Verizon Business attacks billing complexity

Before its acquisition by Verizon, MCI was known to have a complex set of operating systems — the legacy of a series of acquisitions that had never been fully integrated. In particular, the company had added a new billing system virtually every time it bought a new company. When the Verizon-MCI merger was completed in January 2006, one of the first orders of business was to change that dynamic and streamline the number of billing systems — both to save money and to make life easier for Verizon Business customers.

This week, Verizon Business provided a progress report for that effort, saying that it has delivered more than 60 analytic reporting tools to customers, reduced the number of billing applications, moved 23 domestic and international billing systems onto one centralized billing-data repository and archived almost two years of data.

“The billing transformation process was a priority right from the get-go when we merged Verizon and MCI and started Verizon Business,” said Dave Landry, executive director of billing systems for Verizon Business, in an interview. “We defined five program areas we were going to focus on. The idea was to overall improve the quality, efficiency and cost of delivering billing to our customers.”

The five areas of focus are system consolidation, electronic billing, a single bill, process improvements and contract billing, he said. The first thing Verizon Business did was consolidate a proprietary data format, known as VZ 450, that Verizon had developed and that now is used by each one of the company’s billing systems. That enabled the company to create a central billing repository, Landry said.

“That was the foundation, and off of that, we built our electronic billing capabilities,” he said. “That was the first thing our customers saw and the most significant from a customer perspective. It changes the customer experience by helping them understand how we bill them and how they can reduce those costs.”

By accessing the Verizon Business Customer Center billing portal, customers can run up to 50 different analytics on their standard bill, sorting costs in multiple ways.

“Because we have that foundation of that data mine, we are able to provide dynamic reporting on billing data; customers can select ranges of dates, ranges of accounts, and only get what they want,” Landry said. “We keep rolling 13 months of live data, and beyond that, we archive data, and customers can go in and un-archive the archive data. It goes back to seven years, and we are adding to that as we build up. For former MCI customers, the archive starts in January of 2006.”

Verizon also is offering Bill Manager, a downloadable Windows-based tool that enables customers to import data from other outside sources and manipulate it. “They can do internal charge-backs or ad-hoc queries,” Landry said. The system works well for customers who don’t have electronic data interface capabilities, he said.

Verizon Business also is working to consolidate the number of billing systems it operates from the 30 it had at merger — most coming from MCI — to four, Landry said.

“We are going to actively convert customers off of a number of them,” he said. “We will let the other ones drift away. We have today eliminated three billers, and we will do another one next month. Then, we will do one to two a quarter through third quarter of next year. This is a very aggressive conversion plan.”

Ultimately, Verizon will have one billing system to do wholesale, one to do long-distance data and voice, one to do special high-end customer arrangements (such as the government’s Networx contract and a small number of very high-end customers) and one for local services, Landry said. But that is a long-term view. Once the forced migrations are done, the company will still have about 14 systems.

“The remaining 10 will go away as some more obsolete products and services expire,” he said.

Verizon’s intent is to get to a single bill for local and long-distance services, but Landry admits that’s a major challenge, especially on the local side.

“The single bill initiative has two deliverables: one is LEC rebilling, and the major problem we needed to solve with LEC billing is that it is difficult to implement terms and conditions,” he said. So today, Verizon takes the VZ 450 data and feeds it into a National Business Billing Engine, which re-rates based on terms and conditions, he said.  

The other half of the single bill initiative is a national billing report, which is a total spend report geared to upper level executives who have to track total spending. “We are also in the process of delivering a global billing rate report, which will have multiple currencies and the kinds of things you would expect for a multinational operation,” Landry said. “And we are implementing a wireless trial in the fourth quarter, which will be generally available next year.”

Finally, the company is re-engineering internal business processes to eliminate unnecessary manual steps in the ordering process and is simplifying the process of managing rates over the life of a customer contract.

“We are greatly simplifying a lot of jobs,” he said. “Our existing contract rate implementation process boggled my mind. I could not follow what they were doing in order to achieve the end goal, which is the right rates and right systems for the customer. You need a Ph.D. in billing to pull it off. We are hugely simplifying that, reducing the sources of information, reducing the rework required. We now have the concept of a living contract to which you can just apply changes, and a number of them will flow through.”