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April 12, 2022

How to speed and improve quote-to-cash in communication services

In a world accustomed to immediate turnaround, a lengthy quote-to-cash process is costing communication service providers opportunities — and revenue. We offer tips on implementing a genuine overhaul for the digital age.

Like companies in most industries, communication service providers (CSPs) consider quote-to-cash (Q2C) turnaround time a key metric when assessing the efficiency of both their business operations and customer experience. CSPs are investing in shrinking Q2C cycle time — but in most cases, they are doing so on a piecemeal basis, without a big-picture plan.

In this highly competitive space, our CSP clients tell us they are losing revenue, especially in the B2B space, due to declining legacy network demand (as customers switch to networking-as-a-service, or NaaS); pricing pressure from competitors; growing threats from alternative providers; and high customer churn.

Some of this churn can be traced back to the outmoded processes that result in the painfully long lapse between a prospect’s initial interest, the time the order is completed, and the first bill is paid. CSPs tell us Q2C turnaround time is now anywhere from six to 30 weeks, depending on region (Asia-Pacific is slower than North America), the size of the CSP and order complexity. This is unacceptably slow in today’s world.

Given these challenges, as well as other factors (the growth of hybrid/remote work, for example, and the adoption of the Amazon “I want it tomorrow” mindset in not just the consumer space but business as well), CSPs are compelled to improve Q2C.

We believe CSPs need a better plan to reduce Q2C, one that automates processes that currently rely on overworked sales reps and customer service reps. Through straightforward applications of artificial intelligence (AI), machine learning (ML) and application programming interfaces (APIs), we’ve helped CSP clients achieve myriad gains, including the following:

  • Increase in sales (typically 1% to 5%) by allowing customers near-real-time access to multiple quotes; real-time discounts and promotions; and on-demand customized or bundled product offerings.

  • Cost savings (typically 15% to 35%) through self-service options for B2B customers, enabled by automation, which reduces back-office efforts. Savings also come from digital contracting; remote provisioning; zero-touch collaboration; and a drop in pricing and billing errors that in turn reduces the number of iterations required for a single order.

  • Improved ROI (typically 5% to 10%) through reduced Q2C turnaround times.

  • Better cash flow (typically 15% to 20%) due to decreased time for revenue realization and reduced working capital.

  • Improved customer satisfaction (typically 20% to 30%) by allowing B2B customers to meet rapidly changing market demands and empowering them to operate with anywhere/anytime business models, thus reducing customer churn.

The six touchpoints

Through our large-scale modernization engagements with top CSPs across regions, we’ve identified six key Q2C touchpoints and bottlenecks, all of which can be improved through automation. In the below figure we note the current state of each touchpoint and explain how APIs and AI/ML can reduce turnaround time for each, resulting in dramatically reduced Q2C and a better customer experience.

Touchpoint: Presales and sales process

Problem: These crucial initial steps have remained virtually unchanged for decades. Prospects call a human sales agent to discuss company needs. The sales rep pulls data from internal systems and may offer a ballpark quote, but that quote is very approximate, subject to major changes (more on that in the touchpoint below). Thus, right from the start, prospects — who, both as businesspeople and consumers, have grown accustomed to easy self-service quotes and encyclopedic product information — are subjected to an antiquated process that puts the CSP in a poor light.

Solution: To remain competitive, CSPs must shift from sales-rep-driven quoting to self-service, providing instant quotes and offering products and services in near-real-time. This will require AI- and ML-enabled processes. The product catalog should be federated and intent-based. In the complex world of B2B provisioning, there is no such thing as one-size-fits-all pricing, and the product catalog must allow for this and for dynamic bundling. Going forward, CSPs cannot make seat-of-the-pants, last-minute decisions on how to price product offerings. Rather, there must be a layer of consistency to ensure bundles are appropriately priced and offered. One of our clients is achieving this through a federated catalog, which combines wireless and wireline product and service offerings. 

Benefits: A self-service product selection, configuration and quote process not only dramatically reduces overall Q2C time, but also improves the customer experience by meeting their expectations, getting the relationship off on the right foot.

Touchpoint: Delivering the instant quote

Problem: Simply put, speed is a major problem with the traditional model. After accessing internal data to create a quote, the sales rep runs that quote through appropriate channels for approval, which typically entails changes. When the quote is finalized and approved, it’s emailed to the prospect. Our CSP clients tell us the typical time lapse between initial call and quote delivery is five to 15 days. To today’s professionals, that’s an eternity. 

