SAP Big Data Margin Assurance enables telecommunication companies to capitalize on big data and increase profits in the digital age.
The telecommunications industry has undergone a period of dramatic change over recent years. Rising infrastructure investment costs, market deregulation, and an ever shifting technology landscape have communication service providers (CSPs) looking for new ways to increase their profits and thrive in the digital economy. Many providers are hopeful that harnessing the power of data may be the elixir to current woes.
Fortunately for CSPs, there’s no shortage of data in their banks. The telecommunication industry handles unparalleled volumes of structured and unstructured information, from billing and call records to network data. But how can they effectively leverage the hundreds of petabytes of data they collect each year?
“Game-Ghanger for Our Industry”
The SAP HANA Innovation Award winner SAP Big Data Margin Assurance may provide an answer. The solution provides a consolidated repository and analytics engine for fast analysis of real-time telecommunications data. Unlocking the power of big data in this way makes detailed information on margins and profits available to business users.
As Philipp Freudenberger, product owner of the new industry solution, explains: “With SAP HANA, telecommunication companies can capitalize on the massive data volumes they capture and analyze them in ways not previously possible. With the increased insight into revenues, margins, and costs across their operations, CSPs can reimagine their business models.” The impact of this is not to be underestimated, with telecommunications giant Vodafone calling the new solution a “game-changer for our industry.”
One scenario for CSPs could be to transform from an average revenue per user (ARPU) to an average margin per user (AMPU) model.
“CSPs are starting to focus on margin analysis instead of their unit sales,” explains Freudenberger. “Telecoms companies can now find out in real time who their unprofitable customers are and – very importantly – what factors they have in common that could be causing this unprofitability. This means they can tackle the problem at the source.”
In other words, the solution helps CSPs close the gap between insight and action.
Interest from customers has been high, with the SAP Big Data Margin Assurance team working with tier-one customers on three continents for the development of the beta release. “This is an example of a big data use case that really makes sense. The customers we’re working with are really interested in exploring its possibilities,” says Freudenberger.
In a step that serves to confirm the ground-breaking nature of this new solution, Vodafone recently won the Digital Trailblazer category of the SAP HANA Innovation Awards for its use of the SAP Big Data Margin Assurance solution.
As Thomas Holtmanns, Vodafone Director Finance Operations Central Europe and Global Process Owner Margin Assurance explains: “SAP brings excellent capabilities to the table through SAP HANA. Providing unprecedented levels of speed, massive processing and flexibility to query our significant data repositories and powerful analytics, it enables us to identity ways of increasing profits and preventing leakage.”
A central component of the SAP Big Data Margin Assurance solution is a standardized data model based on TM Forum industry standards. TM Forum, a global industry association for digital business, provides a suite of best practices and standards that is widely adopted by CSPs.
“The ability to understand granular customer profitability, specifically which customers are profitable or unprofitable and why, is a game-changer for our industry,” said Holtmanns.
The Digital (Organizational) Transformation
This transformation, however, has not only affected the telecommunications industry. Internally, too, SAP has had to adapt in the face of the digital revolution. The team behind SAP Big Data Margin Assurance only came together a year ago and had to adapt to the principles and processes behind cloud development in a very short space of time.
“DevOps, software packaging, test automation, new programming languages, new platform technologies – coming from a classic ABAP development team, there were a number of changes for us,” says Andre Voigtmann, a developer from the SAP Big Data Margin Assurance team. “But it’s also been a great opportunity for us to play a key role in the development of next-generation technology, and we’re all very excited about that.”
The road to digitalization differs from company to company, industry to industry, and team to team. Digitalization is about the emergence of new business models, and the right technologies will help companies stay competitive. SAP Big Data Margin Assurance is a perfect example of this, showing – both internally at SAP and externally in the telecommunications industry – how businesses can and must innovate for the digital age.