Verizon Business Continues Massive Billing Consolidation

For nearly a decade the billing industry has followed the MCI, then the WorldCom, now the Verizon Business billing consolidation story. Like the giant fish that got away, the number of systems MCI started with has grown with every telling. David Landry, executive director with Verizon Business Information Technology, is overseeing the approaching end to this epic tale. Verizon Business has trimmed its number of billing systems, with a final target of four. Landry says the entire billing transformation program is about halfway completed, with a challenging and aggressive consolidation schedule that will trim at least one more system per quarter until completion. The success of this program depends on the pieces Landry and his teams have already put in place, including a common data model, analytical tools that make dynamic information available to customers, and a collaborative program management approach that executives, stakeholders and users support.

Billing World: The term "billing transformation" is used quite often these days. What will it really mean for Verizon Business customers?

Landry: I think the first thing the customers will see, and that's most significant, is the fact that we are providing a single platform with billing across all accounts on our Verizon Business Customer Center billing portal. They can get high-quality bill analytics on demand, and many customers use this on a daily basis.

Billing Manager 4.0 is coming out [in May]. It provides a powerful platform to allow the customer, on their own desktop or LAN, to perform advanced bill analysis of their billing data and to import data from other sources. In the end this helps customers drive costs out of their business as they deal with Sarbanes-Oxley and the need to manage complex accounts payable in telecom. They will also see increased accuracy as a result of systems consolidation.

In the enterprise market, complex contract rates are typically where a lot of effort is spent, and there's opportunity for billing accuracy problems. We're currently working on a contract rate implementation transformation. What we're doing is classic business process reengineering to ensure that the rates we negotiate in our contracts are put into our rating engine accurately and on a timely basis, and support the flexibility we've always provided to our customers.

Billing World: Reuse is a common theme in this project. From where did that philosophy derive?

Landry: The development team drove reuse without specific direction. The mandate from the CIO was to transform billing and deliver business benefits. The only specific direction we received was to reduce the number of systems, which was pretty obvious to everyone.

When we got together just before the merger closed to do strategic planning, we saw that the Verizon side had already begun a path of transforming enterprise business billing and that there had been prior efforts at MCI to do the same. As a result, there were a number of assets or concepts we could reuse to be successful. Each major deliverable in our program leverages reuse of software or our centralized billing data warehouse.

When we looked at the portals, we had two, but one was clearly the right platform to build upon. It was driven by a billing data warehouse, and we recognized it would provide our customers with a more dynamic platform. It doesn't just provide static reports, it allows the customers to perform analytics across ranges of bills and dates, and enables a lot of flexibility.

When it came to our analytics platform, we had one in MCI and one in Verizon. The comparison led to an interesting decision. One of the platforms' user interface was more usable and powerful, but the technical platform of the other system was clearly superior in terms of scalability, and it supported multiple users. We took the best of each.

Lastly, for electronic billing, we had two EDI platforms, and we chose the one that had the ability to scale to provide our customers a single EDI format and to support the legacy MCI format so we did not have to force our customers to change.

Looking at the enterprise products on our legacy billing platforms and the cost of the conversion, we recognized it did not make sense to convert another one. Instead, we undertook a single bill initiative that solves most legacy issues. This provides our customers with increased capabilities in the interim while the services on the legacy platforms rust away.

When it came to systems consolidation, we first determined what characteristics the target platforms would need. This led us to four target platforms, each with a specific role: wholesale, LEC, ultra-high-end customers, and long-distance voice and data.

Billing World: Who staffed the program management office (PMO), and how did they bring all of the moving parts and people together?

Landry: We were running a serious risk for any program of this sort, because we were driving it out of the IT department, but much of the work and most of the benefits were outside IT.

So the first thing we did was to establish an internal PMO and put Maria Martellotto, the director whose organization is responsible for gathering requirements from customers, in charge of it. We then brought in the major stakeholders and sold them on elements of the program. More and more, this is the key to our success. The PMO was staffed by IT, but we have weekly calls with stakeholders in IT and finance to align with their project management teams, especially where our deliverables impact each other.

We also formed an executive steering committee to adjust to how business priorities play into the program. There are many large-scale programs underway because of the merger, and we have to balance those with priorities like getting new services out. We've used the steering committee well to determine where we align our schedule. The fact that it is collaborative reduces friction and reinforces the need to change direction once decisions are made.

One interesting thing came out three months into the program on a steering committee call. Two executives said, "This is good. What you're doing is valid and we don't oppose it, but there's one thing you should have taken on and didn't: contract rate implementation." So, we reworked our priorities and made that a new focus area.

We are also working at all levels of the organization, right down to the lower levels. On a quarterly basis I do a read-out to all the people in my organization via a large net meeting—and make it available to all the people in the stakeholder organizations—to lay out where we are going next quarter, how we did last quarter, and to take questions about what people are really concerned about. This has let us stay in close sync with our clients in and out of the organization, so we have eliminated many of the political issues that you often deal with in these types of programs.

Billing World: How does your standardized billing data format and your centralized data store support your consolidating systems and your customer requests for information? Why have you chosen to centralize that data physically, if you're using a web services approach?

Landry: Our standard billing data format is an output that we have defined for each billing system to produce as a result of monthly billing. It captures the salient information that can be used for electronic billing, re-billing and re-calculating, applying discounts, closing the books, and formatting EDI—financial information about what's billed, product information, and billing detail. It's a very robust data layout that all of the billing systems are linked to. It's the underlying data in our Bill Manager product (software given to customers for bill analysis), and our customers sometimes build their own systems around the data they receive from us. The data model evolved over time. Every merger—going back to Nynex—has reinforced that this model was the right way to do things.

The warehouse itself is a large DB2 application that provides services to our portal and to internal applications. We went with that approach because we wanted scalability and dynamic analysis for our customers. Centralizing the data into a single data model seemed to be the best way to serve that requirement. The systems that rely on this data model are subscribing to services, so as the data changes—and we release new data six times a year—seldom is there an impact to the consumers of that data.

If we used a pure web services approach and had queries coming in, we'd still have to, in an ad hoc manner, bring the data together and do more work on it. I don't think our response time requirements would allow for that, and it becomes a customer experience issue. Even at that, for some common things, we do pre-staging of results, because we know if we don't we'll have response time issues that irritate customers.

Billing World: What does a single bill mean for your customers?

Landry: When I talk to our customers, they like the single bill as a concept, but as a practical matter most don't want a single payable even if they can have it. What they are looking for is the ability to aggregate and disaggregate and have a total spend view. If you think about it like a single bill you are using a consumer mindset to solve an enterprise billing problem. It is all about being able to slice and dice the data.

Billing World: What are some of the highlights for the second half of the program?

Landry: The biggest challenge is that we are doing billing system consolidations on a quarterly basis. We are going to consolidate one existing system into two others, and we'll be doing this at an aggressive pace of one per quarter. That is the biggest challenge—making sure that each of those is delivered on time, accurately, and doesn't impact our ability to do the next one. So far, so good.