How Telecoms Can Profit: The SOA Advantage

Telecom companies are constrained by IT infrastructures that were built for a different era; one with less competition, slower changes and less-empowered customers. Although the paradoxical mismatch between modernized customers and telecom companies’ antiquated architectures is the source of much frustration, it also affords a prime market opportunity and is driving changes in the ways that companies are competing.

Tremendous growth opportunities beckon, but to profitably realize these opportunities, telecom companies will have to change the way they compete, and move from a model that’s based on price to one based on value-added service. There is strong evidence that customers are not only ready for competition based on value-added service, but that they are seeking it out. A recent analysis of customer churn in the telecom industry shows that few customers leave for lower prices. The majority are simply seeking better service.

With that in mind, it would seem obvious that customer service is where the focus must be. The challenge for most telecom firms now is to find a way to create visible value for the customer. The simple answer to this problem is to increase the customer satisfaction level, although the most efficient method for doing this – without increasing costs – is not as obvious.

Frost & Sullivan research has indicated that “IT/Telecom service providers have to offer an integrated solution including wireless and wire-line services and products so that customers can employ a single system for administration and distribution. This solution will be even more useful if it can integrate with sales, customer service, and logistics.” Frost & Sullivan hit the nail on the head. A collaborative system is the ultimate goal of the integration process, and a service-oriented architecture (SOA) is the most efficient way to enable collaboration. With an SOA in place, information flows from every different service into a central data center that is accessible by all business units. This article will show how telecom companies can use an SOA to close the gap between themselves and their customers and compete more effectively.

The Challenge: Today’s Legacy Systems
Most Operation Support Systems (OSS) were never intended to handle customer orders, not to mention cope with the slew of technological advances and services in the current era of deregulation. Every time a new technology was enabled, it required its own OSS to manage it. This process has created a network of “siloed,” or poorly integrated systems that evolved over the years through a series of patches. These ad hoc networks have no way to track orders accurately or maintain any integrity across systems. As industry consolidation continues, mergers and acquisitions compound the problem by creating increasingly complex networks of OSSes, each with their own picture of activities, customers, and products, oftentimes with duplicate systems. The end result is that customer information frequently goes into various systems maintained by providers and cannot be located again. Without easy access to customer information, customer service failures increase and the customer walks away empty-handed.

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