AT&T needed to move at lightning speed when its $48.5 billion deal to buy DirecTV closed in July last year, but it also needed to make sure that subscribers from both companies didn't feel any merger-related pain.
AT&T Inc. (NYSE: T) had Pam Parisian, chief information officer for mobile and business solutions, on hand to make sure none of the balls were dropped during the transition. In addition to merging the IT functions of AT&T and DirecTV Group Inc. (NYSE: DTV), Parisian's merger integration experience included bringing BellSouth Cellular and SBC Wireless together, as well as pooling the assets of AT&T and Cingular Wireless.
While AT&T's previous deals were more about adding voice services, the DirecTV purchase meant merging with a large video provider. Within a few days of the deal closing, AT&T rolled out a new wireless and video bundle and merged the customer information from AT&T and DirecTV into a single data warehouse. (See What's Next for the New AT&T? )
AT&T equipped the sales reps with a new software app for a single point of sale for the wireless, video and broadband services, and, on the backend, provided a single bill for customers across the range of services and new bundles.
AT&T also tapped into technology by using an HD video conferencing system, which it called "wormhole," to work virtually face-to-face with its DirecTV counterparts.
While Parisian led the integration charge from the AT&T side, Mike Benson was her CIO counterpart at DirecTV.
The integration project included more than 3,300 IT experts from both companies that clocked a cumulative 2 million hours writing and testing code across 200 apps.
Parisian, who has been inducted into the Women in Technology Hall of Fame, provided more details on the IT merger effort with DirecTV during an interview with Telco Transformation.
Telco Transformation: Did AT&T and DirecTV have different cultures when it came to IT?
Pam Parisian: We both had very customer-centric cultures, which was critical to making this a success and was one of the reasons we decided to do the merger in the first place. While we had different technologies and services to combine, we were always coming at problems with the same set of priorities for DirecTV and legacy AT&T customers.
TT: Were there two different platforms for customer data?
PP: DirecTV and AT&T had different customer data platforms. DirecTV had an internally developed platform that was updated in near real-time from its billing (STMS) platform. AT&T used an internally developed database that is called CCR [common customer repository] that receives data across multiple billers -- for example U-verse, mobility and wireline -- and uses an internal customer matching process to create a single AT&T customer view.
TT: How did you merge those?
PP: DirecTV provided a bulk load of secured customer data that was merged into AT&T's CCR based on our customer matching model. Both internal teams worked tirelessly to create a design that allowed the initial load of 22 million customers as our CCR would now contain both AT&T and DirecTV matched customers as well as DirecTV standalone customers. We started with initial batch load files. Once we did the initial loads, an ongoing process to add and modify existing data near real-time was implemented. This data is consumed by both AT&T and legacy DirecTV systems.
TT: What kind of training did customer service reps and sales staff need for new bundles? Was that all done internally?
PP: Training was primarily created internally but administered both internally and with the support of our center strategic partners. Sales and service representatives were trained on the new bundle offerings as well as how to recognize a bundle customer and send to a specialized integrated service model center if needed. The integrated service model centers, which were staffed through strategic partners, received more in-depth training to support the multi-product customer.
TT: Same question for the service techs -- did learning how to install both DirecTV and U-verse services require cross training? Do you use contract techs as well that needed to be cross-trained?
PP: We trained about 20,000 AT&T field technicians on how to install satellite TV. All of the techs are internal employees. They already were capable of performing broadband, voice and IPTV installs. The cross training will allow them to install bundles including DirecTV.
TT: Can you describe the overhaul of the supply chain and inventory management systems?
PP: A solution was required to provide a "single dispatch/truck roll" that was part of the Day 100 initiative supporting satellite video, U-Verse HSIA and U-verse voice for both installation and repair jobs. In order to support this, AT&T's U-verse supply chain systems were modified to perform planning for DirecTV equipment, such as customer premises equipment, dishes, etc., for AT&T distribution centers (DCs) in the U-Verse supply chain system (ERP-EPIC). DirecTV's DCs then transferred the needed equipment to the AT&T DCs. These orders were fulfilled out of AT&T's DCs and activated in AT&T's activation systems. Benefits included: a tight integration between DirecTV and AT&T supply chains, a single unified process for planners and technicians and a consolidated view of DirecTV's CPEs across the DirecTV and AT&T distribution centers.
TT: How did you manage to work around the regulatory constraints prior to the deal being completed?
PP: One of the biggest constraints was against sharing customer data. Until the deal was completed, we were still competitors. So when we were building the process to eventually migrate DirecTV customer data into the AT&T systems, we created fake customer data to do our test runs. We knew we had to hit the ground running once the deal was approved, so we couldn't afford to wait until then to start figuring out how to merge those databases. Having been involved in many of AT&T's previous mergers, though, I knew going in that this would be a challenge we would have to address, and both the AT&T and DirecTV teams worked together perfectly while respecting the legal requirements.
TT: Did a vendor design "wormhole" or was that in-house?
PP: It's a technology we've purchased and then adapted to our specific needs. And it's something we use every day across our business, not just for the merger. We have employees and collaborators not just across the US, but around the world, from Latin America to Europe, the Middle East and Asia. Hopping on a plane every time you need to resolve a technical issue or build a new application simply isn't an option. Fortunately, we're a connectivity company. Using these video conferencing capabilities, we can connect in real-time HD video with our offices around the world so it feels like we're all in the same building.
TT: What areas overlapped?
PP: For example, DirecTV had its own billing system and AT&T had its billing system. But keeping both of those systems running side by side, particularly for customers who buy both DirecTV and AT&T service, is inefficient and not a good customer experience. Likewise, if a customer has already gone through a credit check with AT&T, for example, there's no need to run a second check if that customer wants to buy DirecTV service. Those are the sorts of overlapping systems that we're merging and streamlining.
TT: What was the biggest surprise during the project?
PP: The biggest surprise was the timing of the FCC approval of the merger. The approval was delayed multiple times and both teams collaborated on contingency plans to ensure a smooth legal close and customer day-one experience occurred whenever the merger was given the green light.
TT: Any big takeaways? What would your advice be to anyone else that faces a similar integration?
PP: Always keep the customer first in every decision you make. And develop an integration plan and practice it as much as possible before the deal is complete. Your customers will thank you.
— Mike Robuck, editor, Telco Transformation