Page 506 - Handbook of Modern Telecommunications

Network Organization and Governance 4-37

Channel profitability is a difficult exercise as most fixed expenses are usually not directly allocable
to a channel. Another problem is the cost of campaigns; most campaigns go out through direct mail,
branches, and the call centers. Such channels need to be allocated a higher proportion of the fixed
expenses. All these profitability measures need relevant accounts and customers to be available within
the data warehouse. Moreover, profitability needs to be analyzed over time and sufficient historic data
will be required.

4.3.3.2.8 Event Triggers
Another important tool that can be used for analytics is event-triggered campaigns. Campaigns can be based
on specific customer actions (nonavailability of credit limit, significant high-cost services usage, etc.).
4.3.3.2.9 Other Analyses
There are several other analyses that can be carried out using BI tools, as follows.
4.3.3.2.9.1 Fraud Analysis Transactions can be used for fraud detection. Such analysis uses historic
data about customer, usage, payment record, and so on, which can be validated within the customer
life-cycle framework, and fraud detection triggers can be constructed.
4.3.3.2.9.2 CRM Components A lot of the historic data within the data warehouse can be used to sup-
port the telecommunications company’s CRM initiatives. A data warehouse provides a 360-degree view
of a customer and enables a telecommunications company to study and reasonably predict customer
behavior. A data warehouse integrates well with all campaign channels and provides a framework to
generate integrated campaigns.
4.3.3.2.9.3 Predictive Models A very important aspect of a data warehouse is its ability to provide inte-
grated and historic information on customers, accounts, transactions, delivery channels, and the under-
lying data. All these can be used by a data-mining group to understand customer behavior over time,
carry out trend analysis, and construct statistical predictive models. Models can range from attrition
models to other predictive models that determine the probability of a customer’s behavior.

4.3.4 Strategy at Work
A BI solution can jump-start the required impetus to a telecommunications company’s strategic efforts.
It is important for a telecommunications company to sequence these monitoring, organizing, and anal-
ysis efforts, in order to effectively utilize various resources. A great deal of time needs to be devoted to
planning the various initiatives to maximize benefits and major coordination between various depart-
ments that are involved in these initiatives is required.
There are several critical areas and tools that any telecommunications company should undertake,
although each telecommunications company might differ in the method of analysis and implementation.

4.3.4.1 Strategic Decision Support
This is the cornerstone of business intelligence. In this model, end users are provided with intuitive tools
to distill information about corporate assets and their performance. Corporate assets include custom-
ers, products and services, network infrastructure, and employees. Typical performance measurements
include profitability, availability, usage, sales, and lifetime value. Companies can now track key perfor-
mance measurements, refine customer segments and scores, and optimize campaign strategies.
Some of the typical strategic decision support capabilities in the telecommunications industry include
the following:

• Develop simple reporting capabilities that allow one to measure and trend key performance met-
rics; these metrics include the following:
• Install and disconnect rates