HomeMy WebLinkAbout1986
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cirY o! IDENrON, rBXAS MUNICIPAL BUILDING / DEN1'CN, TEXAS 78201 / TELEPHONE (817) 660-8307
Office 01 the Chy Manager
M F M O R A N D U M
TOI Mayor and Members of the City council
I1'HOMi Lloyd V. Harrell, City Manager
DATES May 16, 1986
SUBJEOTI UTILITY 13ILLINO AND COLLECTION SYSTEI4
During my orientation with the Oity Council, a universal
l,roblem raised concerned customer problems associated with the
City utility billing system. This concern was reinforced after
being on the job only a few weeks and receiving numerous
oomplaints from oitizons regarding our utility billing
operation.
Because of this Council direotion and obvious need, I have
s;ent time with all of the individuals involved with the system
in an attempt to become familiar with the }roblem and to ensure
that the organization pro pares a strategy to improve the
operation. If he major thrust of this affort has been a
challenge issued to John MoOrane to comprehensively analyr.e the
' billing apsratlon in conjunction with other individuals who j
7 play a role in the system and make formal recommendations to my
I office as to how our procedures can be im}roved , In tho
attached memorandum, John has oomplied with that aesignmont'by
comprehensively outlining problems with our utility billing
E operation and steps which have boon taken to alleviate the
identified problems, In addition, John has sot forth formal
recommendations of additional steps which should be considered
to further improve the system,
I have reviewed John's memorandum in detail and would like to
I offer the following formal recommendations to the City Council
to attack the various problems as identified by Mr, McOrano
commencing on page 7 of his memorandum,
COMMUNICATIONS
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1 -I plan to immediately formalize the role of the Cuatomer
Service Manager as the single individual to whom I will, look to
ensure that the billing operation is running smoothly, I am
convinced after reading John's memorandum, visiting with other
department directors, and discussing the situation with consul-
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Memo to Council ve
May 16, 1986 Utility Billing and Collection
Page Two
tanta I've viously employed to review the utility billing
operation, that one of our problems is the number of diverse
dolartments that possess responsibility for a small piece of
the billing oIs Pa tIon, This dIapereaI of responsibility
encourages individuals involvod to blame other aotore in the
system for causing problems with no single individual being
assigned to determine the ultimate cause of the problem and
seek its resolution, Therefore, I would propose formally
designating the Customer Service Manager as the single
individual roe ponsible for t110 utility billing operation, I
will look to that individual to analyze varioue oblems and
facilitate their solution, Furthermore) if anotherrindividual
in the system is not responsive to the Customer 3orvice
i Manager, I will confer with the appropriate dopartmant director
f to aeok resolution of the problem, Nevertheless, one
I individual will be pinpointed as the person who will ensure
that the utility billing systom is working Iroperly,
Mr, MoOrnne suggests that the Customer Servioe Manager be given
additional forma :L authority through a rewriting of our billin
ordinance, The City Council has already holped this situation
with the water adjustment ordinance and we will be
ahead with a revised billing ordinance for pushing
I will expect the Customer Servioe Manager tou assureidthat ithe
ordinance is prepared and submitted to the Council in a timely
fashion.
Also, Mr, No Ora na is committing that, with the additional
personnel which will be reoommendod later in this memorandum, a
comprehensive Iolioy and prooeduro manual for the Customer
Service unit will
be
produced within
time, Thus, this manual will be finalized,o in place andiobeing
used by May of 1987,
Finally, Mr, MoCrano notes the i.mportanoe of
interdepartmental
f communication and coordination to make the billing system
properly oporate, In this regard, I will direct the Customer '
a Servl,ne Manager to convene the customer information group at
least semi-weokly, the purpose of this group will be to
discuss any billing system problems and, as a grou
resolution, p, soak their
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ADDITIONAL CUSTOMER SERVICE EMYyEgg
1 In his memorandum, Mr. MoCrano outlines a number of I
phone answoring delays, accounts receivable problems
billing" situations, incorrect bills, turn-ovor and nburnout11of j
personnel, handling building/oommercial accounts and special
problems. For all of these areas, Mr, Moarane'o primary thrust 1
is the addition of Customer Service personnel, fie has
recommended that the staffing of the Customer Service area be
increased by a total of 4 1/2 positions and the reolassifi-
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Memo to Council re Utility Billing and Collection •
May 1&, 1986
Page Three
cation of two existing positions. The total
yearly additions to the Customer Service staff coat for
$
would be entirely assumed by the utility fund, 95,000 and
Because Mr, MoGrane has offered a concrete proposal for
improvements with measurable ox Ise tationo for success, I
support his recommendation for additional porsonnel and would
seek authorization from the Council to fill the positions
immediately, Normally I will confine requests for additional
personnel to the budget process, However, in this case, I
think everyone feels this is a
attacked as soon as priority problem which should be :
poseiblo, Also
thi
made easier since the funding for those this recommendation is
from the already strapped General Fund, positions will not come
Conoerning the reolasaifioation of the two current employees,
this matter will be referred to the Personnel Department for
analysis and formal recommendation, I am sympathetic to the
request but feel that it should go through the normal prooedure
I, for reolassifioation decisions,
CT If ER STAI-'PINGk E UIHEMENTS
Mr, Me Crane recommends that consideration be to the
retention of a Motor Reader and the hiring of ganvoandditional
System Analyst for the Data Processing Dopartment 030000, f
( Since the seventh Meter Header is already employed by the City,
f it would be my recommendation to retain that i
~ position, This
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stance is supported by Mr, Nelson and I feel would be very
beneficial to the organization,
r { Concerning the System
Analyst, a formal request for this
i position is included in the proposed 1487 budget filed by our
Data Processing Director, Gary Collins, As much sympathy as
poseible will be given to the request during the formal f
1 consideration of the budget,
OTHERER EQUIPMENT PURCHASE RE UESTS
Mr, No arane is also recommending the following pnrahIA se
requestst 3 oomi:uter terminals for use in Customer Service
($41000)1 1 personal computer for Customer service
and update of the telephone system in Customer Servioo$( 800
to $100000), (80000
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It is my reoommendation that along with the employment of the
additional personnel, we add the 3 computer terminals and the 1
ltr iisttrecommended thatrthisssystemCbecconsidered tile in the context
of the budget,
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Memo to Council re Utility Billing and Collection
May 16, 1986
Page Four
OTHER LEOISLATIVE ASSISTANCE
Mr, MoOrane notes that a oomprehensive billing ordinance will
be ,submitted to the City Council in the future for your
