Fail fast and fail often

The announcement by Ericsson of the complete write down of its next generation BSS “Revenue Manager” and a refocus on its legacy BSS did not surprise us. Ericsson deserve credit for biting the bullet and effectively discontinuing “Revenue Manager”, even if it’s possibly two years late.

Appledore believe that the lessons from this are widely applicable. As an industry, we need to stop assuming that “Tomorrow looks like today” and need to create a culture of challenging ideas and avoiding internal “group think”. Active questioning of business model (in response to changes in the market and customers willingness to adopt change) needs to be encouraged and we need to reward willingness to “fail” innovation early. There is a wider industry opportunity to learn from this beyond billing and Ericsson. In areas like “Customer Experience” or 5G the same risks of assuming historic CSP business models and group think apply. We need to avoid these becoming like Revenue Manager.

The anticipated customer demand for a full-stack pre-integrated BSS solution has not materialized.

We have been tracking the progress of “Revenue Manager” for 5 years and even early on we believed it was targeting a business need that was disappearing. Revenue Manager made business sense, at the time it was conceived, based on a view of historic CSP billing practice, need and approach continuing in the future. Ericsson wrongly assumed that CSP billing would:

  • continue to be charged on the basis of usage
  • continue to be complex
  • require new combinations of pre-paid and post-paid services
  • continue to have the CSP own all customer interaction
  • continue to have the CSP take the lead role in aggregating/bundling customer value add services (VAS).

It also assumed a customer desire for big system transformation/replacement rather than incremental additions to existing systems.

Billing system re-written in Java

Ericsson built a cloud system for last decade’s complex billing market. Instead, billing has become simpler, with all you can eat plans; CSPs have generally lost VAS to OTT;  billing is increasingly limited to phone, text and data, with existing postpaid or pre-paid systems supporting these more limited needs. And for those lucky enough to embark on transformation to a new system the program becoming increasingly focused on replicating the existing legacy systems and billing plans; lots of transformational cost and no use of new features.

CSPs and suppliers alike must think about how tomorrow is different from yesterday and plan for that reality.

Image courtesy of prieb