Large Telecommunications Company Gains Full Customer View, Boosts Monthly Revenue, Cuts IT Costs by $3 Million

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1 Microsoft Business Intelligence Customer Solution Case Study Large Telecommunications Company Gains Full Customer View, Boosts Monthly Revenue, Cuts IT Costs by $3 Million Overview Country or Region: United States Industry: Telecommunications Customer Profile This large United States based telecommunications company is a leading provider of long-distance, broadband, wireline, and wireless communications to businesses, government, and individuals. Business Situation Telco needed to centralize and update a business intelligence system that isolated data in separate systems and was reaching the limit of its scalability. Solution The company adopted data warehouse and analysis technology from Teradata and Microsoft, combined with a custom application called PARS. Benefits A single, full customer view with better, faster data Data-driven decisions that boost revenue per customer per month Savings of U.S. $3 million in resources and fees over four years With PARS, Teradata and Microsoft are able to extend business intelligence to the people in the company who need it most. We can give them the right information, right away. Vice President Sales & Marketing Systems, Telco When this large telecommunications company was formed from the merger of two companies, one of the less visible but more challenging parts of the merger concerned integrating the residential wireline information systems of the two companies. They ran on different hardware, different operating systems, different database management systems, and different applications. After the merger, the company was operating with separate data systems that were difficult to integrate and impossible to use for enterprisewide business intelligence (BI). With the need for BIsupported decisions increasing, the company turned to Microsoft and Teradata, a Microsoft Gold Certified Partner. The combination of a Teradata data warehouse, Microsoft SQL Server 2005 analytic and reporting tools, and a custom application has revolutionized business intelligence in the company. Marketing groups now have a more full view of customers and their relationships with the company, so the company is able to make better, data-driven decisions. Business results of its investment are very good, with U.S. $3 million of IT department savings over a four-year period.

2 In the largely decentralized environment, each of the company s regions had its own ways to store and report information, making it difficult if not impossible to compare the successes and challenges of the regions. Situation One of the less visible but more challenging parts of the merger of two telecommunications companies into one of the largest in the nation concerned integrating the different information systems of the two companies. They ran on different hardware, different operating systems, different database management systems, and different applications. It wasn t just the lack of a centralized data warehouse solution that made analyzing and using the company s information difficult. In the largely decentralized environment, each of the company s regions had its own ways to store and report information, making it difficult if not impossible to compare regions. Product lines were reported in separate systems that didn t connect to each other, adding to the difficulty of understanding the components of a region s overall status and of keeping track of the overall set of products and packages sold to individual customers. Because of the separate and often redundant data stores, information was often difficult to access, out of date, and inconsistent. The newly formed company began to address this problem by bringing much of its data about 70 terabytes into a single, integrated enterprise data warehouse using solutions from Teradata, a Microsoft Gold Certified Partner. The data warehouse solved the company s data management and analytics challenges and allowed it to aggregate and analyze data across departments, making it possible, for example, to view product sales across regions and by customers. As the data warehouse matured and more and more users were added to the system, it became essential for the company to be able to deliver the business intelligence to all business users. The company also wanted to meet emerging user requirements for simpler, faster, and more user-friendly ways to access and analyze the information. No longer solely a provider of landline voice communications, today this company offers local and long distance, broadband, wireline, wireless data and voice communications services, and more. Moreover, the company focuses not just on selling single products, but also on selling bundles that is, multiple products and services to customers at reduced rates. That makes it crucial to understand which bundles are the most profitable, which produce the most customer loyalty, and which produce the most churn, or loss of customers. Without the ability to link customers to its products, the company lacked this essential element of business intelligence. Solution The telecommunications company made its first move to add business intelligence to the data warehouse by turning to multidimensional, online analytical processing (MOLAP) technology. MOLAP functions by moving information from the data warehouse into separate, smaller databases, called cubes, which are especially designed for analysis of relationships among the data. The chief advantage of MOLAP is the relative speed with which it can respond to a query, because data is already organized for analysis. The chief disadvantage of MOLAP is the time it takes to move data into the cube and to process it so that the cube can respond to queries.

3 Instead of replicating the data from the data warehouse, ROLAP keeps the data largely within the data warehouse, and it uses data warehouse processing power and high-speed connectivity with the client application to deliver BI results to business users. That key disadvantage soon overwhelmed the advantages. Given the massive amounts of data that the company analyzed, users began to ask that more and more data be added to the cubes. That increased the time needed to process queries, defeating the central benefit of the technology. Moreover, lengthy data transfers into the cubes ran late into the night and, at times, into the morning, leaving employees without access to analysis during the early part of the business day. As the company sought to add dimensions to the cubes to attain increasingly refined analysis, the queries became more complex and the response time lengthened. Ultimately, the cubes reached their limitations and the company could no longer add more dimensions. The company realized it needed to replace the MOLAP structure. The next option was to adopt a relational OLAP (ROLAP) implementation for its Server Analysis Services. Instead of replicating the data from the data warehouse, ROLAP keeps the data largely within the data warehouse, and it uses data warehouse processing power and high-speed connectivity with the client application to deliver BI results to business users. ROLAP eliminated the lengthy and increasing data transfer times that the company experienced between the data warehouse and the cubes. It also virtually eliminated processing time within the cubes. Because all of the data warehouse s information was available through the ROLAP cube, the technology makes it possible to analyze the data more thoroughly. And the ROLAP approach had benefits for the Telco IT department as well: less hardware to buy, configure, and maintain over time. The company developed a custom application based on ROLAP: the Performance Assurance Reporting Suite (PARS), which works with the existing data warehouse, on high-speed Dell PowerEdge 6850 server technology. PARS combines information on customers from landline, DSL, VoIP, fiber, and video billing systems, as well as data sources on demographics, operations (such as fiber availability), and competitive losses and gains. The solution uses Microsoft SQL Server 2005 data management software in several ways. SQL Server Integration Services loads the data to the Teradata warehouse. SQL Server Analysis Services provides the ROLAP cube structures so that front-end applications can drill down and perform what-if? scenarios. SQL Server Reporting Services delivers 37 standard reports that users can access through mechanisms ranging from e- mail to Web-based, Microsoft Office SharePoint portals and various Microsoft Office document formats. Users access PARS through the company s custom user interface (UI) for the solution. This provides all users with a single, personalized, consistent way to access information. PARS is one of 30 applications that technical and non-technical users can access via the custom UI. PARS takes advantage of one of the most valuable corporate assets at the company an understanding of its customer base by using the brute force of Teradata along with the custom UI. Using PARS, the company can determine what types of customers are likely to purchase ideal product sets.

