Which Routing Model to use?

3 min read

We have many routing types and algorithms to choose from. Which one should we use, and when?

What criteria determine the best routing model?

First, we must define the criteria.

The business goal is to earn money, now and in the future. This can be achieved only by serving customers in the best possible way. One of the prerequisites to doing so is to provide the best-quality routes. So business owners should find a balance between profit and quality. High-quality routes are not cheap.

Considering all these factors, we can formulate two indicators of the best possible result.

  • The highest total number of minutes processed by the system (i.e., the highest ACD × ASR product) would indicate a good quality-price ratio, satisfied customers, and good business prospects for the long term.
  • The highest maximum profit generated, which takes into account both the highest number of minutes processed (maximum revenue) and the least cost. This indicator should be bound to the timeframe, which could be short-term vs long-term.

The final choice should be made by the system administrator, and the routing system should be able to work with any of the criteria for the best possible result.

It is important to construct a business offering to customers in such a way that these criteria can be satisfied. We will cover several strategies here.

“Choose your plan” strategy

In other words, ask customers to choose what they want: the quality or cheap calls. Good quality is rarely available at low prices. In order to avoid the internal structure to optimize the routes, providers often create several tariff plans based on the price-quality balance, from the cheapest one with the lowest quality (often called “non-guaranteed”) to the most expensive with the highest quality. The usual naming system is BRONZE, SILVER, and GOLD, where SILVER is a mix between the cheapest and best quality routes.

For example, IDT Express offers a few quality levels:

  • Platinum. Uncompromising voice termination quality with advanced features
  • Gold. Highest QoS at the most competitive market rates
  • IDT Instant. QoS routing with aggressive market-based pricing
  • Custom Routing. Options that are not covered by our Platinum, Gold or Instant services

It is easy to see a pattern here.

This method is easy for the system administrator to manage because it allows customers to choose the route based on their price-quality preference.

The 8020 principle

The Pareto Principle tells us that 20% of the routes generate 80% of the traffic (and profit), while 80% of the routes generate 20% of the traffic and profit.

This distribution suggests that 80% of the routes can be managed automatically, using Least Cost Routing, with some minimal margin restriction to obtain the desired profit margin. In this way, there is no need for a lot of manual intervention to manage most of the routes.

It is important to note that quality changes there would probably go unnoticed by the system administrator. Without proper monitoring, it may lead to large-scale degradation of the service.

The remaining top 20% destinations can be managed manually; the routes can be set using various routing methods, with the purpose of maximizing profit.

This is not as straightforward as it seems. Routing by priority or weight is OK when routes perform well. But if quality drops, routes should be rearranged. That should be taken care of through quality monitoring and other measures.

Setting these routes to quality-only routing would not work. Since they provide most of the income (the top 80% of traffic), quality changes might lead to unpredictable profit margin changes.

Solutions differ in each case. Each route could and should be managed independently, based on the current needs and requirements. That’s when it is necessary to know all the routing algorithms in detail and to use the right tool for the job.

Routing methods: a technical comparison

Choosing routes by the criterion of maximizing profit is the primary concern of the system administrator. It is also important to know the technical implications when choosing the routing type. They are secondary and often neglected, but it is good to have them in mind when working on your routing strategy.

The table below gives a rough technical comparison between routing methods.

Nature* System Overhead
Direct Routing Static Lowest
Least Cost Routing Static Medium
Quality-Based/Adaptive Routing Dynamic Very high
Percent/Probability-Based Routing Dynamic Medium
Priority/Weight-Based Routing Static Low
Caller ID-Based Routing Static High

*  “Static” means that with the same data, the routing table would be identical every time. “Dynamic” means that the routing table could change.

Conclusion

It is important to understand the main purpose of routing: to provide the best service to your customers and to maximize profit while doing so, now and in the future. Sabotaging long-term goals by short-term profit gains and dirty tactics is a bad strategy for this business.

Routing algorithms are directly involved in this matter; e.g., providing customers with the best quality routes (along with other services, such as support and troubleshooting) is in direct conflict with the business goal of earning money now and in the future. Clever route management is one of the most important skills in this business, and should not be neglected.

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2 Replies to “Which Routing Model to use?”

  1. Good morning I would like to know more and how to start this call business in like cote d ivoire since a live in usa

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