Challenge

TMNG Global Solution

During our initial review, numerous problems were uncovered that was seriously impacting the client’s profitability and operational efficiency. Examples include:

• The client had not implemented a communications cost audit process and had never reconciled the cost of telecommunications facilities to the actual customers using the facilities. Thus, we found the client was actually paying for facilities for customers who had actually disconnected service.
• Collections had never actually canceled a customer in nine months of activity, and customers requesting cancellation through customer service were canceled less than 10 percent of the time.
• The receivables were over-weighted in the 120+ area as a result of the lack of cancellations. A base of 108K customers had over $7M in 120+.

These examples were just the proverbial tip of the iceberg, and numerous others could be cited. We also documented problems in the areas of Usage Processing, Rate Table Maintenance, Billing, Payment Processing, Accounts Receivable, and Collections Management. Following a three-week assessment of Revenue Assurance and Billing Operations, TMNG cited major deficiencies across the board in the Billing, Collections, and Telco Cost areas to client senior management.

1. Accounts were not set up properly.
2. Accounts were not validated or verified.
3. Rate plans were overwritten or invalidated.
4. Communications between groups was limited or ineffective.
5. Issues are not resolved in a timely fashion.
6. Credit card and ACH payments were not managed effectively.
7. Collections were near non-existent.
8. Few customers have ever been canceled.
9. No procedures were in place to issue temporary or permanent disconnects.
10. Processes and procedures are not documented.
11. No metrics existed for management review or issue identification.
12. IT reporting was severely lacking in quality and validity.
13. Multiple customer database updates were not linked.
14. Usage and accounts are not reconciled to vendor records.
15. There was only limited ability to track issues from Customer Service.
16. Understaffing and undertraining were obstacles to running a quality operation.

Such a list of issues obviously demanded the implementation of processes and procedures that, in themselves, would provide a guidebook on how to create a functional quality revenue assurance organization. TMNG’s recommendations centered around four ideas:

• Stop the bleeding and implement now
• Maintain ongoing operations
• Prepare for targeted sales immediately
• Plan and develop the future Quality Billing Center.

The CEO and CFO decided that TMNG should move ahead with all necessary corrections and gave TMNG complete line management authority to deal with the problems at hand.

We began by concentrating our efforts in Provisioning, which was restructured according to specific responsibilities and timeframes. All processes where documented and overlaid to existing systems. Identified holes were closed and reporting instituted to determine delays. Training was begun to bring staff up to acceptable knowledge levels. Since a business requires accountability, management reassignments and dismissals were implemented as necessary. The number of errors dropped, and the time delay in order provisioning decreased from two weeks on average to less than four days.

TMNG then turned its attention to Revenue Assurance, embarking on a dual process in this area. The first priority was to correct conditions in the Telco Cost, Billing, and Collections areas, as the errors were so numerous. Secondly, but perhaps even more importantly, TMNG undertook to create a Revenue Assurance Department, establishing the processes required to assure continuous process improvement.

To proceed effectively, TMNG concentrated first on items that would bring in revenue quickly. A 45-day plan was developed, providing specific responsibilities and objectives for all management.

The customer base was resettled. Efforts were undertaken to decipher the billing files and rationalize data. Of 90,000 customers listed as active, the base proved to be actually 65,000!

In Billing, TMNG analyzed the error toll records to identify quick fixes, Over 400K calls were recycled to billing as a rate tables were updated for major error conditions. Billing schedules and cut-off dates were laid out for six months. Reporting was instituted so trend analysis could begin. Rate table analysis was reviewed for updates. Online bill rejects were captured and summarized into common error conditions for correction. The credit card payment process was dissected to locate errors. Every staff member was given specific tasks to perform and objectives to meet.

In Collections, all accounts greater than 120 days were sent a collection letter. TMNG outsourced soft collection calling to a third party, which had never been done. We also initiated regular collection cycle processing for delinquent accounts (letters only) and instituted weekly and monthly measurements of results.

In Telco Cost, TMNG developed a claim strategy and began an auditing process. TMNG developed standard reporting for all cost items and timing of bills, initiated a forecasting process based upon usage and customer counts, and began a monthly close process.

Finally, TMNG developed weekly cross-functional communication among Customer Service/Provisioning/Billing to identify problems and resolve them together.

Benefits to the Client

Billing began running on time 98% of the time. Usage data were reviewed daily and resulted in a 60% drop in cycle pools prior to billing. Invoices posted to the website increased from 80% to 99%. In Collections, $3 million was collected in the first 45 days, almost half of the outstanding balance. For Receivables, cash posting was managed daily. Credit card rejects dropped 80% as tightened validations were placed on new customers and rejects were handled within 5 days of rejects via resubmission or move to paper.

In terms of Telco Cost, TMNG identified $1.2 million in claims. In Provisioning, the reject rate improved from 30% to 5% and local order firm installation from some 2 weeks to 4 days. In Customer Service, an ineffective vendor was eliminated. Customer hold times improved 50%.

In summary, critical business operations were tightened up across the board, corrections were put into place, the groundwork laid for future, more efficient operations, management and employees felt a sense of accountability for their work, and lines of communications were opened among departments.