consideration, Hopefully, suplort will be forthcoming for that
legislation when it is proposed,
In addition, the council lrevioualy has received a
recommendation from the Public Utility Board that a late charge
be assessed for overdue aocounts. This
matter was
tabled by
the Council and it is suggested that this item be re-oxamined
for possible implemPitation, Staff'ft feeling is that this
additional legislative tool will be helpful in further reducing
the Accounts Receivables over and above the pledgee made by Mr,
MoOrene in hie memorandum,
I4OHN PERSONALIZED SERVICE
Mr, MoOrane recommends that, if additional porsonalized
services are desired for our customers, an additional four to
nix employees be hired to perform this task, Although the
employment of these individuals would be desirable, it is felt
that this step should only be considered later in the process,
It would seem to be desirable to devote our attention to
solving the more pressing problems before we try to refine the I
system to give more personalized service. This is certainly an I
admirable goal and ho lefully we can reach this level some time
in the future, C
it is hoped that this memorandum demonstrates the
organizational commitment whioh exists to resolve the utility
billing problems which nave been encountered by the City: of
Denton, In this regard, it is pledged that the City Manager I
will oonverse on a regular basis with the Customer Service
Manager and Finance Director to assess progress which is being
made in improving our utility billing operations and report
these findings to the Council, Initial :uootings will be held
every month with performance data being supplied to indicate
how the pledges made in Mr. MoOrane'a memorandum are being
met, Later the time period between these meetings will be
either shortened or lengthened depending upon the success we
t are achieving in improving the billing operation for the Oity, f
I look forward to visiting with the Council about Mr. MoOrcno's
report and the recommendations offered for improving our
billing system at the upooming City Council retreat, Thank you
II for your consideration,
oyd Harr 12
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21990
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CITY Of DAW00W, T/XAd MUNICIPAL BUILDING ! 216 E, MoKINNEY ST. I DENTON, TEXAS 16201
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MEMORANDUM
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TO; Lloyd V, Harrell City Manager
1 FROM; John F, McGrane, Director of Finance
DATEt May 13, 1986
SUBJECT: UTILITY BILLING AND COLLECTION SYSTEM
The purpose of this memorandum is to give some insights into the City of
I Denton`s_utility billing and collection system. It will attempt to give an
I overview of the system, and in conjunction with the overview, define areas of
concerns along with recommendations for future actions, This is not meant to
be a tecnnical treatise on the merits of the system; however, it is meant to
w delineate areas of concern, past steps that have been taken to correct problem
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areas, and future recommendations.
SUtVARY
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The Customer Service Division has oeen restructured since August, 1986,
for better supervision and accountability, Further, tnis restructuring has
also addressed the need for specialization, The reorganization temporarily
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! placed the Administrative Assistant in charge of specialized areas of credit
and collections, while two supervisors were retained for Customer Accounts and
Customer Relations respectively,
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81118668200 DIPW METRO 404.2820
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Memo to Lloyd V, Harrell
hlay 13, 1986
page two
An additional organizational change, which was only functional, was the
establishment of two senior representative positions, One of the senior
representative positions presently acts as a contact person within the
Customer Relations aroa, while the other acts as a contact person within the
Customer Accounts area. The establishment of contact persons has helped to `
` control and coordinate work for those areas of Customer Service, and has
increased the degree of accountability for work that has ueen assigned,
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With regard to specialization, specific representatives have been given
responsibility for particular types of accounts and functions. For example,
1 as opposed to acting as another billing or service representatives, one
representative has been given the responsibility of attending to comwercial
and building accounts only. This change was instituted when it was recognized
a more
that commercial /buildin9 customers had special needs that demanded
in the Customer Service representative. Previous to
specialized knowledge
specialization efforts, the handling of commercial/building customers
l inhibited productivity by blocking the flow of processes for completion of j
simple requests, As a result of specialization, commercial /building accounts l
are handled much more efficiently and there has been greater cooperation in 1
{
dealing with other .City departments that also handle relates
commercial/building customers Hie,, building inspections).
Finally, a full-time receptionist/phone clerk nas been added to receive
and route customers when they arrive in order to attend to customer needs in a
more timely manner. The receptionist/phone clerk greets and screens customers
and routes them according to their need to appropriate specialized areas, The i
receptionist/phone clerk also handles incoming administrative related calls on
a daily basis,
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In attending to phone inquiries o^ utility customers, there are now three
(3) representatives which handle customer related calls at all times. As many
as five (6) different representatives handle customer calls during busy
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Meyol.tto 1Jb6d V. Harrell
Page three
periods, Yet, even five (b) representatives are not enough employees to
handle customer related calls as evidenced by the number of complaints
regarding phone contact with customers,
Although the Customer Service Division has been on a continual improvement
curve, it has only been able to fight the "grass fires" that keep occurring on
j a daily basis. Under the present conditions, resources are allocated back and
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forth to cover different problem areas, There is never an opportunity to
catch up on the current work load, In order to obtain the operational level
necessary to adequately service, maintain, and monitor the system,
implementation of the following recommendations is essential,
A. Staffing
1
1, Meter Reading
Retain the number of meter readers at seven (7) instead of
six (6), ,
2, Customer Service
. Increase phone representatives from one (1) to two (2)
Increase billing representatives by one (1) 1
- Increase front representatives by one ) 1
Increase the collection staff by one
Hire a part-time representative I
- Roc'lass of two (?1) positions to senior status
f 3. Data Processing I
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Increase the staff by one (1) systems analyst,
B, Equipment Purchaso
-Add three (3) Computer terminals for use in Customer Service,
-Add one (1) personal computer for Customer Service,
j -Update phone system in Customer Service, I
C, Increase Customer Service Manager's authority through updated
ordinances and policies.
D, Provide additional training.
