2008 06 Infotag Communications V4

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Cust om er Financ ia l Management for

t he Comm unica t ion Indust ry

Michaela Kresak

Communications, Utilities & Service ProviderSAP Business Consulting EMEA24.06.2008



© SAP 2008 / Seite 2

Today’s c ha l lenges in our Indust r ies &

The c ust omer ’s ex pec t a t ions

Indust ry c ha l lenges

Complex systems environments but the market is asking for a ‘real-time’ integration ofthe systems to provide customer with actual information

More and more 3rd party products with high revenue risks

Incomplete view of the customer financials and creditability leads to cross/up-saleswhich cause revenue loss

Enhanced customer self-service platforms where customers are demanding to be ableto manage their accounts

Long call times in the Contact Center with expensive second level processing

Customer expec t a t ions

Pay any way I want – including authorizing payments over the Web

Handle situations when I can‘t pay

Capability to dispute charges and get credited

Freedom to define how many bills I receive each month (e.g. be invoiced for webpurchases through my monthly bill)




What Is Col lec t ions Management ?

Collections Management is according to Meta Group

Cust om er Cent r ic Rec e ivab les Management

COLLECTION

CUSTOMER

RISK

CUSTOMER

RELEATIONSHIP

WORKFORCE

CUSTOMER

SELFSERVICE




Paym ent Behav ior o f Res ident ia l Consumers

in Germ any

Payment behavior (in %)

72

70

70

67

62

57

56

52

50

46

44

16

13

17

17

13

23

23

20

22

31

32

11

15

10

10

14

16

15

19

15

19

18

0 20 40 60 80 100

Gas/Heating, Water, Energy

Rent for house

Insurances

Phone (fixed)

Loans

Taxes

Health Insurance

Credit payments

Credit card

Doctor's bills

Mobile Phone

within due period after due changing

Source: Intrum Justitia Inkasse GmbH, Germany – Trendbox




SAP Cust om er Financ ia l Managem ent

AccountsReceivables

InvoicingBillingRatingMediationDispute

Management

CustomerRegistration& Booking

SAPEDR

Billing

SAPConvergent

Invoicing

SAP

RevenueManagement

Contract

Accounting

SAP

FinancialCustomer

Care

SAP

Electronic

Bill Presentment

and Payment

SAPCredit

Management


Credit Management: SAP Credit Management

Convergent Billing & Convergent Invoicing: SAP EDR Billing and SAP Convergent Invoicing Collections Management: SAP FI-CA/RM-CA Subledger Acc. & Financial Customer Care

Electronic Bill Presentment and Payment: SAP Biller Direct

Financial Customer Care & Dispute Management: SAP Financial Customer Care




SAP’s Order-t o -c ash arc h i tec t u re

Sales & Custom er Care Customer Fin .

Management

EDR Billing

Product CatalogManagement,

Bundling & Pricing

Sales & OrderCapture

Account &SubscriptionManagement

Multi-Channel Support

Marketing, Sales & Customer Management

Financial

Accounting &Controlling

Logistics &Supply Chain

EnterpriseManagement

Analytics

Otherfunctions

Service & Resource Management

Order Management

Product

Management

Product Catalog

Product Pricing

Product Bundling

Invoicing

Receivables

Financial CustomerCare & Collections

Rating, Charging,MediationInventory Management Service Fulfillment

BusinessIntelligence




SAP’s OTC Target Arc hi t ec t ure

Bi l l ing

EDR Billing

Marketing, Sales & Customer Management EnterpriseManagement

ConvergentInvoicing

-Invoice

Creation

ContractAccounting

-ReceivablesCollections

Management

Financia ls

FinancialAccounting

Controlling

Custom er Care

Financial Customer Care & Customer Self

ServiceRecurringCharges(CRM)

Rating 1

Rating 2

Sales Documents(CRM, SD)

ExternalBillingSystem

EDRData Base

OnetimeCharges(CRM)

BillingAccounts

Rating 1

Rating 2

RecurringCharges(CRM)

Rating 1

Rating 2





AccountsReceivables


Management


SAPEDR

Billing

SAPConvergent

Invoicing

SAP

RevenueManagement

Contract

Accounting

SAP

FinancialCustomer

Care

SAP

Electronic

Bill Presentment

and Payment

SAPCredit

Management



Convergent Billing & Convergent Invoicing: SAP EDR Billing and SAP Convergent Invoicing

Collections Management: SAP FI-CA/RM-CA Subledger Accounting






SAP Credi t Management – H ighl ight s

Supports implementation of a company wide credit policy taking into accountdistributed system landscapes and other Telcos’ specific requirements

Interface to external credit agencies

Rules engine allowing flexible customer scoring and credit limit assignment

Access to credit information in sales and service processes

Ongoing credit limit control from order to cash

Credit Manager Portal to speed up credit decisions

Monitor customers’ credit exposure in one central system

Strategic credit analysis with predefined reports



© SAP 2008 / Seite 10

Cust o m er Segm e nt a t ion based on r isk

eva luat ion



© SAP 2008 / Seite 11

Credi t Check & Ex posure

Synchron izat ion o f c red i t exposure

base d on SAP Net Weave r/XIAlert

R a t e d

b u t

u n b i l l e d

Open Orders

+ 1000 *)

