Use Blockchain to Optimize Carrier Performance

Blockchain is an electronic system for managing distributed databases or ledgers, which are then shared across participant approved network nodes. In the telecommunication service provider space the underpinning implications are vast.  Today, Blockchain participants can exchange order requests, have said orders managed by governing and immutable Smart Contracts and issue trouble tickets with corresponding SLA enforcement.

Sage Management SVP of Blockchain, April Taylor, understands. An expert on telecommunications ordering / billing / network inventory / contracts / blockchain, Taylor has been in the industry for over 20 years. In her current capacity, she has successfully identified and negotiated more than $250 million in telecom disputes. At the same time, she has implemented complex blockchain deployments for global carriers by creating a rated embedded base of circuits to elevate beyond a simple inventory exercise, to enable real-time-rated ordering all governed by supporting blockchain contracts.

While blockchain has become huge, it’s arguably one of those industry terms that not everyone totally grasps. Can you provide some guidance?

April Taylor: Blockchain is just one example of a Distributed Ledger Technology, or “DLT.” DLTs offer a digital system for recording transactions – think Ethernet and dark fiber – and their details concurrently in multiple places, or “nodes.” You’ll need peer-to-peer networking and a consensus algorithm to guarantee replication across those nodes, according to Metro Ethernet Forum (MEF) guidelines.

In our experience, most early blockchain adopters point to consensus and immutability as two immediate draws to make the change.  These inherent attributes eliminate costly dispute processes and improve financial assurance. Blockchain has been amazing for the telecom sector and we are always looking to expand its applications with the help of our current client base, prospects, partners and advocacy groups such as the Metro Ethernet Forum (MEF).

What sort of obstacles do today’s carriers face when migrating to blockchain?

AT: There are a few, but none are insurmountable. There’s the availability of an accurate circuit baseline with corresponding, real-time rated ordering. Carriers do not want to place inaccurate records on an immutable ledger.  Some carriers need additional software tool enhancements to succeed, one being the absence of a singular supporting order-generation software. There are also privacy concerns, as can be the case whenever information is remotely hosted and exchanged.  Finally, there’s the issue of providing proper resources to staff to assist in their education, training and understanding.

How can today’s carriers overcome these issues?

AT: Ah, the million-dollar question. First, overcoming obstacles can be made easier if you have the right plan and call on a subject matter expert to assist with developing said plan.  That’s where blockchain technology enablement firms like Sage Managementcome into play.  The first key step in any Blockchain deployment, is creating a rated embedded base of existing circuits and from there implementing rated real-time ordering.  Second, align with a SaaS provider if you don’t have the software solution to support single sourced ordering. This solution will consolidate multiple underlying supplier portals into one single pane of glass.

Finally, from a security standpoint, information is retained on a shared, permissions-based, continually reconciled database, thus keeping the data available and verifiable. Plus, no centralized version of your records are kept, accounting for replication and resiliency.

Finally, research available education and training resources. We recommend consulting MEF,  collaborating with current MEF members (such as Sage) or even calling on university level courses offered in Blockchain. 

Last question, but it’s a big one. How can you assure a positive blockchain deployment outcome?

AT: It’s a three-pronged approach, basically, focused on operational efficiency, financial benefit and customer service. In terms of operations, blockchain supports carrier-to-carrier order exchanges, ticket placement and SLA enforcement as well as eliminates swivel chair data entry associated with invoice generation. Blockchain allows for more efficient digital or tech enabled operations, thus helping simultaneously streamline people, processes and tools.

Another key focus is financial benefits. You can reduce claims, back-billing risk and accrual issues by accurately recording services and eliminating unauthorized changes. Blockchain can also serve to automate audits – from invoice to order fulfillment. This serves to bolster financial assurance and help accounting teams to focus on other core areas.

An additional financial benefit is improved mean time to revenue.  In our experience, one out of every five orders have an error that would materialize on the billing end. Blockchain’s ability to standardize order exchange data helps identify and correct said issues in advance of the invoice being issued.

There’s also SG&A (selling, general and administrative) expenses to consider. You can improve your gross margin by phasing out costly legacy systems in place and lessening ordering / billing inaccuracy impact.

Lastly, there’s the customer experience (CX).  By improving service delivery intervals and maintaining the accuracy of orders, the customer experience naturally benefits.

In closing, with Blockchain services from a company such as Sage, you’ll ultimately be better equipped to embrace financial and operational efficiencies, thus helping you to reallocate your human capital to better focus on CX.

And while all of this may seem like no big deal, it certainly is. This area (blockchain) of Sage’s operations has resulted in more than $4 billion in realized savings over our 18 year history.

For more information on Sage Management and how its blockchain services can optimize carrier operations, visit www.sagesemi.com or call (703) 999-6203.