Monitoring and control Sam H Parker Director Management

Monitoring and control Sam H. Parker Director Management Systems Center AT&T Laboratories

Monitoring and Control at AT&T ©What is the Management Systems Center? ©Our focus ©Our history ©Our place in AT&T’s research community ©The composition of our center ©The future

Basics and Infrastructure ©Monitoring is evolving to be an essential management process must ©Auditing and strategic monitoring are evolving fields ©Critical processes are being monitored ©Transactions in e-brokers ©Transfers to foreign countries ©Package tracking

Our Expertise © CPAS Experience in 1986 -1990 ©Continuous Audit ©Model for AICPA committees © FOS (Access Financial Assurance) © MOSS (Consumer Bill Accuracy) © GECKO (Consumer LD Transactions) © LEARN (Consumer Local Provisioning) © INSYNC (Consumer PIC & Revenue) © Dashboards and Scorecards

CPAS OVERVIEW System Operational Reports Workstation DF-level 2 DF-level 1 Operational Report Filter Alarm DF-level 0 Data Flow Diagrams Reports Analytics Database Metrics

Flow. Front - Interactive Flow Diagram Viewer - AT&T Bell Laboratories - Murray Hill, NJ fer Date: 04/01/89 Set Date Recalculate Metrics Recalculating With Check. Help Flow. Front Hierarchy Text Quit! Billing System - Customer Billing Module Trans Customer Database Bill Upda Billing Amt. Due Extract Customer Accounts 1000 Calculate Amount Due Update Billing Info 1000 Pay Journal Files Overview Format Bill Print Bill 998 Inquiry Accounts Missing: 10 2 Journal Files Table Process Errors 0 Errors 988

Sales lead Process Monitoring for SMART Incoming toll free lead -- chart type A Incoming Web site leads -- chart type A Incoming toll free lead -- chart type A Dallas Sales Center: Number --chart type A type 1 --chart type B --chart type C Number type 1 Convergys: Number --chart type A type 1 --chart type B Number --chart type C type 1 Number type 1 Tucker Sales Center: Number --chart type A --chart type B type 1 --chart type C RSM 1: Agent production: Number --chart type A Number -- Active user: xx --chart type B type 1 --chart type A --chart type C RSM 2: Agent production: Number --chart type A Number -- Active user: xx --chart type B type 1 --chart type A --chart type C . . . RSM n: Agent production: Number --chart type A Number -- Active user: xx --chart type B type 1 --chart type A --chart type C Marketing Operation Sales Center Operation Alliance Agent Operation -Number type 1 is the cumulative number of leads for current day -Chart type A: bar chart showing the hourly incoming leads for current day -Chart type B: line graph showing the total cumulative leads (x-axis is hours) -Chart type C: bar chart showing lead status distribution

Monitoring and Control Structures

reports Applications reports Feeds for applications Ad hoc Analytic reports Periodic reports reports alarms Monitoring and control layer intranets Corporate Legacy Systems and ERPSs intranets reports Corporate Web facing Systems extranets Internet Systems from other entities

A la MIMS A la CPAS A la GECKO

Monitoring ©Is one of the key processes of management ©Is changing substantially with online technology ©Audit is an instantiation of the monitoring process ©We have many tracking and monitoring projects – assurance is a specific type

What is Needed? ©A flexible platform for observing business activities and providing automated alerting of adverse conditions

Business Model (1) 1. Auditor partners with Monitoring and Control provider and service is part of audit fee- Auditor pays MC provider 1. Variation 1 1. MC provider is commissioned to provision unresponded alarms to a third party

Business Model (cont. ) 2. MC provider is directly linked to auditee. Audit Committee pays MC provider -Variation 1 A data stream is directed to regulatory authority - Variation 2 A data exception stream is directed to peer review partner -Variation 3 Data exception streams are directed to bank and insurers for direct payment (Must clear SEC rules) 3. MC provider also provides • Monitoring for the regulatory process • Monitoring and control of the audit process

Peer review process Auditor Regulators Secondary assurance MC layer Stakeholders entity -Pension Fund -Employees(Union) -LT Charts -LT Suppliers -Bank -Insurance Cos. Company t ym en Pa Principals n ayme P MC Provider t

Markets ©The worldwide assurance market is about 40 billion with many peripheral services ©Current audit services do not satisfy these needs ©There will be some replacement and some market expansion ©In the systems area other players like EDS and IBM are emerging

Conclusions © The monitoring area is an emerging opportunity © Many opportunities exist across business areas such as marketing, production and finance © Assurance is a specific instantiation of system monitoring © New systems architectures, concepts, and approaches are needed © Extensive research is needed