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Memo to Lloyd V, Harrell
hay 13, '1986
page tour
If implemented, these rerommendations would provide for the restructuring
of the work load, would eliminate burnout, turnover, and would allow for a
more efficient and effective customer relations. 7ney would also provide
faster and greater collections on past due accounts,, and finally, they would
allow the opportunity to provide adequate training and supervision of
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employees.
If it is desirable to expand the, scope of services provided by the
1 Customer Service Division (see text), then the following recommendation is
made
Increase the Customer Service Division staff with four (4) to six (u)
additional highly trained and knowledgeable personnel to handling only
customer complaints, make personal visits to customer's premises, make
basic on-site meter tests, and assist customers in managing the use of
1 their water and electric conmodities,
In my estimation, we have made scattered attempts in the past to address
the problem areas as they surfaced and never really addressed the underlying 1
reasons causing them. As the utility system grow, the poeential for problems fk
to keep resurfacing increased, We have spread our resources too thin and have
not looked at the system as a whole. We have only made attempts at handling
111 problems as they arise and neglect areas that will become the future problem
I areas, A comprehensive effort to alleviate those underlying causes is
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essential in order to maintain a professional and we'll-managea system,
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BACKGROUND
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The City is one of the major utility suppliers to residents of the area,
The City has essentially four (4) types of utilities that it provides and
bills for each and every month, They are electric, water, wastewater and
l solid waste, Each of these utilities has its own rate structure, use
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Memo to Lloyd V, Harrell
flay 13, 1986
page five
measurement and billing calculation systems, and various service subsystems
associated uniquely with each utility, The city has installed a utility
billing software system known as the TRES System in order to process the
entire complex utilities billing and collection system. The basic procedure
for billing is to measure the usage for the period, multiply the amount used
by the appropriate rate, and then print the bill, Although, theoretically,
this appears to be a simple process, there are numerous factors that are
contiguous to the process that contribute to the overall complexity of the
system. In order to demonstrate how complex the formula and process can
become, the following is an example of what is necessary to bill a typical
commercial customer, for electricity, There would have to be an accurate
electric and demand meter reading (knowledge of how to read and reset the
meters is essential), tfie appropriate rate schedule (for that particular rate
' class) would have to be properly inputted, and to this tiie assessment of the
proper facility charge, whether it is a single phase or three phase meter,
would be applied. In addition to the above, the proper demand charge (minimum i
l demand is 7p%, of the maximum monthly demand for May through October), and the '
I proper energy charge and energy cost adjustment (charges from winter to
r surroner)would nave to be applied, If the customer had a dusk to dawn security
light, then the proper type of the light must be known. There are different !
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costs for loo watt sodium vapor lights, 176 watt mercury vapor lights, and 4uO
watt mercury vapor lights, once again, an energy cost adjustoont is then 1.
applied to the formula, and this cost varies according to the time of year.
After all of the above have occurred for each of the separate four utilities,
in the proper manner with no errors, then a correct bill would be produced,
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You can begin to see the different factors that make the system very
complicated,
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In addition to the aforementioned process, it is also necessary to have
the initial account information accurate in order for tho total bill to be
correctly produced, An example of this would be the input of the appropriate
meter numuer, T{ie overall software system incorporates a meter inventory
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Memo to Lloyd V. Harrell
May 13, 1986
page six
subsystem tnat maintains meter inventory data. Before a bill can ue r
accurately produced, an appropriate meter number must be in the system for
each utility service that requires a meter, The amount of meters required
depend upon the type of customers being served, i.e „ main electric meter,
demand meter, water meter, water ronipound motor, and sewer meter Of
applicable). In addition, a meter numoer can only be identified with a single
service address. Until it is released in trio system, the system simply
j rejects the new installation, Anytime a meter is installed, changed, removed,
or tested, the proper meter inventory adjustments must occur before a current
bill can be produced, This also brings in the element of timing. An account
will "no bill", or an erroneous bill will be produced, if the system rejects
the data inputted or the appropriate data has not processed prior to the
billing cycle
In all, the system is very complex all the way from the meter snap, j
{ through meter reading, through Data processing, through Customer Service and !I
up to, and including, the final payment occurring in the Cashiers office, f
There are numerous factors that can effect the simple oilling formula of;
Usage X Noed ~ Bill.
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AREAS OF CONCERN,. PROBLEMS AND RECOM!ENDED ACTIONS.
As the City's utilities system had grown and become more complex, the
organization had encountered numerous problems over the past 5 to lU years. y
As a credit to the current Customer Service staff, the City has come a long
way in resolving many of these problem areas. However, as resources have been
shifted to new areas, other potential problem areas must be neglected. Tne
process still has some areas of concern which can be broken down into four
primary problem areas; communications, staffing, systems, and trdininj.
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Memo to Lloyd V. Harrell
May 13, 198o
page seven
I, COMMUNICATIONS
Problem:. Organizational Dispersion - The entire Metering, billing,
cashiering, and customer service functions are dispersed organizationally
among different departments within the City. Eacn area has responsibility
for a segment of the overall process, but nobody has full authority or
responsibility over the ontire process, As was defined earlier, there are
many variables tnat must be correctly inputted into the billing process in
order for the process to function accurately, Therefore, altl,ougp
workable systems and procedures may be in place, continual communication
I and feedback must occur so that a check on each of the multitude of steps
1 and procedures takes place, If any one of these steps or procedures
,
breaks down, then the entire process could deteriorate, and corrective
action would not take place until each function is reviewed by all six
divisions.
E Current Actions: - An informal communication process lids been
f established between the various divisions involved. As minor problems
occur, the networking system appears to be functioning on an adequate
basis for problem resolution. There are some factors that affect this
system such as work 'load, training, em, and these will be discussed
later in the report, For major problems, there is a group that meets on a
IIII "as needed" basis to help resolve issues. This group is called the
"Customer Information System" group, and consists of the Assistant City
Manager, Data Processing Manager, Customer Service Manager, Finance I
Director and Utility Director, In addition to tiie CIS group, an excellent
working relationship has developed between the Utility and Finance k
E Department and the communication between these departments appears to be
( functioning adequately, Also, the meter reading section, has been
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consolidated into metering/substations in order to assist in the
coordination and communication among these divisions,
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Demo to Lloyd V. Harrell
May 13, 1986
page eight
Future Action Reconkmendatiow With regards to the entire billing
process, more responsibility should De given to the Customer Servico
Manager, This would require active support frow the department heads
whenever proolems and their resolutions cross organizational lines, Tnei-e
also needs to be ordinance and policy changes that would give to the
Customer Service Manager more authority to regulate the utility billing
and collection process.
