3/25/2011

E3 E4 FINANCE CORE MODULE

REVENUE ASSURANCE

For Internal Circulation of BSNL Only

3/25/2011

WELCOME

• This is a presentation for the E3-E4 Finance Module for the

Topic:. REVENUE ASSURANCE

• Eligibility: Those who have got the Upgradation from E3 to

E4

• This presentation is last updated on 19-3-2011.

• You can also visit the Digital library of BSNL to see this topic.

For Internal Circulation of BSNL Only 1

3/25/2011 2

NEED FOR REVENUE ASSURANCE

• INCREASED PRESSURE TO SHOW MORE PROFITS.

• TO IDENTIFY HOW REVENUES ARE BEING MISSED

• IDENTIFY AREAS OF LEAKAGE AND PLUG THEM.

For Internal Circulation of BSNL Only

3/25/2011 3

Components of Revenue Assurance

• Revenue Assurance consists of 4 components:

• Service Assurance

• Billing Assurance

• Collecting Assurance

• Reporting Assurance

For Internal Circulation of BSNL Only

3/25/2011 4

Service Assurance

• Customer request for provision of service should be

honoured promptly.

• We should plan and upgrade our infrastructure properly.

• Regular maintenance of overhead lines, underground

cables and A&P to ensure efficient working of the system

For Internal Circulation of BSNL Only

3/25/2011 5For Internal Circulation of BSNL Only

3/25/2011 6

• Serve the untapped rural market where other operators are yet to penetrate.

• Make all out efforts to attract competitors customers back to BSNL.

• Inform the customers – how you are better than the competitor by distributing pamphlets / Fliers through local dailies./CSR/CSC, bills etc

Service Assurance

For Internal Circulation of BSNL Only

3/25/2011 7

Billing Assurance

• We should ensure that all billable connections are billed.

• We should ensure that all billable events are billed accurately.

• Unaddressed Bills to be reduced should not be repeated for the

next cycle.

• We should ensure correct implementation of tariff.

For Internal Circulation of BSNL Only

3/25/2011 8

Billing Assurance

• old outstanding must be promptly reflected in

subsequent bills.

• customers with old outstanding and still availing the

service to be pursued promptly.

For Internal Circulation of BSNL Only

3/25/2011 9

Steps to be taken for early

realization of Bills

1. Ensure that the bills are issued for correct amount.

2. Billing address is correct and complete.

3. Ensure that the bills reach in time.

4. Engage proper reliable source for delivery of bills .

For Internal Circulation of BSNL Only

3/25/2011 10

Steps to be taken for early

realization of Bills

7. Give intimation to customers through IVRS about the dispatch of bills.

8. Give a ringing reminder a few days before the due date.

9. Give another reminder before a day or two to actual disconnection.

For Internal Circulation of BSNL Only

3/25/2011 11

Collection Assurance

• Ensure prompt collections before pay by date.

• Maintain minimum sundry debtors balance.

• Ensure maximum collections by 6th month.

• Increase the payment options and locations available to the customers.

• Popularize electronic clearing scheme and voluntary deposit scheme.

• Timely disconnection of telephones for non payment of bills.

For Internal Circulation of BSNL Only

3/25/2011 12

Various places of collection

• On line cash counters at BSNL Offices.

• Telecom centers of BSNL.

• Post offices up to pay by date.

• DTOs/CTOs.

• Voluntary Deposit scheme.

• Authorised nationalized banks.

For Internal Circulation of BSNL Only

3/25/2011 13

Various places of collection

• Authorised scheduled banks like ICICI,HDFC etc.

• Payment through Internet via credit card/on line bank

account.

• E-SEVA – state government bill collection system

(AP Circle, Karnataka, Kerala).

• Electronic clearing scheme.

• Automated cheque collection machines.

• Easy bill outlets.

For Internal Circulation of BSNL Only

3/25/2011 14

Pursuit of Recovery after

Disconnection

• Immediate ringing reminder during the incoming facility period.

• Give priority to the customers having huge outstanding.

• Issue default notice preferably in local languages around 45th day of disconnection.

• Issue non-payment closure Advice Note immediately after 90 days of disconnection.

• Finalize the accounts of the defaulting customers and arrive at the net outstanding.

For Internal Circulation of BSNL Only

3/25/2011 15

Pursuit of Recovery after

Disconnection

.• Conduct lok adalats in coordination with the local principal

district magistrate

• File Civil Suits in deserving cases.

• Organise reconnection Melas in coordination with exchange authorities for less than 1 year outstanding (Kerala).

• Conduct LBM’s / HPC’s for write- off of irrecoverable dues.

For Internal Circulation of BSNL Only

3/25/2011 16

Reporting assurance

• TRA is responsible for presenting all the records relating to sundry debtors and sales journal to audit.

• In cash section all collections including deposits are credited to sundry debtors.