Solution: CSPs should pull as many variables as possible into a single database that can be instantly and intelligently searched in self-service mode. For services and locations on the CSP’s own network, this is a straightforward project. In cases where the CSP must purchase services from other providers’ networks, APIs must connect to those providers to ascertain their prices, after which algorithms determine the appropriate end-customer price. 

Benefit: Just as speed is the problem, so it is the benefit. The goal is to reduce the sales cycle, which may take up to six months in some regions. It’s axiomatic that closing quicker is better. As CSPs embrace the digital future, those that can present a quote instantly will capture significant business from slower competitors; a rapid quote is a must-have for today’s business customers due to dynamically changing market conditions.

Touchpoint: Order

Problem: Today, the period between an initial quote and the beginning of the provisioning phase typically takes one to three weeks for an existing CSP client, and even longer for new clients. Much of this time is devoted to checking the client’s creditworthiness, negotiating and finalizing the contract. One of our CSP clients tells us contracting includes over 200 “fallout” scenarios. Most of these are handled manually, often on a case-by-case basis. Naturally, this step is quicker when an existing client is renewing — much of the spadework has already been done. 

Solution: All possible scenarios populate a database, after which algorithms model various scenarios. With the applicable data in place, a straightforward dashboard replaces the laborious manual examination by a contracting agent. That dashboard features a series of colored indicators. For example, green means there are no impediments, yellow indicates areas requiring further investigation and red signals a serious issue. 

Benefits: Automating this post-quote/order process can reduce it to near-real-time. This phase can shrink to one or two days for existing clients with the help of 100% digital contracting and automated compliance and credit checks.

Touchpoint: Order status

Problem: After placing an order, customers face a relatively long period of radio silence while their case bounces around inside the CSP, as noted in previous touchpoints. Clients seeking updates must call their sales rep, who must in turn go to various departments to grab the necessary information. That simply won’t do in today’s world, in which consumers and businesses are accustomed to order transparency and frequent status updates. CSPs risk losing business as customers second-guess orders or suffer buyer’s remorse.

Solution: We are implementing real-time notification for our CSP clients. Through APIs, customers are updated at each step of the process (through URL, email or text) as their order moves from contact to quote to acceptance to provisioning.

Benefits: When they receive reassuring notifications on the status of their project, customers are less likely to bail and seek another provider. Additionally, automation frees sales reps to devote their time to new business and other tasks with a higher value-add.

Touchpoint: Provisioning/service delivery

Problem: The sheer number of vendors and associated legacy systems makes provisioning a tangled web of logistics and manual labor for CSPs. Simply laying a last-mile wire may involve dozens of calls and emails to suppliers as inventories and schedules are checked, bids made and accepted, etc. It’s not uncommon for a large-scale project to require two to six months in this phase.

Solution: As with the order-status touchpoint, the solution here revolves around letting the CSP’s systems communicate with vendor systems through APIs, a process dubbed zero-touch partnering. We’re helping some of our CSP clients do exactly this. Vendors provide APIs that allow the CSP to look into their systems to see if and when the vendor has all specified equipment. With this data quickly available, a manager gets the all-clear to provide an accurate estimated time for fulfilling the order with a high level of confidence.

Benefits: It’s important to note that the provisioning process, even when automated, is marked by a certain level of unpredictability — weather and natural disasters made pinpoint precision impossible even before the pandemic. Nevertheless, a few of our CSP clients expect to realize a 50% reduction in provisioning time, from three months to one and a half, by enabling just moderate levels of zero-touch partnering.

Touchpoint: Billing

Problem: In a word, the problem is accuracy. As all CSPs have learned, it’s a challenge to get billing right with a new order, often because upstream changes aren’t factored into the statement delivered to the customer. As it stands today, these inaccuracies lead to flurries of phone calls demanding customer service time and rework in multiple departments.

Solution. AI and ML can do a lot to minimize billing inaccuracies for both new customers and renewals. For multinational organizations, varying taxes and fees are a major source of mistakes, and AI systems properly populated with data can eliminate problems here. Intelligent systems also ensure that any changes made via self-service are factored into statements.

Benefits: Billing errors lead to upset customers and frazzled customer service reps; streamlining this area helps a CSP on several fronts. Intelligent billing systems have the added benefit of offering promotions based on a customer’s history and enabling one-click renewal.

This article was written by Pankaj Galdhar, Peter Prakash, Naresh Nirmal & James Backer of Cognizant’s Communications, Media and Technology (CMT) Consulting practice.

To learn more, visit the Communications, Media & Technology section of our website or contact us.

Cognizant Insights Team

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