Doing data right

Although a carrier's decision to offer data service is often driven by a variety of business objectives, the basic phases within the life cycle of a service offering are universal. They include a business planning phase in which the carrier establishes its business mission; a service launch phase that provides the basis for marketing strategies and service policies; an implementation phase in which the carrier builds the network infrastructure or augments its existing network; and an operations phase in which all aspects of the service offering are fine-tuned.

Any competitive local exchange carrier that rolls out a new data offering will face pressure in all four phases-especially if it must keep its core voice service a top priority. But the carrier that follows these four phases of service provisioning has the potential to emerge with additional revenue-and satisfied customers.

Phase 1: Which direction and how far? Within the business planning phase, the service provider develops the business mission, establishes financial expectations, identifies the data service offering and defines the organizational structure.

The business mission identifies how the service offering will contribute to corporate goals and directions. The service provider should consider competitive pressures and changing customer needs, and its business mission must be clearly articulated, providing all team members with guidance for decisions.

Measuring the success of a service offering should be an ongoing activity. The carrier must establish company expectations early and perform reviews over the service life cycle. During the business planning phase, the carrier also should establish some key target dates, target costs, revenue and return-on-investment expectations. Risk mitigation and time to market are drivers in establishing financial expectations.

Service offerings vary and are often based on long-term strategies and short-term competitive pressures. The business planning team needs to specify the initial service offering and identify potential future extensions. This helps focus the launch and implementation teams by defining bounds and limitations, including the scope of service level agreements (SLAs), acceptable variations from the basic offering, points of demarcation, geographic coverage and pricing strategy. The specification of the service offering reflects the business mission-not the infrastructure architecture-and is expressed from the customer's standpoint.

Whether the service provider is a start-up or long-established, the organizational responsibilities should be defined early. Time to market is critical, so many activities can be done in parallel. Although the organizational structure can vary, the core roles and responsibilities must be understood so that planning activities are not overlooked.

For example, a CLEC that provides voice-only service off the existing local loop wants to extend its service to provide data access. The data world includes content providers, application providers, and public and private transport providers (Table 1).

A CLEC has many technical and business alternatives for providing connectivity into the data world. It may decide to offer a remote access service and provide a single point of contact and one-stop shopping for its customers that need voice and data. A CLEC can also provide connectivity to many content and transport service providers for its local customers.

A CLEC's focus remains consistent: It wants to provide secure and reliable local access through the existing local loop. The carrier plans to announce the data service in 15 days, turn up beta customers within 60 days and offer general availability within 90 days.

Phase 2: Go for it The service launch phase provides the architecture for marketing strategies, support infrastructure and service policies. The carrier takes the first externally visible steps within this phase.

At this point, the launch team should compile the project plan, which includes the key project dates, risks and responsibilities identified in the planning phase. Whether the project plan is a 6-inch-thick document or a list of dates on the CEO's white board, it establishes common goals for all involved in the data offering life cycle.

Resource planning is also important. A variety of strategies can be used to address the resources needed for both the long and short term. Staffing resources are available from internal organizations, vendors, alliance partners, consultants and new hires. Because staffing is critical and qualified resources are often scarce, the carrier must project and plan its growth.

Marketing is the most externally visible activity within the service launch phase. The strategy and message may vary between carriers, but they must be consistent with the established business mission. For the marketing message to be fully developed, the service provider must define the service offering and approve the underlying infrastructure architecture. Risk and cost management is critical.

The service provider can further define the service offering by including the following:

* SLAs, which have received significant attention, and with reason. SLAs must be easily measured and meaningful to the customer, but they can also significantly affect infrastructure and operations.

* Security, which affects all aspects of the offering, including customer support, operations and service activation.

* Pricing/billing, which allows flexibility in meeting competitive pressures but can also introduce complexity both in sales and delivery. In general, simple is easier to sell and deliver.

* Options and variations, which must be understood early. In some cases, the service may be offered only one way, and any customers whose requirements vary from the standard offering should not be pursued. On the other hand, a service provider might offer infinite service variations to support the customer. Both approaches have their drawbacks, but as long as there is a consistent view of the business mission, then the appropriate policy can be established.

Suppliers may include vendors, consultants and service providers, some of which might be competitors. In selecting a vendor, the service provider must consider not just the product capabilities, including manageability, but also the vendor's support capabilities and commitment to the ongoing product. In selecting consultants, the provider should consider not only the immediate staff augmentation but also the consultants' ability to transition the skills to an in-house team, depth of technical knowledge and understanding of the business goals.

During the service launch phase in our CLEC example, the carrier focuses on its existing customer base (Table 2). Its policies include SLAs with high quality of service (QOS) for reliability and security, a comprehensive and stringent security policy, and a simple pricing and billing strategy. Rather than outsourcing, the CLEC brings remote access capabilities into its infrastructure.