These ordinances and policies need to be rigid enough to control the
system, but also need to be flexible enough so that the Customer Service
I Manager can used discretion in the "gray" problem areas. Staff, in
conjunction with the Legal DeparWent , is currently working on a
comprehensive rewrite of the billing process ordinance, It will uo an
attempt to clarity termination procedures, deposit requirements, etc., and
incorporate the public Utility Commission's guidelines in these areas,
Council has recently passed the Water Adjustment Ordinance that should
also help in customer relations and help diminish the number of "gray"
problem areas that the Customer Service manager has to deal with. In
additior, the staff is rewriting departmental policies that relate to the
handling and processing of bills and customers, This is a continuous
I process in an attempt to develop a policies and procedures manual for the
department, Current efforts in this area are limited due to staffing
I ! constraints, However, with the addition of the recommended staff
E increase, it will allow the management staff to spend more time in this
area and a manual should be produced within a year, The policies will be
Submitted to the City Manager, Utility Director and Finance Director for
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I their approval prior to implementation, j
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Problem: Phone and Answer n2 S stem - Customers calling the Customer
f Service Division about utility questions or billing problems may
experience a busy signal or a request to hold until a representative is
available (See 5xhibit A). The number of calls put on bold or those
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Memo to Lloyd V. Harrell
May 13, lyae
page nine
disconnecting, were at a very nigh level. Some of this was caused by
seasonal peaks associated with the university student transitional periods T
at semester breaks, However, the problem still exists at a lower level
but still at a level that we feel is still too high. Although no
statistics are available on the length of time a person in on hold, the
number of customer complaints in this areas seems rias been reduced,
` Current Actions: In order to reduce the number of customers put on E
hold, and the length of time for holding, we have reassigned and realigned
4 daties in order to have a phone representative that strictly answers
I ' telephone calls, Tnis individual is responsible for answering general
' information inquiries and directing "problem" calls to the appropriate
billing individual. This procedure has decreased the lengtn of time for a
customer to be on hold, but has become an increased work 'toad for the
r billing representatives that nave peen forced to put off other assignments
s
in order to answer phone calls that are being directed by the phone
,
representative, Even with this individual phone representative, the
k = ' overload on the phone system still is occurring,
Future Action Recommendations: An additional full-time phone 1
l 1 representative would help reduce the current inability to riandle the
unpredictable flow of incoming calls. In order to make follow-up contact
with customers, this position would also take on this responsibility }
during non-peak calling hours, This would help limit the response time
with regards to customer inquiries, It is essential to limit the amount
of time it takes a customer to be connected to a representative, or have
their question answered. If a customer is already upset when they begin
' the call, "holding" on line or being unable to get ti:rough, will only add
to the frustration and anger, The more the customer becomes upset, the
harder it becomes to try and resolve tneir problem,
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Memo to Lloyd V. Harrel 1
May 13, 1986
page ten
In addition to the phone representative position, the current phone
system is inadeq+~ate to handle the volume of calls, It is cumbersome and
takes considerable time to transfer the call to the right person to hanale
that problem area. It is recommended that the addition of a phone system
can help facilitate the nandling and directing of incoming calls oe
purchased. It is estimated that a new system would cost between $8,000 to
I $100000 to purchase. The system would be similar, in design to the one
recently put in at the service center for the Utilities Department,
11, STAFFING
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j problems Accounts Receivable and Collections, - Although the total
3i amount of receivables and the length of time for collection has decreased
6 in the past six to eight months, there is still concern in this area,
During 198b, the accounts receivable reached a high as $12,9 million, In
the past 6 to 8 months it has been averaging around $6 to V million (See
Exhibit D). This concern was also indicated by the auditors in their
management review letter in connection with the audit of the )984-86
} fiscal year, There are numerous situations that can contribute to the
` accounts receivable amount. There is not only a problem of collections,
R but may also be a product of a billing error. A tripped meter would cause
an increase in the receivable. As was indicated earlier, if one of the
components in the system fails, or breaks down, an error could be
generated in the billing process. It this proulew is not resolved for a I
lengthy period of time, the customer usually withstolds payment until the
{ bill is solved or they receive a corrected Dill. In the past, it has
taken anywhere from sixty to ninety days to get tshese problems resolved.
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Current Action: An individual has been assigned the responsibility of [
reviewing the aged accounts receivable report on a weekly basis to inonitor
for errors, This individual is reviews the larger accounts over $1,000 in
order to identify areas and try to get them resolved in a timely fashion.
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Memo to Lloyd V. Harrell
May 13, 1986
page eleven
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In addition to the above efforts, we have stepped up our collection efforts by
trying to terminate service when a bill becomes past due, This usua'Ily occurs
within forty-five (45) to sixty (60) days of the Dill uecoming past due. This
has created a tremendous work load on tnis section because of the need to set
up and monitor contracts for payments, process and review past due bills,
process of corrections to account, and the reconnect of service when payment
r has occurred,
Future Action Recommendations: In order to efficiently collect past due
accounts and thereby help reduce the accounts receivable amount, it is
recommended that a Collection Manager (Administrative Assistant) ue provided
to oversee the collection section. This would help establish a formalized
collection section within the Customer Service Division to handle those
delinquent bills, This group would work with a system whereby a very defined
procedure for collecting past due amounts would be established, They would
also be flexible enough to work out contractual payments wheroby an individual
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h ` may be experiencing temporary financial problems with payment of their bill.
