriers; the method of calculation and
issuing of refunds; customer service center design and
management; interactive voice response technology uses for
inbound multilingual customer queries; the use of the Internet;
and other areas.

All must be evaluated as part of a total business
strategy that decides what services should be offered, in which
countries and to which customer segments.

Chris Rees is a senior consultant at American
Management Systems, London office. American Management Systems
Inc., provides customer care and billing solutions for
communications firms. He can be reached at 44 1753-746515.

Tags: Agents Telephony/UC/Collaboration

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