Vous êtes sur la page 1sur 14

Accounts Receivables - Process improvements

A Telecom UK LLC A case study


3. 4. 5.

Background. . . . . . . . . . . . . . . . . . . . . . . 1.0 Brief systems overview. . . . . . . . . . . . . . 2.0 Requirement analysis . . . . . . . . . . . . . . 3.0 Situation analysis . . . . . . . . . . . . . . . . . . 4.0 Process improvements . . . . . . . . . . . . . . 5.0

Background 1.0
A Telecom UK LLC, a self-owned infrastructure mobile network operator in the United Kingdom (UK) with a subscriber base of around 5 million customers (3 million household and 2 million business customers) seeks to achieve the following goals as part of their 3 year growth strategy:

of capacity by 15%, Expansion to newer markets within UK and Bring up its EBIT from current level of -5% to +10%.

Background 1.1
The company uses customised billing software to handle billing for an average traffic of 60 million customer calls per day. Bill payment options are as follows: 2 monthly billing cycles (10th - 9th of succeeding month) & (20th 19th of succeeding month) Payments may be made by customers either online, through companys service centres or via third party agents (such as banks).

Background 1.2
A customised CRM software is employed by the company to help manage customer relationships and promote loyalty in an intensely regulated, competitive and mature telecom market . Besides maintaining customer records and tracking customer-related data such as queries, complaints, etc., the CRM is also responsible for providing customer activations, de-activations and suspensions input triggers to the provisioning, network inventory and customised billing systems of the company.

A brief systems overview 2.0


Provisioning system

Billing system

Data warehouse

Network inventory system

Payment gateway

Mediation system

Core Network system

A brief systems overview 2.1

Customer order initiates CRM to send provisioning command to Provisioning system for allocation of network resources to customer as per order. CRM sends commands to Network inventory system to assign phone numbers, IP addresses to customers.

CRM also intimates customer master data and services opted for by customer to Billing system.

Customer master data from Billing system is updated daily through batch input sessions in SAP FI module used for financial accounting.

A brief systems overview 2.2

On completion of 9th/ 19th of the month, call detail records (CDR) generated by Core network system are rated by the billing system for generation of invoices and despatch to customers. Invoice list from billing system forms basis of accounting sales invoices in SAP FI . Payment information received from Payment gateway are fed into Billing system and updated by batch input sessions in SAP FI on daily basis .

Transactions in billing system are periodically updated in Data warehouse to serve as raw material for business intelligence applications.

Requirement analysis 3.0

Management is evaluating several alternatives to help company achieve its 3 year growth strategy. Considering its 5 million large subscriber base set to grow in the coming years, they have decided to engage external consultants to review their accounts receivables process and recommend suitable process improvements.

Situation analysis 4.0

Accounts receivables team consists of 75 full-time employees contributing to an annual average salary spend of 3 million GBP responsible for the following tasks:

Accurate and complete maintenance of customer master data in SAP FI including customer tax and credit information. Posting of invoices based on invoice list from Billing system in the respective customer, tax and commission expense accounts. Up-to-date posting of payments received through payment gateway.

Situation analysis 4.1

Flagging of overdue invoices and intimation to CRM team for follow-up. Computation of bad debts provision after applying applicable collection ratios on receivables categories i.e. retail customers, inter-connect and prepaid cards distributor segments based on past trends. Write-off of bad debts against provisions based on confirmation list obtained from CRM team. As part of monthly book close, unbilled revenue information for customers from billing system provides basis for recording revenue accrual entries.

Process improvements 5.0

A. Reduce billing turnaround time(TAT) and increase customer engagement Accurate and up-to-date customer e-mail ID, billing address and credit/debit card details help ensure minimum billing TAT for the company. Currently, the onus for update of these details lies with the customer which may be done through company's online self-service portal linked to its CRM. It is however recommended that routine monthly customer service calls may be initiated by company's CRM team to verify customer billing details, obtain feedback about service quality and register queries and complaints, as required thereby increasing customer engagement with the brand.

Process improvements 5.1

B. Strengthen revenue assurance controls to identify and/or prevent revenue leakage Invoice list from billing system provides basis for recording receivables entries in SAP FI and parked entries are reviewed by AR manager prior to posting. However, following additional checks may be performed and results documented as part of revenue assurance: i. Check to ensure invoices have been raised and accounted for all active customers in CRM. ii. Review CDRs with invoice list to verify whether services provided have been rated comprehensively and with appropriate rate.

Process improvements 5.2

iii. Perform analytical review of receivables posted for the period to identify and resolve exceptional variances, if any. C. Reduce collection costs and collection TAT by introducing phone banking option for bill payments Collections are made through payment gateway which interfaces with customer service centres, online credit/debit cards and third party collection agents (incurring commission costs). However, phone banking option for customer payments may be introduced increasing customer convenience, reducing collection costs and collection TAT.