I' This section would also be responsible for working with collection agencies
and would follow the collection process through to possible legal action with
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f recommendation to the City Attorney or an `outside legal consultant, It is
very important that all in-house collection efforts be processed within a
sixty (60) day period, It is a normal rule of thumb that coilecvion agencies {
generate a better collection percentage when receiving an account close to i
sixty (60) days past due, Therefore, a continued, monitoring effort in the f
collection section of Customer Service should help streamline this process,
Also, this section would oe responsible for monitoring the large billing
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errors which may occur because of a break down in the system. This would
include anything from meter trips to water spikes, etc., which may cause an
account to become past due because of an error in the bill or increase
accounts receivable, It is hoped that this section would then be able to
resolve problem billings prior, to a second billing going out, And last, it is
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Memo to Lloyd V. Harrell
May 13, 1986
page twelve
felt that with a collection section, accurate accounting and financial
information will be derived out of the customer information system and be
reconciled to the accounting and financial reporting system which would
neip in the rate setting process used by the City,
Problem. No Bills - As mentioned above, the City of Denton's utility
billing system is very complex system and takes a concentrated effort to
produce an accurate bill in all areas. There are numerous situations that
can cause the system to "no bill" a customer, They would be such things
l as an inaccurate meter inventory number being input into the system, a
faulty meter reading which would trip the meter, the timing of the
installation of a new meter which would cause a billing cycle to trip the
meter, to an enormous amount of usage, etc. When a customer experiences a
"ne bill", it has an impact on the other areas of the system, Again, this
would impact the phone problem mentioned earlier, There are no reliable
statistics available on the number of customers that are "no-billed" or
the length of time that it took to get a bill. However, based on the
decrease in the number of customer complaints in this areas, we feel that
there has been improvement in this area, Although improvement has
occurred, we feel that there is room for further improvement in order to
keep the "no-bill" problem to an absolute minimum.
Current Action Being Taken; Efforts in this area have improved, The
P tront customer service representatives nave been assigned duties of one
day a week to work and check the inputting of data and follow it through
I the system in order to insure that a customer is set up correctly and
1
1 should bill on the next notice. However, this system is impacted during I
j the peaking periods when we do not have the available staff to be able to
take a customer service representative and allow them one day a week to
work on other assignments, They strictly have to deal with customers all L
I clay for the entire week, The system, as mentioned, tends to break down
i
-I. during times when we are short staffed from vacations, illnesses or
peaking periods,
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Memo to Lloyd V. Harrell
May 13, 1986
page thirteen
Future Action Reconimondations; It is recommended that a reclass of two
positions in the Customer Service Division occur in order to give some
direction and stability in this area. We nave estaolished the position of
senior representative in both the front representative area and the
billing representative areas, These senior positions aro people that nave
experience with the system and
have
had past training and are therefore
available to handle more technical type problems and be able to get a
quick resolution to those problems, thus reducing the number of no bill
situations, These two positions have been functioning as senior
representatives in name only. We feel they should be properly reclassed
through toe personnel system,
We also feel that an additional front billing representative is essential
to our being able to handle the "no bill" problem, This position would
provide for tree monitoring of accounts through the system in order to
complete an order, An additional front billing representative would also
t Delp in the areas of training and burnout of other employees, This
position would allow us to give full lunch periods, at staggered times, it
would allows us to allow for vacations, it would cover in times of
illnesses so that a backlog does not occur, and it would allow us to
handle more efficiently the peaking periods which occur during the
semester transitions, -
Aroblemi ><ncorrect Gills,
Turnover and Burnout The problem of
incorrect bills is partially due to the fact of turnover in the division. l
At the time of writing this report, two of the eighteen positions in
Customer Service were vacant. Ten of the eighteen positions had less than i
eight months of experience. Another three have less than two years, In
the past we have experienced about a 70% turnover rate on an annual I
basis, We are dealing with a very complex system that takes a lengthy 1
time for proper training, As you have more and more turnover, the
inexperienced staff 1s unable to handle the process and again, one 'link in
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Memo to Lloyd V. Harrell
May 13, 1986
page fourteen
F
the chain breaks down. Burnout helps to contribute to the turnover
problem. The workload (See Exhioit C) on the Customer Service Division
` personnel has been increasing and with no let up over the past ten (10) to
I twelve (12) months. Burnout usually occurs after an extended period of
continuous overtime and then experiencing the peaking period with the
university students. Burnout is also a product of the nature of the
work, Currently, there is not enough staff to allow for sufficient
vacation or time off from dealing with irate customers. Since the first
t
of the year, the customer service representatives have been working every
Saturday for a full eight hours to handle the work load, As you can see,
burnout affects turnover, turnover affects the billing process which
results in the possibility of incorrect bills being mailed out, Tnis then
heightens the problem once again because it impacts the phone calls which
impacts the workload on the other representatives and again we are just
transferring resources to help alloviate problems as they occur,
Current Action Being Takeni The Customer Service Division, in ;
conjunction with the Utility department, went to a twenty (20) cycle f
billing system, In the past there was a i,en (10) cycle billing systei EE
which put a tremendous work load on a few individuals every other day. s M'
The twenty (20) cycle was instituted in order to spread out the work load j
on a more even basis. Currently, the Customer Service Division is
handling twenty (20) cycles of billing with only two representatives,
This still creates unmanageable workloads which, in turn, prevent the i
adequate response in monitoring of disputed or problem accounts, This is
the reason why customers sometimes receive incorrect bills, and "soft" cut
notices when their account is intended to be given special attention. j
With extensive overtime and the use of temporary help, we have made a dent E
In the clean-up of backlog, Pending order nave oeen reduced from an
average of 800 to an average of 4UU per month. Uncollected accounts have
gone from an average of $12,9 million to approximately $7 million,
However this increased overtime helps facilitate further burn-out,
especially if continuing for long periods of time,
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Memo to Lloyd V. Harrell
May 13, 1986
page fifteen
Puture_ Action a recommendations - A part-time billing clerk would help
insure that bills are not only prepared on time, out would also insure
that the billing is more closely monitored. This would allow the custortier
service reps to send more time reviewing accounts, and if Uere is a
problem area, giving a more personalized, either by phone call or letter,
response to a billing question. We also feel that the part-time billing
clerk would be critical during the peak time periods,
Problem Handlln of Builder/Commercial Accounts and Speeiallrea
l Problems - There are numerous occasions where a need for the specialized
handling of an account is necessary. An example of this is builders that
come in and only require electric, or what is called saw service, prior to
the completion of a building project. Once again, in our complex system,
l this requires a special turn on/turnoff flags within the system so that
only the electric service oills and not water, sewer or solid waste, This
also creates a problem when the individual that finally purchases the
h building moves in because a coordinated effort has to ue entered so that j
the builder's specialized situation is terminated and the new system is !i
f entirety set up for the incoming occupant. If the system breaks down in
this area, this can result in incorrect uills,going to the builder for a ,
period of time. There are also other areas such as apartment building
s owners and managers that require special attention, Due to the nature of
our system, again referring to the meter inventory system, only one
individual can be assigned a meter at one address, We require that prior
to an account being set up, the former account must ue turned off, If the
prior tenant does not officially terminate his service it creates proolems
in the system, To further complicate matters, if there is a vacant
f apartment, and it must be in the apartment owner's or manager's name for
an interim period, then the termination and start-up process has to occur
and then again turned back on when an individual occupies tnat vacant
apartment unit,
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t,terao to Lloyd V, Harrel 1
may 13, 1913b
page sixteen
All of tills usually has to occur within s relatively short period of
spvery time
time. Tnis, again, requires speClaliZud attention and is
ecialized +
consuining and needs cons
accounts such as the Denton Independent School District, North Texas State
University and Texas Woman's University that have unique situations, and
several meters and accounts which require monitoring so that a correct
billing situation takes place.