The CLEC requires minimal investment in remote access servers with supporting management and security tools. It also achieves a shorter time to market by calling in specialists who will perform the technical design and implementation.

The CLEC selects multiple content and transport service providers and establishes high QOS requirements for reliability and security.

Perhaps most important, the CLEC and its content providers, consultants and associated vendors all understand the business mission, goals and service offering. The service is announced within 15 days.

Phase 3: Teamwork makes it happen There is often overlap from all sides with the implementation phase. The implementation team builds the network infrastructure, network operations center, support facilities such as test labs, training facilities, staging areas and any disaster recovery facilities. Whether the infrastructure is a new creation or an augmentation of an existing infrastructure, it should be created with ongoing operations in mind.

The implementation team should establish processes and instrumentation for inter-organizational and intra-organizational interfaces, including external interfaces with content suppliers. Customer interfaces also play a major role in how a customer views the offering. These interfaces should reflect the quality, security and benefits of the service offering. Customer interfaces include classic examples such as help desk, billing and service activation as well as other interfaces such as special customer views of the network.

Although a carrier's offerings are often influenced by what the competition offers, its chosen interfaces should support the service provider's business mission and marketing message and provide a real benefit to the customer. The implementation team should use the content supplier relationships established by the service launch team, testing the interfaces and escalation procedures, establishing the operational contacts and providing feedback when expectations are not met.

During the implementation phase, the service provider should establish the supporting tracking and monitoring instrumentation for SLAs and their reporting mechanisms. SLAs are not forged just between the service provider and the end user but also between the service provider and its suppliers, as well as between internal organizations. If the service offering depends on these relationships, then the relationships represent risks and should be monitored.

Pricing policy is a key component of the service definition. The supporting billing mechanism can range from a simple fixed-rate system to a complex usage-based system. However, the mechanisms for determining who gets billed, when billing starts, what gets billed, and at what rate should be carefully implemented. The carrier should anticipate customer questions and establish appropriate support interfaces.

Returning to the CLEC example, the carrier maintains its focus on the security and reliability of its data service. It implements multiple remote access servers and redundant connections. The CLEC will limit the connectivity with its business partners to frame relay, and it introduces changes to the network operations center (Figure 1). Additional management and security tools are introduced and will run in parallel with voice tools. The carrier also enhances help desk and billing mechanisms, but the core infrastructure remains.

The CLEC selects its initial customers and turns up service within 60 days with connections into a variety of content and transport service providers. Throughout its data service implementation, the carrier's voice offering remains its top priority.

Phase 4: Are we there yet? The delivery of the new service offering and the nurturing of existing business are key activities in the operations phase. All components, including service definition, policies, infrastructure, staff and the marketing message, evolve during the operations phase, and carriers need to continually review quality and progress.

In all the excitement of offering a new service, service providers sometimes tend to place a lower priority on the established business and customers. If this occurs, it should be part of their business strategy and not the result of misplaced enthusiasm.

Technology evolution remains constant, as well as maintaining the infrastructure, evaluating new releases and determining when the new technology is rolled out. It is critical for carriers to understand the impact-on operations, support, management tools and SLAs-and the real risks and benefits associated with infrastructure modification.

Managing staff-both in terms of recruiting and retaining employees-is also an ongoing challenge. Early staff planning is critical; if the plans have not been executed by this phase, then it is too late.

When companies get caught short, they can often look for assistance from vendors, consultants and outsourced companies. However, these solutions can be costly, so devising a training or migration plan for internal resources is a good idea.

Operations and sales teams must have the same business mission in the operations phase. Service providers should modify the marketing message and supporting marketing efforts in response to pressure from competitors as well as technological, social, regulatory and business changes. The infrastructure and support instrumentation must match the direction of the service offering.

In the CLEC example, after the initial data customers are successfully launched, the carrier introduces additional customers (Figure 2). As the CLEC's data staff grows, its knowledge of the data world expands and hired consultants are phased out. The infrastructure allows for easy growth and expansion. Reviews indicate that additional training is needed for the help desk, and the CLEC introduces stronger technical support. In one case, a content provider proves unreliable, so that relationship is severed.

Again, the carrier's primary focus remains to provide secure, reliable access through the local loop, with its new data offering complementing the core voice business.

If the new service offering is successful, then service providers should look for opportunities for service expansion. These opportunities must be addressed with the same planned and disciplined approach. The carrier then re-enters the business planning phase, maintaining a focus on corporate goals, managing cost, mitigating risks and maintaining the quality of the existing offerings.

A carrier that has successfully rolled out data service has several immediate opportunities, including:

* Making additions to the initial offering

* Supporting corporate network access using virtual private networks

* Introducing high-speed multimedia access via asymmetrical digital subscriber line

The life cycle of a successful data service offering requires all m embers of the team to be disciplined, hard working and focused on the business mission. But if done right, rolling out a new service offering can generate additional revenue-and please customers in the process.