• Classification to various revenue and deposit heads will be done by TRA through journal slip by debiting the sundry debtors and crediting various revenue/deposit heads after finalizing sub-ledger.

• Sundry debtors should always show debit balance and it should tally with the actual outstanding.

For Internal Circulation of BSNL Only

3/25/2011 17For Internal Circulation of BSNL Only

3/25/2011 18

Customer Win back

• On average , firms can lose up to 40% of their customers every year

• Lost customers mean lost revenues and negative word-of-mouth.

• On an average , firms have a 60 to 70% chance of selling to its

current customers again, a 20 to 40% chance of successfully selling

to previous customers and only a 5 to 20% chance of turning

prospects into new customers.

For Internal Circulation of BSNL Only

3/25/2011 19

Customer Win back

• Customers defect for various reasons and some customers

are not worth winning back. Through careful segmentation

you can select the most important customers to win back and

develop individualized strategies for each sector of lost

customers.

For Internal Circulation of BSNL Only

3/25/2011 20

• Poor service – This includes history of problems with delivery or

service or even a price increase without adequate proper notice.

• Poor handling of a complaint – if a customer does not feel his or her

complaint is not taken seriously or treated with respect, he can

easily move to a competitor.

Most common reasons for customer churn

For Internal Circulation of BSNL Only

3/25/2011 21

Most common reasons for

customer churn

• Disapproval of changes – you run the risk of losing customers

anytime you change a policy or price or product.

• Feeling taken for granted – Remember that every customer

needs to be “resold” in every transaction.

For Internal Circulation of BSNL Only

3/25/2011 22

Steps to resolve customer dissatisfaction

• Listen – carefully to your customer.• Empathize – with your customer‘s concerns. Let him know that you

sincerely care about his problem even if you don’t agree with his comments.

• Apologize - even if you are not the cause of problem. When said sincerely, the words ‘ I am sorry” can diffuse as much as 95% of most peoples anger.

• Resolve - the problem. Let the customer know you are on his side and will do everything you can to help him get the problem resolved.

• Now – is the time to address the problem. The faster a mistake is fixed, the more likely it is that the customer will give your company another chance.

For Internal Circulation of BSNL Only

3/25/2011 23

• When you lose a single customer you do not lose a single order but a

lifetime opportunity of profitability with that individual.

• Further, if by a positive word-of-mouth, he brings just one more

customer to the organization his value to the organization doubles.

• Therefore it is important for all the employees within an organization

to understand the lifetime value of their customers.

• Customers orders per year as well as average order size will

increase the longer a customer remains with a company

Customer life time value

For Internal Circulation of BSNL Only

3/25/2011 24

Customer life time value

• Target the right customers – focus not on how many customers you

want to acquire but on how much revenue each potential customer

can generate for your business. Then go after clients and industries

that fit your model and your firms vision and area of expertise.

• Target the high value customers who need little incentive to purchase

, more resistant to the pull of competitor, less price sensitive and

generally more tolerant of occasional lapse of services.

For Internal Circulation of BSNL Only

3/25/2011 25

Customer retention

• Retain the right customers.

• Identify the most profitable customers and retain them.

• Retain the customers that have low churn risk and low profit margin

but try to increase their profit margin,

• Example by converting landline customers into broadband

customers.

• Must provide customized services to the high value customers which

makes it difficult for the customer to defect.

For Internal Circulation of BSNL Only

3/25/2011 26

Strategies for saving a customer who is about to defect

• Listen to your customers – while listening, identify what triggered their dissatisfaction. It takes considerable skill and training to handle irate customers tactfully.

• Propose – ask the customers what they need from you to resolve the problem, and to keep them as a customer.

• Meet the customer demands if it is cost effective for the company.

• If what your customer demands is more than the customers estimated value to your company, you may not be able to save the customer.

For Internal Circulation of BSNL Only

3/25/2011 27

Long term strategy

• Play second fiddle – if your past relationship with the customer has

been good, make a pitch for even a portion of their business. Often

this kind of arrangement is accepted immediately and it leaves you

as an established operator.

• Ask for another meeting – if you are turned down for even a portion

of their business, ask if they would reconsider in a few months time

even if this overture is rejected ask for permission to stay in touch.

Courtesy is very effective.

For Internal Circulation of BSNL Only

3/25/2011 28

Long term strategy

• When approaching a former customer your goal is showing

that your product offers a better value than anything from a

competitor.

• You need to create a message that is relevant n personal

• Key points in any re-approach are

• Acknowledge their past business.

For Internal Circulation of BSNL Only

3/25/2011 29

Long term strategy

• Point out improvements and changes that have been made since

the customer left.

• Prove to the customer that your products and services offer

value he or she could not find elsewhere.

• Make it easy for them to switch over.

• Possibly include a financial incentive for switching back.

For Internal Circulation of BSNL Only

3/25/2011 30For Internal Circulation of BSNL Only