Need To Get a Little? Click Here

Sometimes, when you really need to get a little – on your margins that is – you first need to give a little. The scary part is that there is no guarantee any of that good will or revenue or whatever you’re giving up is going to come back to you in spades, in increments or at all.

That’s why it was gutsy of Cbeyond last year to apply the “give a little to get a little" strategy to revenues. And it paid off. Its business customers had been feeling the effects of the Wall Street-led economic meltdown for a couple of years and were spending considerably less. So Cbeyond inflicted an even bigger wound upon itself by lower the price of services, thus reducing revenue even further.

Lo and behold, they grew their customer base by 13.5 percent in 2010 and consequently, revenue, by 9 percent. Given other cost controls, its EBITDA grew by 16 percent. Give a little, get a little.

It’s not that Cbeyond was any less concerned with margins than other companies. In fact, Nathan Fuchs, senior manager of telecom audit at Cbeyond, said, “At Cbeyond margin review is very important to us. It is vital and one of the key measurements we look at that allows us to make better decisions about how we manage our business."

However, Fuchs and company had neither the time nor expertise to gather the required intelligence needed to make such decisions. In a report available now called, “Embracing the Eureka Moment of Granular Margin Management," he tells how the company with the help of Razorsight, managed to turn that situation and its revenues around.

EarthLink also tweaked its margins but with a focus on dynamic routing, a newer, better version of least-cost routing. That story, too, is in the report. EarthLink teamed with GCS on a routing solution that removes the storage- and processing-intensive routing activity out of the softswitch and into a database that has the depth and processing to apply many more business rules to the many choices an operator now has for routing calls.

As Jim Weidman, switch engineer for EarthLink Business, said, the ability to make such real-time changes in the face of increasingly fluctuation rates and the ability to ensure you are making the margins you think you are on each and every call is what sets dynamic routing apart from traditional LCR.

Click here for access to this B/OSS exclusive report. 

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