SalesSystem

BillingSystem(s)

BillingSystem(s)

RMCA

- 2500

I n v o i c

e d

- 2500

P o s t e d

+ 2500 + 2500 + 2500

= Liability notification via Partner Messages

C o n s u m e d

F r e e

*)

*) *)

*) Different liability types and levels available for the various business processes



© SAP 2008 / Seite 12

The Ear ly Warning Lis t



© SAP 2008 / Seite 13


AccountsReceivables


Management


SAPEDR

Billing

SAPConvergent

Invoicing

SAP

RevenueManagement

Contract

Accounting

SAP

FinancialCustomer

Care

SAP

Electronic

Bill Presentment

and Payment

SAPCredit

Management









© SAP 2008 / Seite 14

The SA P Sol ut i on for Bi ll ing & In vo ic i ng

AccountsReceivables

InvoicingBillingRatingMediation

Transformpayment-relevantevent data intostandardizedservice events

Transformstandardizedservice eventsinto pricedTransactions andguide them to thecorrect customer.

Process pricedtransactionsand additionaldata from othersystems (e.g. ordermanagement) tocreate structuredbill contents

Create invoicedocuments basedon:

• structured billcontents from billinghistorical data (e.g.open items)

• out of accountsreceivables

Provide accountsreceivables and

other downstreamsystems withaccording data.

Process required

postings triggeredout of invoicing.Process payments,

dunning, installmentplans.



© SAP 2008 / Seite 15

EDR Bi l l i ng Overvi ew

General Concept of Event Data Billing:

Service usage by the customer is represented by a unique event data record

Each Service Type (Phone, Letter, Road,…) is reflected by an individual EDR Type

Extendible EDR-Data Model

EDRs are aggregated in the bill run

Account Master Data is stored in EDR-Billing Engine

Integration of FI- and CRM business processes

Event for shipmentEvent for letter

Event for publictransport usage

Event for road usageEvent for parking

Event for phone call

Event for text message



© SAP 2008 / Seite 16

K ey Advant ages o f Event based Bi l l ing in SAP

FI-CA

E v e n t B a s e d B i

l l i n g i n F I - C A

SAP EDR concept independent of service type and service data structureService Agnostic

One Interface, many supported processes

Common Master data Model (Business Partner, Contract Account, Billing Account)

Integrated Billing

Platform

Central Event Data repository for all business processes: Billing, Invoicing, DisputeManagement, Customer Service, Unbilled Revenue Reporting and Revenue Assurance

Central EventData Repository

Billing of Services independent of payment direction (inbound and outbound billing)Accounts PayablesAccounts Receivables

Integrated Account determination based on Service Type

Flat rate Billing using integrated Billing AccountsIntegrated AccountModel

Fully transparent document flow from G/L postings down to the single EventTransparentDocument Flow

Designed as Solution for High Volume Billing for Service Provider IndustriesScalable High VolumeSolution

Integrates into SAP CRM, SAP ERP, SAP Customer Financial Management

and SAP NetweaverSAP Integration



© SAP 2008 / Seite 17

Convergent Invo ic ing – Def ini t ion

Convergent Invoicing

Invoice creation by:

including structured bill information from billing system(s) for one or many

services

including additional information out of accounts receivables (RM-CA)

applying discounts (e.g. cross service discounts or discounts on invoice sub-totals)

but in the standard, there is: NO application of pricing or (re-) rating rules

NO transaction on individual events (e.g. calls, downloads)

AccountsReceivables

ConvergentInvoicing

BillingRatingMediation

BillingRatingMediation





© SAP 2008 / Seite 19

What is RMCA and how is i t in t egrat ed?

FI /CA – Financ ia l m anagem ent /Con t rac t acc oun t ing

Pre-audited Multi-currency SOX readiness Business process templates

ConvergentBilling &EDR Manag.

Customercreation/updates

Bill loading

Handling ofPayments,ReturnsRevenue

distribution

Instalm. plan,Securitydeposits

Promise2PayDeferrals

Dunning&Collection,Collection

agencies

GL Recon-ciliation &Reporting

BillingRatingInvoicing

CRMMDMBilling

PaymentgatewayCRM (FCC)

Cash manag.