at present, an account '
Current- Actions Being Taken - Currently,
specialist already exists that deals with commercial and builder
accounts. Because this position has been specialized, much less confusion {
exists in setting up and coordinating efforts with Public Works in
'
now assignment of duties has been
ccounts,
servicing these typos of a This ne
working effectively over the past several months, However, we still feel {
that intensive efforts are needed in this area and other specialized areas,
I Future Action Recommenaations . It is recommended that one customer
k
accounts representative be added in the customer billing section, The now
accounts specialist would not only deal with the more sensitive billing i
1
~ l problems, but would also deal with the special typos of accounts such as
lease/rent property and governmental including the university accounts,
In a city such as Denton, this type of account specialist is extremely ;
'i important for a great many individual accounts, This position would also
be of great value during the student transition and working with the
1 apartment managers and owners, We feel that because these areas are very
important to the City of Denton, its utility system, and its 'local
economy, that specialized attention should be given to those types of
accounts.
More Personalized Services There are two areas where we feel
Problem.
that the Customer Service Division could expand if given the opportunity, and
this is in the area of more personalized type services, The first area is the
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Memo to Lloyd V, Harrell
May 13, 1980
page seventeen
general categury whereby we feel that we would be able to respond in the
customer relations area in a more effective manner. This would be giving
more personalized attention to billing problems, specialized accounts, and
other areas, Personal letters, phone contacts, etc,, are examples of the
types of service that could be provided. The second area would be in the
energy usage complaints conservation area, We feel that we can meld a
modified energy conservation program with billing type problems. When a
customer receives an abnormal usage over a period of time, there appears
to be a problem with their usage, We feel that a program should be
provided to give a personalized type of service for customers in that
I situation,
Current_ Action - Currently, we are not able to expand in these areas
due to the lack of resources available,
Future Action Recommendations: It is recoimnendea that four to six
additional highly trained and knowledgeable personnel be added to the
Customer Service division in order to handle customer complaints only, f
make personal visits to customer premises, and assist them in managing the
use of their water and electric commodities, This could make a tremendous
improvement in servicing our customers and improving our customer
f # relations, It is felt that these individuals would respond on an s
Individual basis to customer complaints for high usage, faulty meters,
1 etc. They would make an on-site inspection to review with the customer
the meter readings, do a basic field test on the meter and review the life
style and utility using apparatuses for the customer in order make
recommendations on possible areas of conservation, With regards to the
area of generalized, more personalized service, this will be accomplished
if the aforementioned recommendations are implemented. No future
recommendations are made at this point in time,
Proulem_: Meter Reading, - There are problems in accessibility to meters
-1 due to fences, locked yards, dogs, etc. There are also problems with
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Memo to Lloyd V. Harrell
May 13, 1966
page eighteen
i water meter numbers not being readily visible on the meters and water and
r` mud in the water ineter boxes. And finally, there is a workload problem of
physically getting the meters read and 'In some cases doing the rereads and
inputting into the system,
Current Action; In order to make meters accessible, efforts are
underway to place remote meter reading devices on these meters, With
regards to wrong water meter numbors and water mud in the meter boxes, new
procedures in the shop nave been implemented in order to clearly locate
meter numbers on now and existing water meters. Also, we are replacing
damaged or incorrectly -installed meter boxes as the meter readers report
tha problems. This requires a great deal of manpower and is progressing
slower than we would like, but efforts will be made to increase this
effort during non-peak times,
Future Action Recommendations, 4.hen we instituted the hand held meter
i
reading devices, we were more readily able to discover, meters that had not +
been read or where account numbers and meters did not match. Some i
training problems existed as is always the situation with a new system.
I
I These problems have been fairly well corrected since the first of 196b.
However, we are understaffoo by one meter reader at present. Turnover has
been a small problem but we believe that once familiarity with the view
t
system takes place, turnover should be a minor concern. We had planned to
reduce the number of meter readers from nine to six when we began using ;
the hand held units, it appears we need to keep the total number of
full-time readers at seven,
III. SYSTEM CONCERNS 1
Problemt_ Abnormal Usages - This type of problem is generally called a`
"spike" because if the monthly consumptions were to be graphed a large
spike would Occur for a short period of tirm. These spikes result in a E;
large bill being produced for an unusual usage albeit for no apparent
Hemo to Lloyd Y. Harrell
May 13, 1986
page nineteen
explainable reason, However, there may be a fault in the system, i,e „
faulty meter, hidden water or electric leak, misreading of meter, etc, In
case of the water, spike, they have generally seemed to have occurred
during the installation/implementation of the hand field meter reaping
devices,
Current- Action: The hand held meter reading devices liave been
installed and have gone through the initial start up and debugging E
process. These devices should allow for accurate monthly readings, In
addition, the units do a field high-low test which indicates a reading
that appears to be either excessively nigh or low for the period. This
would allow the meter reader to identify, very rapidly, whether there may
be a dead meter, a misread in the system, crossed meter, or the
possibility of a leak occurring, Secondly, an ordinance r:as been approved
by Council that would allow the Customer Service Manager to make a one j
time adjustment for bills that are abnormally high. This ordinance
provides for one adjustment to occur within a period time for such things
as water leaks, spikes, etc, It would change only for the variable cost
of producing that service.
