MarketBite

Steps to Greater ROI in the Cloud

Posted on: November 11, 2011


  • Ensure that monetization reflects the underlying business agreements. Monetization is increasingly challenging as organizations create services and products built on more and more complex models featuring interrelated, multiparty relationships. The ability to easily translate business terms into automated action, build complex agreement rules by composing reusable slices, and to track and fulfill obligations across all parties are now all table stakes for an enterprise-grade cloud monetization solution. Further, the impact of the social enterprise is being felt in the form of customer self-care via Web 2.0+ and dashboard-driven business intelligence (BI) and analytics. An agreements-based billing (ABB) and compensation solution contains the financial state of agreements between customers, suppliers and partners. It is required to feed online portals and business intelligence.

 

  • Pay attention to cloud chargeback. Sharing resources to maximize their utilization and to raise infrastructure ROI is not a new concept for financial services companies. IT has long been a service provider for lines of business, sharing common resources among a number of internal customers. The financial crisis has further accelerated the need to look at infrastructure options that enable companies to remain competitive and decrease the costs of IT infrastructure. The economics of a resource-sharing model that enables on-demand IT resource delivery without additional capital expenditures is hard to ignore. An ABB solution is required to support sophisticated chargeback across the organization for cost containment and profitability analysis, and to handle billing and compensation for situations where the enterprise is bursting between private and public clouds.

 

  • Do not hinder new services. The increasing number of financial services made possible as result of the cloud include mobile financial services, microfinance and mobile money offerings for small and medium enterprises (SMEs), data as a service, and data-on-demand approaches that use the cloud to reach new customers and monetize underutilized data assets to bolder IaaS offerings from exchanges such as NYSE. The latter provides a glimpse of the long-term potential to become a cloud provider for financial markets. The community and unique technology needs within the financial services industry make more generic clouds less compelling for Wall Street. The complexity of right-billing customers takes on new meaning. Billing solutions that emerge from the business-to-consumer environment lack the sophistication to support these new service models.

 

  • Embrace transparency to ease compliance processes. Regulations are far reaching and include the need to preserve historical data for certain periods. The billing solution may also need to provide information on how fees were calculated across parties (monthly charges for debit cards and online banking charges). ABB simplifies calculations, supports auditing and eases understanding of the state of agreements across many interrelated relationship models.

 

  • Recognize that monetization is bigger than billing. Exploiting the ROI potential of the cloud means being able to do more than simple digital invoicing. Online customer care and stakeholder compensation count as well, as does revenue sharing, remuneration and settlement, pricing, bundling, discounting and promotional demands. Monetization must also let users negotiate value from all customers while reducing day sales outstanding (DSOs), improving customer care and winning new business through the ability to individually tailor contracts.

 

  • Take advantage of expansion and globalization opportunities. When organizations move toward ABB for cloud-delivered services, they also gain benefits that grow business. The first involves flexibility. Companies can quickly model any new business requirement, thereby reducing the time and cost required to go to market. And, with multilingual billing and communications functionality built in, institutions can manage agreements in dozens of countries with multiple languages, currencies, tax codes and regulatory requirements with ease. Adding this ability to an in-house legacy system can be a slow, costly and difficult process.

 

  • Don’t abandon your legacy investments. While legacy systems can’t support some of the innovations the cloud can enable, financial institutions don’t need to scrap everything they have. Most will have numerous enterprise applications and more than one for billing. These need to be integrated with other software components to create a complete solution. That integration should be seamless, but it should not require a business to completely rip and replace existing technology investments.
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