4 The new solution has significantly reduced the lag time in getting new information into the warehouse from 45 days to the next day so current information is available to personnel more quickly. Furthermore, PARS provides insight into the combination of product sets that are ideal for mitigating churn. This large Telco continues to evolve PARS. As more personnel use PARS for more types of analyses, the number of dimensions to slice and dice the data has grown by 600 percent. The company plans to enhance PARS with Excel Services for Microsoft Office SharePoint Server 2007, so that users will be able to work with PARS data in the familiar Excel format regardless of whether they have Excel running on their local machines. Benefits PARS allows the company to dramatically alter business practices. Queries are not only faster, they are more intelligent, and the results promote a level of strategic thinking that generates business value far greater than the cost of the project. A Full Customer View with Better, Faster Data With PARS, Teradata and Microsoft technology, the company has succeeded in creating a more holistic view of the all of the customer s relationships with the company. Not only is more information available, but it s available to business users more quickly. The new solution has significantly reduced the lag time in getting new information into the warehouse from 45 days to the next day so current information is available to personnel more quickly. Their queries are answered more quickly, too; the process for answering business questions has changed from weeks, days, and hours of data gathering and manipulation to minutes and seconds of points and clicks within the application. The ability to standardize information that is now kept in a single, comprehensive data warehouse as opposed to the isolated data silos used before means the Telco also has better information. For example, the company now has its first enterprisewide definition of churn, which has improved the tracking of this key metric. With PARS, Teradata and Microsoft, we are able to extend business intelligence to the people in the company who need it, says the Telco s Vice President of Sales & Marketing Systems. We can provide the right information, right away. That makes the system infinitely more valuable to them than it was before. Data-Driven Decisions That Boost Revenue per Customer per Month Much of that greater value comes from the ability of the company personnel to use PARS analysis to make better datadriven decisions than they could before. Many groups within the company have reaped the benefits of PARS usage, including Marketing, Finance, Performance Assurance, Campaign Management, Product Lifecycle Management, and the Winback and Retention teams. PARS is a unique application, says the Director of Marketing Support at the Telco. Not only can employees get answers to their questions, such as How many customers have our high-speed Internet at home? They can also ask more intelligent questions How many customers have our high-speed Internet and digital TV, and are they interested in additional services? and act on the results. Employees spend less time gathering data and more time engaging the data through meaningful collaboration and analysis.

5 Marketing has seen the greatest gains from PARS, The Director of Marketing Support continues. The department can compare and incorporate data across regions and products, giving them the ability to create strategic, targeted campaigns based on product bundles. The application is now indispensable for many kinds of marketing analysis. PARS tracks the movement of combinations of products down to the wire center level, which means that product developers can design new packages and bundles and track their effectiveness. For example, the Midwest region concentrated marketing efforts by examining a combination of bundle penetration, demographics, customer revenue, and competitive losses. The solution has helped increase revenues by helping to save potential customer loss to competition. This translates into a huge increase in revenue for the Telco, according to the Senior Consultant Product Management/Product Development, Retail Markets Finance, at the company. There s no better proof of the business value of a solution than increased revenue and PARS delivers. licensing fees and maintenance over a four-year period. It also has reduced data preparation time by 90 percent. Part of that resource savings comes from reduced development and support costs. The MOLAP system required its own dedicated database and storage. PARS reduced costs by operating from shared data on the enterprise data warehouse and saved 56 percent of the overall storage space by operating under the ROLAP model. Before adopting ROLAP, monthly incremental updates and full refreshes of the MOLAP cubes were taking increasing amounts of time. The ROLAP implementation reduced incremental update times by more than 94 percent and reduced full refreshes by 99 percent, increasing application availability and reducing system overhead. In all, the Telco considers PARS to be a solid contributor to its goal of increasing customer revenue. It has also increased campaign response and close rates, and increased noncampaign strategic product sales. Savings of $3 Million in Resources and Fees over Four Years By building its own application, the company has saved approximately U.S. $2 million in resources and $1 million in

6 For More Information For more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) In Canada, call the Microsoft Canada Information Centre at (877) Customers who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) in the United States or (905) in Canada. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to: Microsoft Server Product Portfolio For more information about the Microsoft server product portfolio, go to: For more information about Teradata products and services, visit the Web site at: Software and Services Microsoft Server Product Portfolio Microsoft SQL Server 2005 Technologies Microsoft SQL Server Analysis Services Microsoft SQL Server Integration Services Microsoft SQL Server Reporting Services Teradata RDBMS Rel. 6.2 Hardware Teradata 5550 Data Warehouse Dell PowerEdge 6850 server computers Partners Microsoft Teradata This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. Document published February 2010