I I
Future Action Recommendations: There are no future actions being
recommended at this time,
I
Problem Timely Payments The timeliness of payments will affect the
Accounts Receivable balance, In the past, the only :method of enforcing
payments is the threat of termination of service. Under the current
r
ordinances that are established, this can only occur after a lengthy
process has been initiated. This process can take anywhere from
forty-five (46) to sixty (bU) days before the possibility of termination'
of service can occur. In that interim period of time, an additional
amount would become due and would oe added to the accounts receivable
balance,
Memo to Lloyd V, Harrell
May 13, 1986
page twenty
Current Action: The Customer Service Division has taken a more
aggressive posture with regards to termination of services. We are
monitoring accounts as closely as possible to comply with the ordinance
and to terminate service when Justified and in a timely fashion, Tills has
caused some initial concerns because some customers have been accustom to
paying their bills on a sporadic basis and the enforcement of tills action
has caused some concern, Once again, we will be able to monitor all
forced terminations on a continual basis. At that point, it is also
necessary to refer the processing of those payments
to the collection
process that was mentioned earlier,
Future _A_ction kecomnendations: We will be monitoring the accounts
receivable
process; However, if the current actions being taken are
implemented we feel that no future actions will be necessary. In
addition, there has been an ordinance submitted to Council to review the
possibility of implementing a penalty for late payments. This would I
handle large customers that realistically would not be cut.
Problem: Customization of System » With the software package the City
3 is utilizing for the processing, billing, and collecting of utilities, our '
i current maintenance contract does not allow for any major customizing of
j the system, It is a basic package that was not specifically designed for
the City of Denton and; therefore, the City` has to try to work around it
I i
in order to process the bills and handle problems treat are peculiar to
Denton, In addition, we have a maintenance contract with TRES and any
major problems that do arise are run through the'TRES staff in order to
make corrections to oe able to properly bill, Every day that a billing
cycle is not able to be peoducod puts an additional work load on the other
divisions and creates additional billing problems.. ,
Current Action.- The Data Processing Manager has been working with the
TRES staff to try to identify and remedy our problem areas as quickly as
possible,
f`
Memo to Lloyd v, Harrell
May 13, 1986
Page twenty-one
I
I Future Action Recommendations, We feel it is essential that there be
an addition of a system analyst to data Processing Department, This would
would create a knowledgeable individual who could make corrections to the
l system in order to track the billing cycle through the processing o
Tnis would greatly speed up the timing necessary for the production of the
uiils. It would also insure that the
proper rate structures are
processing correctly in order for the bills to ue produced accurately.
Problem: Terminals and Personal Computers - In order for the staffing
I requirements mentioned earlier to be effec
ti ,
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the proper tools are
necessary. This would include the addition of terminals and a personal
computer in the Customer Service Division, The personal computer would
allow us to track data such as complaints registered, the nature of the
complaint, letters of credit, bad check information, etc.
Future Action Recommendations: The purchase of three terminals and one
l
r personal computer for the Customer Service Division, !
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IV, TRAINING
Problem: Overall Training - There are four major aspects of training ?'I
that are necessary in tie utilities billing process, They include
technical training on the actual software system, customer relations
training, training on the procedural
pro.esses necessary for billing and
collections, and the necessary training for tigld personnel,
E I
I Current Actions ~ei~ig Taken: Only limited training is possible at the
pp~ present time. Due to limited amount of staff, only select individuals are
f
available, if any at all, for attendance at training seminars. Also the
amount of turnover that has occurred in the past has offset any training
f efforts that had been provided up to this point, The leck of i
training is a debilitating
problem in light of the backlog of work and the increase in
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Memo to Lloyd V, Harrell
May 13, 1986
page twenty-two
the demand for service which exists in the Customer Service Division. in
order to alleviate the problems associated with a lack of training,
Customer Service employees have worked after hours and on weekends to
receive further training, as well as giving attention to unfinished work.
At present, Customer Service employees are believed to be considerably
more capable in preforming their duties and finding errors before they
become problems despite heavy workloads, This more capable work force can
1 be attributed to the fact that employees leave put a great deal of time
~ i
into completing their duties, and now have a great deal of intense
experience. It is my feeling that if recommendations that nave been
suggested earlier are implemented then the staff will have more time for
training and will be able to spend the appropriate time with new personnel
in order to insure that adequate training occurs, Currently, new staff
personnel are put on-line after only a brief one or two day training
session, These sessions only incorporate the operational mechanics of the
system, It is also imperative that new personnel be trained in the area
i of customer relations billing process, and have a more in-depth training
of the entire system. Due to the nature to the type of customers that
they will come in contact with, the proper handling of those customer is
essential. When we deal directly with the public, the public relations
effort that we put forth has a direct impact on the City's image, ii
i
EXPECTED RESULTS
If the following recommendations are approved, it is anticipated that the
+ following will occur;
i
1. Reduction in the accounts receivable of approximately $1,000,000.00
through increased collection efforts. In the pastthe receivable
has been as high as 16% of total revenues and averaye~ collection
day was around sixty (60, It is felt that witn the additional
staff we should be able to nelp the accounts receiivablo, which
includes current billing to about 10-13% of total revenues and
reduce the average collection days to forty-five (4b), 'rnis would
include the cleaning up of accounts, personal contact with debtors,
terminations of caccountsn elligible forctwrite-offo and ucollection.
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Memo to L'Ioyd V. Harrell
w
May 13, 1986
page twenty-three
It is our feeling that improvement in this area would more than
likely pay for itself over a period of time.
r 2. An offset to the initial expense of the added equipment and
personnel by increased interest earnings due to better collection
efforts. Again, more rapid collectiuns would mean increased
revenue to the utility system and would help in the rate setting
process and possibly even negate minor increases in the rates. It
would also help in the cash flow situations that effect the utility
funds. We feel the increase would help Offset the customer
` services increased costs by at least one day,
3, Maintain the average level of uncompleted work orders for Customer
Service to under three hundred (300). This would not inclu(je the
two peak periods caused by university students because these can go
as high as 1700, although the length of time for those work-orders
will be reduced to less than one month, In the past the average
uncompleted work order was about eight hundred AU) (See Exhibit
C).
