How to Extend the Life of Legacy Billing Systems

cloud-based-software

Last month, I wrote about the reasons why traditional on-premises billing platforms don’t make sense in today’s non-stop business environment. While those legacy platforms can process large volumes of transactions very quickly, they do so at the expense of the agility necessary to meet today’s rapid time-to-market demands for new product offerings.

Businesses often need to respond to competitive pressures within days or even hours. Consumers want new products and services more frequently and they demand offers that are tailored to their specific needs. That can mean offering a nearly identical service ten different ways at 20 different price points to appeal to hundreds of different buyers.

Many businesses, particularly in the telecom industry, are finding themselves burdened by legacy billing platforms that require coding and heavy IT intervention to introduce new offers, bundles, and promotions—which can take months. They have a few options:

  1. Keep doing the same thing and face disruption
  2. Rip and replace existing BSS systems
  3. Augment existing systems with a SaaS monetization platform

Choosing the first option is probably a career-ending move. The second option could cost tens or even hundreds of millions of dollars—good luck getting that approved. On top of that, the risk of business disruption from a rip-and-replace is very high both for customers and for operational staff. I worked on a rip-and-replace a few years ago—it was a year late, and to this day no one knows what it actually cost. A rip and replace project will usually outlive multiple CIOs, and you don’t want to be one of them.

The third option is to adopt a bi-modal architecture strategy in which a new agility layer—in the form of a SaaS monetization platform—manages the monetization of new business offerings and new lines of business, while leaving existing business on the legacy BSS system. This is a “cap and grow” strategy, which caps the footprint of existing on-premises solutions and allows new business to grow on the more agile cloud-based platform.

The agility platform must easily integrate with legacy systems that manage the core business and serve as the system of record for customers, finance, and order management. That requires a robust set of APIs and standard connectors that make it easy to link with existing systems like CRM, e-commerce platforms, ERP systems, etc., and that readily support architectural solutions like Enterprise Service Bus (ESB), which makes it easier to move data between platforms.

The agility layer option recognizes the value of  investment in legacy systems. It allows you to leverage the best of what you already have in place while taking advantage of the increased agility that SaaS providers can deliver. It allows you to layer your solution, starting with new business or a pilot that can help you minimize and contain the risk of a new software deployment, allowing you to meet the needs of new products and new lines of business without putting existing revenue streams at risk.

You don’t need to be a global communications service provider to take advantage of a layered monetization solution. Virtually any established business transitioning into digital products or recurring revenue streams could benefit from adding an agility layer to their existing on-premises solutions. In my next post, I’ll provide some examples of companies across multiple industries taking advantage of this approach.