Rob Simonds: four key business functions have been
at the top of the agenda for telcos for years and haven't been
Data is dropped as it flows from one point to
another; .combine it at a more detailed, granular level and an
operator can identify and rectify leakage problems
HP describes its Neoview platform, launched in April 2007,
as an enterprise data warehouse that enables businesses to
capitalise on their information at a dramatically lower cost,
offering scaling to hundreds of terabytes.
It is an integrated hardware, software and services platform,
acting as a business outcomes engine, providing HP's telco
customers with a fuller view of essential business information,
such as metrics on sales and customer trends.
HP Neoview Enterprise data warehouse aims to provide companies
with broader access to operational business intelligence:
real-time business information that improves insight and
Neoview aims to deliver a firm's reports and dashboards without
slowing everyday operations to a crawl. With several different
configurations of up to 256 processors, HP Neoview can handle
heavy backroom analysis without choking on thousands of
information requests from workers who need data immediately to
make decisions regarding everyday risks and
Neoview began shipping to trial customers in October 2006,
with HP claiming to speed up business intelligence operations
thirteen-fold for a trial customer. Now it's working on a
version 2.4 of Neoview, out this year, which will offer
suggestions to users on how to more effectively organise data
and fine tune the platform's query optimiser.
HP has followed up its interest in business intelligence by
unveiling a set of BI services designed to help business
improve decision making, regulatory compliance and competitive
advantage. This service offering was enhanced by HP's
acquisition of 700-strong US-based BI consultancy Knightsbridge
Representing telecommunications industry initiatives for
Neoview is Rob Simonds, managing communications and media
solutions practice principal for business intelligence
optimisation (BIO) at HP, who insists that there is more to BI
than simply cutting costs.
"I've been working with telcos around the world to help them
understand the value of data to their business," he says. "All
the details collected in business support systems today have an
intrinsic value. Technology enablers, whether that involves
lower cost, higher reliability, or faster speed, have to be
connected with business value. Cost reduction in itself is only
mildly interesting. Everybody wants to save money, but to us
that's not transforming in any way."
However, when it comes to storing, or accessing vast amounts of
data — and telcos are prodigious data creators, as
Simonds points out — telcos suffer from budget
He believes there are four business functions that are at the
top of the agenda for telcos today: "All four have been there
for years and still haven't been adequately addressed yet,
which tells us something. There's a quality lacking in the
infrastructure, the know-how or capability, within the telecoms
business to address these challenges."
The first, he says, is revenue leakage. "I've worked with HP
for about 15 months in various capacities and have worked with
at least a dozen phone companies during that time. This topic
always comes up. It's a significant problem."
Simonds estimates that the typical telco loses between 5% and
15% of its revenue in this way. "It comes from a variety of
sources. Fraud is one that's well known. Less well-known is
that switches sometimes fail to record billable calls. Service
orders are transacted, but the bills are not actioned
A common reason for leakage is that phone companies have built
out new generation networks rapidly, but there is a failure to
update the supporting business and operational systems
accordingly. "Data is dropped as it flows from one point to
another. HP thinks that by combining more data at a more
detailed, granular level, we can identify and rectify those
Speed is also of the essence when it comes to identifying
potential points of leakage. "Once the billing cycle is
completed, it's ever more difficult to go back and collect
revenue from the customer. If the cycle is 30 days, and those
points of leakage happen within a short window, it's often
Simonds says he not suggesting that telcos automate
collection, but that they should explore ways of automating
identification, which for most companies remains a manual
process. This usually entails running reports, with analysts
comparing results to identify where the problem originates and
what the magnitude of the situation is — a highly
HP also identifies network asset placement as a problem area.
With billions of dollars of capital tied up in the network,
it's critical that assets are deployed where they need to be,
to maximise gross profit.
"It's not unusual to find as much as 20% of assets not in
service," Simonds says. "The asset is not being used, is not
being fully used, or is in transit in its lifecycle."
Part of the problem is that most phone companies don't manage
the lifecycle of an individual asset.
Assets — all the computers and tech that run the
network — are generally managed as groups, as a class,
and are depreciated in groups.
"That's the financial world's view of an asset, but it's not
the business view, which should be more individualised,"
Simonds suggests. "You want to understand every component part.
Is it doing everything it's supposed to be doing? What are the
exact performance levels, and has the project failed or
succeeded according to expenditure and expectations? From a
risk management standpoint, are we vulnerable because an IT or
network asset is about to fail?"
It is possible to use a database to collect some information
for some of the assets, but the classic problem is it's not
consolidated, meaning "it's hard to get a view across the
network, or project, or location. Just 3-5% better utilisation
of assets means millions of dollars of value back to the
Simonds is keen to stress that HP's Neoview is not providing
network capacity planning technology, but a "solution that can
make those systems better."
The third challenge HP identifies is that high customer contact
channels prevail today. "Of all industries, this is one where
the business can use its own technology in innovative ways to
stay in touch with the customer, and communicate with them, but
at the moment it's failing to do that," Simonds points
"Contact centres, real human beings, continue to be employed
as channels for telcos to communicate with their customers, in
addition to print methods like mass mailing."
Instead, Simonds suggests that a telco with millions of mobile
subscribers might send out highly targeted SMS messages to its
subscribers, promoting a new service or call plan. "Some of our
customers are desperate to find a way to drive costs out of
their customer contact. Every call to a contact centre may cost
as much as $8-10. Even though it's not the preferred channel of
communication for many of those customers."
The problem HP sees with operational business intelligence is
that human beings are batch-oriented mechanisms.
"We hear something, we synthesise it, and we work out our
response. There's a latency involved. So what we want to do is
automate business intelligence activities as much as we can.
There are reams of data that allows us to draw conclusions so
we can automate BI in a way that's never been achieved
Customer churn is the fourth major problem noted by HP. "This
has been with the industry since the dawn of deregulation. It's
almost always worse than telcos expect it to be, always
underestimated. In some markets churn rates approach 30% per
year; for example, in central and eastern Europe, central and
south America, and Asia Pacific."
Simonds believes that if a customer calls, and that customer
has made a decision to disconnect or drop a service from that
plan, the call centre representative has a 3-4% chance of
turning the customer around. "The question is how do we get in
front of that? How do we predict it, and how do we approach the
customer in the most convenient, practical way for them?"
Some telcos run data warehouses that produce detailed churn
reports — that is, a list of customers they think may
be at risk of churn — but it can take weeks for the
relevant authority to receive those reports, meaning that it's
too late to take effective remedial action.
What is needed is the metrics to predict churn, which might be
a series of dropped calls, a visit to the website, a call to
the call centre, or a similar event to indicate that a customer
is more at risk of leaving. Operational BI recognises these in
real time, applying them against established analytics, and
recommending action, which may involve sending out a
Until now, telcos have been trying to solve these problems the
old-fashioned way. Simonds insists that HP can change all this
by building on its heritage as a provider of real-time systems,
reliably supporting stock markets, where it handles billions of
transactions every day.
Neoview also, he says, allows for the storage of larger
amounts of data than was possible before. If telcos can manage
vast amounts of detailed information, whether that's trouble
tickets, work orders, or customer contact with the business,
then they can build more accurate and predictive models.
Additionally, Neoview supports a mixed workload. "We go after
the set of problems in a much different way, combining
analytics with operational characteristics."