CRM (FCC)

Credit Manag.CRM (FCC)DecisionEngines

CollectionAgencies

GeneralledgerControlling

Reportnng



© SAP 2008 / Seite 20

Exam p le of a dunning p rocedu re

Procedure 01Business customer low risk

Level 1 Level 2 Level 3

SMS

> $0 > $150

low risk high risk

worklist

letter

> $0 > $300 > $900

letter

low risk high risk

call call discon

> $0 > $900

discn CA



© SAP 2008 / Seite 21

Bus iness Ru les Conf igura t ion

Collections Management /RMCA

Business Rules Framework (BRF)

Master Data

Contract Account

Collection Strategy Event Rule SetMapping

Rule 1

Rule x

Action 1

Action x

Return result

Expression

Decision tree Request context value Range expression Case expression Boolean expression Truth table Formula editor Function module

…

Allows for dynamic evaluation of any parameter Is typically configured by the business user

Supports linear as well as decision-tree based

strategies Logic can be displayed and configured in a user-

friendly way No programming required

Next collection step Ranking of activities Message



© SAP 2008 / Seite 22


AccountsReceivables


Management


SAP

EDR

Billing

SAP

Convergent

Invoicing

SAP

Revenue

Management

Contract

Accounting

SAP

FinancialCustomer

Care

SAP

Electronic

Bill Presentment

and Payment

SAP

Credit

Management









© SAP 2008 / Seite 23

SAP Financ ia l c ust om er c are

The SAP Financial Customer Care is a user friendly web based interface for

SAP RMCA incl. dispute management and FCC functionalities. The SAP FCC

for provides a 3 60 de gre e vi ew o f t h e c u st o m er ‘s f in an c ia l situation

and supports the following functionalities:

Account and invoice display

Payments (search, clarification, incoming & outgoing payments)

Financial disputes & Credits

Promise-to-pay, Installment plans & Deferrals

Security deposits

Collection Management

Correspondances

Interaction history, Follow ups, Notes, Workflows, …

… and a lot more …Collection

Scenario 1



© SAP 2008 / Seite 24 © SAP 2007 / Page 24

XI response Bonus points

miles, freeSMS, and so on

Balance type

Amount

Currency code

Bi l l ing Dat a In tegrat ion

CRM query Amount

Businesspartner

Businessagreement

Uniqueservice ID

Telco contract

External billing system External billing system

I n te rac t i on

Center

SAP CRM2007

SAP NetWeaverExchange

Infrastructure



© SAP 2008 / Seite 25

Business Proc ess Areas in Col lec t ions

Management

Batch Work/Mass activities

Manage CollectionsWork Lists

Process CollectionsWork Items

Today• RM-CA classical dunning based

on dunning procedures

New (EhP2)

• Dunning by collection strategy;dunning strategy and rankingrules are modeled in BusinessRules Framework (BRF);

• Evaluation of P2Ps

• Evaluation of collection success(per master data entity andcollection step)

New (EhP2)

• Maintenance of rules forautomatic assignment of workitems to teams/ agents

• Worklist management

• Release of dunning activities

Today• ICWebClient for processing

incoming/ outgoing calls

New (EhP2)

• ICWebClient for CollectionAgents provides all data andfunctions for collectors

• Full view of customer andaccounts

• Create/ change promise-to-pays

• Collection fact sheet

• Extended collection history

Analyze

Today• A variety of BI content

available

New (EhP2)

• Additional BI contentcoming

• Collection Success permaster data entity andcollection strategy/step

• Efficiency of collectors

• Promise-to-pay analysis

Collection

Scenario 4



© SAP 2008 / Seite 26

The Disput e Case

Contains a lot of information

Customer master data

Disputed items and amounts

Status

Related documents, order/contract data

Notes, history, change log

The Dispute Case is a virtual folder which providesall relevant documents and objects

Allows to trigger actions, e.g. ad-hoc or automatedcorrespondence

Option to create a credit note or an adjustment requestwith relation to the Dispute Case

Provides routing capabilities and escalations



© SAP 2008 / Seite 27

The Disput e Case



© SAP 2008 / Seite 28


AccountsReceivables


Management


SAP

EDRBilling

SAP

ConvergentInvoicing

SAP

Revenue

ManagementContract

Accounting

SAP

FinancialCustomer

Care

SAP

Electronic

Bill Presentment

and Payment

SAP

CreditManagement









© SAP 2008 / Seite 29

The Bi l ler Direc t – a Cust om er Sel f Serv ic e

Plat form



© SAP 2008 / Seite 30

Value propos i t ion CFM

Improved first-call-fix rate for financial inquiries and disputes

360 degree customer financial view for the contact centre agents usingreal-time information from SAP RMCA (FI-CA)

Consistent financial dispute communication with customer as well asacross department boarders

Easy to understand application – less trainings efforts by using e-learningtools, interactive scripting and integrated knowledge management

Pre-defined integration with CRM applications and other legacy systemsusing SAP XI leads to lower implementation cost and lowers the TCO

Reduction of DSO due to highly efficient collections functions

Support of multiple languages company specific terminology

Out-of-the-box Integration to other components allows for lowimplementation cost and productive work environment



© SAP 2008 / Seite 31

Dank e für Ihre Aufm erk sam k e i t !



© SAP 2008 / Seite 32

Contac ts

Michae la Kresak

Principal Business ConsultantCommunication, Utlities & Service ProviderSAP Business Consulting EMEA

SAP (Sw it zer land) Inc .

Althardstrasse 80CH – 8105 Regensdorf

M +41 79-820 24 48E [email protected]

http://www.sap.com