4, The phone delay statistics can be misleading oscause the length of
time is not measured, It can be anywhere from a half-of a second
to several minutes, Currently, the number of calls delayed is
about 80% of all calls. It is hoped that with the recanmenddtions
delineated previously, this could be reduced to 60%. In addition,
the current percent of a'I1 calls that are abandoned is about 5U%,
i We feel that this would decrease to around lb%.
6. The current amount budgeted for overtime is $20,000, If all the €
recommendations are incorporated this amount could ue reduced in
I half to s10,UU0 and, depending upon peak period workloads, we may G
be able to reduce it to approximately $6,000 for the entire year, !
6.. Have the ability to allow employees time off in the event they
request vacation or they are ill (at the present the division
cannot afford to give any time off without causing severe staffing
problems in each area of operation. Tnis would also help to
eliminato the burnout that has been occurring in Customer Service
4 and would, hopefully, cut down on the turnover rate.
k 7. It would increase morale as a result of manageable work luads and
less stress.
H, It -would increase public relations by providing better customer
relations and would afford a more personalized approach to the
whole billing process, l
9, it would provide for a better system reliability so that the
communication process and the coordination of efforts can be more
effectively dealt with and would help insure the efficient
processing and collection of utility bills.
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R Memo to Lloyd V. Harrell
May 13, 1986
page twenty-four
1
CONCLUSIONS w
The utility billing system currently has approximately _66,000 active
meters in the system. Each one of these meters has to be processed for
billing on a monthly basis. The City has a very complex utility bi,;ong and
{ collection process, In light of these factors, the City's utilities nave been
1 experiencing a rapid growth. Over the last four to five years, this has all
had a definite impact on the billing and collection procedures, and the staff
has not expanded in the ratio that is necessary to keep up with the growth and
handling of the complex problems that have occurred, Because of this and
extreme amount of turnover that has occurred in the division coupled with the
need for longevity in order to become familiar with the system and how it
works, a backlog has been created which creates the "grass fire" mode of
operating. This then generates additional proulems through incorrect
inputting into the system, improper processing of the system, etc. In order
to maintain a comfortable 'level through the system, it is necessary to
implement the recommendations indicated above. It is hoped that these
recommendations will help eliminate the majority of these problems, although i
r due to the type of system we have, it is almost ridiculous to assume that all
E
problems will be eventually eliminated, However, we feel that when a customer
r has a complaint, we should be able to handle that complaint and make some
resolution and determination within a reasonable period of time and to do in
the least burdensome manner for the customer. iii
If you need any additional information, or have further questions, please
advise, ;
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Olin r, cGrane
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A8t8 chments
117
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Exhibit A
AS INDICATED BY THE ILLUSTRATION BELOW, THE EFFICIENT
HANDLING OF PHONE CALLS HAS 88EN MAINTAINED AT UNACCEPTABLE LEVELS.
WHILE THE MONTHS OF NOVEMBER AND DECEMBER ARE NOT PART OF THE
PEAK PERIOD EXPERIENCED BY CUSTOMER SERVICE ON A CYCLICAL BASIS,
THESE MONTHS STILL EXPERIENCED HIGH PHONE CALL DELAY AND ABANDONMENT
PERCENTAGES,
Customer Service Phone summary
100 r Abandon
® tD91ay
90 85 79 84
81 61
80
74
69
70
60 56
m 50 45 45 49 t
L
46 36 37
33
30
22
!
!
20
10
0
Jun Jul Aug aap Oct Nov Dec Zan
Exhibit 8
AGED ACCOUNTS RECEIVABLE PERCENTAGE DISTRIBUTION SUMMARY
(Active and In-active Accounts)
SEPTEMBER: Total $12,431,837.80
Current 53;
R 30 Day 21;
60 Day 7;
90 Day 19;
00;
OCTOBER:. Total $ 9,5460716,28
k Current 46;
{ 30 Day 25;
li 60 Day 9;
90 Day 20;
f
1001
i
NOVEMBER: Total $10,362,586,13
Current Sl;
30 Day 20;
60 Day 9;
90 Day 20%
i S
DECEMBER, Total $ 9,753,139,20
30 Current 541
60 Day 12; f
I, f 90 Day 16;
` 1U0;
j
JANUARY: Total $7,641,859.17
' Current 63;
30 day lit
60 day 7;
90 day 191
Exhibit C
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ACTUALi Actual Productivity Measures
CAPACIM Productivity for Four (4) Employees in an Eight (8)
Hour Day, With Twenty (20) Minutes Time Spent on Each
Customer,
e The term "workload" represents the measure of Customer Relations
work completed (such as disconnection/connection and transfer of
service),
"
1
Customer Service;
Workload Frequency Distribution
X90
r"Fr Actual
f 270 r r r Capacity
1 250
f w 2:30
210 I
0 190
15p
j 130 3
110 r r r r r r r r w r r r r r r r r r r r r r r r r r r
0 90
x 70
50 'r
60 oo 00 00 60 4,~
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Exhibit D
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THE ONLINE REPORT REPRESENTS PENDING ORDERS THAT ARE YET TO COMPLETED,
PENDING ORDERS ARE WORK ORDERS FOR CONNECTION AND DISCONNECTION OF SERVICE
(WHICH I$ COMPLETED BY CUSTOMER SERVICE), AS WELL REMOV INSTAL
INSTALLMENT, EXCHANGE AND
6 AL OF METERS (WHICH IS COMPLETED BY UTILITIES),
NO. OF PENDING ORDERS
Customer Service 5673 3 7 1 670 8/1 840 169/79 4 10/1 kl 2/1 1212 l/2
89 3/3 - 473
~ 38 73 112 247
TOTAL
ti 811 991 1136 1772 770 439 160 319 493 343
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On-Line Report Summary
1,800 1772
1,700 Customer service
b70 ■ Utilities
1,400
1,~o I
t 1,200 1136
8 1'100 991
1,000
b 900 811
m wo no
r
1700
I a
0600
500 493 II
400
~ 819 343
200 160
100 k.
T~~+v
A
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